Kilter Rural is seeking additional equity within its Australian Farmlands Fund as it continues to provide sophisticated and wholesale investors with the opportunity to secure investment in farmland and water markets while delivering environmental benefits.
The Australian Farmlands Fund is an impact investment in farmland, water and environmental assets, and offers a benefit of low correlation to traditional financial investments. Launched in March 2019 by Kilter Rural and Regal Funds Management, the fund has a capital raise target of A$300 million.
As at 31 March 2020 the fund has:
- A$33.3 million in assets under management, with a capital allocation of 40% to water entitlement purchases, 34% to land and development, and 26% for working capital and undeployed cash.
- Delivered a performance, annualised since inception (October 2018), of 3.2% to 31 March 2020.
- Five farms and more than 2500ML of water entitlements purchased with land regeneration underway.
The Phase 1 capital raise was fully funded in October 2018, with investments in farmland and water delivering a first crop of field tomatoes harvested in Autumn 2020.
For Phase 2, Kilter Rural has identified a A$100 million pipeline of landscape investments within the southern-Murray Darling Basin that includes excellent transport infrastructure and access to a well-educated workforce.
Kilter Rural, as one of Australia’s most experienced agricultural asset managers in irrigation farmland regeneration, water and production sustaining ecosystem protection, has a solid track record in the transformation of Australian farming landscapes and water markets to deliver investors long-term financial returns with positive environmental and social impact, as well as governance performance.
Two of its funds, the Australian Farmlands Fund and The Murray-Darling Basin Balanced Water Fund, have been certified by the Responsible Investment Association Australasia (RIAA).
RIAA is the largest and most active network of people and organisations engaged in responsible, ethical and impact investing across Australia and New Zealand.
For 15 years Kilter Rural has deployed and refined its investment strategy via a A$400 million mandate for a A$25 billion institutional investor. The strategy has outperformed in delivering financial returns with significant and measurable environmental and social benefits.
A triple threat of growing global population, climate change and finite natural assets is placing increased pressure on Earth’s scarce and finite natural assets, which in turn is driving demand for clean and green food and fibre products that are produced in an environmentally sustainable manner.
Agriculture through modification of natural landscapes over time has contributed to the escalating issue of global carbon emissions. Kilter Rural has tackled this challenge with proven experience regenerating irrigated farming landscapes to mitigate risks from climate events and the provision of a net carbon sink.
An investment in the Australian Farmlands Funds supports implementation of regenerative farming systems that deliver part of the solution to reducing long-term global carbon emissions.
Kilter Rural’s commitment to and leadership in the impact investment space has been recognised by the Australian investment industry with the award of Impact Asset Manager of the Year in November 2019.
As Kilter Rural seeks to expand investor participation in the fund, the trustee has issued an updated Information Memorandum dated 30 June 2020, which could be further amended from time to time.