Galbraith Rural Matters Summer 2017

Rural

ISSUE 3 SUMMER 2017

matters

Contract farming

A simple way for both landowner and farmer to benefit

PLUS: Anyone for a cup of Scottish tea? | Making a tenancy sale work | Long-term gains from forestry | Marketing Scotland's magical north coast | Time for optimism on field sports | A vodka tonic for potato farmers

Welcome

contents

New name, same service

4

Welcome to Rural Matters, our magazine for rural businesses and those involved with them.

6

You may notice a slight change to the look of our third edition. We are now Galbraith, rather than CKD Galbraith, which reflects the continuing evolution of our own business and its brand. While the label is a fresh one, the people and the service behind it remain wholly committed to providing the highest quality advice and creative support that is the hallmark of our firm.

It is certainly a time of change. Landowners, farmers and all involved in the rural sector are living and working in unprecedented circumstances. Brexit and our own constitutional uncertainty loom large at a time when businesses are dealing with an ever-increasing array of practical challenges.

As is typically the case in general election years, we can see that the uncertainty caused may well slow the property market in the weeks leading up to June 8. Once the dust has settled however we believe the market will pick up again and continue to grow.

With challenges come opportunities, and, in this edition we have a special focus on farm and estate diversification. We hope that this copy of Rural Matters will provide you with some considered current opinion, together with stimulating insights into issues and ideas that are front of mind for rural businesses.

Iain Russell Chairman

Land reform: Selling a tenancy.

Graduates at work and play.

Diversifying?

It may be time for tea.

8 The route to hydro success.

United Auctions: a powerful alliance.

10 A valuable scheme for sporting estates.

12 The road to richer tourism.

14

COVER STORY Advantages of contract farming.

Ballindalloch's champions.

16 Long-term gains from forestry.

Keeping trees in good health.

18 Ossian: The name for adventure.

Valuing renewable assets.

20 Galbraith is Scotland’s leading independent property consultancy. Drawing on a century of experience in land and property management, the firm is progressive and dynamic, employing more than 250 people in offices throughout Scotland.

The firm provides a full range of property consulting services across the commerical, residential, rural and energy sectors.

Pheasant woes.

Field sports: Time for optimism.

22 Setting the scene for film success.

Vodka tonic for potato farmers.

Galbraith provides a personal service, listening to clients and delivering advice to suit their particular opportunities and circumstances.

Follow us on Twitter.

Like us on Facebook.

Join us on Linkedin.

Rural Matters is produced by Galbraith and designed by George Gray Media & Design, St Andeux, France. © CKD Galbraith LLP.

Page 2 | Rural Matters Summer 2017 | galbraithgroup.com

Shooting The considerable consternation that is being caused by the imminent reintroduction of business rates on shootings and deer forests is growing by the day.

Farmers and landowners who have been deluged with paperwork requesting detailed and complex information are understandably confused as many of them have no history or interest in field sports.

As someone with experience in rating valuation dating back more years than I care to remember and who works for a firm that is involved in the management of a large proportion of the Scottish countryside, I’m afraid to say this has come as no great surprise.

One view is that the abolition of these rates some two decades ago was a sop to the landed classes but those closely involved suspected they cost far more to implement than they ever brought into the public coffers.

Having recently met the representatives of the Scottish Assessors Association, who have been tasked with valuing sporting subjects, I learnt that they consider there to be greater evidence of land being leased for shooting than was previously the case. As a result of the evidence gathered to date they were also expecting to be able to make a number of entries in the roll by April 1 – the revaluation date – although most of the entries will follow over the next few months.

At this stage, however, the specific valuation methodology is something of a mystery beyond it having to be based on the evidence collected and the premise of all rateable values i.e. an assessment of the open market rent that would

in the dark Calum Innes, Galbraith partner and member of the RICS Ratings and Local Taxation Group, analyses the impact of the re-introduction of ‘sporting rates’.

be struck between a willing landlord and willing tenant.

I have helped clients in their submissions to the assessors and, despite a wider assumption that rates would target only large sporting estates, the reality is that all rural land over which there is the potential right to shoot requires assessment. The assessors' role is not, however, to ensure that landholders pass over large sums of money in rates payments. The office’s sole responsibility is to put a rateable value on qualifying properties and what proportion actually have to make any rates payments remains to be seen.

The reason for this is that the government recently announced that it will maintain the small business bonus scheme and proposes that all subjects with a rateable value less than £15,000 will receive 100% relief. So it is likely that a substantial proportion of shootings will not find themselves liable to pay business rates as long as this relief is maintained. For larger landowners the reintroduction is likely to mean additional payments, and the cumulative effect of a number of different rateable values within the same ownership will also have to be taken into consideration.

The government has made deer management

a cornerstone of upland land management policy, but the increase in roe deer numbers in the lowlands and urban fringes has resulted in increased stalking activity in these areas.

Playing devil’s advocate, it is quite possible that one area of mixed arable and woodland may have a healthy population of trophy roe and command a high rental whereas the neighbouring, identical estate, might have a zero tolerance policy with deer. No deer equals no trophies and no prospect of any significant rental. Will both estates have the same rateable value? Will one glen that is run as a commercial shoot have the same value as its twin that is held as a nature reserve by a charity? We’ll have to wait and see.

The assessors are starting from a position of limited knowledge and much has altered in the period since sporting rates were abolished.

The uncertainty does not bode well for the rural sector, but if land needs to be valued for sporting purposes, farmers and landowners will have to comply even though it appears an arduous task. calum.innes@galbraithgroup.com 01738 456075

“

Despite a wider assumption that rates would target only large sporting estates, the reality is that all rural land over which there is the potential right to shoot requires assessment.

galbraithgroup.com | Rural Matters Summer 2017 | Page 3

Passing the baton to the next generation Wattie Barbour and Patricia Sanderson act for a client who has a small estate near Pitlochry. Patricia outlines how selling a 1991 Act Tenancy can prove a success for both tenant and landowner.

The provisions of the Land Reform (Scotland) Act 2016 are about to come into force.

A large part of the Act is dedicated to reforming agricultural tenancies and introduces the ability for existing 1991 Act tenants to ‘sell’ their interests to an incoming tenant. Although it has received Royal Assent, the Act is not yet live, but this will happen imminently with provisions being introduced in stages.

It is in this context we outline the situation that faced one of our clients and how this was resolved to the mutual satisfaction of all parties. Furthermore, it could be a useful template for others.

The client owns a small estate near Pitlochry with one let farm, some seasonally let grazing and several residential buildings, including two properties that are run as self-catering accommodation by the estate tenants.

The farm tenants, who had been on the estate since the 1950s, approached our client prior to the Land Reform Act

being passed, intimating their intention to retire. Although they did not give formal notice they started scaling back in various ways, including selling off their own land and surplus equipment.

The Land Reform Bill was brought forward and the tenants were advised that there may now be the potential to receive a payment for their interest, from either the landlord or an incoming tenant rather than simply returning the farm with vacant possession to the landlord on retirement.

The client did not want the tenants to retire. He held them in high regard, liked the status quo of having tenant farmers in place and, in any case, he did not have the funds to buy their rights from them. The tenants understood this and embarked on trying to find potential successors to their tenancy who were willing to pay them to acquire their interest in the lease. A few months later, a locally respected farmer expressed his interest in taking over the farm and, despite the Act not being live, we began negotiations based on what we knew would eventually happen.

