Fundo Imobiliário Riza Terrax (RZTR11) – Comprehensive Analysis for Foreign Investors

Overview of Riza Terrax (RZTR11)

RZTR11 – Riza Terrax is a Brazilian Real Estate Investment Fund (FII) focused on the agribusiness sector. Launched in October 2020, the fund acquires productive rural properties (farmland) and leases them to agricultural operators . This “buy-and-lease” model provides investors exposure to Brazilian farmland – an asset class with historically consistent appreciation – while generating rental income through long-term land leases . RZTR11’s mandate explicitly targets income (lease rents) and capital gains (land value appreciation and strategic sales) by acquiring, leasing, and selling agricultural properties across Brazil . The fund is managed by Riza Asset Management and trades on the B3 stock exchange under ticker RZTR11 (there is currently no ADR available) . As of October 2025, RZTR11 has a net asset value of ~R$1.85 billion (≈ US$370M) spread over 18.85 million units, and a broad investor base of ~146,000 unitholders .

Portfolio & Strategy: RZTR11 owns a diversified portfolio of farmland properties (~90,000 hectares) across multiple states – including Mato Grosso, Maranhão, Goiás, Tocantins, Bahia, Piauí, and Paraná . The fund focuses on major grain and fiber producing regions (e.g. soybeans, corn, cotton), as well as other agri segments like cattle ranches and recently coffee farms. RZTR11 employs three core strategies in its operations :

• Sale & Leaseback: acquiring farmland from an owner-operator and leasing it back to them. This unlocks capital for the farmer and secures a long-term lease for RZTR11. For example, in September 2025 RZTR11 purchased four farms (560 hectares in Maranhão) for R$25.7 million and simultaneously leased them back to the sellers for 13 years . The negotiated price was ~R$46k per hectare, and the lease yields an estimated R$0.18 per fund share annually in rental income . This kind of sale-leaseback provides the fund a stable, inflation-adjusted rent and a committed tenant.
• Buy to Lease: purchasing a property on the market (or from a developer) and then finding a third-party agribusiness tenant to lease it. These deals also feature long-term leases (often 10-15+ years) which lock in steady cash flow for the fund. RZTR11 targets fertile, high-potential land where a strong tenant can be secured, focusing on regions with established agricultural infrastructure . For instance, in 2024 the fund contracted to acquire multiple farms in Paraná and Tocantins with 15-year lease agreements already arranged, adding roughly R$0.17–1.00 per share in annual income from those new assets . Long lease terms align with crop cycles and give predictability to investors.
• Land Equity (Development & Sale): identifying underutilized or emerging farmland opportunities to realize capital appreciation. In these cases, RZTR11 may acquire large land parcels (sometimes partially developed farms or pastureland) and work with an operating partner to improve the land’s productivity (e.g. converting pasture to cropland, adding irrigation) . The goal is to sell the land at a higher value in the future, capturing the land value uplift as profit for the fund. Notably, RZTR11 has executed several land equity transactions: for example, in August 2025 it sold part of its Fazenda Clarão da Lua property after value appreciation. This partial sale is expected to generate a profit of ~R$2.17 per share, which will be realized over four years (the sale payments are likely in installments) . In a prior case, the fund sold another farm (Fazenda Roma in Tocantins) for R$112 million, earning a massive R$6.68 per share profit for investors . These gains from land sales directly boost the fund’s results and can be paid out as special dividends or reinvested. RZTR11’s management actively pursues such opportunities to recycle capital – they buy land low, help increase its productivity/value, then sell high, enhancing total returns beyond just rental yields.

Rental Structure: The leases in RZTR11’s portfolio are typically triple-net style farm leases: tenants (farm operators) pay rent to the fund (often quarterly or annually, sometimes indexed to inflation or commodity prices), and usually cover operational costs and maintenance of the property. Many leases also include purchase option clauses or structured payments. For example, a recent acquisition in September 2025 was a coffee farm where RZTR11’s payment to the seller was partly in cash, partly via assumption of the seller’s debt, and partly in future sacks of coffee over 3 years . Such innovative deal structures align the fund’s returns with the farm’s output. Additionally, some leases give tenants an option to buy the land after a certain period – effectively a pre-agreed exit – which if exercised can bring in lump-sum gains for RZTR11 (often at a higher price than cost). This approach of combining recurring rent and an eventual sale (at an appreciated price) helps RZTR11 achieve both high current income and capital appreciation for its unitholders .

Buy-and-Lease Model vs. Credit-Focused Funds (Fiagro)

RZTR11’s “buy and lease” strategy sets it apart from many other agribusiness funds that rely on credit instruments. Most Brazilian Fiagro funds (the agro equivalent of FIIs) invest in fixed-income securities like CRA/CRI (agribusiness receivables certificates) or debt financing to farming companies, effectively acting as lenders. We compare the two models:

