AgriView Autumn Winter 2019

AgriView Winter 2019

Rural update from Fisher German

Understanding current times

Improving sustainability, profitability and resilience

The real value of soil

Launching the new FG Soils Matrix service

Collaborative farming

A game changer for those who have embraced it

Legacy development

Building communities for the future

Meet the team Our 25 offices provide local experts in all these work areas. If you would like guidance on any rural property matters, please contact one of us and we will ensure you get to talk to the very best advisor.

David Merton

Stuart Flint

Head of Rural Sector – Estate management and strategic consultancy

Head of Agency Sector – Farms, estates and country house sales

07770 333331

07501 720422

david.merton@fishergerman.co.uk

stuart.flint@fishergerman.co.uk

David Kinnersley

Darren Edwards

Agribusiness

Sustainable energy

07501 720405

07918 677571

david.kinnersley@fishergerman.co.uk

darren.edwards@fishergerman.co.uk

Helena Tibbitts

Charles Meynell

Valuation

Expert witness

07918 628985

07836 212307

helena.tibbitts@fishergerman.co.uk

charles.meynell@fishergerman.co.uk

John Ikin

Kay Davies

Compulsory purchase

Planning

07887 627978

07733 124551

john.ikin@fishergerman.co.uk

kay.davies@fishergerman.co.uk

Ben Marshalsay

Richard Benson

Development

Building consultancy

07771 974322

07768 552827

ben.marshalsay@fishergerman.co.uk

richard.benson@fishergerman.co.uk

William Gagie

Richard Gadd

Minerals

Farm agency

07551 152691

07966 481487

william.gagie@fishergerman.co.uk

richard.gadd@fishergerman.co.uk

Welcome With continued uncertainty and a lack of clarity over future farming policy, it is increasingly important for UK property owners to monitor any progress made in respect of proposals of the principal political parties over the coming months, and to consider their implications.

Focus on the environment and in particular ‘natural capital’ – land, soil, ecosystems, air and clean water – has never been greater.

Soil science in particular is complex, and Fisher German, working with agronomists Indigro, have developed a Soils Matrix which we believe helps us to assess soil health, plan improvements and monitor in a systematic way. In this edition of Agriview, Robert Knight explains how we are adding value to farms and estates with a passion to reverse the adverse effects on their soils, both in the medium and long term.

We have an update from David Kinnersley, highlighting the benefits that can be obtained from collaboration. Establishing joint ventures has been a game changer for those businesses which have embraced it, making

them substantially more profitable and resilient to the vagaries of the market – as well as reinvigorating the owners with a new challenge.

We also have insight from Richard Gadd on the farmland market. Despite a lack of clarity, whilst vendors who are not under pressure to sell have generally taken a wait-and-see approach, our research and trading activity in 2019 indicate that buyers are generally retaining a firm and consistent interest in farmland, resulting in values remaining stable, and in some cases strengthening. In particular, land and farms which hold future development potential continue to attract unprecedented interest from a variety of buyers.

Increasingly, however, those seeking to bring forward land for development are first pausing to contemplate what type of development they wish to deliver. Given the prominent role that landowners play in the local community, Tom Homfray and Mark Gauguier of Farrer & Co give their thoughts as to how legal structuring and long-term stewardship can influence the approach to design-led legacy projects.

Well-managed and structured businesses continue to thrive despite the challenges.

Although without some certainty it is difficult to recommend introducing major changes, being prepared by understanding the current position and reviewing where changes might be appropriate is a sensible approach.

David Merton 07770 333331 david.merton@fishergerman.co.uk

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The value of agricultural land is largely determined by the market forces of the day and what prospective customers are willing to pay for it. But the soil that makes up that land can be valued more precisely; measured by its productivity, its condition, and what it can give back.

Soil varies with every step across a field; it changes each day in condition and behaves differently depending on rain or shine.