The successors to the tenancy are local

“

There was a moment when all three parties needed to simultaneously sign documents and none of the lawyers wanted their clients to sign first.

Page 4 | Rural Matters Summer 2017 | galbraithgroup.com

and have a great reputation, so the client was quite happy and essentially took a back seat while the existing and potential tenants discussed terms – including monetary compensation.

Once the basic terms were agreed, the final proposal was put to the client for his approval. At this point, he expressed his nervousness about agreeing to a new lease continuing in perpetuity given the uncertainty over what future agricultural legislation might be introduced, so we agreed that the client would accept the terms, provided that the new tenancy was a long Limited Duration Tenancy (LDT) and not a new ‘91 Act Tenancy. The term of the LDT offered was 35 years, which would take the new tenant to retirement age.

None of the advisors and parties involved had experience of a situation like this and there was no precedent for the processes involved in signing over a tenancy to a new party while simultaneously terminating the existing arrangement, what tenancies should be 'sold' for, or who is eligible to 'purchase' them (the definitions of 'new entrant' farmer and a farmer 'who is progressing in farming' have not been detailed in the Act, but successors need to fall into one or both of these categories).

There was a moment where all three parties needed to simultaneously sign documents and none of the lawyers wanted their clients to sign first. The outgoing tenant had to agree to give up their tenancy so the landlord could agree to enter into a new agreement with the new tenants as soon as the unit became vacant, and the new tenant needed to sign a LDT prior to paying the outgoing tenant any compensation.

Fortunately, all parties wanted the succession to work and there was never

any risk that anyone would pull out at this stage.

In total seven parties were involved in the negotiations – two farmers, three solicitors, the client and the team at Galbraith – yet there has been no animosity or antagonism, just active and positive negotiation based on what we knew was coming in terms of legislation, while accepting that nothing we were doing was already enshrined in law.

By the end of November, the old tenants had moved on (and by all accounts are very much enjoying their retirement) and the new tenants had already started making improvements to the farm. They made a point of introducing themselves to the other residential tenants on the estate and have settled in really well.

The client is delighted that he now has another tenant in place so the status quo is maintained but at the same time he now has comfort in knowing that the lease over his farm has an expiration date so the next generation of landlord and tenant will be able to decide between them the best way forward for the farm in 35 years’ time.

patricia.sanderson@galbraithgroup.com 01738 456067

wattie.barbour@galbraithgroup.com 01738 456069

Mud, sweat and careers Marcelina Hamilton reflects on her first year as a graduate rural surveyor.

I was relieved to find Galbraith does not expect its trainees to be chained to their desk 12 hours a day.

Instead, there is an expectation to go the extra mile and get involved in work related extra-curricular activities. The firm believes that if you work in the rural sector you should support, understand and be involved with rural communities, and everyone at the firm takes this ethos to heart – and we also get a lot of enjoyment from it!

In forthcoming months, teams made up of people from our offices across Scotland are participating in the Cateran Yomp, the Lanrick Challenge, the Buccleuch Property Challenge, and the RSABI Great Glen Challenge. These events will raise money for vital charities such as ABF The Soldiers’ Charity, the Sandpiper Trust, Scotland’s Charity Air Ambulance (SCAA) and the Royal Scottish Agricultural Benevolent Institution (RSABI).

Being encouraged to spend time outdoors, set yourself a challenge and raise money for charities that make a valuable difference in the lives of some of the people we work with is one of the aspects of working at Galbraith that I enjoy most.

Galbraith has created a wellstructured training programme for its graduates, having firmwide formal training sessions on specific competencies every four months. Each graduate works with a supervisor and counsellor to ensure we are ready for each stage of the Royal Institution of Chartered Surveyors’ Assessment of Professional Competence (APC). The

effectiveness of this approach is shown by the very high first-time pass rates for the firm’s trainees.

While graduates work towards achieving their APC from their first day, we are also encouraged to be innovative and get involved in projects which interest us, regardless of whether they are connected to our team or office. Having clients and offices across Scotland means there is no limit to what we can get involved in. Even if you are a graduate in our Castle Douglas office you could still end up helping the Inverness office with a job up in Caithness.

Although I grew up in the Scottish Borders I am not from a farming family, but from day one Galbraith encouraged and helped me to gain access to the information and knowledge I needed. During my first few months with the firm I attended the Stirling Bull Sales, our own firm’s Farming Seminar at Murrayfield Stadium and the New Entrants to Farming Gathering.

Working in the rural industry is not just about farm consultancy, estate management or renewable energy.

I don’t switch off from the job as soon as I leave the office. People join the rural sector because they are invested in the future of the Scottish rural economy and have a genuine interest in making their lives a part of that future. That culture is embodied in everything I do at Galbraith and it provides me with a highly rewarding training scheme.

For more information about graduate opportunities with Galbraith please visit: www.galbraithgroup.com/ recruitment.

marcelina.hamilton@galbraithgroup.com 01738 451111

www.galbraithgroup.com | Rural Matters Summer 2017 | Page 5

Poppy Baggott explains how her family's livestock farm has diversified into a refreshingly new sector.

Anyone for tea?

As I write, the Prime Minister has just triggered Article 50 to begin the process of exiting the European Union.

With the future of farm subsidies and prospective trade agreements uncertain, innovation and diversification are as important now for landowners as they have ever been.

My family has a livestock farm on the coast in South West Scotland. In its heyday, the farm was part of a larger estate, and three walled gardens remain as an epitaph to those times. Over the past 30 years, these gardens have played host to a herd of wild boar, pheasant pens, and Christmas trees, the latter growing into a commercial sitka crop which was felled in April last year. Rather than replant, we decided to

“

We intend to produce some signature high-end teas for retail, and also hope to reap the benefits of the nascent ‘tea tourism’ sector. take the opportunity to diversify and have since planted 500 Camellia Sinensis – tea plants.

This was a hugely exciting step for us, but of course the road to the first cuppa from our own plantation is long and arduous. Before we could consider buying the plants we had to ascertain the pH of the soil, which is make or break when it comes to tea growing. A pH of 4.5 – 5.5 is ideal. Happily for us, South West Scotland has the right soil acidity for camellias, and the walled gardens are no exception.

Summer last year was devoted to removing all trace of the sitka crop from the ground. Brash, stumps and roots all had to go, leaving a clean slate for the tea plants. Before planting, we covered the whole area with a weed suppressant

membrane to reduce the weeding workload.

We then planted the tea plants down through it, placing shrub guards and horticultural fleece over each plant to protect them from the elements of their first Scottish winter.

Camellia Sinensis is the plant from which all tea flows – green, white and black all come from the same bush. It is the different methods of processing which create the individual teas. Growing tea is incredibly interesting and intricate in that the tea plants will absorb elements of their atmosphere and location, which will then affect the taste of the end product. This means that while growing jasmine or roses near your tea may produce an interesting and fragrant brew, certain composts or fertilisers are definitely to be avoided. A Scottish Tea Growers’ Association was established last year which growers can join to benefit from the support and experience of other growers.