• Income Source: RZTR11 earns rental income from land leases (and occasional profits from land sales). This income tends to be stable and linked to real assets (farmland). In contrast, credit-focused funds earn interest income from loans or bonds (e.g. financing a sugar mill or a grain producer). While both can offer high yields, RZTR11’s income has a built-in inflation hedge – farmland rents and eventual sale prices typically rise with commodity prices and inflation, maintaining real value . Credit funds often pay fixed or floating interest; if interest rates drop or if inflation spikes beyond expectations, their coupons might not keep up.
• Capital Appreciation: A crucial advantage of RZTR11’s model is property value appreciation. Investors participate in the upside of rising land values, which in Brazil have shown strong long-term trends (Brazilian farmland has appreciated consistently as agriculture expands) . When RZTR11 sells a property at a profit, that capital gain boosts the fund’s NAV and can be distributed. Credit funds, on the other hand, do not directly benefit from asset appreciation – they simply receive loan repayments. For example, RZTR11’s sale of a farm parcel added R$2.17/share in profit in 2025 , and a major farm sale in 2023 brought R$6.68/share , yielding windfalls for investors. A pure debt fund would never see this kind of one-off jump from asset sales; its returns are capped at interest and principal repaid.
• Risk Profile: In RZTR11, the primary risks are vacancy/occupancy risk (if a farm tenant defaults or leaves, the fund must find a new lessee) and land market risk (farmland values can fluctuate with commodity cycles or regulatory changes). However, the land itself provides tangible collateral – if a tenant fails, RZTR11 still owns the farm, which can be re-leased or sold. In credit funds, the risk is credit default – if a borrower defaults on a CRA, the fund might have to enforce collateral (possibly the borrower’s land or assets) through legal means, which can be slower and more uncertain. Essentially, RZTR11 already owns the collateral (the land) upfront, whereas lenders have an indirect claim. This arguably reduces risk of permanent loss, though it introduces the operational responsibility of owning property.
• Return Profile: RZTR11 has delivered double-digit yields from rent plus NAV growth from appreciation. Over the last 12 months, its dividend yield was about 13–14% in BRL terms . Many credit Fiagros also target high yields (often ~12-15%), since Brazilian interest rates have been high. However, those yields are purely interest; RZTR11’s total return (dividends + NAV increase) has the potential to be higher due to land value gains. In 2025, RZTR11’s unit price rose significantly while paying hefty dividends (more on performance below), reflecting this dual source of return .
• Example – Peers: Consider FGAA11, an agribusiness fund that has often distributed capital back to investors via amortizations. FGAA11’s strategy is heavily focused on buying and later selling rural properties (then returning principal to investors) . It’s akin to a land-flipping fund with less emphasis on ongoing yield. RZTR11, in contrast, tries to hold and lease properties for income and choose optimal timing to sell some for gains – providing a balance of steady cash flow and occasional big payouts. Another peer, CPTR11 (Capitânia Agro), is largely a credit (receivables) fund, yielding income around the CDI rate. While CPTR11 might offer ~1% monthly yields from interest, it lacks the NAV growth element. RZTR11’s model has actually led to growing dividends over time – management frequently renegotiates leases to increase rents or “repactua” contracts. For example, in May 2025 RZTR11 signed lease addendums on Mato Grosso farms that raised the cap rate from 12.7% to 13.5% annually, immediately boosting rental income by ~R$0.22 per share per year . This was achieved by compensating the tenant for improvements and in return charging higher rent – an active management move that pure credit funds cannot emulate.

In summary, RZTR11’s buy-and-lease model offers a more equity-like upside (through land appreciation and active asset management) while still delivering high current income. Credit-focused funds offer a more bond-like fixed return. For a long-term investor, RZTR11 provides an attractive combination of recurring dividends and potential capital appreciation, albeit with the complexities of real asset ownership.

Financial Performance and Dividend Track Record

RZTR11 has delivered strong financial results, underpinned by Brazil’s high interest rate environment and the fund’s effective execution of its strategy. Key points on performance:

• High Dividend Yield: Over the last 12 months, RZTR11’s dividend yield was approximately 13–14% (in local currency) . The fund pays distributions monthly. In 2025, the monthly dividend has been around R$1.00–1.05 per unit for most months . For example, in June 2025 the fund distributed R$1.05 per share, which was a 1.11% yield for that month (equivalent to ~13.5% annualized) . This comfortably outpaced Brazil’s Selic rate (~13.75–14.0% at the time), meaning RZTR11 provided a real return premium . The ability to exceed the high risk-free rate underscores the attractive cap rates the fund achieves on farmland deals (management noted the portfolio’s contracted yields average ~15.26% a year, despite the high interest environment) .
• Growing Payouts: The fund has generally maintained or grown its regular dividend over time. At inception in late 2020, payouts were around R$0.65–0.90. They increased to ~R$1.25 in 2022 , held around R$1.05–1.15 through 2024 , and stabilized at ~R$1.00 in recent months of 2025 (after some large one-time distributions in late 2024 – see below). The 2025 average dividend is ~R$1.05 per month , and total dividends in the first 9 months of 2025 reached R$9.30 per share, about 16% higher than the same period in 2024 . This growth reflects successful acquisitions and rent increases that have boosted cash flow.
• Earnings and Coverage: RZTR11’s earnings have comfortably covered its distributions. In June 2025, the fund earned R$19.05 million net profit (after expenses) on gross revenue of R$20.85 million . Operational costs were only ~R$1.64 million, indicating a high margin (land leasing is relatively low-cost) . With ~18.85 million units, that profit was about R$1.01 per unit – roughly matching the R$1.05 paid out, with the small remainder likely retained or adjusted via the fund’s reserve. The fund is required to distribute 95% of its semiannual earnings to investors (as per FII regulations) , and it does so via monthly advances. On a semiannual basis, any surplus from asset sales or accumulated earnings is either paid out or reinvested per management’s decision. Notably, when RZTR11 realizes large one-off gains (e.g., from land sales or contract termination fees), these often translate into extra distributions or higher monthly dividends. For instance, after a lucrative transaction in late 2024, RZTR11’s November 2024 payout jumped to R$1.15, and December to R$1.10 (up from ~R$0.90 in prior months) . The fund had announced a contract termination/new lease in Nov 2024 with an estimated profit of R$12 per share (!), likely related to a tenant buying out a lease . Such events can lead to special cash inflows – a portion was distributed immediately, boosting those late-2024 dividends, while the remainder may be staggered over time.
• NAV and Price Performance: RZTR11’s Net Asset Value (NAV) per unit is about R$97.89 (as of latest report) . The market price has been trading around R$92–93, which is roughly a 0.94 P/NAV ratio . This implies the fund trades at a small discount (~6% below NAV), in line with or slightly better than the average FII in its segment . The modest discount likely reflects investor confidence in the appraised value of its farms and in the manager’s ability to generate value (many FIIs in Brazil trade below NAV due to high interest rates, but RZTR11’s narrower discount shows it’s relatively well-regarded). In 2025, the unit price has appreciated significantly: it opened the year around R$78.68 and is now in the R$92–93 range . That is a ~17% price gain year-to-date, on top of dividends. Over a longer horizon, since IPO at R$100 in 2020, the price has fluctuated (down to ~R$70s in past bear markets) but total return has been strongly positive when including hefty dividends. RZTR11 is also a constituent of the IFIX index (the Brazilian REIT index) with about a 1.2% weight , reflecting its large market cap (~R$1.73 billion market value) and liquidity (~R$3.8 million average daily trading volume) .
• Resilience and Profitability: Even during periods of high Brazilian interest rates and inflation, the fund managed to deliver real returns. Management has highlighted that their lease contracts often have inflation adjustments or yields ~15% which make them attractive even with Selic near 14% . Moreover, by monitoring agricultural productivity, the team ensures tenants are successful – the June 2025 report noted harvest outcomes across the portfolio: e.g., above-expected crop yields in Maranhão and Piauí farms, some weather challenges in Paraná, etc. . This granular approach helps maintain rental revenue (since a good harvest means the farmer can comfortably pay rent). The bottom line is that RZTR11 has consistently covered its dividend from operational cash flow and supplemented it with capital gains when available, resulting in an attractive blend of income and growth for investors.