The soil’s texture, based on its proportions of sand, silt and clay, dictates what you can do with it. Its nutritional content, organic fraction and structural condition are all influenced by what activities have been carried out in it which in turn determines what uses it can now be put to.

Post-war UK agriculture is something of a victim of its own success. Producing increasingly cheaper food and lowering the cost of production by striving for yield and specialisation, has come at a cost to our soil.

The impact of the past on today’s production can be surprisingly consistent year on year. Fisher German manage neighbouring farms under contract agreements that have different histories, different rotations and therefore different soil conditions; for the same management and level of input they consistently return a different output.

The ‘real’ value of soil Soils Matrix – how it works Soil science is complex, and working with Indigro we have developed a tool which we believe helps us to assess soil health, plan improvements and monitor them in a systematic way, adding value to farmland both in the medium and long term. We are working with farms and estates with a passion to reverse the adverse effects on their soils, auditing, monitoring and benchmarking changes.

Indigro, our agronomy partners, work with us on many of the farms and estates that we manage and have pioneered a matrix measurement and interpretation system. We then cost and apply a farm management planning service for our clients.

The table below is the Dashboard page from the Indigro FG Matrix soils condition calculator.

Farm/Field Condition dashboard Location: Sand % Silt % Clay %

Manor Farm 25 38 37

Factor

In one case, there is an 8% average difference in output between farms for the same level of input. At today’s prices that is approximately £112 per ha average on the bottom line, for no apparent difference in cost or inputs; over ten years on a thousand hectares that’s £1.12 million.

With such advantages to be gained, Fisher German and our clients are asking how to go about monitoring and making changes to effect these differences; our soils benchmarking and valuation analysis is helping to do just that.

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Land - Fixed/Long-term Grade of Land Field Drainage

First Analysis 01 March 2014

Subsequent Analysis 03 March 2018

Importance of Factor

Input Actual Value

Score 1-10

Weighted Score

Input Actual Value

Score 1-10

Weighted Score

10% 15%

2 200

9 8

0.90 1.20

2 0

9 10

0.90 1.50

30%

25

5

1.50

45

8

2.40

6

0.60

Land - Variable/Short-term VSA Soil Quality Index

Worms observed*

3

pH

10%

P (mg/l) K (mg/l)

7 0.40

5

4

6

5%

16

7

0.35

18

8

0.40

3%

395

7

0.21

440

7

0.21

Mg (mg/l)

2%

56

7

0.14

65

8

0.16

Organic Matter

15% 10% 100%

2.8 9

5 5

0.75 0.50 5.95

3.5 13

6 4

0.90 0.40 7.47

Weed burden

Land Total

* The VSA Index methodology for worms observed is 15, however we report numbers below that for interest

Soil as an asset has been overlooked for too long – a fact the industry has undoubtedly woken up to.

It is the hot topic of the moment, and rightly so as it underpins everything we do: whether growing grass for livestock or planting seeds to grow grain or vegetables.

The Matrix programme applies a weighted score to the parameters chosen to be measured, and those scores are then factored to populate a total for that field or block.

The parameters chosen are those we deem to be essential to monitor the soil’s value, to protect that value for its owner or aim for its improvement, based on a skilled and detailed farm/field/soil survey.

Each element has a scaling system behind the spreadsheet that builds the matrix. The variable soil analysis (VSA) score and its scale is shown as an example.

Scale 1

2

3

4

5

6

7

8

9

10

0-5

6-11

12-18

19-24

25-30

31-36

37-42

43-48

49-54

55+

Parameters measured: • Soil classification. The bit you cannot alter, but has an impact on the value; this has a low weighting.

• Drainage. Investments required for ditch or underdrain systems are long term and get costed and valued through to the scale.

• VSA soil analysis (table, right). An industry-recognised field soil analysis measurement, probably the most important factor in the weighted score providing information as to soil productivity and current health.

• pH status and liming requirement. An elementary but vital factor for successful crop production.