We continue to learn as we go along, but there are two elements of our future tea industry to consider. First and foremost, we intend to produce some signature high-end teas for retail, and secondly, we hope to reap the benefits of the nascent ‘tea tourism’ sector. There is a growing number of tea gardens in Scotland, from the Borders to the Lothians, Perthshire and even the Highlands and Islands and it is hoped that tourists will come to sample a fresh brew and find out more about the Scots’ other favourite drink!

Our first flush of tea should be ready to pluck this summer. We now have another garden to clear and prepare – and to spur us on we have the knowledge that last year tea from Scotland was sold to... China.

Watch this space!

Page 6 | Rural Matters Summer 2017 | galbraithgroup.com

poppy.baggott@galbraithgroup.com 01556 505346

All traces of the former sitka plantation had to be removed (top) before the old walled garden could be transformed into a home for the new tea plants.

galbraithgroup.com | Rural Matters Summer 2017 | Page 7

Going with the flow for hydro success Charlotte Maclean reveals how to navigate the potential complications surrounding a hydro project.

In an effort to improve their green credentials, a Galbraith client was looking to identify viable renewable energy projects on their land.

A potential small-scale hydro scheme was identified on a burn they own and, while the owner was in the fortunate position of not requiring bank funding for this project, there were various other hoops to jump through to enable the project to happen.

The scheme planned to make use of a redundant weir for which there was no record of ownership. Galbraith investigated the weir’s ownership, and ultimately arranged the transfer of title and CAR licence (water abstraction rights) to our client as the owner of the surrounding burn and land.

A special purpose vehicle (SPV) was set up for the project. This was granted a lease of the hydro site, on the basis that the build costs would be privately funded but the eventual profits would be given as rental to the landowner, who is a charitable trust.

The area required for the scheme was let under a secure agricultural tenancy which meant that, while the tenant was agreeable in principle, he needed compensation for losses suffered during both the build phase and operation of the scheme.

Galbraith negotiated the formal resumption of the hydro site from his tenancy, an appropriate rental reduction, granted rent-free grazing rights over the pipe route once it has grassed over, and an annual disturbance payment to compensate

him for his additional maintenance of the access track and disturbance by vehicles visiting the hydro.

In future, the tenant may also be employed as a contractor to undertake some of the basic maintenance of the turbine and intake, given his immediate proximity to the remote site.

The local community council was initially strongly against the development due to a concern that it had not been properly consulted. Galbraith therefore arranged for the hydro developer to explain the scheme to the community and run through their concerns.

Following this meeting the community’s concerns were addressed, including moving the outfall from the power house further up the burn to ensure maximum flow over the waterfall at the community’s viewing platform, agreeing an annual contribution to the community from the profits, fitting larch cladding to the power house to help it blend into the surroundings, and installing a public information board at the viewing platform. These were relatively low cost items to the landowner, but ensured that the good relationship between the landowner and community was preserved.

The burn itself was a prime candidate for hydro, but the potential complications were many and varied. By persevering through what initially seemed a complicated project and gaining sound professional advice, the landowner, community and tenant farmer have succeeded in achieving a scheme which operates to the benefit of all parties.

Page 8 | Rural Matters Summer 2017 | galbraithgroup.com

charlotte.maclean@galbraithgroup.com 01786 434603

The power house was clad in larch to help it blend into the surroundings.

United we stand United Auctions’ George Purves looks back on 10 years of a unique alliance.

As we embark on the next chapter of Scotland’s leading livestock auctioneers with United Auction’s new management team having taken the helm earlier this year, we also celebrate a decade of successful collaboration with Galbraith.

as the main building at the facility is now full. This cluster of agricultural specialists located in the heart of Scotland combines with our thrice-weekly sales and special events, including the world-famous Stirling Bull Sales, to draw tens of thousands of farmers to the centre’s doorstep each year.

The Galbraith team attends the centre's commercial and special sales, giving them

It was in 2007 that the then CKD Galbraith acquired United Auctions’ land agency division from Macdonald Fraser and, since then, the collaboration has gone from strength to strength.

The special arrangement ensures our 18,000 customers have access to a range of rural property services, from farm sales and purchases, to valuations, forestry, compensation claims and renewables.

Clients hailing from the length and breadth of Scotland benefit from joint professional advice and shared local knowledge, accessed via United Auctions’ eight facilities and the 11 Galbraith regional offices across Scotland.

It’s a partnership that makes sense to our customers, we handle the livestock while Galbraith deals with the land issues and opportunities. Since the alliance began United Auctions has introduced a huge amount of farms and estates to Galbraith with a wide geographic spread, including farms in Dumfriesshire, the Scottish Borders, Argyll, Stirlingshire, Lothians, Perthshire and Aberdeenshire. The strength of the team at Scotland’s leading livestock auctioneers is well recognised and United Auctions are trusted by the farming community to provide the best service and advice possible.

Our alliance was further cemented in 2011 when Galbraith opened their National Farm Sales office at our headquarters, Stirling Agricultural Centre. In addition to its rural talents, Galbraith has an active commercial property division, which advised on the centre’s construction and handles the ongoing tenancy management.

The centre has been a major success since it opened in 2009, attracting national agricultural brands and vital rural services, including Carrs Billington, Ledingham Chalmers LLP and Johnston Carmichael, Agricar, Clyde Vet Group, independent insurance broker BCS Hendricks and independent finance broker Rural Finance.

Many of these agri-businesses have since grown and taken more space, including Galbraith. So much so that we have developed two further office buildings

George Purves, right, with Simon Brown, who leads the Galbraith rural and residential sales and lettings team.

closer access to their customer base, and the firm is a regular sponsor of the October Bull Sales.

United Auctions’ relationship with Galbraith has been forged over the past 10 years through mutual trust, hard work, professionalism and a shared vision to support and service Scotland’s thriving rural sector. We look forward to this continued collaboration for decades to come.

George Purves is managing director of United Auctions. www.uagroup.co.uk

galbraithgroup.com | Rural Matters Summer 2017 | Page 9

The process of accreditation is time consuming and will involve contributions from several members of staff, and on the surface it may seem that it is a lot of effort for little return.

But in the current political climate it is generally accepted within the sporting industry that anything which shows best practice through a holistic approach to estate management is of huge benefit. Furthermore, the process of accreditation can help form part of a due diligence package that can mitigate against the risk of vicarious liability.

Galbraith is able to guide clients through the process in three ways. Firstly, by advising clients on land use issues; secondly by producing management plans for the client and finally by gathering together all of the information required to create the final application.

Dedication reaps sporting rewards

Wildlife Estates Scotland (WES) started in 2010 and was developed by Scottish Land and Estates with input from Scottish Natural Heritage, the Game and Wildlife Conservation Trust, RSPB and the Cairngorms National Park Authority.

The primary aim of WES is to promote the best game, wildlife and habitat management practices through an objective accreditation system. The assessment criteria set out by WES are: • Commitment to best practice • Adoption of game and wildlife management plans that underpin best practice • Maintaining records of species and their habitats • Conservation and collaborative work • Integration with other land management activities (such as farming, forestry and tourism) • Social, economic and cultural aspects (such as employment, community engagement and communications).

With proper guidance the process of obtaining WES accreditation is fairly straightforward.

Firstly, the estate must have a wildlife and habitat management plan in place. The details of this will be very closely linked to the game department. The plan must detail which species are shot on the estate and how their habitats are maintained. It must demonstrate that all laws and regulations are followed. It must give a detailed account of how game is reared, killed and treated before entering the food chain. The plan must also detail if there are any species re-introduction schemes in place or wildlife policies such as a ‘no shoot’ policy.

