by Lynda Kiernan

New Zealand investment firm MyFarm has launched Kakariki Fund Limited, an investment vehicle that is looking to raise $100 million (US$66 million) to invest in long-established, high-value permanent crops including kiwifruit, apples, sweet cherries, avocados, aroma hops, and plantation Manuka.

MyFarm Investments realized that although New Zealand farmland was a desirable investment asset able of generating healthy long-term returns, the barriers to investing in it were a challenge. Today, the firm is a specialist provider of premium, rural land-based investments that has raised $165 million (US$109.3 million) to-date, investing  in 18 individual orchards, vineyards, hop gardens, and Manuka plantation businesses since 2015.

Each orchard, vineyard, plantation, and farm in Kakariki Fund Limited is to be professionally co-managed by leading horticultural processors and exporters, such as apple growers Rockit Global and Freshmax; Sacred Hill wines; craft beer hop grower Hop Revolution; Manuka honey producer Comvita; and kiwifruit grower and packer DMS Progrowers.

Under this structure, Kakariki is targeting 10 percent or higher annual returns, generated from the sale of crops through its partnerships and increases in land value. And adhering to its investment ethos that embraces Kaitiakitanga, a traditional belief that respect and stewardship of the land and its people is critical to the future of New Zealand, the fund is aiming to achieve net zero carbon emissions by 2024. 

Eventual plans including listing on the NZC within three-to-five years, however, initially, the fund will be available to wholesale investors, fund managers, iwi groups, and eligible individual professional investors. Minimum investment is set at NZ$100,000 (US$66,300), and the fund’s initial call of 25 cents per $1 invested will give investors access to:

~ An 11 canopy-hectare SunGold kiwifruit orchards in Bay of Plenty

~ A 50 percent stake in a large-scale 130 canopy-hectare hop garden

~ 35 canopy-hectares of Rockit apples

~ A 2000-hectare Manuka plantation development

“There is really no other single investment that gives New Zealanders access to a diverse range of permanent crop businesses, or exposure to the intellectual property our partners have invested in their plant varieties and brand stories,” said Andrew Watters, CEO, MyFarm.

Rockit apples, produced by Rockit Global, are sweet, miniature, and nutritious apples packaged in recyclable tubes. Currently grown in six European countries and the U.S, demand for the apple continues to outstrip supply, and Rockit Global is planning to expand its orchards in Hawkes Bay from 200 hectares to 600 hectares by 2025. 

“MyFarm brings to the table a long-history of agriculture and horticulture management as well as a solid understanding of our customers’ quality requirements,” said Austin Mortimer, CEO, Rockit Global. “They are therefore an ideal partner to help us grow the New Zealand supply of Rockit Apples. We are looking forward to working with the Kakariki Fund, Andrew and the team.”

Jason Judkins, CEO of Hop Revolution, noted how New Zealand hops are in high international demand for the distinctive characteristics they impart to beer. 

“New Zealand hops are highly regarded but have been difficult to source by offshore brewers,” said Judkins. “The growing climate in Nelson and the iconic varieties we offer represent an exciting proposition to brewers, which are constantly looking for new tastes and flavours.”

In partnership with MyFarm, Hop Revolution is plating 116 hectares at its Tapawera Hop Garden, and has invested in new harvesting equipment and kilns in anticipation of its first harvest in 2020. 

“We are delighted MyFarm is bringing Kakariki to market as it has the potential to accelerate our growth in the U.S., Europe and Asia,” said Judkins. “As well as capital MyFarm offers Hop Revolution a deep understanding of agricultural economics and an ability to tap into a broad range of experts to help us make the most of the significant opportunity we see.”

 

– Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.com.