• Phosphate indices. Notoriously difficult and costly to improve. Both their minimum levels and, in the future, maximum levels contribute to this score.

• Potassium and magnesium levels.

• Organic matter. Affects workability, shear strength, bulk density, water-holding capacity, nutrient retention and how quickly soils warm; it carries a high importance factor.

• Weed burden. Essential for long-term sustainable production to stabilise or reduce seedbanks of weeds such as blackgrass.

In the hypothetical example provided, the condition score for the field is 5.95 when first measured and scored. The process is then repeated four years later, each change logged and the direction of travel through management demonstrated for each measurement. The overall weighted score is then calculated, in this case increasing to 7.47; a healthy improvement in a short period.

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The ‘real’ value of soil, continued...

Costing the change We measure and benchmark the condition score based on the matrix, then apply cost calculations as individual parameters alter. This might be to demonstrate the cost to rectify a change between two scores over time, or to set a theoretical optimum level for a certain soil that could be attained through management.

We can then show what it would cost over time to get the soil into that condition.

dressings in order to increase indices. With current fertiliser pricing factored in we then cost that change.

years of rotation and drill and grow cover crops at various intervals, but is it worth the investment?

The organic matter (OM) change is more complicated depending on:

• Tenancies can have the matrix score agreed at the beginning between landlord and tenant; it can be monitored at intervals and land returned in similar health and condition, or compensation paid for loss or improvement to score.

• cover crop use

The calculator values the savings in nutrition from the manures applied and predicts the increases achievable. A single percentage shift in Soil Organic Matter (SOM) would change water-holding capacity by around 200,000 to 224,000 litres per hectare; provide sufficient food for 750–1000 kg earthworm biomass; and lift Soil Mineral Nitrogen by 80-100 kg per hectare (of which 20–30kg would be plantavailable over 6–12 months).

• Investors and owners can take land at a given score, manage appropriately, monitor and benchmark progress to demonstrate the value added.

• The matrix and cost analysis options give you the investment required to influence the change you want.

Farm management planning to predict and demonstrate how we can influence the soil status and score is where the tool assists us. Different soil types react differently to applications of P, K, Mg and lime but the standard data gives a good start to the amounts required over and above maintenance

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• local sources and costs of manures • changing cultivation systems

• rotational changes including introducing grass in a rotation and even mob grazing systems.

All factors influence the speed and amount of increase or decrease of OM in the soil.

Our costing calculator starts with options of applying manures but can factor any of the influences that alter rate of organic matter change depending on the local and management constraints.

The first farm calculations have demonstrated some interesting net cost forecasts.

It might be costly to apply 150 tonnes per ha of a local manure over eight

For a soil bulk density of 1.45 gm/cm3, a value of 1% SOM equates to 16.8 tonnes of organic carbon per hectare. As the world asks us to sequestrate carbon here lies part of the answer, with a technique and affordable cost to understand how to do just that.

Robert Knight 07557 037903 robert.knight@fishergerman.co.uk

Joint venture arrangements – time to revisit?

Agriculture has become a higher risk business with the impact of policy changes and price volatility reducing financial certainty and rising input costs (particularly machinery) increasing the working capital at risk. This won’t improve with the reduction in direct support proposed under the Agriculture Bill and the introduction of the Environmental Land Management Scheme (ELMS).

Add the reducing efficiency and availability of pesticides and less predictable weather due to climate change, and the variance in farm profitability is significant between years.

Well-managed and structured businesses can and will still thrive despite these challenges, and those with the lowest cost of production and therefore higher margins are the most resilient to the fluctuations in price and output. These don’t have to be the largest businesses to achieve these efficiencies, but it helps particularly as the equipment and technology to improve productivity climbs in cost and staff expect better conditions to work in.

The options for achieving this reduction in cost of production and risk are many. They are driven not just by immediate returns but also a mix of income, capital and inheritance tax policies that encourage businesses to continue to operate and take risk – not just let out their property element.

