Compass Meadowbank Investment Trust
Wholesale Investors Only

Compass Meadowbank Investment Trust

Compass Meadowbank Investment Trust
Compass Meadowbank Investment Trust
|
Last Updated 14.09.2023

This is an opportunity for wholesale investors to invest in an irrigated dairy aggregation of two substantial neighbouring properties in the tightly-held Derwent Valley of Tasmania (For Wholesale Investors Only)

Compass Meadowbank Investment Trust
Min. Investment
$500,000
Objective
Growth and Income
Structure
Managed Fund
Asset Class
Property (Listed/​Unlisted)
Liquidity
Unlisted liquid
Closing Date
29 August 2023
View More Details
Min. Investment
$500,000
Objective
Growth and Income
Structure
Managed Fund
Asset Class
Property (Listed/​Unlisted)
Liquidity
Unlisted liquid
Closing Date
29 August 2023
Industry
Farming, Animals & Conservation
Funding Stage
Unlisted Early-Stage Fund
Security Type
Unit in a trust
Target Capital
$6,000,000
Availability
Open for investment

Expected IRR
10 - 15% p.a
Expected Cash ROE
5 - 7% p.a
Intended Distributions
3% p.a. paid annually
Intended Term
7 - 10 Years

Compass Agribusiness Management Australia presents the opportunity for wholesale and sophisticated investors to invest in an irrigated dairy aggregation of two substantial neighbouring properties in the tightly held Derwent Valley of Tasmania.

 

Properties are underpinned by 2,681ML of 100% surety irrigation water sourced from the Derwent River. Tasmania, although only 1% of Australia's land mass, receives 13% of the country's rainfall. 70% of this is captured in the Derwent River.

 

The purchase of this existing dairy operation and grazing support block has been negotiated at a discounted entry price of 17% compared to neighbouring properties of a similar asset class.

 

With infrastructure upgrades and irrigation development planned in the initial 2 years, the expected year-on-year return on investment is 12-15% over the investment term and 3% intended distributions paid annually to investors after year 2.

 

This is an opportunity for wholesale investors to invest in an irrigated dairy aggregation of two substantial neighbouring properties in the tightly-held Derwent Valley of Tasmania.

 

Through our local knowledge and network, we have identified two properties for purchase at a discounted entry price of 17%, as compared to neighbouring properties of a similar asset class. 

 

With infrastructure upgrades and irrigation development planned in the initial 2 years, the target year-on-year return on investment for this opportunity is approximately 12-15% p.a. across the proposed life of the investment of 7 years.

 

Our Target Assets sit on the banks of the Derwent River, and this abundant water resource is where the water rights for the properties are drawn from.

 

Compass has been developing and managing dairy assets in the Derwent Valley since 2014, with a proven track record of positive return on investment, contribution to fostering ecosystems and providing opportunities for the local communities' growth.

 

At the end of the term of the Trust, we believe that these Target Assets, possibly combined with additional assets managed by Compass, will form an attractive, scaled dairy operation, allowing potential institutional investors to gain access to some of the most reliable water and productive farming land in Australia.

 

As of 3 July 2023, the Compass Meadowbank Investment Trust (CMIT) has settled the dairy block property of these target assets. The purchase of all livestock and sufficient plant and equipment to run the business was settled on the same date. We are now operational across the 511 highly irrigated hectares and are due to start milk production at the end of July. Negotiations are also underway confirming the details on irrigation development and various diversified seasonal cash crops to generate alternative revenue streams. The dairy block was settled for a total of $14.6m ($28k per hectare) as outlined in the IM. Given recent 30 June 2023 valuations, this shows a discount to comparable neighbouring Derwent Valley Compass managed assets ($34k per Hectare) of 17% and a discount to Compass managed assets in Northern Tasmania ($40k per Hectare) of 30%. 

 

We expect to see the CMIT land values increase significantly early in the fund as an outcome of the planned development across both properties in the first two years. 

 

We now begin our second capital raise to complete the purchase of the grazing block, with an expected close date of 29 August 2023. At present, the grazing block has been secured (311ha) under a lease-to-buy arrangement allowing access for operations. To secure the property and begin development, we have now started efforts to raise $6m from interested investors.

