A very interesting piece here from the Wall Street Journal on the rapid rise of private capital in African farmland investments.The article has some very interesting statistics:
"To meet growing global food demand the United Nation's Food and Agriculture Organization estimates an extra six million hectares need to be brought under cultivation every year for the next 30 years. With sub-Saharan Africa estimated to hold up to 60% of the world's remaining uncultivated land."
The article also references a private equity fund called Emergent Asset Management here in London that is purely dedicated to investing in African farmland. It sounds quite intriguing - until one sees the price tag which calls for a minimum investment of US$500,000 for individuals!
However, if you are intrigued by this type of investment in farmland, we are pleased to say that our unique farmland investment in Africa starts at only £5,850 (which is approximately 6,400 Euros and US$9,500). The investment recently paid a 16.2 pc dividend yield, and was awarded the "Alternative Investment of the Year" award from a prestigious UK property association. The key is that the price of farmland in Africa starts at such a low base that both high yield and tremendous upside in land values are possible. The target return is yearly dividend of 15 pc dividend yield, with a 7 pc yearly upside in capital value of the land (although in practice its been way more than just 7 pc so far). Like all farmland investments, this one is meant to be held for the medium to long term, although it can be sold at any time. The initial phase of the project is selling out quickly, but additional acres are being purchased by the project developers due to the high demand from retail investors whom are keen to add some diversification to their portfolios in these unsteady times. And, all of our projects, including this one, are SIPP eligible investments for UK citizens.