- Fund will be seeded with a $177M Victorian glasshouse
- Currently leased to vegetable provider Flavorite
- Comes as Centuria entered the agriculture market last year with the acquisition of Primewest assets
Centuria Capital Group has announced the launch of a new unlisted, open-ended agricultural fund, the Centuria Agriculture Fund (CAF).
It will be seeded with a $177 million glasshouse in Warragul, Victoria.
CAD will acquire the glasshouse – which benefits from a 19-year sale and leaseback, triple-net lease to Flavorite, a popular Australian vegetable provider.
The facility is climate-controlled and a protected cropping facility. It covers 33.5 hectares or around 40% of the total site, making it one of the largest glasshouses in Australia.
Centuria attends to acquire assets that are leased to experienced agricultural operators along with associated agri-logistics assets that come with favourable lease terms.
“CAF intends to carefully partner with select operators who have a strong track-record in producing high-yielding produce and who are well established with extensive experience throughout various weather cycles,” said Jason Huljich, Centuria Joint CEO.
“The Fund has a two-prong investment strategy. It will primarily focus on Precision Farming assets, such as glasshouse production, netted crops, vertical farming and properties with access to water, substrate growing and automated harvesting.
Jason Huljich, Centuria Joint CEO
“Secondly, we will target assets aligned to the agricultural supply chain, such as processing, storage/cold storage and distribution to meet the paddock-to-plate demand.
“This remit includes both existing assets as well as those where farming operations can be expanded or improved through capex funding.”
John McBain, Centuria Joint CEO, noted that Centuria began branching into the agriculture sector following the merger with Primewest last year, and the opportunities are endless for the fund given ongoing demand both nationally and overseas.
“We intend to expand this vertical to capitalise on the growing demand for premium agricultural products,” said Mr McBain.
“Strong fundamentals that underpin the sector include population growth forecasts, which increase demand for food domestically and internationally, robust free trade agreements supporting exports, and an $80.4 billion gross value agricultural production forecast for 2022, contributing approximately 2% to Australia’s GDP.”
John McBain, Centuria Joint CEO
Currently, Centuria manages seven agriculture properties, worth around $343 million as of 30 June 2022 book value.
Based on the initial asset of the new fund, CAF intends to commence with a starting distribution yield of 5.25 cents per unit and will seek to provide monthly distributions, a limited quarterly wi facility and unit pricing on a daily basis.
The minimum entry investment is $10,000, with Centuria aiming to raise $103 million to launch the fund.