Insight is proposing to leverage the accumulated experience and knowledge of its farmland business by evolving its farm investment management.
Watch our video to hear Mark Stancombe, Head of Corporate Strategy, member of the Executive Management Committee; and Detlef Schoen, Head of Real Assets, discuss farmland as an investment opportunity.
Why Insight for farmland?
The strategy aims to capture the benefits of agriculture as an asset class by providing:
- Regular cash income and capital growth with inflation hedge: Targets 4% annual cash distribution and 8% IRR, net of fees and taxes
- Diversification: In addition to diversification away from traditional asset classes (equities and bonds), diversification across products and geographies – with as much diversity as required while maintaining ’critical mass’
- A measurable and audited ESG commitment: Alignment with the UN Sustainable Development Goals and audited environmental, social, and governance metrics
- Scale : Building out from existing ‘bridgeheads’ in key target geographies, using aggregation and vertical integration as the primary risk mitigation strategy
- Liquidity: An ‘evergreen’ structure with regular liquidity windows after a short initial lock-up
You can download a summary of the Insight Farmland strategy 2018 here.
An overview of our approach
We aim to deliver attractive risk-adjusted returns with a ‘peace of mind’ approach, avoiding experiments, taking as little headline and execution risk as possible and investing in low-cost production system/regions and investment-grade countries only.
Our highly experienced team of large-scale farm investment practitioners – with a long and robust track record – uses a combination of top-down and bottom-up analysis to identify and combine the most attractive opportunities from across the risk and return spectrum.
Insight Farmland proprietary risk/return matrix
Source: Insight Farmland pro January 2018
The proposed scope
The Insight Farmland strategy aims to build out the existing bridgeheads in: Oceania (Australia and New Zealand); Pacific South America (Chile/Peru/Colombia), EU (Romania/Portugal/Spain), UK, USA.
Insight farmland strategy 2018: the proposed scope
Alignment with ESG guidelines
The strategy is focused on sustainability goals that drive target selection and asset management.
We adhere to specific guidelines demonstrating our commitment to long-term sustainability and key selection criteria for targeting geographies through informed climate change overlays.
Read our responsible invesment in farmland for further information on our commitment to ESG.
Past performance is not indicative of future results. Investment in any strategy involves a risk of loss which may partly be due to exchange rate fluctuations.
The performance results shown, whether net or gross of investment management fees, reflect the reinvestment of dividends and/or income and other earnings. Any gross of fees performance does not include fees and charges and these can have a material detrimental effect on the performance of an investment.
Any target performance aims are not a guarantee, may not be achieved and a capital loss may occur. Strategies which have a higher performance aim generally take more risk to achieve this and so have a greater potential for the returns to be significantly different than expected.
Portfolio holdings are subject to change, for information only and are not investment recommendations.
Farmland is exposed to the impact of government policy. Subsidies, renewable fuels, trade agreements and attitudes to ownership rights can vary between markets, and may change over time. Farmland is an inherently illiquid asset subject to the range of risks associated with primary production. Land values, like commodities, will experience large deviations from the equilibrium as a result of a range of market forces such as returns across other assets, level of interest rates, and investor sentiment.
Investments in emerging markets can be less liquid and riskier than more developed markets and difficulties in accounting, dealing, settlement and custody may arise.
The investment manager may invest in instruments which can be difficult to sell when markets are stressed.
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