LATEST activity in the Queensland property market includes an investment in Central Qld from The Rohatyn Group, and local sales of Burumbah in the Toobeah district and three Border River water allocations.

TRG investment

Based in New York, The Rohatyn Group is a joint venture involving a global institutional investor, and it has paid $39 million for the partial sale and leaseback of two CQ cropping properties owned by Rural Funds Management.

The 10-year deal includes a 50-percent stake in the 2942ha Mayneland and the 4130ha Baamba Plains.

RFM’s largest fund under management, the Rural Funds Group (RFF), said the sale provides several benefits including a reduction in exposure to operating earnings, a confirmation of asset values and capital for debt reduction.

Settlement is expected early next year following Foreign Investment Review Board approval.

The sale-and-leaseback agreement between Rural Funds Management and the Rohatyn Group is not new territory for the groups.

In September 2022, RFM entered into a 40-year agreement with The Rohatyn Group to lease up to 3000ha of macadamia orchards in Maryborough, Bundaberg and Rockhampton.

In November 2021, RFM spent close to $70M on The Rohatyn Group’s 28,000ha Kaiuroo Aggregation, including 12,448ML of water entitlements, in CQ’s highly regarded Mackenzie River district.

At the time, RFM negotiated an extended two-year settlement period to allow it to undertake productivity developments to position the property for leasing in the future.

The 2942ha Mayneland is located 10km north-west of Rolleston in Queensland’s Central Highlands region.

According to the RFM website, cotton is the main crop produced at Mayneland, together with rotation crops including sorghum, wheat, mungbeans, and chickpeas.

During RFM’s ownership, it has added 4940ML of efficient long-term water storage to maximise the use of water allocations and water from significant rain events, as well as upgrading river pumps.

Irrigation improvements include the upgrading of three, and the installation of seven, centre pivot irrigation systems.

Acquired in 2018, Mayneland was the second cropping property added to the RFM portfolio after the 4963ha Lynora Downs, which the fund paid $25M for in 2016.

Lynora Downs is also located near Rolleston, and the current owner has improved its productivity by increasing water storage capacity to over 14,000ML, and installing five 80ha centre pivot irrigation systems.

In 2021, RFM added a third cropping property to its portfolio by paying $32M for the Springsure district’s 4130ha Baamba Plains, including 20,733ML of water entitlements.

Burumbah

Alister and Jo Persse’s Western Downs grazing enterprise with mixed-farming capabilities has made in excess of $6M after selling to the Frith family from St George for expansion.

The 2289ha Burumbah is 40km north-east of Toobeah and 53km from Goondiwindi, in south-west Qld’s Goodar district.

Burumbah is suited to sheep grazing, lamb fattening, and cattle trading, and has the ability to grow both winter and summer forage and cash crops as security.

It was offered to the market as a thoughtfully developed property with sound improvements and excellent sheep-handling facilities, supported by a secure stock-watering network that consists of piped water servicing all paddocks.

During the sale campaign, the fully exclusion-fenced property was carrying a big body of feed supporting around 4000 ewes and lambs.

The productive soil types, mostly heavier grey belah and brigalow, are conducive to growing winter or summer cash and forage crops.

Burumbah is watered by 15 dams.

Improvements include a four-bedroom home, workers’ accommodation, sheds, a five-stand shearing shed and sheep and timber yards.

Nutrien Harcourts agent Andrew Jakins handled the sale.

Border Rivers water allocations

A local irrigator seeking more water security has paid more than $11.7M for three unsupplemented Border Rivers irrigation allocations totalling 2058ML.

The three 686ML nominal volume assets – each offered with an annual 1715ML volumetric limit – are located within Qld’s Macintyre Zone, and were being sold on a permanent-transfer basis.

The first allocation sold under the hammer for $5700/ML, with the undisclosed buyer taking the option to secure the remaining two assets.

JLL Agribusiness director Clayton Smith said there were multiple buyers at the auction, with bidding starting at $4000/ML.

“The end result, which was at the top end of our expectations, indicates a healthy and strong water market in that valley.”

The three allocations are currently operating under the Queensland Border Rivers continuous accounting system for ease of seasonal and permanent transfers.

Mr Smith said this means they can be easily traded within the zone they sit.

“The holder can also apply to the state government to trade up or down the river, including a provision for cross-border sharing on to the NSW side.”

Mr Smith said the flexibility accommodates temporary/assignment basis on individual flow events, or more permanent seasonal assignments.

“The allocations are also offered with healthy availability in multi-year accounts which can benefit from up to five years’ accrual in lieu of seasonal and river-flow fluctuations.”

JLL’s Chris Holgar described the assets as an opportunity to accumulate more water and ensure higher reliability for their existing enterprises.

“Allocations for irrigation water are becoming a much more attractive asset due to their finite nature,” Mr Holgar said.

“They sit in a secure, well-structured and defined regulative system in a mature market and as a result, are emerging as an investment class in their own right.”

Whenever water licences become available, there is strong interest and even more so now the Federal Government is committed to a targeted buyback of 44.3 gigalitres of water per annum in the Murray-Darling Basin.

This commitment, viewed as controversial by some, is aimed at securing water for the environment and is budgeted for the next 10 years.

Grain Central: Get our free news straight to your inbox – Click here