Proterra Investment Partners managing director Becs Willson. Picture: Supplied
Podcast: Becs Wilson on the impact of rising interest rates on Aussie farmland
Proterra Investment Partners’ Becs Wilson joins The Australian Ag Podcast to talk rising interest rates, $350m sales and who will own Aussie land.
A looming rise in interest rates won’t cause a “train smash” for an Australian agriculture sector currently riding a wave of record capital, one of the nation’s biggest farmland investors says.
Becs Willson, the managing director of US private equity firm Proterra Investment Partners, which owns significant farming assets in Queensland, NSW, Victoria and South Australia, said while there could be “a reckoning in asset prices” if interest rates rose as expected, any impact on the billion-dollar agriculture industry would likely be buffered by strong global demand for Australian farm commodities.
Australia’s Reserve Bank last week kept the nation’s cash rate at a record low 0.1 per cent but dumped its yield curve control stimulus measures, sending a signal to the market that rates might rise earlier than expected.
“There won’t be a train smash in the agriculture market by any means,” Ms Willson told The Australian Ag Podcast. “The global underpinning demand (for food) is there and will continue to be there for the next spurt of population growth.
“I don’t see it waning anytime soon.”
Prices for rural property have soared this year due to a perfect storm of low interest rates, strong farmgate returns and improved seasonal conditions.
Proterra has significant farmland investments in Queensland, NSW, Victoria and South Australia. Its assets include the 22,500-hectare Corinella Group of properties in western Victoria and South Australia’s South East which was listed for sale in August with expectations of more than $350 million.
The Corinella portfolio – encompassing 50 farms – is understood to be one of the biggest-ever offerings of prime farmland in Australia.
Ms Willson told the podcast the sale had attracted significant demand and expected at least parts of the portfolio to end up back in Australian farming family hands.
“We’ve had interest from local family farmers over the fence, from syndicates of growers that have come in to bid on a number of assets together, as well as institutional interest domestically and quite a bit from offshore,” she said.
“When it all washes up you will see that locals have been in the prime seat to take some of these assets out. It has certainly not just been a matter of us saying ‘Well, sell to the corporate because it is one transaction’.
“We have been happy to do the hard work and really divide up the portfolio in the best value for our investors.”