The U.S. sovereign wealth fund, New Mexico State Investment Council has made its first major allocation to the agricultural investment sector, committing $200 million to TIAA-CREF’s Global Agriculture II fund.
Deputy State Investment Officer, Vince Smith, states that an appealing aspect of Global Agriculture II was it offers global diversification through its investments in the U.S., Australia, and Brazil.
The 21-year life, Global Agriculture II is targeting a corpus of $2.5 billion, with an expected net internal rate of return (IRR) of between 8% and 12%. The portfolio will be made of purchased farmland and land used for agricultural purposes, which will then be leased back to operators, with 70% of the portfolio comprised of row cropland and 30% permanent crops.
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