Will Frazer details how many landowners could benefit significantly by qualifying for the Wildlife Estates Scotland accreditation scheme.

Once the wildlife management plan is created, the next step for the landowner would be to fill out the application form. This includes a comprehensive assessment of the wildlife present on the estate, with estimates required for main species and a view on the population trend as whether it is increasing, stable or decreasing. It also asks for in-depth information into the management of estate activities and how considerations for wildlife and sustainability are adopted in all aspects of land management.

Page 10 | Rural Matters Summer 2017 | galbraithgroup.com

Information about any designated sites, such as Sites of Special Scientific Interest (SSSI) or Special Areas of Conservation (SAC) should be detailed on the estate form part of the application and the applicant should explain how the estate’s land management policy works to support such designations.

Schemes currently in operation that contribute towards the biodiversity of the estate should be outlined. This includes agricultural best practice such as meeting the criteria for EFA (Ecological Focus Areas) and compliance with the regulations for Nitrate Vulnerable Zones.

The forestry policy on the estate and the longterm plan for managing woodland or forest is also of vital importance to the application.

Sport on the estate must be properly managed and all best practices must be adhered to in terms of Deer Management Plans and game bird rearing. Overall habitat conservation for the game – and the wider biodiversity that encourages – are a key component of a successful application.

After the application is submitted to WES an inspection will be carried out by independent assessors, Acoura, who manage a variety of accreditation schemes in the farming, food and drinks sector. The assessor will spend time on the estate to see how the information given in the application is put into practice.

WES accreditation is not only a very practical way of looking at an estate’s overall approach to effective, efficient and sustainable management, it is also a useful political PR tool. This helps when a perception exists that sporting estates are under the political spotlight. This has arisen following the reintroduction of sporting rates and the stated aim of sporting rates to fund community land purchase.

There is an increasing onus on estate owners and managers to operate in an open and transparent way that conforms to legislation.

The Wildlife and Countryside Act 1981 was augmented by the Wildlife and Natural Environment (Scotland) Act 2011 which specifies the responsibilities that owners and managers must adhere to. This has helped demonstrate best practice in all aspects of game management and the requirement to conform to certain codes – all part of the need to show due diligence in the way that land is managed.

Perhaps the most notable area is that of vicarious liability which formally puts the responsibility on owners and managers to ensure that the correct policies are in place to protect malpractice by employees. WES accreditation requires these controls to be in place and having a badge of accreditation can only help in promoting a forward thinking, engaged rural business, delivering public good

“

Overall habitat conservation for the game – and the wider biodiversity that encourages – are a key component of a successful application. and thus help in reducing the political pressure to further control sporting activities.

The WES scheme highlights both the importance of the sporting industry to Scotland in terms of the economy and also in terms of conservation of the countryside and the clear public benefits this provides. WES seeks to demonstrate that conservation on this scale would not be possible without the commitment of dedicated landowners and land managers.

WES accreditation should be achievable by any well-managed estate. The process of compiling the evidence for submission will also help to reassure the landowner that maximum benefit is being drawn from the estate’s natural assets and compliance with best practice and legislation is being met.

william.frazer@galbraithgroup.com 01738 451111

galbraithgroup.com | Rural Matters Summer 2017 | Page 11

The North Coast 500: Miles and miles of opportunity

Claire Acheson applauds a new tourism initiative.

a common thread emerged in conversations last summer with North Highland clients and friends with properties along the coastline, particularly those with hotels and holiday accommodation: 2016 had been their busiest summer yet.

The reason for this sudden boost in tourism revenue? No, not the weather – the North Coast 500, which has been one of the UK’s most successful tourism initiatives in recent years.

Launched in April 2015 as Scotland’s answer to America’s Route 66, the 500-mile route around the North Highland coastline is aimed at promoting tourism and bringing economic benefit to the region. The concept appears to have captured the imaginations of visitors from

Page 12 | Rural Matters Summer 2017 | galbraithgroup.com

far and wide who are flocking to the area to drive or cycle round the scenic coastal route.

Whether racing around in record time, or taking a leisurely trip over a week or more, the increased numbers of visitors are providing welcome additional custom for the shops, eateries, hostelries and activity providers along the route.

Taking in the best of Scottish scenery including sandy beaches, breathtaking cliffs, majestic castles and lofty mountains, it’s not hard to see why this route has become a bucket list trip.

The statistics generated since the launch are impressive. NC500 attained an audience reach of more than 620 million people through a variety of media platforms within six months of its launch.

The tourist season has been extended beyond

the traditional summer months, and the circular route has helped draw visitors to the previously less frequented parts of the Highlands, most notably on the east coast.

So how does the organisation ensure they keep coming back? Tom Campbell, chief executive of NC500, believes there is an unprecedented opportunity for business growth and future sustainability of the tourism sector in the North Highlands and there is no reason why visitors would not return year after year.

One of the main challenges along the route has been accommodation – in particular offering a sufficient variety to cater for a diverse clientele and having enough availability and flexibility to offer short stays, especially during peak season.

Now could be the ideal time for rural businesses to invest in innovative accommodation options such as sleeping pods, luxury camp sites, bunk houses or docking stations for camper vans.

NC500 is also keen to encourage visitors to return to their favourite or newly discovered areas for a longer stay. This is where self-catering holiday lets are seeing the benefits, where visitors rent a property as a base for a more in-depth exploration of the local area. Cottages & Castles – a Galbraith Group specialist holiday lettings company - has noted a significant increase in bookings across its North Highland portfolio over the last 12 months.

Accommodation is not the only option to attract tourists to your property or business. Visitors are keen to enjoy activities and attractions while they are here. Guided walks or wildlife tours, Land Rover or quad bike safaris, bicycle hire or fishing lessons are just some of the options that can be very popular. There could also be the opportunity to offer services, such as bicycle repairs, charging points for cars or electronic devices or picnic delivery.

NC500 offers businesses an excellent platform to advertise their products and reap the benefits of collaborative marketing. Business Club members are listed on the website, by both service and map. In addition businesses can take advantage of social media promotion packages, various other PR and marketing activities and the ability to use the NC500 logo on their own marketing material. With 38,000 followers on social media it can expose a rural business to a wide audience in a short space of time.

the North Coast 500 In numbers

So how do you grab a slice of the action? As with any diversification it’s important to consider the assets you have available. Are there redundant buildings that could be converted to business use? What would they be most suitable for?

What are the natural assets on your property that visitors would want to see? What skills do you have that could help enhance the visitor experience? With some creative thinking, it could certainly be an excellent time to invest in the tourism sector in the North Highlands.

620,000 Audience reach six months after launch 38,000 Followers on social media

1,656 Businesses on the app

50,000 Copies of the map printed

516 Miles along the route from NorthCoast500.com

claire.acheson@galbraithgroup.com 01463 245353

galbraithgroup.com | Rural Matters Summer 2017 | Page 13

Contract farming agreements maximise flexibility for landowners Richard Haggart explains the mechanism of the agreement and the benefits to the parties involved.

Contract Farming Agreements are found in a wide variety of circumstances including arable, mixed and livestock holdings.

