Centuria Capital Group has acquired a 20-hectare tomato glasshouse facility in Guyra, New South Wales, in a move that grows its total agricultural assets under management to $500 million.
The acquisition, made on behalf of its Centuria Agriculture Fund, is the fund’s third off-market glasshouse purchase and brings its total size of its glasshouses under management to about 74 hectares worth $323 million.
Tomato Exchange, a wholly-owned subsidiary of ASX-listed Costa Group, is the property’s existing tenant and has extended its lease for 15 years with CPI-linked rent reviews.
The glasshouse produces 12,800 tonnes of tomatoes annually and has relationships with major fresh produce retailers in Australia.
The company intends to grow its platform across alternative real estate sectors, including agriculture, as it believes there is strong demand for agricultural real estate investments.
“In just over six months, CAF has secured three high value, off-market glasshouse assets worth more than $323million,” said Andrew Tout, Centuria’s Head of Agriculture.
“In recent years, the pandemic and other climatic and geopolitical events have highlighted the importance of food security and access to nondiscretionary fresh produce. Australia is also reputed for being a ‘clean and green’ producer of high-quality agricultural products and demand for Australian grown fresh food and other quality agricultural products is forecast to increase materially over the next 10 years, driven by middle class population and income growth in both local and offshore markets.”
Centuria Agriculture Fund was launched this financial year as a new fund vehicle for Centuria’s retail and private bank investment clients. The fund’s rapid growth is expected to continue with total agriculture AUM forecast to exceed $600 million in FY23.
The acquisition comes as the pandemic and other events have highlighted the importance of food security and access to fresh produce.
Centuria’s focus on sustainable agriculture investments leased to reputable operators with strong sustainability credentials is expected to attract continued investor interest in the sector.
“Centuria has expressed its intention to strategically grow its platform across alternative real estate sectors, including agriculture,” said Jason Huljich, Centuria Joint CEO.
“We believe strong demand fundamentals will drive continued investor interest in agricultural real estate and Centuria will continue to seek high quality assets, leased to reputable operators with strong sustainability credentials in high revenue producing sectors such as protected cropping. We have developed a healthy acquisition pipeline of assets which suit the CAF investment profile and expect total agriculture AUM to exceed $600 million during FY23 and continue to grow rapidly in FY24.”