Review delays a risk to complex sales

Review delays a risk to complex sales


Agribusiness
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UNLESS the Foreign Investment Review Board (FIBR) speeds up its approvals process, there is a risk complex agriculture property deals will fall through because of the delay.

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CBRE director of agribusiness Danny Thomas.

CBRE director of agribusiness Danny Thomas.

UNLESS the Foreign Investment Review Board (FIBR) speeds up its approvals process, there is a risk complex agriculture property deals will fall through because of the delay.

That is the view of the property consultant who helped grain grower John Nicoletti pull together his 68,000 hectare sale and lease back deal with a foreign investor prepared to accept the risk on Australian agriculture production.

CBRE director of agribusiness Danny Thomas was critical of the complex deal involving five properties and a Merredin silo complex being stalled for more than five months while the FIBR considered it.

"Real estate agents don't normally speak out like this, but on the length of time taken to get FIBR approval, I think I have to," Mr Thomas said.

"Holding up a potential sale for five months is totally unacceptable.

"The FIBR really needs to review its processes if that sort of delay is the norm.

"It is not so much whether the answer is ultimately a yes or no, vendors and purchasers need some surety that the answer is going to be provided in a timely manner.

"With a complex transaction it is difficult enough just to get vendors and purchasers together in the first place, but then to ask them to put a deal on hold for five months is just unacceptable.

"If it (delay) was one of the unintended consequences of the change in the foreign investment rules then so be it, but it still should not have caused such a delay," he said, referring to changes applying from December 1.

Those changes announced by Treasurer Scott Morrison included lowering the private agricultural land threshold for FIBR review to $15 million, establishing an agricultural land foreign ownership register and introducing FIBR fees for a review.

"In this instance why should the change of rules add to the delay?" Mr Thomas asked.

"The application was made under the old rules and should have been considered under the old rules surely?

"The FIBR fees are astronomical and a much quicker decision is a reasonable expectation.

"When you enter into this process there is no indication it is going to take five months to get an answer."

Mr Thomas said FIBR approval was the "last hurdle" for the deal which could now move to settlement.

"It's important to point out for a few people that nothing much is going to change, John is still going to be there for the next 10 years," Mr Thomas said.

"He's still going to grow wheat that's still going to go to CBH.

"He's still going to sell cattle and sheep at the markets.

"He's still going to employ some 30 Australians.

"That was one of the things with this deal, we were hoping to have it cleared well in advance of this so he could concentrate on preparing for the coming season.

"Now at least he has got a chance to sort out his season."

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