Roc Partners holds A$40m first close on Premium Food Fund – exclusive

Roc Partners’ Premium Food Fund was one of three buyers, alongside Primewest and another local buyer, for Harvard University’s Western Rosella portfolio.

Roc Partners reached a A$40 million ($29.7 million; €25.1 million) first close at the end of H1 2021 on its inaugural food and agriculture vehicle, the Premium Food Fund, and is targeting a final close by the end of August this year.

The firm’s partner, Brad Mytton, confirmed the fund’s status to Agri Investor after it purchased a property in New South Wales’s Riverina region known as Euroley, from the Harvard University Endowment Fund.

The 2,419-ha property comprises 376 ha planted to almonds, approximately 950 ha of dryland cropping land planted to canola and around 1,100 ha of grazing and support land. Roc Partners’ Lachlan River Almonds business will manage the asset, marking the establishment of the private equity firm’s first in-house tree nut investment platform.

Roc Partners paid A$14.3 million for Euroley. Mytton told Agri Investor the Premium Food Fund is currently marked at 1.4x multiple of money invested and a 40 percent IRR based on “significant positive developments” across its three existing investments, with the almond deal the fund’s fourth investment.

The firm has been busy in the market chasing deals for the fund, losing out to Macquarie Infrastructure and Real Assets in a fight to de-list Vitalharvest Freehold Trust and reportedly landing as an underbidder to Canada’s PSP Investments on cotton giant Auscott.

As well as managing Euroley, Roc Partners’ Lachlan River Almonds has signed an agreement to lease the 524 ha Moora property from Primewest, also sold by the Harvard University Endowment Fund. Moora’s land comprises 430 ha of almond orchards with the remainder used as support land.

Primewest, which recently merged with fellow ASX-listed real estate investor Centuria Capital Group, has launched a new wholesale unlisted fund, Primewest Agricultural Trust No. 2, which will be seeded with the Moora asset. The firm said that it had paid A$53.9 million for Moora and will seek to raise A$34 million from investors to fund the acquisition.

The deal included more than 7,100 ML of Lower Lachlan groundwater and 700 ML of high-security Lachlan Regulated River Water Source. Primewest has signed a 12-year triple-net lease with Lachlan River Almonds to operate the asset.

Primewest Agricultural Trust No. 2 has been launched following the close of its predecessor vehicle, which is now fully subscribed. The firm said it would have a 12-year initial WALE weighted average lease expiry by income and will provide an initial cash distribution of 7 percent per year, paid monthly, and that it has “a strong pipeline of potential future acquisitions” for the fund.

Harvard University Endowment Fund put the two properties up for sale in 2020 alongside a third, Newmarket, a 10,707 ha property with multiple irrigation systems and substantial on-site water storage, which together comprised the Western Rosella portfolio.

Agri Investor understands that Newmarket has been sold to a local buyer who is not a major corporate farmer or institutional investor.