Syndex announces first of its kind Diversified Agri Fund

Syndex announces first of its kind Diversified Agri Fund

9th April 2018

Innovative investment platform Syndex today announced the listing of its first diversified agriculture fund.

The “Natural Farm Food Limited Partnership” fund* (NFFLP) is being launched in conjunction with Farm Venture, a farm property and operations management business based in Taranaki.

The new funds targeted a total capital raise of NZ$150 million, with a first close of NZ$50 million. There is a minimum capital investment of NZ$25 million for ownership of an initial three dairy farms and livestock, plus capex and the proportional purchase of Fonterra shares.

Syndex Chief Executive Ross Verry says individual investors already have other options to invest in farm syndicates.

“The Farm Venture fund is unique in that it also lets in institutional and wholesale investors on the action. It is an innovative structure, responding to a strong demand for new models and products supporting wealth creation and growth,” he says.

Farm Venture believes the new fund taps into a growing demand from institutional and wholesale investors and private equity funds. This fund offers investors the opportunity to reweight their portfolio and access some of the superior returns offered by these asset classes.

Managing Director of Farm Venture Tim Barrett says: “Internationally we see investment portfolios with much higher weightings in alternative investments and particularly agricultural assets. It is aimed squarely at New Zealand investors, with international investors capped at 30% of tranche one capital raising.”

The fund is targeting returns of 10% per annum, comprising a 6% per annum return from operations after management fees, before tax, plus a 4% per annum capital value increase potential from productivity improvements and valuation movements.

Barrett says, “Farm Venture provides support to the on-farm management team to ensure effective planning and implementation of farming practices as well as strong performance and growth. Investors will be kept well informed of our progress thanks to our strict reporting disciplines. The on-farm management teams are also encouraged to invest in the fund for common alignment, to secure their future as the operational farmers for New Zealand”

Syndex’s innovative investment platform supports the diversified agriculture fund, providing contemporary and efficient services for both managers and investors.

Verry says: “The benefits to Farm Venture and its investors from utilising Syndex focus on administrative ease. Detailed reporting can easily be distributed to investors, and investors can access information and analytics around financial, operational and environmental performance all in one place, at any time.“

“The diversification, scale and low leverage of the fund, combined with the transparency and secondary market that Syndex delivers, means that this fund offers a higher level of liquidity than traditional agricultural investments”, says Verry.

Farm Venture has more than 12 years of successful syndicated farm management, offering strong governance and disciplines to ensure best practice approaches to productivity, profitability and environmental performance.

Farm Venture is a signatory to the United Nations-backed Principles for Responsible Investing Initiative (PRI). The PRI is a network of international investors working together to put six Principles for Responsible Investment into practice.

NFFLP is a “feeder fund” for the New Zealand Pastoral Investments Limited Partnership (“NZPILP” or “the Fund”). NFFLP pools the capital commitment of investors and solely invests such capital into NZPILP which holds all the assets of the Fund, including the property, buildings, stock, and plant & machinery necessary to operate and conduct the farming businesses owned by the Fund.

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