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Farmland

INVESTMENT OPPORTUNITY

Australian Farmlands Funds

The Australian Farmlands Funds represent an opportunity through which sophisticated and wholesale investors can access an agribusiness portfolio of irrigated farmland, water and environmental assets in the southern Murray-Darling Basin (sMDB).

It was established in August 2018 to invest in a portfolio of irrigated farmland, water and environmental assets in. Financial returns are delivered through the renewal of underutilised irrigation farming operations to deliver high value organic and conventional crops, sustained by ecosystem protection and enhancement to deliver long-term returns to investors.

As of October 2018, the Funds had received a fully subscribed Phase 1 investment of $20 million invested capital. These funds have been deployed to purchase properties and water assets in the sMDB.

Download the full Australian Farmlands Funds Information Memorandum.

Why Invest in Farmland? 

It has been proposed the world may be facing ‘peak land’, meaning it has run out of good arable country. Astute investors see opportunities presented by the global demand for protein driven by population growth, a growing global middle class and reducing availability of arable land.

In the same way many think about food security we should concern ourselves with soil security. The maintenance of the world’s soil resource is fundamental to providing sufficient food and fibre.

Currently 7 billion people rely on food grown off around 11% of the global land surface. Of this 11% only 3% is estimated to be inherently fertile. In 2010 National Geographic proposed the world may be facing ‘peak land’, meaning it has run out of good arable country.

Astute investors see opportunities presented by the global demand for protein driven by population growth, a growing global middle class and reducing availability of arable land and fresh water to produce the food.

Investing in farmland through Kilter Rural’s commercial stewardship philosophy delivers a pathway to enduring income from improved yields, multiple revenue streams and capital growth from redeveloped farming landscapes.

The philosophy delivers resilience through large-scale intervention on farmland to protect and enhance long-term function of ecological systems while sustaining long-term agricultural production.

Farmland Asset Returns

Historical analysis shows that investment in farmland benefits the risk return profile of a balanced investment

Over the 12-Year Period from 2000 to 2012, the top 25% of farms delivered returns exceeding that of Australian Equity, Property REIT and Government Bonds

Over the recent 5-Year period from 2007 to 2012, Average Farm Return has surpassed that of Australian Equity and Property REIT

Farmland is less volatile than investing in Australian Equity and Property REIT

Farmland Investment has a low correlation with the All Ordinaries Index and the S&P 200 A-REIT Index.

Farmland Investment experience

Kilter Rural invests in farmland to maximise opportunities provided by drivers of food security, climate change, demographic change and sustainability.

Since 2006 Kilter Rural has been implementing its Future Farming Landscapes investment model, purchasing 40 properties, covering 10,000 hectares (24,700 acres) of farming country in Australia.

Farmland is renewed at scale to deliver long-term resilience and reduced exposure to traditional risks. This is a core plus strategy - adding value to deliver farmlands with a sustainable, global competitive advantage.

Our wholesale and sophisticated clients are aligned with the Principles for Responsible Investment but recognise the opportunities provided by drivers of food security, climate change, demographic change and sustainability.

Watch the video to discover more about Future Farming Landscapes.