Over the past year, Galbraith has been involved in setting up an increasing number of arable and livestock agreements. A Contract Farming Agreement (CFA) is an arms-length agreement in which a landowner (the farmer) engages the services of another (the contractor) on agreed terms and pays him according to a formula, to carry out work. Typically, CFAs are set up for three to five years.

This kind of arrangement is wellestablished, and provides the landowner with an alternative to an in-hand farm or leasing the land to a tenant. It is an agreement for the provision of services governed by a commercial contract between the farmer and the contractor.

As well as being simple to understand and easy to operate, CFAs should be inexpensive to administer and provide flexibility to both parties to agree terms.

It is usual for the farmer to provide the land and buildings as well as fixed equipment such as fencing, drainage and equipment for livestock handling.

It is also their responsibility to provide the finance in order to provide cashflow to the agreement along with short and long term farm policy objectives.

The contractor usually provides labour, machinery and machinery costs, management, breeding livestock (via a livestock hire agreement) and replacements.

The process of creating a CFA is relatively straight forward. On most occasions, particularly arable farms, the contractor may already be known to the farmer. As this is an agreement between parties for mutual benefit, fostering the relationship between farmer and contractor is one of the key ingredients to a successful arrangement. Galbraith takes a hands-on approach to nurturing this relationship and continues to manage

the arrangement via regular meetings.

As a firm, we handle many or all stages of the process on behalf of the landowner, from advertising in rural media outlets and constructing a list of potential local contractors to preparing a prospectus and financial terms and organising structured viewing days. We then invite interested parties to submit a financial proposal covering proposed farming policy and anticipated returns. All this is done before the first interviews are conducted.

Short-listed farms are then visited and final interviews held before

Page 14 | Rural Matters Summer 2017 | galbraithgroup.com

references are taken and the contractor appointed. We conclude the process by preparing documentation and chairing any management meetings before the agreement starts and throughout its term.

The contracts we manage have proved beneficial to both the farmer and the contractor and can be utilised on both arable and livestock farms.

richard.haggart@galbraithgroup.com 01738 448143

Advantages of CFAs For the farmer...

• Avoids creation of a tenancy or partnership • Retains tax reliefs associated with land ownership • Retains active farmer status for Basic Payments Scheme (BPS) claim • Can release capital by selling machinery fleet • Lowers overhead costs

For the contractor...

• Improves economies of scale • Larger farming portfolio • Incentivised by receiving larger percentage of 'divisible surplus'

Farms of all types – from a small sheep farm to a major arable concern – can benefit from contract farming agreements.

A history of champions Toby Kirkwood welcomes the inaugural straw sale from the Ballindalloch herd’s prize-winning Aberdeen Angus bull.

LAST year's seminar at Murrayfield for those involved in the agricultural sector, hosted

by Galbraith, far exceeded our expectations in terms of attendance and the volume of business it generated.

It was of particular interest to me since I am focusing on agriculture as one of my specialisms within the Royal Institute of Chartered Surveyors’ APC (Assessment of Professional Competence). As part of this training I have been fortunate enough to observe and help the team working with the historic Aberdeen Angus herd on the Ballindalloch estate, Speyside as they embark on a new initiative.

The Aberdeen Angus breed is recognised worldwide for its high-quality meat, which commands a premium price. The Ballindalloch herd has been in continuous existence since Sir George Macpherson-Grant began improving the breed in the 1860s, and it continues to thrive under the careful stewardship of Guy Macpherson-Grant, his mother Clare Russell, and farm manager David Johnstone. The herd, currently 35 cows plus followers, has some of the oldest surviving bloodlines of Aberdeen Angus in the world and is a passion for the family.

Although the herd can be said to date from 1860, it had already been recorded by the famous cattle breeder, William McCombie, that Ballindalloch was perhaps the oldest herd of polled cattle in the north. He noted: “It has been the talk of the country since my earliest recollection and was then superior to all other stock”.

Sir George and his brother built up the herd with great dedication and skill, producing the world-famous lines of Erica, Jilt, Pride, Georgina, Lady Fanny and Rose. The Erica and Pride

lines are still prominent in the herd to this day.

Since David Johnstone’s arrival at Ballindalloch, the profile of the herd has been considerably raised with a careful selection of breeding stock purchases leading to increasing success in the show ring and the sale of home-bred bulls, both privately and at bull sales.

This summer, for the first time, semen will be available for sale from Ballindalloch Earl N397, the family’s prize-winning home bred bull.

Ballindalloch Earl was the Aberdeen Angus calf champion at Nairn, Black Isle, Keith and Grantown Shows in 2013, the Aberdeen Angus calf champion at Stars of the Future 2013, and bull calf champion at the Black Beauty Bonanza 2013. Ballindalloch Earl's semen will be showcased during the World Angus Forum, to be held in the majestic grounds of Ballindalloch Castle on June 29 and sponsored by Galbraith.

Cattle breeding is increasingly done by artificial insemination, with semen being sold through advertisements in the farming press and travelling sales reps. Good quality semen sells for £30 to £100 per straw.

I have been given the opportunity to help promote the first straw sale from Ballindalloch’s prize bull and I feel very privileged to be involved. The sale represents an excellent opportunity for farmers to take advantage of heritage bloodlines at a reasonable price.

Equally, herd managers will be able to introduce new genetic traits into their herd without the need to acquire a specific bull for a specific characteristic.

Also this year, an Aberdeen Angus tourist trail has been established to celebrate one of Scotland’s most lauded products. It includes heritage sites, farms, farm shops and restaurants whose menus feature Aberdeen Angus beef.

toby.kirkwood@galbraithgroup.com 01786 434635

galbraithgroup.com | Rural Matters Summer 2017 | Page 15

Forestry diversification

Good things come to those who wait Claire Wightman compares the long-term gains from woodland creation with the low steady profits from pasture management.

When considering farm diversification, forestry is often at the end of the list of possible options.

In large part, this is because it is a permanent change of land use, unlike most habitat management of agricultural land. Once ground is planted with trees it is legally required to remain so forever.

When considering the relative value of pasture land against the potential value of woodland, a long-term view is imperative as well as careful consideration of the financial model required for grazing versus woodland, both of which vary considerably.

A recent example in Ross-shire, in which Galbraith was involved, provides an interesting case study where the option of planting with productive woodland was considered alongside carrying out improvement works to increase the profitability of grassland pasture.

Generalised financial models were established to allow comparisons to be made between the two land uses.

The financial model of grassland pasture The main opportunity for diversification into productive forestry on farm land is on pasture land, where the farming potential can be low and the forestry potential can be high. Some ground which has limited cropping opportunities can still have excellent potential for growing quality timber, whether native or non-native. In many cases, such pasture will be let on a seasonal or annual basis at a relatively low rent. However, the inputs to achieve this income are also relatively low, perhaps only re-seeding every 10 years or so.

The overall cash flow of pasture land is summarised in the chart below.

Income Expenditure

10 20 30 40 50 60 70 80

Years

The main features of this model are: • Consistent but low income • Regular and predictable expenditure.

The financial model of woodland creation There is currently good financial assistance available for the creation of new woodlands through the Forestry Grant Scheme. However, applicants do need to pay for the establishment work before they can claim any grant.

Maintenance grants are then available for the next five years to ensure successful establishment.

Once a woodland is established, it will take between 25 and 35 years to reach the first thinning stage. There is now a healthy and growing market for both small conifer products and hardwood firewood, so most first thinning operations should return a small profit.

