The Sustainable Agriculture Fund has sold 10 properties across NSW and Victoria, the lion’s share of a portfolio it put to market in March, for a price understood to be about $110 million.
AgCAP, which manages the super fund-owned Sustainable Agriculture Fund, sold the tranche of properties – the first of several deals in the sale of the portfolio – across NSW and Victoria with a combined area of 16,000 hectares to TIAA-CREF Global Ag Properties.
‘‘This is a particularly pleasing result for the investors and managers of the fund, and builds on the strong operational returns from the last two years to deliver a very robust total return to the investors across the life of the fund,’’ AgCAP CEO Martin Newnham said.
The purchaser’s asset manager, Westchester Agricultural Asset Management, headed by chief executive Randall Pope, is understood to have struck several arrangements with local farming businesses over the plant, equipment and crops associated with the different properties.
‘‘AgCAP believes these transactions are in the best interest of the shareholders and our staff, and the future management of the assets,’’ AgCAP general manager of strategy, Deo de Jesus, said. ‘‘There will be continuity of operations with local contractors and service providers to be used under the new ownership.’’
The sale by its super fund owners of the fund – which owns 23,000 hectares of the highest-quality farms in Australia from King Island to Moree in NSW – highlights the difficulty for agricultural fund managers of maintaining longterm superannuation investment. The sale was broken up after the fund manager received no acceptable offer for the total portfolio of 17 properties.
One asset included in the first sale is the 9710-hectare North Star Aggregation, comprising five non-contiguous holdings in the so-called Golden Triangle region of northern NSW between Moree and Goondiwindi, along the Newell Highway. It is well suited to wheat, dryland cotton, barley, chickpeas and sorghum.
Another is the Darlington Point Aggregation, a 4937-hectare irrigated and dryland cropping portfolio located in the Murrumbidgee Valley in NSW, while a third is the Western Victoria Aggregation: a portfolio of three noncontiguous holdings at Lake Bolac covering 1445 hectares.
The sale was managed by CBRE Agribusiness agents Duncan McCulloch, Col Medway, James Beer and Danny Thomas.
Mr Thomas declined to confirm the sale price or structure of the deal, but said the sales campaign was a competitive process.
‘‘Local farming groups bid very strongly for individual assets or combinations thereof, and the institutional and corporate groups bid very strongly for aggregations or combinations of aggregations,’’ he said.
‘‘We also received bids for the total portfolio and the fund, albeit these bids were significantly exceeded by the combinations of bids for individual assets.’’
AgCAP and CBRE said they were likely to make further announcements in relation to the fund’s King Island and Cradle Coast assets soon.