Expansion Plans and Recent Developments

RZTR11 has been in growth mode, rapidly expanding its portfolio and deploying new capital into acquisitions. For foreign investors considering a long-term position, it’s important to understand the fund’s recent moves and future plans:

• Capital Raising and Scaling Up: Since inception, RZTR11 has conducted multiple follow-on equity offerings to fund new investments. Notably, the fund’s 3rd issuance of units (Initial target ~R$750 million) was approved in late 2023 , and by early 2024 the fund had successfully raised capital (after a postponed attempt in 2022 due to adverse market conditions ). This influx of equity nearly doubled the fund’s size from ~R$1.0 billion NAV in 2022 to R$1.8+ billion in 2025 . The fact that RZTR11 attracted such interest even when priced near NAV indicates strong demand for its strategy. With this war chest, RZTR11 moved aggressively on acquisitions in 2024–2025.
• Ongoing Farmland Acquisitions: RZTR11’s expansion plan involves broadening its geographic and crop exposure. Recent acquisitions and deals include:
  • Northeast Brazil (Maranhão) – Sale & Leaseback: In Aug/Sep 2025, as mentioned, the fund acquired 4 farms in Alto Parnaíba (MA), totaling ~560 ha, from soybean producers and leased them back for 13 years . This deal not only increases RZTR’s land bank but immediately contributes to cash flow (adding ~R$0.18/share/year rent). It also cements RZTR11’s presence in Maranhão, a frontier region for soy and corn expansion.
  • Southeast Brazil (Minas Gerais) – Coffee Farm: In Sept 2025, RZTR11 announced the acquisition of a coffee plantation (a bit of diversification from row crops). The purchase price involved cash, taking over some liabilities, and even payment in coffee beans over the next 3 years . The seller likely continues to operate the farm, implying a partnership structure. Coffee tends to have different harvest cycles and pricing, so this deal shows RZTR11 branching into other high-value crops while leveraging creative financing (in-kind payments). It broadens the portfolio beyond just grains and adds a new income stream (lease or profit-share from coffee production).
  • Mato Grosso & Tocantins – Grain Belt deals: RZTR11 has been very active in Brazil’s top agriculture state, Mato Grosso. In May 2024, it signed contracts to buy two farms in Nova Ubiratã, MT (2,084 hectares) and concurrently repactuated leases on them, raising yields to 13.5% . The fund even reimbursed the tenant ~R$26.7 million for on-farm improvements to facilitate the new terms – effectively investing in the property to achieve higher rent long-term. Additionally, RZTR acquired farms in Tocantins (another soybean frontier) with 15-year leases (one deal expected to add R$0.17/share/year) . The strategy here is clear: deploy new capital into immediately income-generating assets at attractive cap rates, often north of 12-13%, which boost the dividend capacity.
  • South Brazil (Paraná) – Agri-industrial lease: In 2024 RZTR11 also ventured into Paraná by buying two farms (likely for grain or cane) with 15-year leases, projecting an impressive +R$1.00 per share/year to fund income . This is a large impact and suggests these were sizable, high-rent deals (perhaps involving agri-industrial use or high-value crops). It underscores management’s focus on accretive deals – i.e. acquisitions that immediately raise the dividend per share for investors.
• Strategic Sales and Recycling: Alongside buying, RZTR11 has actively sold or restructured holdings to lock in gains – a key part of its expansion is to realize profit and reinvest. We’ve noted the partial sale of Fazenda Clarão da Lua (TO) in Aug 2025 for a R$2.17/share gain . Another headline event: in Nov 2024, the fund announced the sale of Fazenda Monte Cristo I & II (land equity project) which yielded an estimated R$0.47 per share profit . And in 2023, the big sale of Fazenda Roma (Tupiratins, Tocantins) for R$112 million brought R$6.68/share profit . These profits can be paid out over time, but importantly they free up capital. The proceeds are typically reinvested into new acquisitions (via new “Instrumento de Compra e Venda” deals), which RZTR11 frequently announces. The fund often has a pipeline of deals under due diligence. For instance, in April–May 2024 it disclosed contracts to acquire six farms across Maranhão, Tocantins, and Paraná (as mentioned above) , showing a steady pipeline of opportunities. In one interesting case (Nov 2024), RZTR11 did a “distrato” (contract termination) and new lease on a property that generated an estimated profit of R$12 per share . This likely means a tenant exercised a purchase option or paid a hefty fee to terminate early, and RZTR simultaneously signed a new lease or sold the land, resulting in a big gain. However the mechanics, it exemplifies the fund’s agility in managing its assets for value – even renegotiating or ending contracts if it benefits investors.
• Increasing Scale and Diversification: Post-2024 expansion, RZTR11 now owns over 25 rural properties (often grouped as farm clusters) across 7 states . No single property comprises an outsized portion of the portfolio, which mitigates idiosyncratic risks (like drought in one farm, or a tenant issue). The largest farm by area was Fazenda Clarão da Lua in Tocantins (~14,439 ha) before the partial sale, and Fazenda Santa Clara in Piauí (~12,272 ha) – both very large grain operations. The breadth of regions means exposure to different climate zones (Cerrado savannah in the Center-West, MATOPIBA region in the Northeast, subtropical South, etc.), reducing the impact of any single weather event. RZTR11 also appears to mix established cropland with developmental land. Some farms are fully operational soybean plantations; others might be in earlier development stages (providing land equity upside). This mix helps balance current income vs. future growth.
• Forward Outlook: RZTR11’s expansion plans likely involve continuing this dual approach: acquire core income assets (sale-leasebacks, long leases) to support dividends, and pursue land equity deals for capital gains. Given Brazil’s push to increase agricultural output, there is ample opportunity to buy undeveloped land, develop it with partners, and sell at a profit. The fund’s successful capital raises indicate it could raise more equity if needed for large deals (subject to market conditions). Notably, RZTR11 paused a capital raise in 2022 due to market volatility , showing discipline to not dilute at the wrong price. By late 2023 when conditions improved, it raised R$750 million . Future follow-ons are possible if new opportunities arise (foreign investors should watch for announcements of new quota offerings, as these can temporarily pressure the trading price but enable growth).

