NB-napier-blakeley-Property-Review-Banner-728x

SECTION: RURAL & AGRIBUSINESS

Rural & Agribusiness

Rural Funds taps market for $78m

RURAL Funds Group (RFF) has announced a $78.6 million equity raising, which it will use to reduce gearing and facilitate a pending cattle station acquisition.

The equity raising will comprise a fully underwritten two for nine non-renounceable entitlement offer with a fixed issue price of $1.70 per unit.

The group intends to initially reduce its gearing from 42.7% to 29.5% after debt-funded acquisition of two assets over the summer totalling $60.5 million.

In December it purchased the 4,880-hectare Lynora Downs cotton site in central Queensland for $26.5 million, which the group’s manager Rural Funds Management Limited (RFM) will lease and operate in a joint venture with Queensland Cotton Corporation Pty Ltd.

Shortly afterwards the group acquire 9,549ML of Murrumbidgee River high security water entitlements for around $34 million.

The group’s target gearing range is 35%, plus or minus 5%.

It said the reduction in gearing would create balance sheet capacity to further build RFF’s portfolio of agricultural assets.

“RFM is currently undertaking due diligence on an asset within the Australian cattle sector. The asset is similar in functionality to RFF’s other cattle assets, in that it provides the potential third party lessee, with an integrated breeding and backgrounding operation.

“One of the features of natural resource assets is the higher level of capital growth they can achieve when compared to infrastructure assets which tend to deliver higher levels of income but depreciate over time,” RFF said.

The fixed issue price represents a forecast AFFO yield of 7.4% for the 2018 financial year, and distribution yield of 5.9%.

RFF’s AFFO and DPU forecast for the 2017 financial year are unchanged, at 12.42c and 9.64c respectively.

Australian Property Journal

Read more

Grape farm ripe for investment

AN irrigated grape and citrus farm in Queensland’s St George is on the market. CBRE’s Thomas Warriner and Chris Holgar have been appointed to market....

Wilga Downs sells at auction

THE weaner production and fattening enterprise Wilga Downs near Emerald in central Queensland has sold at auction for $3.75 million. The 4,133....

Blue Sky buys NSW station

BLUE Sky has acquired the Hayloch & Katika station in the Murrumbidgee Irrigation District in New South Wales for $6.1 million. According to Beef....

Mittagong mortgagee sale

A 50-hectare parcel of mostly-cleared land in the Southern Highlands of New South Wales has sold for $1.775 million at a mortgagee’s auction. The 41....

AACo beefs up earnings

THE Australian Agricultural Company has posted a meaty 202% increase of operating EBITDA over the past 12 months. The period saw the continued....

Bonny Rigg rural property sold

BREEDING aggregation Bonny Rigg in New South Wales’ North West Slopes region has sold for $8.5 million. The 3,500-hectare station and is also suited....

Usher Pastoral takes the lead

THE Usher Pastoral Company has added to its south-west Queensland landholdings with the acquisition of the Mount Margaret and Kihee stations for....

Sheep and cattle property sold

THE Mount Kew and Box Valley sheep and cattle station in western New South Wales has sold to a local pastoralist for $4.5 million. The 49,095-hectare....