Thinning can then be carried out on a five to 10-year cycle. As the trees grow and the quality of the woodland improves, the profit from each thinning intervention should also improve. There is no requirement to restock (re-plant) after a thinning operation, however there are maintenance costs for productive woodlands, particularly with regard to maintaining access routes.

The timing of clear felling varies greatly depending on the species that is planted and site conditions. Sitka spruce may be ready for clear felling at age 40, while Douglas fir or Scots pine is best harvested at between 80 and 100 years old. Clear felling generates significantly more income than thinning but there is a legal obligation to restock (re-plant) woodlands after this process. Thus, a spike in income is followed by a spike in expenditure.

The costs of restocking are similar to those of establishment but there is much reduced grant income available for restocking. However, foresters are increasingly experimenting with continuous cover systems which use natural regeneration and special thinning techniques to avoid clear felling and the associated restocking costs.

Page 16 | Rural Matters Summer 2017 | galbraithgroup.com

A typical cash flow based on a clearfelling approach is summarised in the chart below.

Income Expenditure

10 20 30 40 50 60 70 80

Years

The main features of this model include: • Peaks of income and expenditure – not a steady cash flow • Unpredictable income dependent on timber quality and sales market conditions • Greater long-term profit margin manifesting around year 45 • Significant peaks of income and expenditure at either end of timber rotation cycle due to establishing/ re-establishing woodland costs.

Comparison These models, albeit general scenarios, demonstrate the basic differences in the financial models of the two land uses. Pasture management can be summarised as a low input, low profit financial model with a steady and predictable cash flow, while productive

forestry can be summarised as high input, high profit with significant peaks and troughs of income and expenditure.

Site specific factors which directly affect the profitability of productive forestry operations must also be taken into account. For example: • The scale of a proposed woodland directly affects its efficiency and profitability – the larger the woodland the easier it is to generate profit • Accessibility is key to maximising the value of the woodland. Although most woodlands can be accessed with modern machinery, if the cost of extracting the wood is too high the profitability of the operation will fall.

When considering diversifying farmland by planting trees it is important to take account of the longterm impact of any change, particularly on cash flow.

On the right site, forestry can be a very good alternative income stream for those with patience and time on their side.

Georgie Brown looks at the issues affecting tree health.

Global trade and a warming climate have brought a rise in the occurrence of tree pests and diseases in recent decades.

around the country so the emphasis is on trying to restrict the spread of the disease outside the Galloway Management Zone. Statutory Plant Health Notices (SPHN) are issued for infections outside the zone and there is financial assistance to help owners fell infected stands.

These can potentially affect forest management decisions and economic returns and can have significant impacts upon highly valued landscapes. While the Forestry Commission and its agency, Forest Research, work tirelessly to survey the country and improve plant health regulations, forest managers and landowners need to be vigilant and proactive.

It is important for a landowner to act quickly if an SPHN is issued. We can help to assess the viability of felling options, market the timber and apply for associated grants. Hamish Robertson, a senior forest manager based in our Perth office, has experience of marketing and harvesting infected larch stands and is registered as an approved agent with the Forestry Commission.

Current threats in the UK include Phytophthora ramorum, a disease which primarily affects larch trees. Outbreaks were initially concentrated in the south west of Scotland, particularly Galloway, where significant areas of larch have been felled as a result. However, it has now been discovered in other locations

Elsewhere in Scotland, dothistroma needle blight (DNB), caused by the fungus Dothistroma septosporum, has affected stands of pines, primarily those of Lodgepole and Corsican pine which are thought to be more susceptible than our native Scots pine. Again, areas have been felled to try to reduce the impact

s

claire.wightman@galbraithgroup.com 01463 245690

Proactive management and diversity key to tree health

galbraithgroup.com | Rural Matters Summer 2017 | Page 17

s

of this disease. The most successful way of countering DNB infection is to thin crops to increase air flow and reduce humidity levels, which decreases distribution of fungal spores.

The effects of Chalara ash dieback (Hymenoscyphus fraxineus) can be seen across the country now. If you own infected ash trees you are no longer required to take specific action other than reporting it and monitoring tree safety. Progress is now being made in the quest to find and selectively breed Chalara resistant ash trees, hopefully securing the continued presence of this species in British forests.

The great spruce bark beetle (Dentroctonus micans - pictured) is now turning up in some forests in south Scotland, where previously it was only found in England and Wales.

Infestations of this beetle can substantially reduce vigour and cause tree mortality, and if left untreated this will ultimately affect the value of a spruce crop. However, it can be effectively managed by the controlled release of another beetle, Rhizofagus grandis, which is its natural predator. The Forestry Commission will release these beetles at infected sites free of charge.

In all cases, catching signs of infection as early as possible is extremely important, as is good hygiene, rapid response and ongoing research. This is all happening in the vibrant world of forestry, however it requires a sustained collaborative effort to maintain effective control.

Although some of these pests and diseases can decrease timber worth, the UK timber processing industry continues to innovate to recover value.

In addition, we need to be actively improving the resilience of woods.

Increasing diversity of species and age in a woodland is key to reducing and distributing risk. Well-managed, increasingly diverse woods are likely to be a healthier, more resilient resource in the future.

Forests remain a valuable asset and worthwhile investment. A healthy and growing demand for timber, the rising value of forestry land, favourable tax treatment of commercial forests and significant grant funding for the establishment of new woodlands all make forestry an attractive option for landowners and investors.

georgie.brown@galbraithgroup.com 01738 456066

Could your estate be part of the adventure?

Ossian – a new member of the Galbraith Group – has been created to offer the very best of Scotland to ultra-high net worth clients around the world.

A stay in the finest stately homes and castles? The need for a fleet of helicopters and Range Rovers? A chance to enjoy the very best country sport? The opportunity to play world-renowned golf courses? Ossian ensures visitors can sample it all and savour those moments in luxury.

Ossian organises bespoke and exhilarating experiences individually designed by adventure specialists.

Itineraries can include whale watching, rally driving, shooting, stalking, access to the finest private golf courses, whisky tasting, visiting heritage sites, wild swimming, tuna and salmon fishing, private sporting tuition or a trip on the MV Hebridean Princess, recently chartered by Her Majesty the Queen.

This is combined with unrivalled and exclusive access to the finest sporting estates and private properties in the country. Ossian also provides personal chefs alongside private dining at Scotland’s Michelin-starred

Page 18 | Rural Matters Summer 2017 | galbraithgroup.com

restaurants and incorporates the bespoke requests of its clients, such as expert sporting tuition, private aviation or private security.

Since its conception, Ossian has received a surge in enquiries from land and estate owners interested in the potential of using some or all of their land as a tourism asset.

Whether it’s the regeneration of castles and keeps, or the establishment of uniquely located residences, Ossian’s expert team can advise on new ways to create added value and future-proof estates. In all cases, there is a focus on delivering an attractive return on investment for the landowner.

As Scotland’s leading and unique adventure specialist, Ossian is dedicated to the promotion of Scotland as a truly exceptional holiday destination and is constantly sourcing and adding to its varied and extraordinary offerings.

The tricky business of valuing on-farm renewables Alistair Christie explains the methods involved in the accurate valuation of renewable assets.

The value of farms and other physical assets such as houses, forestry and farmland are generally accessed by analysis of comparable evidence, often gathered from recent sales.