In summary, RZTR11 has been rapidly expanding and actively managing its portfolio, indicating an ambitious growth trajectory. The fund is now one of the largest “farmland REITs” in Brazil, and management’s recent moves (diversifying into coffee, executing sale-leasebacks, leveraging options contracts, etc.) suggest a commitment to long-term value creation. Expansion is not just about buying more land; it’s about unlocking higher returns from the land – e.g., repactuating leases at higher rates after improvements , or splitting properties to new leases for better terms . This hands-on approach will likely continue. For a long-term foreign investor, the expansion means RZTR11 could keep growing distributions and NAV, but it also means the fund is continually undertaking new projects (so one should monitor its deal execution and the Brazilian farm economy’s health). Overall, RZTR11’s growth strategy aligns with Brazil’s agricultural expansion, positioning investors to benefit from both rising farm incomes and land prices over the coming years.

Comparison with Peers (Local & International) and Valuation

Local Peers (Brazilian Market): RZTR11 is a pioneer in the farmland FII/Fiagro space, but it’s not alone. When evaluating RZTR11, it helps to compare with similar funds:

• BTG Pactual Terras Agrícolas (BTRA11): This is another FII that invests in farmland. BTRA11’s strategy is also buying and leasing farms, but it has had some hurdles. It’s a smaller fund (NAV ~R$376 million) and currently trades at a steep 50% discount to NAV (P/VP ~0.50) . Its 12-month dividend yield is around 8% , much lower than RZTR11’s ~13%. The heavy discount likely reflects issues BTRA faced – for example, BTRA has dealt with land title disputes and squatter issues. Indeed, in 2022–2023 BTRA had to go to court to regain possession of certain farms (e.g., Fazenda JR and Fazenda Colibri in Mato Grosso) , which disrupted rental income. By contrast, RZTR11 has so far avoided major legal disputes (it conducts due diligence to ensure properties have no environmental or legal encumbrances before acquisition ). RZTR’s near-NAV valuation (0.93–0.94 P/VP) vs. BTRA’s 0.5 suggests investors view RZTR11 as a more reliable vehicle in this segment . It’s worth noting BTRA’s yield is lower partly because it may have idle land (no rent coming in until issues are resolved), whereas RZTR’s portfolio is fully leased.
• Suno Agro Fiagro (SNAG11): SNAG11 is a Fiagro-Imobiliário managed by Suno, investing broadly in agribusiness assets (a mix of land and possibly some receivables). SNAG11 currently yields around 15% , slightly above RZTR11’s yield. It trades at a low absolute price (~R$9-10, as it’s a newer fund), but yield indicates it’s pursuing high-income strategies too. The difference may be that SNAG could hold more credit securities or shorter-term deals, whereas RZTR holds hard assets. SNAG’s high yield suggests higher risk or a need to attract investors in a newer vehicle. Without going deep into SNAG, a foreign investor should note that RZTR11’s yield is in the top tier of its category, yet it comes from tangible assets – a potentially safer source than pure credit yields.
• FG Agro FIAGRO (FGAA11): Managed by FG/A (a Brazilian asset manager), FGAA11 has a strategy focusing on farmland deals and has been notable for returning capital. In 2025, FGAA proceeded with its fourth capital amortization – meaning it sold assets and paid back part of investors’ principal . This reflects a more closed-ended, finite-life approach (possibly aiming to liquidate after executing a set of flips). RZTR11, conversely, is an evergreen fund (indefinite life) that reinvests proceeds into new acquisitions rather than shrinking. The two strategies can yield different outcomes: FGAA’s amortizations give investors cash back (which they then must redeploy), while RZTR11 compounds internally. For a long-term holder, RZTR11 provides ongoing exposure without needing to find new investments as capital is returned.
• Other Fiagros and FIIs: There are also funds like CPTR11 (Capitânia Agro Strategies) which primarily does agro credit and recently underwent a spin-off reorganization , and SNFI11/SNFZ11 (Suno’s other agro funds like Suno Fiagro and Suno Fazendas) that target farmland development projects. Additionally, traditional “paper” FIIs that invest in CRIs (real estate credit) sometimes have small agro exposure but generally yield ~12-14% without upside. Overall, among its local peers, RZTR11 stands out for its size, liquidity, and balanced strategy. It is one of the largest and most traded agribusiness funds in Brazil (daily liquidity ~R$2–4 million, versus some peers with only ~R$100k/day) . Its 13–14% yield and ~0.94 P/NAV are in line with or slightly better than the segment average, indicating a fair valuation for its risk profile . Investors essentially get a high yield at a slight discount to asset value, whereas a peer like BTRA11 offers a huge discount but with more uncertainties.