Contract Farming Agreements (CFAs) have been the most popular route for retiring farmers or landowners without the skill set or scale to farm inhand, to collaborate with other farmers to reduce their cost of production and improve profitability. The “operating” farmer achieves economies of scale in their operations many of which are now covering 2,400 ha (6,000 ac) from a fairly small owned area. Fisher German manage 40,470 ha (100,000 ac) under these type of arrangements – typically for arable farms.

Share Farm agreements (where inputs and outputs are split on an agreed basis) tend to be more popular for livestock enterprises, but are relatively rare despite their success in New Zealand. More generally in the UK livestock sector there has been a trend toward the larger businesses, whether dairy, beef, poultry or pigs, contracting out certain elements of their production to other farmers whether that be rearing, fattening or finishing. This has been

very successful for both parties in managing the capital they have tied up and the risk involved, while achieving economies of scale.

functions. It can also create great careers in a larger business for the highly skilled staff and managers helping retain them.

Collaboration hasn’t been a popular business model in the UK agricultural sector, but the pressures on margins and availability of labour plus the demographic structure of farmers may mean it becomes more so in the future.

The Fisher German Agribusiness team have been involved in setting up several of these types of joint ventures at a variety of different levels. Key to their success has been:

Structures such as Joint Venture Machinery & Labour companies are one such concept which has proved successful. This is where two or more businesses come together to form a larger business that provides lower-cost services back to their individual farm businesses, having a great deal of potential for reducing the overall cost of production.

These agreements can be a simple arrangement to share the cost of a combine or specialist harvester to much more complex agreements to form a new business to own and run a full complement of machinery and the labour required to manage it. The objective is to provide a contract service back to the “parent” farming businesses, at the lowest cost with a range of mechanisms, to ensure that this is achieved fairly, even if they have different cropping and areas under their control.

• a mindset to enter into the spirit of collaboration • clear communication of everyone’s objectives from the outset • clarity about the roles that everyone has and collective responsibility for delivering them • the ability to achieve meaningful financial returns • a great team of advisers to ensure that the agreements and advice given achieve the right outcome and cover the policy, tax and employment issues effectively • support from a chairman or non-executive director to help resolve any contentious decisions and provide reassurance when needed.

It has been a game changer for those businesses which have embraced the collaboration and made it work, making them substantially more profitable and resilient to the vagaries of the market – as well as reinvigorating the owners with a new challenge.

A well-set-up agreement with the right partners can be a great deal more than the sum of its parts, with the ability of the individual principals to play to each other’s strengths and build a business that is much better both technically David Kinnersley and financially. It enables them to be 07501 720405 more competitive when taking on more land and better david.kinnersley@fishergerman.co.uk able to manage all the administrative

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Legacy development: Building for future generations “I tell developers to bear two things in mind: they’re not just building homes but building neighbourhoods; and they need to ask themselves whether they’re building the conservation areas of the future” Kit Malthouse, former Minister of State for Housing and Planning

For rural landowners continuing to face profound uncertainty, disposing of land for residential development may appear more attractive than ever. Increasingly, however, we are seeing those seeking to bring forward land for development first pausing to contemplate what type of development they wish to deliver. While the size and certainty of the financial receipt remains a primary motivator, matters such as build quality, design, sustainability and legacy may also influence approach – particularly given the prominent role that landowners play in the local community.

The growing body of evidence illustrating the benefits, both social and financial, delivered by design-led legacy developments has grabbed the headlines as well as the government’s attention. A myriad of factors will impact on the viability and feasibility of such schemes; we have witnessed, first-hand, the increase in the scope and sophistication of these projects. In this article, we briefly consider two key focal points of any legacy scheme: legal structuring and long-term stewardship.

