Property

Weekly property review: Water availability and security drives Qld coastal land purchases

Property editor Linda Rowley, November 6, 2019

The Dray Family Farming Aggregation, an 8825ha property in one of Central Queensland’s highly productive water-secure areas is attracting nationwide interest.

SOME cattle producers are buying up traditional sugarcane-growing country along the high rainfall Queensland coast to provide feed for their livestock.

Properties boasting secure water and cropping or forage growing potential have been attracting strong interest from large private operators, corporate farmers and investment funds.

Inquiry is coming from all states, but particularly from the Gulf in north western Queensland and eastern Northern Territory, western Queensland, the Darling Downs, and Victoria.

Robert Murolo is the North Queensland rural property sales specialist at Elders. For the first time in 20 years, he has noticed cattle producers are purchasing blocks to grow their own feed.

“Three years ago, I sold a cane block in the Proserpine area to some Innisfail farmers who ripped out the cane and grew a commercial crop of corn and maize for fodder,” he said.

Mr Murolo believes more producers will follow suit and convert cane land into improved pastures, especially if cattle prices stay high.

“There’s another cane farm between Proserpine and Airlie Beach that has also stopped growing cane and is growing grass for feed. That farm is bailing consistently to send fodder out west.”

Mr Murolo said water is a critical issue for farmland investors.

“While scale is important, water availability and security are key. They allow cattle producers to expand, provide some drought security for their business and grow their own feed instead of buying it.”

However, Mr Murolo said while well-watered properties were keenly sought-after, buyers did not want to pay a premium.

“Buyers will only buy market value. They do their homework and compare prices,” he said.

Well-watered Proserpine country in high demand

Faust Family Aggregation

In April, Mr Murolo sold the 3134ha Faust Family Aggregation to the Vella Family from Bald Hills Station, Marlborough, for an undisclosed sum.

The substantial sugar cane and beef production asset is the largest holding in the Proserpine region, in the heart of Queensland’s Whitsundays.

Boasting high quality pastures, it can carry 500 breeders plus followers and has a sizeable 3119ML water rights portfolio.

Part of the cane farming infrastructure on the Faust family aggregation near Proserpine

Dray Family Aggregation

Mr Murolo is also involved in negotiations with interested parties for a large-scale property in one of Central Queensland’s highly productive water-secure areas.

The Dray Family Farming Aggregation, pictured at top of page, offers substantial beef production and sugar cane. The 8825 hectares comprises 1248ha of arable land, producing sugar cane and suitable for alternative high value horticulture, and a further 500ha of grazing land.

Boasting 4488 ML of water licenses plus six unregulated irrigation bores, the property features extensive underground irrigation and storage infrastructure, with the high levels of water security being enhanced by water harvesting (overland flows), drainage and reuse infrastructure.

When the marketing campaign was launched, Tom Russo, Elders national general manager real estate, said the substantial water portfolio was attracting nationwide interest.

“Water security has become a critical issue for investors, such as large private operators, corporate farmers and investment funds. When you consider that Proserpine receives 1400mm of annual rainfall, the Faust dam is currently 80 percent of capacity with over 10,000ML of irrigation water remaining unallocated, this is an extremely attractive proposition.”

Yarraman

Last week, Mr Murolo listed a further 2772 hectares in the Proserpine district featuring excellent water security and high rainfall.

Yarraman Park sits on the Goorganga Plains wetlands and despite growing sugar cane for many years, offers some of the most productive coastal breeding, fattening, and cultivation capabilities in the Whitsunday region.

Boasting 3000ML of water storage, five unmetered bores and extensive water distribution infrastructure, with further development potential, the property is being sold through an offers to purchase process.

Passed-in

But not all properties with water security have sold.

Last month, Central Queensland’s highly productive and versatile Lancewood was passed in at auction for $5.5 million and is now being offered for sale.

The 1545ha mixed grazing and irrigation aggregation is located in a tightly held area on the Burdekin River, 115km from Townsville and 40km north of Charters Towers.

Its wide frontage to the Burdekin River provides permanent natural supplies for stock, irrigation and water harvesting purposes.

It also has two water licenses totalling 2000ML, nine dams and a 200ML water storage area.

The carrying capacity under its current operation is 600 head, but those numbers could be lifted if the property was adapted to high intensity grazing.

Selling agent David Woodhouse from Landmark Harcourts Mareeba is negotiating with several parties and the property is expected to settle in the coming weeks.

Mr Woodhouse said established producers are showing more interest in high rainfall properties, or those with a secure water supply by way of irrigation.

“There is genuine interest in location and water security than ever before. Producers are changing their business models to mitigate their drought risk by diversifying and growing fodder.”

Mr Woodhouse said the real movement in the market was for better quality properties.

“It still difficult to sell second or third-tier properties even though they may have secure water. First and foremost, producers consider the production capacity of a property,” he said.

“Productive irrigatable country on a medium to large scale is the most sought-after and inquiry is coming from locals and from drought-stricken producers in southern Queensland and northern New South Wales. Smaller to medium blocks are generating interest from Rockhampton to Charters Towers to Mt Isa and western Queensland,” Mr Woodhouse said.

Water security is the key selling point for North Queensland’s highly productive and versatile Lancewood Station.

In July, Gary Johns from Landmark Harcourts Mackay sold the blue-ribbon Queensland coastal cattle property Exmoor Station to an Australian company with aquaculture interests for between $25 and $30 million WIWO.

Spanning 7012 hectares, it is located on Queensland’s Whitsundays at Bloomsbury, 40 minutes south of Airlie Beach.

Exmoor featured more than 30 percent improved pastures, with the remainder mixed improved and native pastures as well as rangeland and saltpan areas.

The property boasts 14km of beach coastline with tidal creeks entering the property. The water supply is described as reliable with double frontage to the Hervey, Dempster, Rebus and Cedar Creeks, supplemented by 18 open earth dams.

Bue-ribbon Central Queensland coastal cattle property Exmoor Station, which boasts 14km of beach frontage

Exmoor was sold with 3600 head but can carry more than 4000 head of mixed cattle.

Mr Johns said in the last five to six years, there had only been a handful of farms that have reverted to hay production in the Mackay district.

“Transactions are occurring on less efficient cane farms with irrigation. Once the productivity has dropped, these properties become more affordable to producers with grazing interests.”

Mr Johns urged producers to consider purchasing prime country with development opportunities.

“Producers can expect to pay around $19,700/ha for premium irrigated cane country in the Burdekin. Irrigation infrastructure is straight forward and not costly. If undertaken, producers could increase the value of their properties – in some cases more than double it per hectare.”

 

 

 

 

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