Primewest buys into Vitalharvest berry and citrus farms
A West Australian property investor has expanded its new agriculture portfolio by buying farm manager goFarm Asset Management and taking a stake in Vitalharvest.
LISTED West Australian asset management company Primewest Group has consummated the second stage of its $100 million expansion into agriculture by buying the manager of the Vitalharvest Freehold Trust.
PWG bought Vitalharvest’s manager, goFarm Asset Management, from goFarm Holdings for $10 million plus took a 11.8 per cent stake in horticultural company with first right to buy a further 6.2 per cent.
It makes PWG the largest shareholder in Vitalharvest, which owns Australia’s largest portfolio of citrus and berry farms, all leased to Costa Group Holdings.
PWG said the portfolio had a weighted average lease expiry of six and a half years.
“The tenant holds an option for a further 10-year period and in exercising this, provides significant future rent growth through an uncapped market rent review at the end of the initial least term in 2026,” the company said.
PWG, which now had $4.4 billion in assets under management, mostly in commercial, industrial and retail real estate, announced in April its intention to expand into agriculture with a target to spend $100 million.
It bought the Pinegetta farm near Deniliquin from the Rennie family in April for $4.8 million.
The farm produces carrots and potatoes under irrigation, with recent contracts to supply the Smith Snack Food Company owned by Pepsico.
Under the latest deal, PWG does not acquire the goFarm Asset Management name.
It has already renamed the asset manager Primewest Agrichain Management Pty Ltd.
The property management company has foreshadowed changing the Vitalharvest name to the Primewest Agri-chain Fund.
Primewest executive chairman John Bond said the goFarm Asset Management deal was an exciting step for the company.
“We look forward to working with VTH’s existing investors in its next stage of growth,” Mr Bond said.
GoFarm Holdings retains a number of subsidiaries, including goFarm Australia.
GoFarm Australia managing director Liam Lenaghan said goFarm Asset Management was a non-core subsidiary and the sale allowed goFarm to concentrate on what it does best: active property development.
“Our whole purpose is about improving agriculture and creating wealth for investors and leaving a proper legacy,” Mr Lenaghan said.
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