Legal structuring The day one freehold disposal, usually with planning consent, remains the most attractive option for landowners seeking early payment and a clear exit. It is also the developer’s funder’s preference, with the freehold interest in the land offering the most immediate and readily understandable security. This approach does not preclude the incorporation

of design controls, but inevitably there is a dilution of control once title to the land has passed. Principally, the landowner loses the effective sanction of being able, in due course, to refuse to transfer a dwelling to a purchaser if there is a breach of design standards. Design control protections may be incorporated, but much will depend on the parties’ negotiating position.

Where viable, a development agreement, or ‘building licence’, can be the preferred option.

A key feature of these agreements is the retention by the landowner of title to the site; the developer is granted wide-reaching rights to develop, market and sell the dwellings – but it does not hold title to the scheme.

By retaining title to the land, a landowner is able to exercise a higher degree of control over design and construction standards and will ultimately run the disposal process.

Developers and funders alike can struggle with this structure, and its success tends

Tom Homfray, Associate, Property +44(0)203 375 7115 tom.homfray@farrer.co.uk

to depend on bargaining strength. It also requires significant medium to long-term input from all parties.

A fashionable hybrid is the development lease. Here, an agreement will be entered into which provides for the grant of a lease to the developer once certain conditions (perhaps linked to planning or funding) have been met.

The lease will govern how the development is undertaken, incorporating all or most of the provisions typically found in a development agreement. As the development is built out, the lease falls away and the units are sold to end buyers. The grant of the lease gives the developer a proprietary interest in the land which affords the developer greater control and is often required by its funder. It also ensures that disposals can only occur once works have been satisfactorily completed.

Typically, the development agreement and lease structures feature the payment of a capital sum to the landowner at an early stage, with overage or an ‘agreed distribution’ subsequently payable on unit disposals or at certain milestones. The initial premium

is likely to be lower than that payable on a straight freehold disposal, an attractive prospect for a developer from a cashflow perspective, particularly where the developer is to fund upfront infrastructure costs.

However, due to the higher quality of the dwellings constructed, the aggregated sum payable to the landowner, as units are sold and successful ‘placemaking’ is achieved, may prove to be significantly more than the capital receipt on a freehold disposal.

Stewardship While the design and build stages are critical, it is the establishment of an effective management regime that secures a lasting and positive legacy. Again, one size does not fit all and there are many ways to implement this. Central to the approach will be the extent to which landowners wish to be involved with daily management and whether they have the resources, both human and financial, to play such a role. The use of management companies has been prevalent, but they are not without complication – principally around the role they play and the approach taken

Mark Gauguier, Partner, Property +44(0)203 375 7466 mark.gauguier@farrer.co.uk

by their directors. There are other options, however, and community development trusts are becoming increasingly popular – as much for the community role they play as for the distance they put between schemes and their proprietors.

Conclusion Specific circumstances, perhaps relating to tax planning, business costs or debt repayment, will inevitably dictate a landowner’s approach to a development project. Local politics will also play a part. For landowners willing and able to take a longerterm approach, however, with payment to be received over a lengthier period, carefully structured and policed developments with robust and effective design codes afford the opportunity to leave an enduring and tangible legacy.

Tom Homfray and Mark Gauguier Farrer & Co LLP

Prestigious national award won by Barnston Estate, Cheshire Edward Trevor-Barnston & RASE President Jim Godfrey

Edward Trevor-Barnston, owner of the 1,800-acre Barnston Estate near Farndon, has received the Bledisloe Gold Medal from the Royal Agricultural Society of England.

The medal is given to landowners who demonstrate outstanding achievement in the successful land management and development of an agricultural estate in England.

The Barnston Estate, which is managed by Fisher German, has overseen the expansion of Crewe Hall Farm over the last year, and that successful project was a major factor in Edward landing the award.

Edward said: “The tenant at Crewe Hall Farm wished to substantially increase the number of cows on the site, and I was happy to invest to help him achieve this.

“Over the last year, we have developed a state-of-the-art dairy farm, with new cattle housing, a 60-point rotary milking parlour and extended silage clamps.

“Crewe Hall Farm is now one of the best farms of its kind in Cheshire thanks to our investment and the tenant’s great ambition.

