December 6, 2022

photo of Coldridge vineyard courtesy of Warakirri Asset Management

By Lynda Kiernan-Stone, Global AgInvesting Media

Under a new partnership with global wine company Australian Vintage Limited (AVG), Warakirri Asset Management (Warakirri), one of Australia’s leading ag investment managers and operators, announced the acquisition of two large-scale vineyards with a combined value of A$62.5 million (US$41.8 million) for the Warakirri Farmland Fund. 

Totaling more than 1,300 hectares (3,212 acres) and 3,700 megaliters of water, the transaction includes Coldridge in South Australia and Grande Junction in New South Wales, which, under the terms of the deal, will be both leased back through an initial ten-year agreement, with the parties working together on developments to maximize production and sustainability.

“Warakirri are known for their world-class capability within the agricultural sector,” said Craig Garvin, CEO, AVL Wines. “They have committed to further enhance and develop the vineyards thereby improving yield output and we are really pleased to be able to work with them on this opportunity.”

A Look Back 

It was back in April of this year when we saw that Warakirri was perhaps charting a new strategy when PSP Investment announced the consolidation of two of its majority-owned Australian broadacre cropping businesses, bringing together BFB and Daybreak Cropping to create one of the leading cereal growing operations in the country. At the time, Warakirri concurrently announced its exit from Daybreak Cropping – a joint venture investment fund established between PSP Investments and Warakirri Asset Management in 2016. 

Under the management of Warakirri, Daybreak acquired Erregulla Plains, an iconic farming property in Western Australia, for A$97 million (US$65 million) in February 2020. Most recently, in mid-March, Daybreak went on to acquire Yarrabee Park, a grain aggregation in New South Wales, from goFARM in a deal reported to exceed A$60 million. This deal marked the eighth acquisition for Daybreak Cropping, which expanded its overall portfolio to more than 85,000 hectares (210,040 acres) across eight aggregations in New South Wales, Queensland, Western Australia, and Victoria.

That same month Warakirri signaled a shift when it announced two foundational investments for its Warakirri Farmland Fund that align with a stone fruit category strategy with fresh fruit market leader and fund tenant partner, W.F. Montague Pty Limited.

Launched in April 2021  with Seed funding from one of Europe’s leading pension funds, the Warakirri Farmland Fund will buy, develop, and own a diversified portfolio of investment grade agricultural assets, including horticulture, viticulture, water entitlements, and selected row crop farmland assets, with the intention of leasing them to high-quality agricultural businesses as tenant partners.

And within weeks of those transactions, the firm announced that its Warakirri Diversified Agriculture Fund acquired the Chromy Estate Vineyard and Winery in the Tamar Valley, Tasmania’s oldest wine growing region known for its premium cool-climate wine. 

Standing in the Present

This latest deal for Coldridge and Grande Junction brings AVG, a new best-in-class tenant partner to the Warakirri Farmland Fund. As one of the largest producers in the country, AVG is an industry leader, crushing 7 percent of Australia’s total wine production, crafting high-quality wines from some of the country’s most iconic growing regions. These two holdings are operated by a highly experienced in-house management team and currently supply approximately 23,000 tons of grapes to the AVG winery each year. 

“We’re excited to add these two quality assets and another best-in-class Tenant Partner to the Warakirri Farmland Fund,” said Jim McKay, managing director, Warakirri Asset Management. “AVG’s commitment to quality grape and wine production, innovation, social responsibility and sustainability make them a great partner for our Fund’s clients.”

 Steve Jarrott, portfolio manager for the Warakirri Farmland Fund noted that the Australian wine industry carries with it strong fundamentals and good prospects for future growth, commenting, “With our strategy and investment philosophy, patient long-term perspective, and a high-quality partner like AVG, this land and water rich vineyard investment is a great way for the Fund to gain exposure to this sector.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

*The content put forth by Global AgInvesting News and its parent company HighQuest Partners is intended to be used and must be used for informational purposes only. All information or other material herein is not to be construed as legal, tax, investment, financial, or other advice. Global AgInvesting and HighQuest Partners are not a fiduciary in any manner, and the reader assumes the sole responsibility of evaluating the merits and risks associated with the use of any information or other content on this site.