 

This is an exciting opportunity to access some of Australia’s most secure water and productive farming land assets. We look forward to speaking to interested parties.

 

Although Tasmania is only 1% of Australia's land mass, it contains approximately 12% of the country's freshwater resources. 70% of this is captured in the Derwent River, which is the water source for the Target Assets.

 

Water-Rich Assets

The Trust will acquire 2,681ML of annual water rights, inclusive with the purchase of the Target Assets.

 

Target Assets

The Trust is planning to initially acquire two Target Assets in the Derwent Valley of Southern Tasmania, with high-security water, high-value agricultural land, and potential capital appreciation through ongoing development.

 

Dairy Asset

This asset was settled on 3 July 2023. The Target Assets is a dairy property and a grazing property, as set out below. The dairy property consists of 511 ha, with to the Derwent River and Meadowbank headwaters.

 

Feature 

Description

Location 

Derwent Valley, Southern Region of Tasmania

Annual Rainfall 

508mm

Water 

Water rights for 2,131ML per annum

Water Source 

Meadowbank Dam, Derwent River

Total Area 

511ha

Total Milking Area 

385ha (Fully irrigated)

Irrigation 

Pivots & gun irrigation

Estimated Production (Yr1/Yr2) 

362,826 KgMS

Estimated Milking Herd (Yr1/Yr2) 

900 cows

Dairy

60-unit rotary, 16,500L

 

 

The Grazing Property

The grazing property is a beneficial support property to the large-scale dairy enterprise and includes 550ML water rights from the Meadowbank Dam.

Feature 

Description

Location

Derwent Valley, Southern Region of Tasmania

Annual Rainfall

508mm

Water 

Water rights for 550ML per annum

Water Source 

Meadowbank Dam, Derwent River

Total Area 

311ha

Total Irrigated Area 

100ha

Irrigation 

Pivot & flood system

Young stock (Yr1) 

500 heifers

Winter grazing (Yr1) 

600 cows

Risks

As with any equity investment, investing in the Trust gives rise to a number of general and specific risks for the Investors, many of which are outside the control of the Trustee and the Manager. If these risks eventuate, returns to Investors may not be as expected and distributions may be reduced or suspended, and the capital value of the Trust may be reduced.

 

The main risks for Investors investing in the Trust to include the following non-exhaustive list.

  • General investment risk
  • Regulatory risks
  • Trust-specific risks include but are not limited to Sector risks, Price risks, Key personnel risks, Borrowing risks, Leverage investments, Security risks, Agri asset investments, Liquidity risks, Performance risks, Performance fees, Reliance on the Manager, Water rights, Environmental risk, Stamp duty risk, Investors may suffer dilution, acquisition risk, and capital expenditure risk.

Offer: Relates to an offer to subscribe for units in an Australian unit trust called the Compass Meadowbank Investment Trust.

The Trust is not a registered managed investment scheme under the Corporations Act 2001 (Cth) (Corporations Act).

The minimum Investment Amount for the Units is $500,000, subject to the discretion of the Trustee. The Offer is available to wholesale clients within the meaning of the Corporations Act and therefore the issue of Units does not require disclosure in accordance with the Corporations Act.

Information Memorandum: The associated Information Memorandum for the Compass Meadowbank Investment Trust must be requested directly from the Manager prior to any application being submitted. It is the responsibility of the Investor(s) to review and ensure understanding of all detail contained in the Information Memorandum prior to making a decision whether to invest in the Trust.

Selling restrictions: This does not constitute a public offer or an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer.

No cooling-off rights: Cooling-off rights do not apply to the Offer of Units in the Trust. Accordingly, in most circumstances, you will not be entitled to a refund or withdrawal of an Application for Units once you have made an Application.

Not personal financial product or investment advice: This summary and the associated Information Memorandum has been prepared without taking account of your personal financial situation, objectives or needs. These documents contain general advice only and do not contain investment, legal, tax or immigration advice nor is it a recommendation or opinion on the merits of investing in the Trust.

