Realty Income Corp., a publicly traded REIT with a market capitalization over $40B, is expanding into agriculture development with a new billion-dollar partnership.

Realty Income has formed a strategic real estate alliance with indoor vertical farming company Plenty to acquire sites and develop them to be leased back to the South San Francisco-based startup, the companies announced Tuesday.

The agreement is for as much as $1B worth of development opportunities, according to the release. The first deal in the partnership is for Plenty's Richmond facility, expected to be the world's largest vertical farming complex at completion, where Realty Income will acquire the land and fund development, according to a press release.

"Our entry into agriculture technology provides another potential growth opportunity for our company," Realty Income CEO Sumit Roy said in a statement. "Over time, we aspire to expand our collaboration with Plenty internationally in markets of mutual interest."

Plenty's Richmond farm already has a production deal with produce giant Driscoll's to grow strawberries for Northeast consumers. That 120-acre campus is expected to produce more than 20 million pounds of produce across multiple crops when it is complete, and create 300 new jobs.

The company closed a $400M funding round last year, Bloomberg reported. One of its investors is Walmart, which will be a recipient of Plenty produce grown in another upcoming facility in Compton, California.

"Scale is a critical component of advancing indoor farming's role as a core contributor to our global food supply," Plenty CEO Arama Kukutai said in a statement. "Teaming up with Realty Income is a significant step forward in accelerating the deployment of our farms with vertical farm facilities that are purpose-built to support Plenty's proprietary growing technology."

Indoor and urban farming has grown in popularity in recent years, particularly around dense urban areas like New York. Some companies have explored making use of tax breaks available by developing urban farms in opportunity zones.

Realty Income owns more than 11,700 properties in the U.S., United Kingdom and Spain, according to its website. The properties span retail, industrial and agricultural uses and are largely under net-lease agreements with high-credit tenants like Walgreens, 7-Eleven, Dollar General, Dollar Tree/Family Dollar, Circle K and Speedway.

In 2021, Realty Income struck a deal to buy VEREIT, adding some 3,800 commercial properties spanning 89.5M SF to its portfolio.