International Comparisons: It’s useful to compare RZTR11 to international farmland investment vehicles, keeping in mind the very different economic contexts:

• U.S. Farmland REITs: In the United States, the two notable farmland REITs are Farmland Partners (NYSE: FPI) and Gladstone Land (NASDAQ: LAND). These own American farmland (row crops, permanent crops) and lease to farmers, akin to RZTR’s model. However, their financial profiles diverge sharply from RZTR11’s. Farmland Partners (FPI) yields only about 2.3% annually in dividends , and Gladstone Land yields ~3%. These low yields reflect several factors: U.S. interest rates (5% or lower) and the fact that U.S. farmland cap rates are typically very low (3-5% range). Investors in the US accept low current yields, betting on slow, steady land appreciation and ultra-stable tenants. By contrast, RZTR11’s ~13% yield is high because Brazilian interest rates are high (currently ~12.75% Selic, recently 13.75%) and farmland deals can be struck at cap rates of 12-15% in Brazil . Essentially, the risk premium in Brazil is much higher. Also, RZTR11’s active trading of land contributes to payouts, whereas FPI and LAND rarely sell land (they hold for decades, so appreciation is mostly embedded in NAV). It’s notable that FPI often trades near or above its NAV (P/B ~1.0–1.2) despite the low yield, because investors value the land assets. RZTR11 trading just below NAV (0.93-0.94) is not a red flag in Brazil’s context – it’s actually relatively strong (many Brazilian REITs trade 10-20% below NAV due to high local yields). For an international investor, RZTR11 offers a far higher income than any developed-market farmland vehicle, but with corresponding higher risk (market volatility, currency, etc.).
• Global Farmland Funds: There are few publicly listed farmland funds outside the U.S. Some examples include certain UK or Australian agriculture funds, but often those focus on specific niches (like timber or vineyards) or are private. One could argue farmland is sometimes embedded in conglomerates (e.g., SLC Agrícola in Brazil is a farming company that owns land; its stock price indirectly gives farmland exposure). Compared to such alternatives, RZTR11 is a pure-play on land ownership without the operational farming risk (tenants shoulder that). It’s more akin to a REIT renting to farmers. In terms of valuation, an international investor should note that part of RZTR11’s high yield is compensation for currency risk and country risk. Brazil’s sovereign risk and currency volatility mean foreign investors typically demand a high return. The fund’s ~13% yield in BRL could translate to a lower effective USD return if the Real depreciates. For context, if BRL weakens, some of that is often offset by rising commodity prices (since commodities are priced in USD) – which can actually increase farm profits and land values. Thus, RZTR11 might have a partial natural hedge (when BRL falls, soy prices in BRL rise, benefiting farmers and in turn the land rent). Still, it’s not a 1:1 hedge, and currency swings will impact a foreign investor’s returns significantly.
• Valuation Metrics: RZTR11’s P/FFO or P/AFFO (funds from operations) isn’t publicly broken out as in US REITs, but we can glean that with a ~R$20 million monthly gross revenue and ~R$1.64M expenses (June 2025 data) , the fund’s annualized net operating income is around R$220 million. Against a market cap of ~R$1.73 billion , that’s a yield of ~12.7%, consistent with its distribution. For comparison, FPI’s NOI yield is around 4-5%. The higher yield indicates higher perceived risk and perhaps growth potential. If Brazil’s interest rates fall in coming years (many expect easing as inflation is tamed), RZTR11’s yield could compress – meaning its unit price might rise as investors accept a lower yield. In other words, there is potential valuation upside if macro conditions improve. This is opposite to the dynamic in U.S. REITs (where rising rates hurt REIT prices). In Brazil’s case, falling rates can boost FII prices. For example, if Selic drops and investors demand only a 10% yield from RZTR, its price could rise so that the R$12 annual dividend = 10% yield → implying a price of R$120 (versus ~R$92 now). This is speculative, but it shows how RZTR11 has capital appreciation potential not just from land sales, but also from yield compression if Brazil stabilizes economically.