As a result, and especially in areas where there have been a number of recent farm sales, most farmers and valuers have a good idea of what farms and land are worth in their area. But add in an array of wind turbines, an anerobic digestion (AD) plant or a hydro scheme and that valuation is less clear-cut.

There is currently a lack of farms on the market with renewable energy projects already on-site, or indeed standalone commercial renewables projects. This means there is very little comparable data to go on, so a more technical approach is needed. Valuations can be further complicated depending on how easily a renewables project can be separated from the main farm or estate business and treated as a stand-alone asset.

The ‘investment method’ is generally regarded as being the most useful approach and relies heavily on having accurate financial data, including actual and forecast income and expenses. It is the most straightforward method for larger schemes, typically over 250kW, which are set up as a stand-alone enterprise with a separate business structure and can therefore be divided into a tradable asset with an appropriate value.

To discuss diversification opportunities with the Ossian team please contact Ted Innes Ker: adventure@ossian.co 0131 240 6995

The investment method is based on two key criteria: the income (Feed-in Tariffs or Renewable Heat Incentive) and any costs associated with energy generation such as maintenance or feedstocks over the remaining lifetime of the project. This gives a net present value expressed as pounds per MW installed. For smaller schemes (sub-1MW), the value is multiplied up to a per MW figure.

A slightly different approach is needed where projects are integrated with the farm business and cannot be easily split off, for example a biomass boiler heating poultry sheds or energy from an AD plant providing a large dairy unit with electricity

and hot water. In these cases, the renewables installation is usually treated as fixtures, plant and equipment and as such is a wasting asset due to its wearing parts and natural cessation. However, if the installation is being sold as part of the farm an investment value can still be attributed to it and that is usually done through the discounted cash flow method.

This method looks at total income and costs directly attributed to the project over its lifespan, including subsidy income, revenue from energy sales and the cost savings to the operator as a result of lower energy bills offset against costs of generating electricity, especially on intensive farm units such as dairy, poultry and pig farms.

Risk also needs to be considered, which will influence the rate of return that any

“

Valuing renewables is all about weighing up the risks and returns, which can be more complicated than the traditional comparable approach. investor is willing to accept. For technology such as AD, there are potentially more things that could go wrong due to its relatively new technology and the nature of the operation of the plant, so it is seen as higher risk than solar or hydro for example.

An investor might want a 15-20% return on capital for AD to reflect the increased risk, whereas for lower risk technologies, which have been established and developed over many years, such as wind turbines, they might accept a return nearer 6-7%.

Valuing renewables is all about weighing up the risks and returns, which is very different and can be more complicated than the traditional comparable approach.

Being on all of the Scottish high street bank valuation panels, Galbraith is highly experienced in valuing farms and estates with renewable projects in place.

alistair.christie@galbraithgroup.com 01786 435047

galbraithgroup.com | Rural Matters Summer 2017 | Page 19

No place for pheasantries

Jamie Grant examines the lessons learned from a recent planning enforcement notice.

At Galbraith, we have followed the development of a particularly interesting planning appeal case which serves as a warning to those who rely on ‘agriculture’ permitted development rights.

In a recent appeal decision notice, a reporter appointed by ministers from the Planning and Environmental Appeals Division (DPEA), upheld a planning enforcement notice issued by Perth and Kinross Council to Glenshee Pheasantries Limited to cease using a section of purchased land for the purposes of pheasant and

partridge rearing as it constituted an “unauthorised change of use of agricultural land”.

For Glenshee Pheasantries this was a costly conclusion to a frustrating year of interaction with the planning system.

Glenshee Pheasantries was informed in a pre-application advice email from a council planning officer that the proposed use of the site, rearing pheasants and partridge for shooting, is accepted to be ‘agriculture’.

Based on this advice the appellant purchased the site, did not apply for planning permission and invested a significant sum into starting up the business.

Several months later, Glenshee Pheasantries received another email from the planning officer stating that the council had taken the view that game rearing was in fact not agriculture and that the use of the land for pheasant rearing is a material change of use of the

land from agriculture and was a breach of planning control.

When the Glenshee Pheasantries appealed this planning enforcement notice to the DPEA the council put forth a powerful argument.

The council took the view that rearing pheasants should not be considered ‘agriculture’ as they are being commercially reared for sport more so than for food. They provided evidence supporting this position: an article by the Game and Wildlife Conservation Trust which stated that only 37.5% of released pheasants are actually shot and could potentially be eaten, therefore it did not follow from this that the pheasants were produced for food.

The reporter concluded that the scale and activity of rearing pheasants on the site had constituted a material change of use from ‘agriculture’ to mixed use where the non-agricultural activity of rearing pheasants and partridges for sporting purposes formed the dominant part. As this mixed use did not have planning permission, the enforcement notice was upheld by the reporter.

This example serves as a cautionary tale to those who are considering agricultural activity and business developments.

Planning policy and legislation in Scotland remains a grey area for many rural development proposals. Our planning team has reviewed a number of proposals recently which could be assumed to be agricultural permitted development, such as fishing huts, equestrian riding arenas, and allotments.

It should be remembered that positive pre-application planning advice is not the same as gaining planning permission. When there is doubt about whether a proposal is within agricultural permitted development rights, consultation with a planning professional is a wise move. jamie.grant@galbraithgroup.com 01786 434638

Page 20 | Rural Matters Summer 2017 | galbraithgroup.com

A glass half full Mungo Ingleby gives his optimistic take on the world of field sports.

Occasionally, during the course of daily conversations with owners, enthusiasts and the men and women who earn their livelihood from field sports, there is a Private Fraser moment “We’re doomed, we’re all doomed”.

Any one incident can be the catalyst for such a train of thought – snow storms in late May, a drought that marches relentlessly through September and into October, perhaps a bureaucratic road that either seems to have no ending or one that leads into a cul-de-sac of frustration.

Happily however, field sports enthusiasts are largely optimistic and, more often than not, such a conversation will shortly turn to excitement at the prospects of a coming day or week. It is a pleasure to work with so many people who share this mindset and who appreciate that, with wild sport, there are no certainties. This article is therefore a rallying cry for both field sports and our wonderful country. It is imperative that all stakeholders apply this optimistic approach and take an active role in rebutting the naysayers.

Our small country offers wilderness and sport

to rival any European destination. Scotland has a tradition of field sports that is centuriesold and it is rightly famous across the world for its characters, topography, hospitality and challenging and rewarding sport. This international acclaim has been won by the fact that these pursuits are at the very heart of some of Scotland’s rural communities and visitors enjoy not just our sport but the very essence of Scotland. To my mind the pull of Scotland is not diminishing, quite the opposite, and I would argue that there are myriad opportunities for owners and enthusiasts alike.

I appreciate that there are undoubtedly frustrations: sporting rates are in the metaphorical post, the recent Wild Fisheries Reform process has been an exercise in bureaucracy and little else, a vocal anti-shooting minority shouts from the side-lines, and the west coast continues to labour under its burden of salmon farms. But where, in the modern world, are there not frustrations? In business and in politics, in subsidies and grants, in economic policy or in health and safety you choose your field and you choose your obstacles and red tape.

