THE value of the 8900-hectare Linkletters estate in Esperance in the Western Australian wheatbelt, the sole remaining rural asset of the ASX-listed Agricultural Land Trust, has been boosted by 37 per cent following an independent valuation.
Nanjing Night Net

The January valuation lifted the book value of the estate by $4.75 million to $17.65 million.

Justin Epstein, director of fund manager One Investment Group, which manages the trust on behalf of its biggest shareholder, the powerful West Australian landholder Allen Caratti, was unavailable for comment – the agricultural trust’s accounts are being audited ahead of the publication of December half-year results.

Last August Mr Epstein told The Australian Financial Review that a rehabilitation of the estate over about 18 months – by removing the blue gum plantations and returning the property to cropping and grazing use – would see its value increase from $12.9 million (its June 2014 book value) to between $28.5 million and $29 million.

The Agricultural Land Trust, once controlled by rural group Elders, was one of the major players in the forestry-managed investment schemes before the dramatic collapse of operators such as Great Southern and Timbercorp saw forestry values plummeting. The trust has a $10 million syndicated loan facility maturing in 2016 to pay for the remediation of Linkletters.

“Our priorities are to remediate Linkletters, lease it out and also to streamline the operations of the trust,” Mr Epstein said six months ago.

“We think Linkletters is an amazing property. No listed agricultural trust has this level of opportunity, but it requires a little bit of vision,” he said.

A sale of Linkletters has not been ruled out either but Mr Caratti, who owns 61 per cent of the trust, would prefer to lease out the property. The January valuation uplift would suggest Linkletters was benefiting from the first stages of this rehabilitation as well as from its prime location in Esperance.

“In cropping, Esperance is considered a premium region,” said one agribusiness valuer.

A February report by valuers Herron Todd White noted increasing confidence in the WA wheatbelt.

“The majority of wheatbelt farmers have now finished their harvest with many achieving above average results and higher than expected yields. This has seen confidence increase and activity in the property market increase with two good years now under their belts,” said Herron Todd White.

Linkletters is named after US television host Art Linkletter, who developed the estate in the 1950s. It was acquired by the Agricultural Land Trust nine years ago and planted with blue gums, before the sector slumped.

This story Administrator ready to work first appeared on Nanjing Night Net.