In conclusion on peers: RZTR11 compares favorably with both local and international peers on a yield basis. It is among the highest-yielding farmland funds globally. Locally, it’s one of the most solid agribusiness funds, with a track record that many newer Fiagros lack. Internationally, the risk/return profile is very different (high risk, high return vs. low risk, low return). A foreign investor should consider RZTR11 if seeking to augment portfolio yield and tap into emerging market growth, but should size the position cognizant of the higher volatility relative to, say, a U.S. farmland REIT or bonds.

Investing in RZTR11 – Access and Tax Considerations for Foreigners

Access (ADR and Direct Investment): RZTR11 is not listed outside Brazil, and no ADR (American Depositary Receipt) exists for it as of 2025. To invest in RZTR11, a foreign (non-resident) investor has a few options:

• Open a Brazilian Brokerage Account: Foreign individuals and institutions can invest in Brazilian markets by registering with CVM (Brazil’s securities regulator) as a foreign investor (often via a local custodian bank) and obtaining a Brazilian tax ID (CPF/CNPJ). Many foreign investors use an intermediary or global broker that handles this. Once set up, you can trade RZTR11 on the B3 exchange in São Paulo like any local stock. This route gives direct ownership of RZTR11 units. Several Brazilian brokers (and even some U.S. brokers with international divisions) facilitate this process.
• Use an International Broker with B3 Access: Some global trading platforms (for example, Interactive Brokers, Charles Schwab’s international accounts, or Fidelity International) offer access to B3-listed securities. They might allow you to buy RZTR11 in your home account if they have the Brazilian market enabled. In 2021, Brazil eased access by allowing certain Brazilian brokers (like XP, Avenue Securities – now part of Itaú) to cater to foreign clients. It’s worth researching which broker can most easily provide B3 trading for you. Without an ADR, buying on the Brazilian exchange is the main avenue.
• Indirect Exposure: If direct purchase is infeasible, one could seek funds or ETFs that have Brazilian FII exposure. However, globally there are very few such funds. No known international ETF specifically covers Brazilian REITs or Fiagros at this time. Another indirect route could be investing in Brazil-focused hedge funds or EM real estate funds that might hold RZTR11, but this is only for very large investors usually. In short, most foreign investors who want RZTR11 will need to go through the Brazilian market.

Tax Implications: Investing in RZTR11 as a foreign investor carries Brazilian tax considerations:

• Withholding on Income: Brazil famously exempts domestic individual investors from tax on FII dividends, provided the FII meets certain conditions (RZTR11 does meet them – >50 investors, etc.). However, this tax exemption does not automatically extend to foreign investors. Generally, non-resident investors are subject to withholding tax (IRRF) on FII income. The standard rate has been 15% on fund income for non-residents from countries not deemed tax havens . This means if RZTR11 pays you R$1.00 in dividends, R$0.15 might be withheld, and you’d receive R$0.85. There have been some evolving regulations: Brazil, for instance, long offered 0% tax on interest from certain Brazilian bonds for foreigners, but FII dividends have had a separate treatment. As of mid-2025, the government proposed a new rule specifically to tax foreign investor dividends at 10% starting 2026 . If enacted, this 10% would apply to corporate dividends (Brazil currently has no tax on dividends domestically) and possibly to FIIs as well, potentially lowering the tax on FII payouts from 15% to 10% for foreigners (a simplification aimed at aligning with new dividend taxes). It’s wise to keep an eye on this tax reform – it could actually slightly improve net yields for foreign FII investors if the rate becomes 10%. Do note, if an investor is domiciled in a recognized tax haven jurisdiction, Brazil imposes a heavier withholding (often 20% or 25%).
• Capital Gains Tax: Brazil usually exempts foreign investors from capital gains tax on exchange-traded equities, as part of incentives to attract foreign capital (with some exceptions). FIIs, however, historically had a flat capital gains tax of 20% for local individuals. For foreigners, recent clarifications by Receita Federal (Brazil’s IRS) indicated a 15% tax on gains from selling FII units off-exchange , but if the trades are done on the stock exchange, many foreign investors qualify for exemption (similar to stocks) under older rules (Medida Provisória 2.158/2001) . This area can be complex: essentially, if you as a foreigner invest via the “4,373” regulation (the foreign investor regime), trading gains on Brazilian exchange-listed assets are often exempt from Brazilian tax. It’s recommended to confirm with a Brazilian tax advisor or your broker – but practically, many foreign investors pay no Brazilian tax on FII trading gains realized on B3. If that exemption doesn’t apply, the worst case would be a 15% tax on net capital gains (and Brazil has no wash-sale rule like the US, but also no tax-loss harvesting benefit for foreigners, since if exempt you can’t claim losses either).
• Tax Filing: As a foreign investor under the non-resident regime, Brazilian taxes are usually withheld at source (for dividends) and you don’t need to file a Brazilian tax return. The broker/custodian handles withholding. You might have to handle taxes in your home country (e.g., declare foreign income). If there is Brazilian withholding (like the 15%), you should check if your country has a tax treaty with Brazil that might allow you to credit that tax or if Brazil’s withholding is final. Note that Brazil’s tax treaty network is limited (e.g., no tax treaty with the U.S., but has with Japan, UK, etc.). However, since dividends were untaxed domestically, treaties often didn’t cover them; now with new dividend tax proposals, treaties may come into play.
• IOF and Other Fees: Brazil had a financial transaction tax (IOF) on foreign exchange for certain investments, but as of 2023 the IOF on foreign investment in stocks/FIIs has been reduced to 0% (recent policy changes removed IOF on foreign equity inflows) . So, bringing money in to invest in RZTR11 should not incur IOF as it might have in the past.
• Summary: Net of taxes, a foreign investor currently might receive roughly 85% of RZTR11’s dividends (assuming 15% WHT). That still leaves a net yield around 11% (if gross yield ~13%) – very robust. If the new 10% rule passes, net yield improves. Capital gains are likely exempt if trading on exchange (check specifics), meaning you could enjoy price appreciation without Brazilian taxation. Your home country’s taxation will of course apply (for example, U.S. investors would pay U.S. tax on foreign dividends and capital gains, possibly at different rates; currently there’s no U.S.-Brazil tax treaty to reduce the 15% WHT, but you might claim it as foreign tax credit). It’s advisable to consult a tax professional, but the bottom line is that Brazil offers relatively favorable terms to foreign investors in its markets, and the government is moving to formalize some taxation (like 10% on dividends) that is still moderate by global standards .