“We’re always looking to expand and improve the Estate, so we’re incredibly proud to have been awarded the Bledisloe Gold Medal, which carries tremendous kudos in the rural world.

Along with Crewe Hall Farm, the Barnston Estate also consists of Monument Place Employment Park, a former plant-breeding site which now hosts a children’s nursery and a greenhousemanufacturing company.

Top Farm is also located on the Estate, which was converted for commercial use in the 1980s. It features a restaurant, physiotherapist clinic, hairdressing salon and picture gallery among other shops.

Edward is planning on expanding and improving the Barnston Estate even further in the next five years, with a cookery school and B&B on the horizon.

He also aims to significantly reduce the carbon footprint of the entire estate by adopting modern farming practices and technology.

Edward Clark, partner, said: “We have helped Edward and his predecessors manage the Barnston Estate for more than 50 years now and we are so pleased he has won the Bledisloe Gold Medal.

“His willingness to invest in new ideas rather than sitting on his laurels has paid off – both in the success of his tenants and with the awarding of the medal.

“Edward still has ambitious plans for the Estate, and we will be on hand to advise him every step of the way.”

“I have to thank Fisher German for all the advice they have provided over many years. We have worked with the company for more than half a century and their input has been key.”

Edward Clark “I have to thank Fisher German for all the advice they have provided over many years. We have worked with the company for more than half a century and their input has been key.”

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07718 524819 edward.clark@fishergerman.co.uk

Join our apprenticeship trail Surveying is a wonderful career. It is truly varied; you can be in meetings with clients on site or back at base working with the team. No two days are ever the same. At Fisher German we are always keen to welcome individuals who want to enter into this fantastic profession, and we believe in creating as many routes as possible, which is why we are part of the Apprentice Surveying Trailblazer Group.

Fisher German has been part of the Surveying Trailblazer Group which worked on the new standards for degree-level apprenticeships.

Initially there was no mention of the rural pathway, but the Group’s efforts have now secured its inclusion. Our involvement in this Surveying Trailblazer Group is at the heart of Fisher German’s ethos of encouraging individuals from diverse backgrounds into surveying. We understand that not everyone learns in the same way or wants to attend university. We also believe that the cost of a degree should not be a barrier to having a great career and, to that end, we fully support the apprenticeship scheme.

We have individuals within the business studying for rural, commercial and building surveying degree apprenticeships. Some joined us direct from A levels, whilst others have worked at Fisher German for a while and decided this is a career they want to pursue. We are currently considering planning apprenticeships.

The work of the Trailblazer Group is ongoing in a variety of areas. When revisions are made by the Royal Institute of Charted Surveyors to the Assessment of Professional Competence, the Trailblazer Group ensures that the mapping to the end point assessment is amended to reflect the new competences.

Another area of key focus is trying to push ahead a Level 7 (Postgraduate Degree) Apprenticeship. There is a strong demand for the opportunity to include a Masters option for non-cognate graduates. The sticking point is the End Point Assessment which is currently the same at Level 6 and Level 7 (the Assessment of Professional Competence) but work goes on to drive this forward.

If you would like to know more about a career at Fisher German, we would be pleased to hear from you.

Maria Hawley 07918 677572 maria.hawley@fishergerman.co.uk

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Alpaca jumper When you think of a farm which rears livestock, a few animals come to mind, usually cows, sheep, pigs and chickens. But one farmer and entrepreneur decided to rear an altogether rarer kind of animal – alpacas – without any real farming experience. Her leap of faith is now paying dividends. As Fisher German continue to sponsor the Outstanding Rural Diversification Project category at this year’s Rural Business Awards, we take a look at how Moor View Alpacas in Cornwall has grown since its foundation.

couple decided to put their house on market and start a farm together in the countryside.

Emma Collison and her partner Stuart Billinghurst never thought they would become alpaca farmers – Emma studied Theatre and Performance at university instead of an agricultural course.

