Rabo Farm feels competition in CEE

The Dutch investment manager is still working on Rabo Farm Europe Fund II’s first commitments as increasing numbers of investment firms enter the region.

Agriculture investment in Eastern Europe has become more competitive in the last five years, according to Dick van den Oever, managing director of Rabo Farm, the agriculture fund management arm of Rabobank.

Rabo Farm, which is currently in talks with two institutional investors for its second agri vehicle, Rabo Farm Europe Fund II, has noted more entrants into agriculture investment in the region since its first fund closed on €315 million in 2009. A recent example is Westchester, the agricultural manager for US pension provider TIAA-CREF, which hired a new Europe chief executive to look more closely at the region.

“There is certainly more interest in the agriculture sector in general. We wouldn’t call them our direct competitors but there are more investors in the space,” said van den Oever. “I think they have been attracted by the global challenge of food security and the investment opportunity this provides,” he said.

Increasing competition in the CEE region has raised some questions about how the changing competitive landscape will impact the investment market with a limited pool of suitable land and farm management professionals. But the CEE region still offers a great deal of potential in terms of productivity gains to be tapped, argued van den Oever. And Rabo is still aiming to close Fund II for the final time in March 2015. It is targeting €315 million.

Fund I focused on investing in Romania and Poland but Fund II is also looking at other Eastern European Union countries that could account for up to 30 percent of the fund’s investments.

Other fund managers active in the region including Black Sea Agriculture, Anholt of the Kattegat Trust and Trigon InvestAg.

Rabo Farm does not use a placement agent.