Dambadgee Springs Dandaragan

 The Dambadgee Springs project is a 1,600 Ha property located in Dandaragan, Western Australia, 1.5 hours north of Perth.

The property was purchased in March 2017 for $4.2 million and has traditionally been operated for small grain and livestock production. The property is located in a reliable 600mm rainfall zone and is highly productive for traditional agriculture.

Alterra has completed a pre-feasibility study for conversion into intensive dairy and has commenced a pre-feasibility in relation to the potential for developing water to support high value tree crops including SHD olives, citrus, pomegranates and table grapes.

In May 2020, the company sold 913 hectares of the property for $3.1 million. The 727 hectares retained by Alterra contains the $2.5 million of contracted income from Yandin Wind Farm as well as surface water resources with development potential and areas suitable for livestock, plantation forestry and carbon forestry. 

Alterra expects to receive approximately $100,000 p.a. (net of costs) from a combination of leasing the retained land and wind farm income with an estimated ongoing annual return of investment (ROI) of 15 per cent based on the remaining equity held by the company.

Alterra Sells Part of Dambadgee Springs for $3.1M

Highlights 

• Alterra enters contracts to sell 913Ha for $3.1M

• Funds will be redeployed to support Alterra’s avocado development projects 

• 727Ha retained including the $2.5M Yandin Wind Farm income stream

• Alterra to continue adding value on remaining land

Alterra Ltd (ASX:1AG) (Alterra or the Company) is pleased to announce it has entered two contracts for the sale of its “Dambadgee Springs” property totalling 913 hectares of the 1,640-hectare property to a local farmer. 

The property was purchased in March 2017 for $4.2 million plus stamp duty of $0.2 million.

·       Contract 1 valued at $1.6 million is subject to finance (30 days) and expected to settle on or before 10 July 2020. 

·       Contract 2 valued at $1.5 million is subject to finance (30 days), land survey and subdivision approval.
Contract 2 is expected to settle on or before 20th January 2021. The buyer has agreed to lease the area contained in Contract 2 for the 2020 cropping season.

The area retained by Alterra includes the $2.5 million of contracted income from Yandin Wind Farm as well as surface water resources with development potential and areas suitable for livestock, plantation forestry and carbon forestry. 

The partial sale of this non-core asset will enable Alterra to access additional working capital to advance development operations at the Company’s projects in the South West region and retire debt on the Dambadgee Springs property.

Of the funds received from the sale:

• Contract 1: $1.3 million is expected to be retained for working capital with the balance utilised to retire debt

• Contract 2: $0.7 million is expected to be retained for working capital with the balance utilised to retire debt

 Based on completion of the above sales, the Dambadgee Springs property is currently achieving a six per cent internal rate of return (IRR) and 18 per cent return on investment (ROI).

Post settlement of Contract 2, Alterra expects to receive approximately $100,000 p.a. (net of costs) from a combination of leasing the retained land and wind farm income with an estimated ongoing annual ROI of 15 per cent based on the remaining equity held by Alterra. 

“Alterra is prioritising its development activities in the South West of Western Australia and the majority of capital released from this sale will be redeployed into Alterra’s avocado investment program, including the recently announced Carpenters Project in Pemberton,” said Alterra Managing Director Oliver Barnes.

“Alterra intends to continue adding value to the remaining land at Dambadgee Springs through pasture improvement for grazing as well as carbon and plantation forestry.”

- END -

About Alterra Limited Alterra is an originator, developer and manager of in-demand agricultural assets with a focus on ‘land use change’ opportunities in Australia, developing underutilised land and water into the next generation of agricultural assets capable of supplying premium whole foods. Alterra drives sustainable growth to leave a positive social, environmental and economic legacy to unlock investment-grade returns. Visit alterra.com.au for more information.

 

For investor enquiries, please contact: Oliver Barnes, Managing Director P: (+61) 08 9204 8400   E: obarnes@alterra.com.au

 For media enquiries, please contact: Tessa Dempster, Media Relations P: (+61) 415 640 665   E: communications@alterra.com.au

Here is another version of this local story

A PORTION of a premium property at Dandaragan, known as Dambadgee Springs, is in the process of being purchased by local farmers.

Dambadgee Springs was part of the iconic property Yathroo.

The property of 4170 hectares was listed on behalf of two vendors: the ASX-listed company Alterra and Mat and Jade Stoney, of Stoney Agri.

The portion that is close to selling is owned by Atlerra, which comprises 1640ha.

Alterra has retained 727ha of the offering, resulting in 913ha being bought by a neighbouring farming family for $3.1 million, equating to $3395 per hectare.

Alterra purchased the property in 2017 for $4.2m or $2561/ha.

This indicates an increase in value of about 24.5 per cent over three years.

Farm Weekly understands the buyers are cropping focussed farmers and the portion they purchased was the broadacre part of the parcel and will be included in in their 2020 program.

The buyer has also leased some of the land that Alterra retained that will also add to their 2020 cropping program.

The marketing of Dambadgee Springs is being handled by Steve Vaughan, Ray White Rural WA and Terry Norrish, Nutrien Harcourts.

It's understood that the portion of Dambadgee Springs held by the Stoneys is likely to be purchased by two buyers - a farmer/farming family and an agricultural business.

The portion still held by Alterra, of 727ha, includes a $2.5m income stream from the Yandin Wind Farm, surface water resources and areas suitable for livestock, plantation forestry and carbon forestry.