Despite all this, Scotland continues to attract visitors from around the globe. Country sports

generate more than 270,000 trips, 1 million room nights and an estimated £155 million to the economy. This can only be good news for the continuity and longevity of the pursuits that we love and so I urge enthusiasts to approach the new season with a spring in their step.

While optimism is the theme of this article, it should never be confused with complacency.

The greatest threat, of those that we currently face, is that the vocal minority will shout loudly and long enough for their view to become the accepted norm. This must not be allowed to happen and there are a range of simply tremendous groups representing the interests of field sports that showcase the benefits to conservation and rural communities alike.

“

To my mind the pull of Scotland is not diminishing, quite the opposite.

I know that many of you support your passions, but I would urge those of you that do not to look at the great work of the GWCT, the Gift of Grouse, the Scottish Moorland Group, the Atlantic Salmon Trust, the S&TCS or indeed any other and add your voice to those championing our traditions.

mungo.ingleby@galbraithgroup.com 01738 456079

galbraithgroup.com | Rural Matters Summer 2017 | Page 21

Lucie Howatson explains how creative expansion can lead to something worth celebrating.

Hatton of Ogilvy Farm, a few miles to the south of Glamis in Angus, has been farmed by the Jarron family since 1910.

The business always focused on a traditional mix of arable and livestock production but in September 2014 Graeme Jarron, the fourth generation farmer, produced Scotland’s first potato vodka, Ogilvy.

Setting the scene for the silver screen Gilda Walsh and Gareth Taylor explain the script when allowing a production company to film on your land.

A brush with fame is undoubtedly an appealing prospect and Scotland has a wealth of excellent film locations.

But whether it’s a multi-series blockbuster about time travel, a TV advert for a well-known whisky or a request to film a documentary in a cave, you should first consider a number of important factors.

The potential impact of filming on other activities should be examined; this is particularly pertinent on farming and sporting estates. A tractor might be considered by the production team as unwanted noise during filming and crew traipsing over moorland might be considered by you as an annoying disturbance during shooting season.

Depending upon the fee and potential disruption to other income streams, it is worth weighing the pros and cons carefully.

Galbraith has helped landowners with such decisions in the past. In the summer of 2014 an estate managed through the firm’s Ayr office, was teleported back to the 1700s during the Jacobite rising. The estate owner in this instance was approached directly by producers, but appointed us to manage the filming on behalf of the estate. This ensured that relevant agreements were put in place not just for the estate, but also for its tenants who were compensated for their loss of grazing.

In total the crew were on site for five weeks with up to 100 people at any one time and quite a number of vehicles, but damage was minimal as access

It was launched on to the market in early 2015, but it had taken many years of dedication, research and inspiration from Graeme and his wife Caroline for the farm to diversify into making vodka.

had been managed and temporary metal tracks laid. Overall, it was a very successful venture for both the estate and for the production team.

Elderslie Estate in Renfewshire has been using filming opportunities as a source of additional revenue since the early 1990s. Over the past 17 years the estate has welcomed a number of different production companies on to the land to make use of the versatile buildings and picturesque scenery.

Elderslie's owner, Mark Crichton Maitland, says: “As landowners we need to find ways to make productive use of the diverse landscapes and the beautiful historical buildings in our care.

Galbraith encouraged me to pursue any filming enquiries and this has resulted in scenes from Dr Finlay’s Casebook, Taggart and children’s educational programmes having been shot around the estate. The scenic Neilston quarry has also been used to shoot climbing scenes for various BBC dramas. I would encourage others to ensure they are listed as a potential filming location.

Diversification is essential for most rural estates and I’m pleased that filming has added yet another string to Elderslie’s bow!”

Galbraith has had wide exposure to filming projects including helping teams to find suitable TV and film locations.

gilda.walsh@galbraithgroup.com 01292 292546

gareth.taylor@galbraithgroup.com 0131 240 6962

Page 22 | Rural Matters Summer 2017 | galbraithgroup.com

The couple first considered the idea in 2012 with a view to capitalising on the existing potato operation at Hatton of Ogilvy. The farm grows around 50 acres of potatoes each year and focuses on growing three premium potato varieties. Maris Piper proved to be the perfect variety for their vodka because its dry matter content is between 19 and 21%. Wetter varieties did not produce the consistency of flavour and texture they needed.

Extensive trials, using potatoes from the farm, were held in conjunction with Heriot Watt University in Edinburgh before investment in the new building and distilling equipment was made.

The trials not only confirmed the best variety of potato but also allowed Graeme and Caroline to ensure that the distilling process could be increased from laboratory-sized production to a more commercial scale.

Ogilvy is produced using 600kg batches of potatoes at a time, which are washed and minced with the skins on - the skins caramelise and add a unique sweetness to the finished

From field to bottle...

In high spirits...Graeme and Caroline Jarron on their farm near Glamis.

Where there's a still... vodka – to produce a ‘mash’. The mash is then pressure cooked for four to five hours, using a method of ‘sour mashing’ to alter the pH of the potatoes which allows the naturally found starch to turn into sugar. This results is a liquid mix of sugar which is then fermented with the addition of yeast.

“The chemical reaction during fermentation heats the liquid, which is left for a period of five to six days,” explains Graeme. “The higher the outside temperature, the quicker the process.”

After fermentation the liquid (or ‘wash’) is about 7 to 8% alcohol. The distilling process creates the alcohol by separating the menthol from the ethanol

(alcohol). The alcohol content rises to 70 to 80% after the first distillation and peaks after the second distillation at 96%, the minimum requirement for vodka. Once at 96% the vodka is left to mature for seven days, which allows the alcohol to breathe by reacting with the air around it. The final stage involves ‘polishing’ the vodka through a charcoal filter and adding the soft Angus water to dilute the vodka to 40% before it is bottled.

The result is an international awardwinning spirit, which counts the coveted Vodka Trophy at the International Wines and Spirits Competition in 2015 among its trophies. Graeme and Caroline have created a true craft vodka; the entire

process from growing the potatoes to bottling the finished product is carried out on the farm, providing 100% traceability.

Ogilvy is a great example of how, with a bit of ingenuity and hard work, a business can capitalise on its existing enterprises and successfully diversify to create a new product or service.

As Graeme says, “it is important for the future of farming to diversify and create new markets in which to sell our products, be it a potato or a bottle of vodka.”

lucie.howatson@galbraithgroup.com 01738 456085

galbraithgroup.com | Rural Matters Summer 2017 | Page 23

our expertise l Agricultural loans (AMC

Finance)

l Aquaculture l Building surveying l Compulsory purchase

and compensation

l Energy l Estate management l Farm and estate sales

and acquisitions

l Farm management l Forestry l Land management l Landlord and tenant issues l Planning and development l Sporting management l SRDP and IACS l Subsidy trading and advice l Telecoms and utilities l Valuations

contact Aberdeen Ayr

01224 860710 01292 268181

Castle Douglas

01556 505346

Cupar

01334 659980

Edinburgh

0131 240 6960

Elgin

01343 546362

Galashiels

01896 754842

Inverness

01463 224343

Kelso

01573 224244

Perth

01738 451111

Stirling

01786 434600

Offices across Scotland | Sales & Lettings | Farm & Estate Sales & Acquisitions | Rural | Rural | Energy Forestry | Property & Land Management | Sporting | Agricultural Loans | Subsidy Trading & Advice

Page 24 | Rural Matters Summer 2017 | galbraithgroup.com