Hassad Australia heads list of Australia’s biggest farm sales of 2018

DEMAND for rural properties has defied widespread dry conditions across eastern Australia.

Cobungra Station.

DEMAND for rural properties has defied widespread dry conditions across eastern Australia.

The Weekly Times’ analysis of property sales during 2018 showed that billions of dollars of land changed hands with strong domestic and international demand, from both institutions and individuals, across almost all farming types.

“(The market has been) phenomenally buoyant,” CBRE regional director Danny Thomas said. “There’s some headwinds emerging in the market now which might mean we’re going into some more difficult times, but the market to date, despite the drought, has been really strong.”

Mr Thomas said competition for permanent plantings, particularly almonds, citrus, avocados and berries was particularly buoyant with good buyer interest for livestock properties with demand for sheepmeat and wool strong and beef “coming off a high base”.

However, he said dairy remained a sticking point with “a massive imbalance between supply and demand from a real estate point of view” particularly in western and northern Victoria.

The year featured the listing of several high-profile properties and aggregations, not the least of which was the Consolidated Pastoral Company empire, spanning five million hectares across northern Australia, which hit the market in March with a reported asking price of about $1 billion. So far, only one station, Nockatunga at Thargomindah in Queensland, has sold — for $50 million.

The past 12 months also saw the wind up of the once-dominant Hassad Australia, Sustainable Agriculture and Twynam Agriculture portfolios — which fetched a combined $670 million.

From a buyer perspective, more established institutions such as Paraway Pastoral Company, AJ&PA McBride, Rural Funds Group, Canada’s Public Sector Pension Investment Board and Hong Kong-based CK Life Services have mixed it with newcomers such as Macquarie-backed Vidiris Ag and Dutch-based Optifarm Pty Ltd.

The year’s biggest sale belonged to Hassad, whose portfolio of 10 aggregations in NSW, Victoria and Western Australia fetched $370 million. In September it sold nine properties, totalling almost 100,000ha, to Paraway and Vidiris Ag in a deal worth about $300 million.

Just weeks earlier, it sold the 47,677ha Telopea Downs aggregation in western Victoria to the South Australian-based AJ&PA McBride for $70 million.

The second-biggest transaction, of about $208 million, was for the 44,167ha BFB Farms properties around Temora, Junee and Wagga Wagga in NSW.

Lake Midgeon Aggregation at Narrandera, NSW.

The sale caused controversy with a local consortium of buyers claiming they were shut-out of negotiations despite offering a higher bid than eventual buyers, the Canadian Public Sector Pension Investment Board.

Other high-profile properties still on the market at year’s end include the 31,000ha Cobungra Station in Victoria’s high country, which has an expected price tag of $45-$47 million, as well as the 203,000ha Nicoletti Farms portfolio in Western Australia with an asking price of more than $75 million.

Inglis Rural Property sales manager Sam Triggs said property values were being underpinned by “strong macroeconomic fundamentals including low interest rates, satisfactory Australian dollar, ongoing demand from Asia and historically strong commodity prices”.

He said the drought had put renewed focus on higher-rainfall country and irrigation assets.

“Water entitlements in the major irrigation systems — Murray, Murrumbidgee and Lachlan — have seen huge shifts upwards, which is directly correlated to the increased volume and permanent plantings — almonds, walnuts and also cotton,” Mr Triggs said.

Looking forward, he said land values were expected to plateau in 2019 but “solid ongoing investment” was likely as “the market sees rural land as safe, lower risk asset class versus other property and investment classes”.

READ THE FULL LIST OF MAJOR PROPERTY SALES FOR 2018