Centuria sets up new agriculture fund

Centuria Agriculture Fund (CAF) is an unlisted, open-ended agriculture fund, seeded with a $177 million glasshouse in Warragul, Victoria.

Centuria intends to build a portfolio of assets leased to experienced agricultural operators as well as association agri-logistics assets with favourable lease terms.

The manager is hoping to raise $103 million to launch the fund, it said.

"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," Centuria joint chief executive Jason Huljich said.

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According to Hulijch, the fund a two-prong investment strategy, focusing primarily on Precision Farming assets, such as glasshouse production, netted crops, vertical farming and properties with access to water, substrate growing and automated harvesting.

Secondly, it 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," Huljich said.

The fund's minimum investment is set at $10,000 and has a starting distribution rate of 5.25cpu.

The glasshouse is the cornerstone asset and benefits from a 19-year sale-and-leaseback, triple-net lease to well-regarded Australian vegetable provider Flavorite.

Flavorite is the largest glasshouse producer of fresh fruits and vegetables in Australia and has 25 years of experience in this industry.

The Flavorite facility is a climate-controlled, protected cropping facility covering 33.5 hectares or approximately 40% of the total site and is one of the largest glasshouses in Australia.

Co-chief executive John McBain added: "Centuria branched into the agriculture sector following our merger with Primewest in July 2021 and we intend to expand this vertical to capitalise on the growing demand for premium agricultural products."

"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 $80.4billion gross value agricultural production forecast for 2022, contributing approximately 2% to Australia's GDP."

CAF's launch will complement Centuria's existing agriculture trusts.

In total, Centuria manages seven agriculture properties worth a collective $343 million.