Before you make a decision to subscribe for Units, you should read the Information Memorandum carefully and in its entirety and each section should be read and considered in the context of other sections and in particular, the risk factors of the investment. It is important that you undertake your own independent review of the Information Memorandum and read the information contained in the context of your own personal financial situation and objectives and needs. You should seek professional advice from experienced financial advisers, accountants, tax professionals and lawyers as you require.

Taxation: The taxation position described in the associated Information Memorandum is to be used as a guide only. It does not constitute tax advice and is based on the Trustee's understanding of current tax laws and their interpretation. Your individual situation may differ, and you should seek independent professional tax advice on any taxation matters.

Financial information: Any historical or prospective financial information provided has been prepared by the Manager based on unaudited management and financial year-end accounts. The historical and prospective financial information is given for illustrative purposes only and is not a representation of the future performance of the Trust.

Currency: Unless otherwise stated, all financial amounts are expressed in Australian currency.

Illiquid investment: An investment in the Trust will be illiquid and will not mature for seven or more years.

No guarantee of repayment of capital or investment performance: Investments in the Trust are not deposits with or other liabilities of the Trustee, its associates or any other person and are subject to investment risk, including loss of capital invested, negative returns and delays in repayment.

No warranty: Although this information has been prepared with reasonable care, to the maximum extent permitted by law, neither the Trustee, the Manager, nor any of their respective associates, related bodies corporate, officers, employees, agents, advisers or representatives make any representation or warranty, express or implied, as to the accuracy, reliability or completeness of this summary, the Information Memorandum or subsequently provided to Investors.

Accuracy and updates: The information provided has been prepared as at the date of this listing. No representation or warranty is made that there has been no change to the information or in the affairs or financial condition of the Trust since the date of this listing.

Discretion to accept: The Trustee reserves the right to withdraw, or to extend, the Offer at any time, to reject any Application for any Units in whole or in part and to issue to any Investor less than the full amount of Units sought by such Investor.

Photographs: Photographs used should not be interpreted to mean that the assets shown in them are owned by the Trust.

Compass Agribusiness Management Australia, established in 2013, has more than 20 years’ experience in the agribusiness and financial sectors of Australia and New Zealand. The Manager has a proven track record in managing the performance of large-scale farming operations, delivering both production and financial returns.

 

Nine years ago, the Manager identified Tasmania as having valuable water and land assets, with unrealised production and growth potential. The Manager has been one of the largest investors in dairy and dairy capable assets in Tasmania since that time, and been recognised as Employer of the Year (2017) and Tasmanian Dairy Business of the Year (2023).

 

The Manager's team comprises experienced agribusiness specialists, accountants, HR and business professionals, with team members based in Launceston, Hobart and Melbourne.

 

Raised on a family farm in South Otago, New Zealand, and a graduate of Lincoln University, Canterbury, Nigel spent several years running his own farm in Canterbury before heading overseas and working in a range of roles across the agricultural industry. 

 

He returned to New Zealand to work in the rural banking sector, first based in Canterbury, then moving to Melbourne with Australasian bank ANZ. Since establishing himself and his family in Australia 15 years ago, Nigel Pannett has built an extensive network across Austral-Asia and has experience across agricultural finance, establishing farming partnerships for farmers and investors, and agri consulting with particular success in succession planning, expansion and sustainable agricultural practices.

 

Outside the office, Nigel keeps fit with a range of outdoor pursuits including mountain biking, golfing, exercising and spending time with his family.

 

Heidi brings with her 15+ years’ experience in hospitality and guest services in various roles across the ski industry in Colorado, USA and the hotel industry in Melbourne, Australia. She has extensive experience in employee relations and administrative support with a strong focus on service and professionalism.  Heidi holds a Bachelors’ Degree in Psychology and Kinesiology from the University of Colorado, USA, and a Diploma of Human Resource Management. Heidi provides EA support to our Australian Managing Director and office management to our Australian office.

 

Outside the office, Heidi spends her time supporting her kid’s activities and clubs. She is a passionate skier and enjoys all kinds of exercise.– from Pilates to kayaking and mountain biking.

