Funded by the family pension fund of expatriate Australian, Michael Hintze, MHPF is the investment vehicle now driving one of Australia’s fastest-growing farm portfolios.
Since making its debut in 2007, MHPF has amassed 11 properties in NSW and two in north Queensland, all managed by Growth Farms Australia.
Until now the portfolio has been heavily weighted towards southern NSW mixed farming – wool, prime lambs, cattle and winter cropping – but the latest purchases widen MHPF’s scope.
The group has just confirmed its purchase of three farming properties in the Walgett district (where it already owns “Marshmead”) and two cane farms in North Queensland.
At Walgett, contracts have been exchanged for the purchases of “Mourabie”, “West Mourabie” and “Bynia”, a combined area of 7981 hectares including 1880ha developed for cotton irrigation.
The sale was negotiated by Moree Real Estate, which advertised the properties for sale in conjunction with Kelly’s Property Sales of Walgett earlier this year by expressions of interest.
Situated 50 kilometres west of Walgett, fronting the Barwon River, the properties have in total 4875ha of established cultivation and will provide geographic and enterprise diversity.
Included in the sale package, thought to be worth between $11 million and $13m excluding crop, are 4781 megalitres of water entitlements, 17,000ML of off-river storage and extensive infrastructure.
Also this week, MHPF confirmed the purchase – through Ferry Property at Townsville – of two cane farms in the Burdekin region of north Queensland.
The two farms, near Ayr, have a combined production capability of 40,000 tonnes of cane off 315ha, and were bought walk-in, walk-out (including crop) for a reported $6.8 million.
The latest purchases bring the total holdings of the group to more than 45,500ha, worth nearly $120m (including water), and covering all mainstream agricultural enterprises.
Further acquisitions are in the pipeline and expected to be unveiled as the year progresses.
Mr Hintze is the founder and senior investment officer of CQS Management, a London-based hedge fund with assets of $US10.5 billion.
His Australian holding company has three local directors who oversee the acquisitions and operational aspects of the investment, and a team of legal and financial advisers.
The group’s recent growth has been driven by the directors’ view that rural land in Australia just now represents good value, in light of the strong global demand for “soft commodities”.
They believe land has the potential to increase sharply in value in the next few years, yielding attractive returns on the investments now being made.
A key strategy of the group has been to aggregate parcels of land where possible to achieve efficiencies of scale and cross-property synergies.
All proposed acquisitions are first inspected and assessed by Growth Farms Australia, which draws up a comprehensive farm plan for each new purchase, identifying capital spending needs and – for grazing farms – suggested stocking strategies.
Richard Taylor, a director of Growth Farms Australia, said while efficiencies of scale, synergies and diversity were all desirable objectives, they were not the core criteria.
“Having highly-productive and well-managed farms is even more important, and this is the focus for ongoing management of the portfolio,” he said.
Prior to the latest purchases, MHPF’s most recent shopping spree saw it pick up the 1733ha “Rippling Waters” grazing property, near Tumbarumba, late last year from the failed Willmott Forests timber investment group.