Royal County of Berkshire Pension Fund, Maidenhead, England, committed a total of £30 million ($43.4 million) to two farmland buy-and-lease strategies managed by Milltrust Agricultural Investments, confirmed Nick Greenwood, pension fund manager.
Mr. Greenwood said the £1.7 billion pension fund is the seed investor for the MAI New Zealand Buy & Lease Farmland and the MAI Australia Buy & Lease Farmland funds.
The investments, which fall under the pension fund's real estate allocation, are being funded from the proceeds of a real estate strategy that is being wound up.
The funds invest in a range of farmland assets such as arable and pastoral farms, and permanent crops in Australia and New Zealand. They are designed to provide low correlation income and to general real asset exposure for pension funds and other institutional investors. They aim to generate an annual gross lease income of 5% to 6%, with an additional expected real annual capital appreciation of about 5%.