Agencies unfazed by FIRB changes

02 Sep, 2013 04:55 AM
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REAL estate agencies operating in the agricultural sector have shrugged off Coalition plans to lower the ­threshold for Foreign Investment Review Board (FIRB) examination of foreign purchases of farmland.

Opposition Leader Tony Abbott last week said he would lower the threshold from $248 million to $15 million. International companies seeking to invest in Australian agri­business would also have their applications examined if the investment was more than $53 million.

The move followed concerns that restrictions over foreign ownership of agriculture are insufficient. It comes as real estate agencies are expanding their agribusiness teams because they believe the agricultural property market such as cattle stations and wineries is set for a turnaround thanks to the falling dollar returning confidence and broader global interest from investors.

Foreign ownership of agricultural land sits at about 11.3 per cent, according to FIRB statistics from the Australian Bureau of Statistics, while foreign ownership of businesses is closer to 1 per cent. The Northern Territory has the highest percentage of foreign ownership of land, at nearly 24 per cent.

For the last 18 months in particular, agricultural property has been in the doldrums thanks in part to the high local dollar driving up export prices, the federal government ban on live ­cattle exports pushing down the price of cattle and significant debt.

Global firms grow teams in sector

But now global firms such as CBRE and Colliers International are growing their sales and valuations teams in the sector, traditionally the arena of agencies such as Elders Real Estate and Landmark Harcourts Real Estate.

CBRE has recruited Phil Beale, former chief financial officer of Australian Agricultural Company, and Geoff Warriner the former chief operating officer of Consolidated Pastoral Company to its team in Australia.

The agency started up its ­agri­business team only in May last year and it now has more than 30 sales and valuations people nationally. Mr Beale said he was not fazed by talk of lowering the threshold: "I anticipated the FIRB threshold would get lowered."

"All that does is put a process in place where people will just have to apply through the FIRB. The experience there has been that sensible, ­reasoned applications are generally well-received and processed."

Mr Beale said he expected the sector to benefit from increased corporatisation, major investment houses buying land and leasing the properties back as well as foreign parties looking to invest based on food security concerns.

Tim Altschwager senior executive of Rural and Agribusiness for Colliers said the move was a "good thing".

"It doesn't mean they are going to stop foreign investment coming into the country, it just means they keep track of it and there's a bigger list of which properties are bought from overseas clients," he said.

Colliers has increased its own ­agribusiness team from about six or seven people to more than 20 in the last 12 months.

Colliers said it would focus on larger properties such as wineries and cattle farms rather than sales and purchases of smaller family farms typically ­negotiated by Elders and Landmark.

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READER COMMENTS

Bushie Bill
4/09/2013 7:18:30 AM

It will be a long time before the Coalition gets around to this, if ever. Never will be the most likely outcome. No wonder real estate agencies are not concerned.
NIMBY
6/09/2013 4:20:20 PM

What's the point of keeping track of foreign ownership of our land unless they scrutinize it and limit it? It's just the same as watching the horse bold! Our land is our sovereign property, and like most countries, it should stay in Australian hands.
Percy
21/04/2014 9:54:35 PM

With Anzac day drawing nigh then we need to ask the question: Just why and what for did so many young man sacrifice their lives in the wars we have fought to preserve our sovereignty and freedom to make our own choices? Do not allow invasion by wealth!

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