One more consideration is currency exchange: if you’re investing fresh capital, you’ll convert, say, USD to BRL to buy RZTR11. Down the road, currency fluctuations will affect your total return. There’s no direct tax on currency movement, but any currency gain/loss is reflected when you convert back. Over the long term, the Brazilian Real has periods of depreciation, but it also yields high interest rates which partly compensate. Some investors hedge FX, but hedging BRL at 13% carry cost can eat the yield. Many choose to accept the currency risk as part of the investment in an “emerging market real asset” – ideally, farmland values and BRL might move favorably over a multi-year horizon if Brazil’s economy grows.

Bottom line: Foreign investors can invest in RZTR11, though it requires some setup, and should plan for ~10-15% withholding on income (with potential changes on the horizon) . Even after taxes, the net yield is highly competitive. Ensure compliance with your local tax reporting, and be mindful of the FX aspect.

Long-Term Outlook for RZTR11 (Dividends & Capital Appreciation Potential)

For an investor with a long-term horizon, RZTR11 offers a compelling case as a play on Brazil’s agricultural growth, with both steady dividends and capital appreciation potential:

• Structural Tailwinds: Brazil is one of the world’s largest and fastest-growing agribusiness producers (top exporter of soybeans, beef, coffee, sugar, etc.). Demand for food and commodities is expected to rise with global population and income growth. Brazilian farmland is relatively inexpensive on a global scale and has been appreciating as new areas are cultivated. RZTR11 allows investors to ride this trend. Farmland in productive regions of Brazil has shown consistent long-term appreciation , historically outpacing inflation. As the fund focuses on high-quality land (for grains, fibers, and now coffee), its assets should gain value over years. Additionally, improvements (land clearing, irrigation, soil correction) made by tenants or via capital expenditures can further increase land valuations. This underpins the NAV growth aspect of RZTR11.
• Income Stability and Growth: On the income side, RZTR11’s leases are long-term (often a decade or more) and often come with built-in adjustments (many are inflation-indexed annually, or have step-ups). This means the dividend has a built-in inflation hedge and should grow over time in nominal terms. The fund demonstrated in mid-2025 that it could maintain ~1% monthly yields even with Brazil’s benchmark rate near 14% . If interest rates decline, RZTR11’s absolute yield might dip a bit (if rents adjust by inflation which is also falling), but the flipside is its relative attractiveness increases, potentially boosting its price. The fund manager has also shown a willingness to raise rents when possible – e.g., renegotiating to 13.5% cap rate from 12.4% . This proactive management means the cash flow can grow not just passively but through strategic actions.
• Upside from Land Sales: Unlike a typical rental REIT that might seldom sell properties, RZTR11 will periodically sell farms when it’s advantageous. These sales can result in significant capital gains distributions. For instance, the sale of a Tocantins farm for R$112 million (cost was presumably much lower) yielding R$6.68 per unit profit is equivalent to more than 6 months of regular dividends in one go. And the partial sale of Clarão da Lua at R$2.17/share profit is about two months of dividends worth of extra value. Such events may not happen every year, but over a long-term (say 5-10 years), it’s likely that RZTR11 will execute multiple profitable exits. These gains can either be paid out (giving a nice bonus yield in those years) or reinvested into new acquisitions, which then generate higher future income. Either way, long-term holders benefit. It’s realistic to expect that total returns (dividends + NAV growth) for RZTR11 could be in the mid-to-high teens annually in BRL, assuming farmland values continue to appreciate and the fund continues its pattern of value-adding deals .
• Reinvestment and Compounding: RZTR11’s policy of plowing profits into new deals (when not distributing) creates a compounding effect. The capital raised in 2023–2024 was swiftly deployed to buy income-producing farms that increased the 2025 dividend (we saw 16% higher dividends year-over-year) . If the fund can keep finding accretive deals, it can grow its assets and distributions faster than inflation. Brazil’s sheer size – there are millions of hectares of farmland – provides a large opportunity set. The challenge is finding the right deals (good land, reliable tenant, good price). RZTR11 has so far demonstrated an ability to source deals (often off-market or in partnership with land sellers) and a strong network via Riza Asset’s agro expertise . As the fund grows, it may achieve efficiencies (e.g., better financing terms, or leverage – though currently the fund doesn’t appear heavily leveraged, which is conservative).
• Risks and Mitigants (Long Term): No investment is without risk, especially in emerging markets. Key long-term risks include: 1. Agricultural Risk: Droughts, floods, pests, or sustained low commodity prices can strain farmers. If a tenant struggles, RZTR11 might have to adjust rent or find a new tenant. Mitigant: RZTR11’s diversification across regions and crops helps. Additionally, the structure of having some deals with built-in purchase obligations or upfront payments (like sale-leasebacks with pre-paid components) gives cushion. The fund also often requires guarantees or uses the land as collateral if rent isn’t paid (in extremis, they could evict a tenant and lease to another, since the land remains valuable if it’s good land). The Brazilian ag sector has been resilient and technologically improving yields, which bodes well for tenant success. 2. Regulatory/Policy Risk: Farmland in Brazil can be subject to regulatory changes. There have been discussions on easing restrictions for foreign ownership of land – if that happens, it could actually increase land values (more demand). Conversely, sudden adverse policies (land use regulations, environmental compliance crackdowns, etc.) could affect operations. RZTR11 carefully vets environmental compliance (it only buys farms with no environmental irregularities or legal encumbrances) , reducing risk of fines or seizures. Tax policy changes (like the dividend tax) we discussed – they are manageable at the levels proposed. 3. Macro and FX Risk: In the long run, Brazil’s economy and currency will influence RZTR11’s USD/EUR returns. High inflation could erode returns if not matched by land appreciation or rent indexation. Political instability could impact markets broadly. That said, farmland is often seen as a defensive, real asset – during Brazil’s past crises, farmland values and production continued an upward trend, as the ag sector is globally driven. Additionally, in an inflationary scenario, RZTR11’s leases are indexed (Brazilian leases commonly adjust by inflation IGPM/IPCA annually), so the rental income keeps pace in nominal terms. Farmland tends to hold value in real terms (some even call it “gold with yield”). Still, currency depreciation is a real risk; over 10+ years, one might see cycles of BRL weakness that could dent foreign-currency returns. An investor can choose to hedge periodically if concerned, or simply accept the volatility with the expectation that high local returns compensate over time. 4. Liquidity and Market Volatility: RZTR11’s price can be volatile – e.g., it dropped in 2021–2022 when interest rates spiked, then recovered strongly in 2023–2025. The Brazilian FII market can swing with investor sentiment. For long-term holders, interim volatility is not a huge issue as long as fundamentals (land values, rents) are intact. Liquidity is decent (trading a few million Reais a day) , but nothing like large-cap stocks – big orders can move the price. As a foreign investor, one should use limit orders and be patient when building or exiting a position.

