AN innovative and ambitious farm equity model hopes to boost regional and rural investment and link young aspiring farmers to those looking at easing out of agriculture. Cultivate Farms is the emerging result of two mates from Albury in southern NSW pondering how find a way to allow young farmers to access land and finance while providing a competitive return for investors.
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Sam Marwood and Tim Hicks have been promoting the concept heavily this year and are encouraged by the strong interest from young farmers and private investors.
Not surprisingly, interest from established older farmers has been more limited.
“That is the need for us now, to find people willing to consider an equity proposition and have a chat over a cuppa to see if it might be for them,” Mr Marwood said.
On the other side of the ledger, more than 60 young farm families had registered interest in the model and he had had several positive discussions with “high net worth individuals” who wanted to invest in agriculture but did not want to be “hands on” managers.
“We are targeting these private investors who want a connection with farming and want to see regional communities thrive.
Some love the idea of visiting and enjoying their farm while seeing a return on their investment,” he said.
“We want to be able to demonstrate that this can be as good an investment as the stock market.
We have a commercial vision as well as a community rejuvenation vision.”
Under the proposed model, the young farmer would be required to have some equity in any new enterprise but this could be flexible and relatively small depending on the total mix of investors.
He hoped the selling farmer would retain some equity in the business and provide a mentoring role to the new operator and “local knowledge” to the enterprise.
Cultivate Farms was using social media as a platform to promote the concept and was investigating crowd funding options, methods that Mr Marwood agreed could challenge some older farmers and investors more familiar with traditional sale and leasing forms of transition.
“This is new thinking for agriculture and these options are not well understood. We have to get people talking about them so they can be normalised,” he said.
Farm consultant, Jim Symon, McMichael and Associates, agrees that the sector needs to look at all available options to meet the wide range of farm family needs.
Mr Symon, who helps facilitate flexible farm transfer deals for clients, was “initially a bit skeptical” about the Cultivate Farms model but recognised new and innovative models were needed.
“Every family and farm business is different and this model will not suit everyone but it is already operating successfully in Europe.
There needs to be some examples up and running so we can see what is involved.
Once, we get a model working, it will get people talking about it,” he said.
Mr Symon will be one of a panel of 10 farm transition practitioners and related professionals who will help guide farmers, young and old, through the range of farm entry and exit options available at a community workshop in Cooma on August 12.
For more information on the farm transition workshop, contact: Ted O’Kane, DPI, Goulburn, 0427 781 514; or Nancy Spoljaric, Monaro Farming Systems, 0438 066 322.
