Alternatives Outlook 2024 Report

AGRICULTURE

The outlook for Australia’s agricultural sector remains robust with strong domestic population growth, secure trade agreements and rising global food consumption key drivers of underlying demand. Covering 427 million hectares (equivalent to 55% of total land area) Australia’s agriculture sector plays a crucial role in meeting both domestic and international agricultural commodity requirements. While the ANREV Australian Farmland Index has remained largely flat over the past 24-months, more substantial growth is expected in 2024 with various bodies predicting a record or near record year for agricultural production. Furthermore, both domestic and international investor interest is predicted to remain strong. Land sovereignty or reclamation motivated purchases are expected to persist amongst domestic privates and high-net worth investors while offshore institutions are likely to seek opportunities aligned with key technological advancements, food security and supply chain thematics. While most major investment into the Australian agricultural sector in 2023 was through operating asset or platform exposure, leased agriculture remains a relevant component of the market which traditional real estate investors are increasingly considering. Although underlying demand drivers are considerably more diverse and complex across the agricultural sector compared to core real estate, lease terms are often not dissimilar to core sectors. Sector size estimate: AUD 9 billion* Prime yields: 5.00%-6.00%*

KEY TRANSACTIONS

Type

Name

Size AUD Yield

Buyer/Investor

Date

Kimberley Cattle Portfolio

Alberta Investment Management Corporation

Direct

300m -

Nov-23

Capital Raising

Riverina Almond Project

120m*

-

Costa Family

Dec-23

Australia New Zealand Landscapes and Forestry Fund (ANZLAFF)

Capital Raising

Australian and European institutional investors

450m*

-

Dec-23

*Capital raised, total fund size

*Institutional leased assets only

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