It was not until Emma read ‘Field to Farm’ which she refers to as her ‘bible’, that she decided to raise alpacas.

“Quite simply, we didn’t want to live opposite an incinerator,” Emma said.

“And Stuart has always wanted to build his own house, so we decided to look for a plot of land where we could make this happen.

“We knew we wanted to grow our own vegetables and raise livestock, and we assumed we’d start off with pigs and lambs to provide ourselves with meat.”

But their decision to change their lives was kick-started by a large incinerator being built next to their Plymouth home.

Emma added: “We chose alpacas because we felt it would fill a niche. We could have chosen ostriches too – but they require a Dangerous Animal Licence and eight-foot-high fences, so we ruled them out.”

Despite campaigning against it for the best part of two years, the incinerator was built and the

Once Emma and Stuart found a 16-strong alpaca herd for sale in August 2011, all they

needed was a site to start their farm. The pair later found a 10.5-acre plot of land with a barn on Bodmin Moor near Liskeard which was perfect for what they needed.

In October 2011, Emma and Stuart moved onto the land – and Moor View Alpacas was born.

It soon became clear that the space they had at the farm was not enough to fulfil their ambitions, so Emma and Stuart set about expanding.

Over the years, Moor View Alpacas has grown to provide clothes made from alpaca wool, various meat products including steaks, burgers, sausages and mince, and experiences for visitors such as ‘alpaca trekking’, where alpacas can be walked around the farm.

Moor View Alpacas also raises rare-breed animals, including Valais Blacknose sheep from Switzerland, which has generated further business for the farm.

And their alpaca herd has grown to three times its initial size since the farm opened, with 48 individuals now roaming their land.

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“Although we live on a farm, I’d say I’m a businesswoman first and a farmer second,” Emma said.

“The alpacas and rare breeds we have on the farm allow us to stand out from the crowd, and our customers are always looking for quality no matter what it is they’re buying, whether it’s our meat, our clothing, or our alpaca trekking experiences.

“One of our best customers, a nearby pub, buys loads of our alpaca sausages and always comes back to us for more.

“And we often head to food shows such as the Exeter Food Festival to show people just how tasty alpaca meat is, which helps us attract more regular customers.”

Their success saw Moor View Alpacas nominated for the Rural Business Awards in the Best Rural Food Business category last year for the South West region.

And Fisher German, who sponsor the Outstanding Rural Diversification Project category, felt the farm’s great success should be highlighted after Matthew Trewartha, Partner at Fisher German’s Ashby office, met Emma by chance.

Matthew said: “Moor View Alpacas was such a great example of how a slightly unconventional farm can be very successful with a bit of hard work along the way.

“Focusing on finding an interesting niche and impressing customers with consistent quality is almost guaranteed to succeed, even though doing so is not easy, especially when starting out.

Emma Collison

“We’re looking forward to seeing more shining examples of diversification that farms have used to enhance their businesses at this year’s Rural Business Awards.

expanding the alpaca trekking side of the business in the future.

The regional finals of the Rural Business Awards are currently under way, with the winners in each category progressing to the national awards in February 2020.

“Emma and Stuart are deservedly reaping the rewards of their hard work, and we’re all looking forward to meeting other farmers with similar stories at this year’s ceremony.”

Matthew Trewartha The couple is now building a new house on the farm after recently receiving planning permission, and are planning on

07971 457015 matthew.trewartha@fishergerman.co.uk

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Farmland Stable demand from As we move into winter we start to round off a rather more sedate year of activity than many had predicted.

With little evidence of progression over timing and implications of an EU exit, coupled with a lack of clarity over future farming policy, those vendors who are not under pressure to sell have generally taken a wait-and-see approach. Many consider that demand for farmland has eroded, as buyers hold off for similar reasons. Our research and trading activity in 2019 argues with this view, as buyers are generally retaining a very firm and consistent interest across the board.

