Unprecedented uncertainty

Bayleys national director rural – Duncan Ross

Just six months ago, I signalled in the introduction to the autumn edition of this magazine that “the unknowns that the COVID-19 outbreak may bring with it, are not to be underestimated when looking ahead” in the rural sector.

And boy, who could have foretold the disturbance that a virus could create?

As if there wasn’t enough on farmers’ plates with dire drought conditions, a shortage of feed in many parts of New Zealand and potential regulatory changes that could impact the operational side of their businesses – normal seasonal programmes were derailed.

Despite all the negatives that COVID-19 has brought with it, the role of farmers and the significance of the broader rural sector to our economy has been amplified and I believe there’s new public respect for the sector’s contribution to the nation’s economic wellbeing and to the food supply chain.

It’s a tough gig balancing farm productivity and profitability, environmental credentials, societal expectations and the wellbeing of those working the land.

Throughout lockdowns and the minefield of changing political restrictions, primary producers just got on with the jobs at hand. They were deemed essential to the country’s lifeblood. Animals were cared for, crops were harvested, supply chains were managed, and New Zealanders got fed.

Although there were some hiccups in global distribution networks due to border restrictions, reduced schedules, and shortages of refrigerated space, exports largely continued – products from New Zealand were still delivered to offshore markets.

New opportunities have arisen as a result of the changed landscape that the pandemic has generated.

During lockdown, Bayleys brought to the market and closed numerous deals on rural property – including components of the high profile T.A. Reynolds mixed-use portfolio in the Franklin district.

It wasn’t exactly business as usual, but it was all hands to the deck to ensure that our clients’ best interests were served throughout a sustained period of uncertainty.

The strength of the Bayleys network proved to be a platform capable of delivering a national portfolio of rural product to buyers here and abroad, despite restrictions.

With sustained farm gate pricing, an historically-low interest rate environment and compressed investment yields in other property sectors, eyes have turned towards rural property and business opportunities where there are proven, ongoing sustained revenue returns.

Further to this, there are some innovative ways to structure lending and succession plans to enable farm ownership with management options via new equity arrangements, a topic we explore in more depth in this edition of Country magazine.

With the general election scheduled around the time Country is released, we also challenge industry leaders to lay their policy cards on the table and to give us their views on “where to” for the primary sector.

In the lifestyle property space, we’re expecting to see renewed interest in home and income opportunities that lie beyond the city borders.

Fresh air, plenty of space, room to grow and produce some of the family’s food needs, and the absence of general hustle and bustle mean a lifestyle property has taken on heightened status post-lockdowns.

Country talks to several lifestyle block owners about how they pivoted their businesses when they were forced to find new markets for their products when widespread lockdowns interrupted usual trade.

Yes, it’s a time of unprecedented complexity in the global economy, but with stoic consistency in the rural sector and an abundance of investment opportunities, the robust rural market is showing no signs of being beaten by the bug.

When the time is right, the Bayleys country team is here to help you realise the value of those years of hard work, or to link you up with a new opportunity.

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