 

With more than 27 years working in the dairy industries in New Zealand and Australia, Ryan is responsible for overseeing all Compass’ managed farms in Tasmania as well as growth and management of the grazing offering across the state.  He brings with him over 27 years of dairy industry experience gained both in New Zealand and Australia. Ryan’s strong industry experience and knowledge is a great asset to the Compass team

 

Ryan’s interests outside of work continue to be outdoor based, with a love of trekking, hunting and camping with this family and friends.

 

Dave joined the Compass team in 2020, bringing with him strong knowledge and skills to support our clients with their management accounting needs, as well as farming business finance advisory services. Dave comes from a 6th generation dairy farming family in Victoria, Australia and puts his Bachelor’s degrees of Business and Agriculture to use to assist our clients in improving their business performance. Dave’s natural ability to form an immediate personal connection with clients forms a strong base of trust to build a long-term partnership.

 

Outside of work, Dave enjoys the outdoors whether it is travelling, enjoying the beach, on the snow or on-farm. He is still actively involved in his own farm in country Victoria.

 

With a Bachelor of Accounting and a diploma in Chartered Accounting, Michael joined Compass in May 2021 after spending 4 years with a Brisbane based accounting firm. His desire to make an impact through direct contact with farmers / farm managers sets the stage for him to help Compass grow in alignment with our long-term vision of leading sustainable agriculture. Having grown up on a cattle property in Queensland, that is still owned and operated by his family, Michael well and truly is connected to the Australian agricultural industry.

 

In his free time, Michael is a true explorer taking in all the sights and experiences Victoria has to offer, from live music in Melbourne to trips to the incredible regional towns across the state.

 

Abbie has a rich history and extensive experience in HR Management in industries ranging from Fisheries to Employment & Disability Services. Joining our team in 2022, Abbie’s dedication to working hands on with our farm teams and helping the team members reach their full potential is the daily display of our commitment to our people and communities.

 

In her spare time, Abbie coaches a local women’s rowing club in Hobart, and she enjoys watching sport with family and friends.

13 July 2023 Full IM available upon request.
Download PDF

This section has intentionally been left blank

  • By selecting “Receive Info” when viewing the card relating to the listing

 

Or

 

  • By clicking the enquire button on the card view

 

We will respond using your preferred communication method (i.e. email or phone).

Want More Information?

Phone
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
By submitting this form, you agree to our Terms and Conditions

Statutory Statement

This offer of scheme interests is available to wholesale clients only. This product listing was vetted by and approved by the product issuer identified above before publishing. Investment Markets (Aust) Pty Ltd AFSL 527875 (IM) is not the issuer of the product.

General Disclaimer

IMPORTANT STATEMENT ABOUT YOUR USE OF THIS SITE

Information on this site is intended for Australian users only.

This site is operated by Investment Markets (Aust) Pty Ltd. (ACN 634 057 248) (IMA, we, us and our), the holder of Australian Financial Services Licence (AFSL) no. 527875. The content is provided solely for information purposes, is not a recommendation or an offer to buy or sell a security, and is not warranted to be correct, complete or accurate. To the extent permitted by law, neither IMA, its affiliates, nor the content providers (such as the issuers of securities who appear on the site) are responsible for any investment decisions, damages or losses resulting from, or related to, the content, data and analyses or their use. The investment products on this site and any statements made about them by their issuers are not vetted, verified or researched by IMA. The presence of an investment product on this site should not be interpreted as an implied endorsement of it by IMA. Certain content provided may constitute a summary or extract of another document such as a Product Disclosure Statement. To the extent any content is general advice, it has been prepared by IMA. Any general advice has been provided without reference to your investment objectives, financial situations or needs. For more information refer to our Financial Services Guide. To obtain advice tailored to your situation, contact a financial advisor. You should consider the advice in light of these matters and, if applicable, the relevant Product Disclosure Statement (or other offer document) before making any decision to invest. Past performance does not necessarily indicate an investment product’s future performance. The content is current as at date of initial publication and may not be current as at your date of viewing. For a more complete understanding of all the terms and conditions of your use of this site click here.

Subscribe to our newsletter

Elevate your investment game with our exclusive weekly newsletter, curated for astute investors like you. Dive into deep market insights and uncover a purposely broad range of unfiltered opportunities. Join a community that thrives on informed choices. Don't just follow the market—lead it.