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Agriculture: A New Asset Class Presents Opportunities for Institutional Investors

June 13, 2016

A new white paper written by HighQuest Consulting Managing Director, Philippe de Lapérouse, defines the long-term fundamentals for investment in farmland, describes the opportunities for global investment and explains the makings of a farmland portfolio. 

Over the last decade, there has been an increase in interest amongst institutional investors to invest in food and agriculture via a number of different vehicles, including alternative real asset funds, private equity and venture capital. While expectations of a global food crisis have moved off the front pages for the time being, given the softening of crop prices over the past two years, interest in the sector remains strong due to a number of key attributes which this sector provides investors, including:

  strong long-term fundamentals based on secular trends (climate change, increased urbanization and rising GDP in emerging markets);

  attractive historical returns (based on a mix of current income and capital appreciation);

  uncorrelated returns with other financial instruments;

  a strong inflation hedge;

  capital preservation.

While institutional investors have increasingly been making allocations to ag venture capital and private equity, to date the major focus of their allocations to the ag sector has been real assets. Similar to large family offices, specialist hedge funds, pure-play public companies and sovereign wealth funds, they have been investing in funds acquiring farmland in North and South America, Australia and certain markets in Eastern Europe, as well as investing in projects managing long-term leaseholds in Eastern Europe and Sub-Saharan Africa. Investment strategies range from conservative (e.g., currently productive permanent cropland in the U.S.) to aggressive (e.g., developing raw land in emerging agricultural regions for crop production, as well as investing in ag tech ventures).

Download the full white paper here: Agriculture: A New Asset Class Presents Opportunities for Institutional Investors

この無料レポートでは、日本で利用可能です. 農業: 機関投資家へ機会を提供する新しい投資対象

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