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Harrison Lane
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Wanting opinions on my unique syndication

Harrison Lane
Posted

Hi all! My name is Harrison, I am a farmer from New Zealand looking to start a syndication purchasing a mid to large scale dairy farm in New Zealand and was hoping for some help on my proposed structure of the deal to appeal to investors but also if you think something this unique would catch the eye of potential investors. dairy farms are paid by the amount of milk fats in the milk also called milk solids (MS)The current price per kg of milk solids is $9.70-$10.30 NZD but with global demand rising this price is predicted to continue up to all-time highs which presents a perfect time to invest into the industry. the current farm I am looking at would be an annual COC return of 8.62% for the investors at 85/15 with hopes of this rising through reducing expenses and milk prices rising, my thoughts around structure would be 1% acquisition fee, 85/15 profit split and unsure on what a typical disposition fee should be in this instance as I want to appeal to investors.

Would love any help on the structure, who might be best to pitch to or if you have any interest in this or know of anyone who might, I'm more than happy to answer any questions :)

Regards,

Harrison

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Chris Seveney
  • Investor
  • VA
18,993
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Chris Seveney
  • Investor
  • VA
ModeratorReplied
Quote from @Harrison Lane:

Hi all! My name is Harrison, I am a farmer from New Zealand looking to start a syndication purchasing a mid to large scale dairy farm in New Zealand and was hoping for some help on my proposed structure of the deal to appeal to investors but also if you think something this unique would catch the eye of potential investors. dairy farms are paid by the amount of milk fats in the milk also called milk solids (MS)The current price per kg of milk solids is $9.70-$10.30 NZD but with global demand rising this price is predicted to continue up to all-time highs which presents a perfect time to invest into the industry. the current farm I am looking at would be an annual COC return of 8.62% for the investors at 85/15 with hopes of this rising through reducing expenses and milk prices rising, my thoughts around structure would be 1% acquisition fee, 85/15 profit split and unsure on what a typical disposition fee should be in this instance as I want to appeal to investors.

Would love any help on the structure, who might be best to pitch to or if you have any interest in this or know of anyone who might, I'm more than happy to answer any questions :)

Regards,

Harrison


Are you seeking investors from New Zealand or from the US? If you are seeking investors from the US I apologize but it is going to be a very big uphill battle as most US investors do not know new zealand laws, how syndications work in New Zealand and investing across the planet would be perceived as a risk for a CoC return of 8%+ which they can get in the US and be able to meet the sponsor.

The structure (assuming 85% to investors) is a great structure - just find it difficult for US investors to get on board. 

  • Chris Seveney
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7e investments
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