CEE REPORT FLIPPING PAGES.pdf

Brown&Co Research CEE Land Market Brief 2014 Brown & Co Res arch Central & Eastern European Land Market Brief 2014

Adam Oliver a.oliver@brown-co.pl

Central & Eastern European Land Market Brief 2014 Introduction

Brown & Co are are unique in having a permanent presence in the

Brown & Co have recently announced the launch of Agricultural Asset Management (‘Agri-AM’), a joint venture with Dexion Capital, which aims to bring the investment case for agriculture to a wider audience, making the asset class more accessible. Agri-AMwill invest in farmland in the US, UK, and Central and Eastern Europe. In the US, Agri AMwill source attractive farmland purchases and work with local farmers sharing business risk and income through a combination of land leases, crop share and and custom/ contract farming. Capital investment will also be made, to improve under-invested farms, and increase farmoutput through the adoption of innovative technology and latest farming practices. Agri-AM provides exposure to trends in rising farmland values and commodity prices, which result from long-termglobal increases in the demand for food, combined with a shortage of farmland supply and capital investment. Agri AMwill provide investors with a source of diversi%ed, alternative and secure returns of between 8-10% (net of fees) for the US and between10-14% for CEE. The venture combines Brown & Co’s local farming, land management and acquisition knowledge with Dexion Capital’s own investor network and experience inmanager selection. region for over 15 years.Working across the region, amanagement/ advisory role has been carried out on in excess of 750,000 hectares andmore than US$150m worth of land has been valued.

If we look back 15 years the CEE markets, to a certain extent were similar in terms of prices, stability and lack of robust rule of law. Now they could not be more di#erent. Poland has matured in ways di$cult to imagine when EU membership was secured 10 years ago. Ukraine, at the other end of the spectrum, is undergoing challenges that will delay investment for many years to come. Romania and Bulgaria are widely considered the greater opportunity, given where land prices currently are and yet there are still substantial challenges to be faced in acquiring and consolidating land and simply “getting things done”. Within this publication we explore the main issues a#ecting the agricultural markets in Poland and Romania. Finally, we are grateful to Martin Davies, CEO of Westchester Europe who has kindly contributedWestchester’s perspective on these markets - through a Q&A article on page 10. The agricultural markets of Central and Eastern Europe DUH EHFRPLQJ VXEVWDQWLDOO\ PRUH GLYHUVLÀHG

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