Bonnefield managing partner Andrea Gruza told Agri Investor that Sam Doyle will play a key role in managing the Bonnefield Integrated Agriculture Fund, a distinct vehicle devoted to Canadian agribusiness targeting mid-teen annual returns. Gruza declined to identify a target or timeline for the fund, adding that the Toronto-headquartered firm has started meeting with potential investors and reviewing deals for the fund.
The decision to expand into agribusiness, she explained, came after more than 10 years of investing in Canadian farmland and more than a year studying agribusiness. In addition to calls from certain of its more than 100 farm partners asking for help in financing processing infrastructure, she said Bonnefield heard from investors interested to see expansion of the firm’s strategy.
“They [LPs] had the solid core downside protection of the farmland asset and were looking to move up the risk curve and pick up a bit more cash yield by going into something that is more of an integrated agriculture play,” said Gruza. “As well, there’s some investors who want to start at a higher level than what you get in the farmland fund, so those two things came together.”
Doyle joined Bonnefield in late April after six years at Davis, California-headquartered AGR Partners, the agribusiness affiliate of Nuveen. According to his LinkedIn profile, Doyle spent the past two years as a Chicago-based vice-president for AGR and had previously served as an associate in Davis for three years. The profile also shows that prior to joining AGR, Doyle worked as an analyst with Goldman Sachs in Salt Lake City and at Castle Lake Alternatives, a financial services firm headquartered in Halifax, Canada.
Doyle declined to discuss any specific investment he focused on while at AGR and told Agri Investor his work did include sectors like alternative proteins and oilseeds, where Canada plays a major global role. Those sectors could be relevant for the Bonnefield Integrated Agriculture Fund, according to Doyle.
The vehicle will focus on provision of non-controlling structured capital to facilitate growth and succession in agribusinesses from primary production to value added-processing, said Doyle, who re-located to his native Halifax to take the new role. He declined to share interest rates or terms for any envisioned debt investments form the vehicle beyond explaining they will likely include preferred equity and debt, in addition to sale/leaseback structures similar to those employed in farmland investments.
Gruza said early feedback has revealed strong demand among pensions and family offices for exposure to Canadian agribusiness, especially among institutions from outside of the country.
“We see a lot of interest in agriculture and Canadian agriculture particularly because it’s historically been hard to get exposure to, it has really strong tailwinds with respect to what we are seeing with climate change and water availability. There are a number of investors who need to move up the risk curve beyond farmland to achieve the returns they need for their portfolios. It’s not across the board, but I would say that’s a group that historically has just not been able to access farmland,” she said. “This [agribusiness fund] is the type of investment we’ve heard from them that they are looking for.”
Bonnefield manages more than $1 billion in farmland and agribusiness assets. The firm sold a majority stake to Walter Global Asset Management in in March 2021.