New Zealand's leading primary sector syndication company MyFarm has this week launched a new Hawke's Bay-based Rockit™ apple syndicate, offering the potential of cash returns rising to 20% pa when the orchards reach maturity.
The opportunity comes amid a surge of investment into the primary sector as kiwis seek exposure to the backbone of the New Zealand economy, the prospect of regular and attractive cash returns and tangible local stories Since April 2020 MyFarm has raised $102m of investor equity, double the average annual investor equity it raised between 2016 and 2018.
The Heretaunga Orchards Limited Partnership will develop one freehold orchard of 11.5 canopy hectares in the Twyford area North of Hastings and another leased block of 9 cha at Pukehamoamoa, southwest of Napier.
The freehold orchard is in the traditional heart of New Zealand's premier apple growing area and next to the Delegats Winery on State Highway 2. It is expected to be planted in 2021, while the leased orchard was established in 2020 for an initial term of 18 years commencing in 2019, with the option to extend for two periods of five years each.
Both orchards will grow Rockit™ apples, which are a rosy red, small and sweet snack apple sold in branded tubular packaging in 28 countries world-wide. Rockit Global Limited (RGL), which owns the Rockit™ intellectual property, will develop the orchards and provide orchard management, post-harvest and export services.
MyFarm is seeking $9.3 million for the syndicate with the offer to wholesale investors of 930 units priced at $10,000 apiece. The minimum investment in the syndicate is $50,000. MyFarm expects the syndicate to start generating cash returns in the 2024 financial year onwards. These are forecast to start at 2% p.a. on contributed capital and building through to 20% p.a. once the orchards are delivering mature production.
The staged nature of the development means funds will be called in at least three tranches over a three-year period. The initial investor fund call is 20% on application, 55% on 1st March 2021 and the remainder (25%) over the following two years.
MyFarm Chief Executive Andrew Watters said: "Primary sector investments have proved resilient in the face of many Covid-19 related challenges over the past year. Meanwhile, the Heretaunga Partnership offers wholesale investors a rare opportunity to share in the international success of Rockit™, a true New Zealand-bred value-add strategy.
"At MyFarm we offer a range of investment opportunities that allows investors to take a portfolio approach to investing in the primary sectors. The Heretaunga Partnership offers tax write-offs in early years and expected strong cash returns when the apples trees are at full production. This can fit well as part of an investor's portfolio to boost average cash returns when many other asset classes are now in the low single digits".
For more information:
MyFarm Head of Sales
Tel: 029 445 5871
MyFarm is a specialist in New Zealand primary sector investment. It enables eligible investors to invest in hard-to-access primary industries. Since we established in 1990, our investment focus has evolved from the purchase and syndication of handpicked dairy farms to a broader range of opportunities in the horticultural sector.
Today, MyFarm targets double-digit annual returns from investments in meticulously chosen businesses and land-based horticultural assets including vineyards, apples, avocados, kiwifruit, hops, cherries, forestry, manuka honey and rural commercial property. These are a combination of longer-term development opportunities and investments in established assets offering immediate cash returns.
From daily operations to end of season harvest and export, MyFarm ensures every asset is professionally managed on the ground through partnerships with some of New Zealand's most successful horticultural managers and post-harvest operators.
On the web: www.myfarm.co.nz/about-us