Primewest launches $100m agricultural trust

ASX-listed fund manager Primewest is building a portfolio of agricultural assets, launching a $100 million syndicate and announcing the acquisition of a property leased to Australia’s biggest fruit and vegetable processing group.

Earlier this year, Business News reported on Primewest’s ambitions to diversify its asset base into agriculture, with the syndicator in February doing due diligence on two assets.

Primewest announced today it had paid $4.8 million for a 425 hectare property in New South Wales’ southern riverina region, via its Primewest Agricultural Trust No 1.

The property, known as Pinegatta, is leased to Kagome Corporation, a Japan-headquartered fruit and veg processor with a market capitalisation of more than $2 billion.

Primewest director David Schwartz said the property was a high-quality investment grade asset that was positioned to benefit from an expected uplift in the agricultural sector.

“Kagome has invested around $700,000 on capital improvements to the property  in the last 12 months, and it also features $1 million worth of central irrigation pivots that span 259 hectares of land.

“It provides a net passing income of $300,000 per annum, and we expect investors will receive a total return on investment of 8 per cent per annum.”

Mr Schwartz said Primewest intended on acquiring a range of properties in the new trust, totalling $100 million.