Growth Farms buys majority of Kangaroo Island portfolio and leases SA property

The Sydney-based fund manager took on all but two properties in the Cygnet Park Farms portfolio on behalf of a private buyer and leased a further property on behalf of the same client.

Growth Farms has purchased the majority of a portfolio of farms co-owned by Australian billionaire media magnate Kerry Stokes and cattleman Peter Murray on Kangaroo Island in South Australia.

It bought most of the Cygnet Park Farms portfolio on behalf of a private buyer via a separately managed account. The value of the deal was approximately A$20 million ($14 million; €13 million) for the land alone, according to a source familiar with the matter, with the buyer also purchasing the majority of livestock and some equipment on the properties for an additional undisclosed sum.

The transaction saw Growth Farms purchase the 4,848-hectare Woodlana property, an aggregation of four separate holdings, and the 1,606-hectare Naroonda property, an aggregation of three holdings.

Not included in the deal were the 847-hectare Riggs property and the 520-hectare Benneys property, located on the western side of the portfolio.

Murray, co-owner of the Cygnet Park Farms portfolio, has bought out Stokes’ share in Riggs to own the property alone, according to another source familiar with the deal, while Benneys was sold to a local operator, Mike Smith.

As part of Growth Farms’ purchase, the Sydney-headquartered fund manager also agreed to take on a long-term lease on behalf of the anonymous private buyer for the 3,724-hectare Balquhidder/Mt Scrub aggregation located on the Fleurieu Peninsula in South Australia, which operated under the same management as the Cygnet Park Farms portfolio.

That property remains solely owned by Stokes, the chairman of Seven West Media, and was carrying approximately 16,000 composite ewes and their progeny when the properties were listed for sale by Elders in September 2017. Bidders who expressed interest in the Cygnet Park Farms portfolio were invited to indicate interest in a lease on the mainland aggregation.

Elders Real Estate and Growth Farms declined to comment for this story.

The herd across the Cygnet Park Farms portfolio comprised approximately 3,000 mixed-age Angus cows, approximately 2,200 mixed-sex weaner calves and around 300 yearlings/bulls. Growth Farms has not purchased all of the herd.

All the South Australian properties purchased or leased by Growth Farms are located in areas of reliable rainfall, with lower volatility that in many other areas of Australia, a source said.

Separate to the transactions in South Australia, Growth Farms held a first close for its Australian Agricultural Lease Fund in late 2018, Agri Investor understands. The upper fundraising limit for the fund was set at A$100 million but the value of the close has not been disclosed and Growth Farms declined to comment.