In conclusion, RZTR11 is well-suited for a long-term investment approach, providing both regular passive income and participation in the appreciation of Brazilian agricultural land. The fund’s track record since 2020 shows it has delivered on both fronts: consistent monthly dividends and NAV growth through savvy asset management (e.g., increasing cap rates, flipping properties for gains) . It effectively offers an “equity plus bond” combined return – the lease income is bond-like (and high-yielding), and the land ownership is equity-like (capital growth). Few investments offer double-digit current yield and growth potential; RZTR11 is one, albeit with the caveats of emerging market exposure.

For foreign investors, the lack of an ADR is a minor hurdle relative to the potential benefits. Once accessed, RZTR11 can play a unique role in a portfolio: it’s a diversifier (farmland returns have low correlation with typical equities or even with urban real estate) , an inflation hedge (land and commodities tend to rise with inflation) , and an income generator. Its performance to date – delivering ~13% yields and outperforming even Brazil’s Selic in total return – demonstrates the viability of its model .

Bottom Line: RZTR11 is a high-yield agribusiness real estate fund that marries Brazil’s competitive advantages in farming with the income needs of investors. It has robust expansion plans, skilled management, and a proven ability to generate both dividends and capital gains for its investors. While there are risks to navigate, the long-term horizon favors those who can stomach short-term volatility. Farmland is ultimately about the long game – growing value from the soil year by year. RZTR11 allows investors globally to join that journey in Brazil, reaping the cash harvests (rent) along the way and potentially enjoying a bountiful payoff when the land bears fruit in the form of appreciation. It is an investment to consider for those seeking income and growth and willing to venture into international real assets for outsized returns .

Sources:

• Riza Terrax Fund Description and Portfolio Details
• Toro Investimentos – What is RZTR11 (fund objective and dividends)
• Status Invest / Investidor10 – Fund metrics (NAV, yield, holdings)
• Suno Research – RZTR11 June 2025 performance (earnings, dividend, strategy)
• Clube FII News – Recent acquisitions and leaseback deals (Maranhão sale-leaseback, 13-year lease)
• Clube FII News – Lease renegotiation (cap rate increased to 13.5% in MT)
• BB InvestTalk (Banco do Brasil) – RZTR11 Fatos Relevantes summary (recent farm acquisitions, sales, profits per share)
• Status Invest – Peer fund BTRA11 metrics (P/VP 0.50, 8% yield) and RZTR11 YTD price performance
• Investing.com / Yahoo Finance – Suno Agro Fiagro (SNAG11) yield ~15%
• KPMG & Brazilian news sources – Proposed tax changes for foreign investors (10% WHT on dividends from 2026) and current withholding (15%) .
• Official fund reports – RZTR11 monthly report excerpts via Suno/Genial (farmland harvest updates, contracted yields ~15.26%) .

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