buy and lease

Primewest will use part of the A$60m raised in an institutional placement to make a cornerstone investment in its first agriculture fund.

Managing director Bill Reiman says covid-19 disruption delayed deal closures but increasing farmer interest in sale/leaseback helped the firm match its 2019 capital spend.

Capital was deployed from the firm’s evergreen ag and timberland vehicle which had a €32m first close at the start of November.

Primewest took over management rights to the Vitalharvest Freehold Trust in June, which is now subject to a takeover bid from MIRA worth approximately A$185m.

Bonnefield president and CEO Tom Eisenhauer explains why investors need to commit to ag now, his firm’s reasons for steering clear of an own-and-operate strategy and the impact of covid-19.

The Diversified Agriculture Fund will deploy approximately A$25m across three foundation assets and will move to an open-end structure to continue raising capital.

Real estate investors looking for steady returns are beginning to view sale-and-leaseback agriculture assets as core investments, Colliers says.

As of March 31, OCERS’ investment in the AAF was valued at $64.1m, which constitutes a 6.4% net IRR. The $16.7bn pension committed $40m to the fund in 2010.

Homestead Capital Farmland Fund III had raised just over $400m by the end of 2019 and has a $600m target – the buy-and-lease strategy is expected to reach final close in June 2020.

The fund had received subscriptions from institutional investors, private banks and wealth managers, all of which were returned after the income trust's IPO was pulled from the market.