Alternative asset manager, Aquila Capital, with nearly $10 billion in assets is shifting its investment drive away from New Zealand to Australia in response to the ‘incredibly high’ prices of New Zealand dairy farms. Through the shift, Aquila will be keeping dairy as its main area of investment based on strong support of the market from growing Asian demand. Although the Germany-based group has directed the $500 million it has raised since 2007 to New Zealand, it has stated that it will direct up to $400 million of proceeds from a fresh capital raise to Australia. New Zealand farm prices were worth a 20% premium to comparable land in Australia because of a lack of stamp duty and lack of a capital gains tax, however currently, land prices in New Zealand are double those in Australia. The group will be primarily interested in investing in dairy properties in the south east of Australia in Tasmania and Victoria, and cited the additional benefit of investing in a stable country that is also a major grain producer which should alleviate feed supply and cost pressures.
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