Investment returns are the main reason that Agri Investor readers are interested in the asset class, according to a recent poll. When answering ‘what is your interest in agri investment?’, 46 percent of pollsters voted for investment returns, while 24 percent indicated that responsible/impact investment was key to their interest in the burgeoning asset class.
Exposure to food, inflation hedging and portfolio diversification came next with 13 percent of the vote, 10 percent and 9 percent of the vote, according to the poll of 127 readers.
From an investment perspective, agriculture’s popularity often stems from the ability to get rental income and capital appreciation on the value of the land over time, according to one Eastern European fund manager.
But the appeal of the asset class as a responsible or impact investment is not surprising and ties in with increasing investor demand for sustainability, according Stuart MacDonald, managing director at Aquila Capital, the alternative fund management firm. “We have always embedded the notion of sustainability in both senses of the word in our investment offerings,” he told Agri Investor. “People have been responsive to the notion of sustainability, both in terms of responsible investments and investment returns,” he said.
And now there is demand from fund managers and investors alike, to embed principles of responsible investment into investment offerings from the start, rather than include them as an afterthought. “Sustainability to me is self-evident from an investment point of view but also as a matter of simple logic: in the same way I wouldn’t deliberately destroy my own house I am not going to damage the ecosystems on which we all depend for our existence,” said Rufo Quintavalle, private investor, principal at a multi-family office and director at Agro-Ecological Investment Management in a recent interview.