Our farm agency team have registered more farmland buyers in the first six months of 2019 than through the entire 2018 calendar year.

Focus on strategic land Land and farms which hold future development potential continue to attract unprecedented interest from a range of buyer profiles. Such development potential, whether it be residential or commercial in nature, will likely be a number of years away and may require significant investment over the intervening period to secure a consent.

With significant experience in identifying, purchasing and selling strategic land, our farm agency team work hand in hand with our national planning and development team to provide the best advice and secure the very best terms for our clients.

Our farm agency team specialise in medium and longer-term opportunities generally under existing agricultural use, both on the open market and privately.

Freehold sales of long-term strategic land allow landowners and farmers to secure values often well in excess of agricultural value and potentially retain a future share of any increase in value, frequently referred to as overage, clawback or uplift provisions.

With a limited supply of genuine strategic opportunities for sale and a hugely aggressive

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Market buyers but fewer opportunities across the marketplace This continuing demand, along with limited supply, has resulted in values remaining stable, and in some cases strengthening. Quality, scale and location remain the key drivers behind those values. Where rollover buyers and amenity or lifestyle purchasers are active, it is location that firmly dictates transactional values.

Farmers and institutional investors have represented the majority of vendors in 2019 and we expect this trend to continue.

Rollover buyers will continue to drive farmland values for the larger commercial holdings over 500 acres. Private investors, institutions, charities and developers are generally dictating farmland values where there is significant strategic appeal and hope value.

Looking ahead, our views remain consistent and we expect the farmland market to remain calm. We await further detail surrounding the Agriculture Bill, and specifically the proposed Environmental Land Management Schemes.

These new policies will impact upon future profitability across our industry and will almost certainly require changes to farm business structures and operations across the UK.

Transactional values continue to range from £6,250 to £15,000 per acre for arable land and between £5,000 and £11,500 per acre for grassland.

Those well-diversified farming businesses who are not wholly reliant on pure agricultural income, and those progressive farmers who have maximised efficiencies and sustainability,

marketplace, vendors can often negotiate flexible sale terms. Many strategic buyers will be non-farmers, e.g. private investors, institutions, pension funds and other investment vehicles who will often be open to a leaseback structure allowing the farmer or landowner to continue farming operations.

Buyers’ requirements Strategic land buyers will have individual parameters in respect of land values, both existing and future consented values. They will often have preferences on geographical location, required return (Internal Rate of Return), minimum acreage and overage provisions. They will also need to consider likely timescales for future development. Appropriate highway access, surrounding infrastructure and other transport links will also form key considerations, along with local services, facilities and expected population growth.

Such sites may currently sit some distance from settlements but in obvious and logical growth corridors.

Any restrictions likely to reduce or restrict planning potential, or increase costs, will have to be considered. These may include: restrictive

covenants, easements that may impede development, difficult topography, statutory designations and flood risk.

will continue to invest especially where they can add value and further strengthen profitability.

Lifestyle and tax-driven (rollover) buyers will also continue to invest for their respective purposes.

As anticipated we have seen an increasing number of buyers focusing on soil health, enhancement and productivity potential in more depth, as they look for opportunities to build capital value over the long term, and hedge against any short-term land value fluctuations.

Richard Gadd 07966 481487

Values Transactional freehold values range significantly depending on location, timescales for development, acreage and access. We have seen buyers pay 1.5 to 5 times agricultural value with reasonable overage provisions.

richard.gadd@fishergerman.co.uk

Values will of course be defined on a sitespecific basis and are heavily dependent on the level of clawback a vendor wishes to retain.

Is your land strategic?

If you consider your property may hold strategic potential, please ask us for a brief assessment without obligation.

The sale of longer-term strategic land has allowed many landowners and farmers to realise significant capital receipts to invest in their farming businesses and expand acreage whilst still farming the land sold. In addition, they can offer a future windfall payment to the vendor or their successors in title with no ongoing time or financial cost.

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