Alterra managing director Oliver Barnes said the company would still continue to add value on the remaining land until it decided to divest it to suit its investment model.

"The plan is in time to realise that investment and redeploy that capital in the South West region," Mr Barnes said.

"We have a short to medium-term view of holding this property.

"There's ongoing investment in the Dandaragan region, particularly very close to that property in feedlotting and finishing cattle and we think demand for land in that region will continue to increase."

Mr Barnes said the property was marketed to appeal to a broad range of buyers and it attracted strong interest, including those looking to hold agricultural land as a passive investment, but the natural buyer turned out to be a neighbour.

"I guess the opportunity doesn't come up that often to add additional land to their operation and they were very familiar with operating in the region - with those soils and that climate, so they had a good understanding of what the value attributes of the property were," he said.

"It's also nice to be able to transact with and support neighbouring farmers in the region."

Moving forward, Alterra plans to focus on its 300ha avocado investment at Pemberton, the Carpenters Project.

The land and water resources for the project have been leased from Red Moon Property Holdings Pty Ltd, an entity related to the Casotti Group, Western Australia's largest privately-owned fruit grower, packer and wholesaler.

Mr Barnes said the company was not currently seeking additional assets to develop.

Yandin Windfarm goes online

West Australia’s largest wind farm, Yandin, goes online.

The Yandin Wind Farm, a 212MW wind farm and western Australia’s largest wind farm has gone online and is officially operational. 

The wind farm completed electrification and delivered its first output to the Western Australian state grid, also known as the South West Integrated System (SWIS). 

The Yandin Wind Farm that began construction in July 2019, located in Dandaragan, Western Australia, around 175 kilometres north of Perth, is a joint venture between Ratch Australia and Alinta Energy with the investment in the wind farm is being managed by Alinta. 

The Yandin Wind Farm is estimated to have cost approximately US$400 million to construct the 51 turbines, that each have a capacity of 4.2MW.

Currently, only the first 34 of the 51 4.2MW Vestas turbines have been installed. 

The contracting company, Decmil, revealed the connection to the Western Power network, through a new 330kV terminal and 10km transmission line. 

The contracting company had the US$79 million contract to complete the civil and electrical design and construction, including wind turbine bases, access tracks, site cabling, switch room and substation.

Article supplied by:

ByCukia M

Jul 16, 2020  Construction Review online

 

Foreign Corporate Buys more Dandaragan Land

Foreign corporate adds to ag portfolio

Mollie Tracey13 Apr 2020, 6 a.m.

KLK Farms Pty Ltd is a Malaysian-owned company which operates a large scale mixed farming enterprise in Western Australia and recently purchased a premium Badgingarra property. In the Dandaragan Shire.

It's understood KLK paid about $6 million for a 1148 hectare mixed enterprise farm situated at Badgingarra, Dandaragan Shire

MALAYSIAN-owned company KLK Farms Pty Ltd has added to its vast Western Australia farmland portfolio by purchasing a property at Badgingarra.

Farm Weekly understands KLK paid in the vicinity of $6 million for 2150 Badgingarra Road, Badgingarra, of 1148 hectares in the Dandaragan Shire

While Elders real estate sales specialist and selling agent Kris Teakle declined to confirm the sale price, she said "it is a magnificent farm where someone could just walk straight in and continue on farming".

"It was a very well presented and top selling property in the Badgingarra/Dandaragan area," Ms Teakle said.

"The property is so versatile that it really lends itself to any type of operation.

"The vendors previously had a Poll Dorset stud and I believe the buyers intend to run cattle, so the only thing they would really need to add would be cattle yards."

The property was marketed as a 'jewel in the crown' with good soil types, quality pastures and good infrastructure, including a stunning rammed earth house.

As well as having an average annual rainfall of 550 millimetres, the property had abundant water.

Ms Teakle said she received strong enquiry from local buyers and some from South Australia and Victoria.

All of KLK's Australian agricultural land investments are in WA and including this recent purchase, it's freehold landholdings total 58,555ha.

According to the company's 2019 annual report, it has no leasehold investments in Australia.

Despite the head office of its parent company Kuala Lumpur Kepong Berhad being in Malaysia, the company has an extensive history of farming in WA, having owned land in the State for more than 40 years and has been steadily growing its portfolio over the past several years.

As outline in its latest annual report, KLK's WA farmland investments include:

Cattle and grain property Chilimony Farm, at Northampton, of 16,189ha;

Erregulla Farm, Mingenew, measuring 10,238ha for sheep and grain production;

Grain and cattle property Wyunga Farm, Dandaragan, spanning 14,418ha;

Jonlorrie Farm, at York, of 4927ha, which is a sheep and grain property;

Warrening Gully Farm, Williams, covering 5119ha for sheep and grain production; and

Grain and sheep property Tatchbrook Farm, Arthur River, measuring 6516ha.

KLK's other investments around the world include the manufacturing, plantation and property industries throughout Asia and Europe.

It is regarded as a palm oil producing giant, which is its core product.

KLK reported that in FY2019 its Australian farming businesses "improved substantially", with a profit of $10,500,372 compared to profits in FY2018 of $1,260,045 by increasing crop production with higher yields and a larger cropped area.

Both the vendor and buyer declined to comment on the sale, I wonder why?