Tasmania’s largest farm, Rushy Lagoon, is for sale and expected to fetch more than $100 million

Tasmania’s largest farm is back on the market and is expected to receive bids worth more than A$100 million (NZ$110 million).

Rushy Lagoon is a sprawling 22,000-acre estate in the northeastern corner of the state.

The late Allan Pye purchased the farm in 1996, purchasing it at auction for $8 million.

Pye was one of New Zealand’s richest farmers, having made his fortune in potatoes.

He died earlier this year and the sale forms part of his estate.

Peter Ryan of RMS Advisory is one of the listing agents and said inquiries about the farm have been pouring in.

“Rushy Lagoon is an iconic site, not only in Tasmanian terms but also in Australian terms,” he said.

“Almost everyone involved in agriculture has heard of the legendary Rushy Lagoon.

“We had a lot of interest a few years ago, and today there is increasing interest from parties who certainly have the means to make a purchase.”

The farm includes dairy, beef and sheep farms and extensive irrigation.

The property was listed for sale in 2017 and was expected to sell for $70 million, but was later taken off the market.

Since then, multi-billion dollar wind farms have been planned for Rushy Lagoon.

“If the wind farm were to evolve, the rent paid by the wind farm operator would represent significant income for the farm,” Ryan said.

“I should emphasize that the wind farm is not certain, it is more than a concept, but let’s call it a plan.”

Green references increasing land value

Farmland in Tasmania is some of the most expensive in Australia.

According to a Rural Bank farmland value report released in May, the average price per acre in the state is more than $20,000 per acre.

For comparison, the national average price is $9,500 per hectare.

Michael Warren, director of Nutrien Harcourts Tasmania, said land prices were much higher in sought-after parts of the state.

“Your farming operation in the Northern Midlands is likely to be in excess of $40,000 per hectare on better managed properties with water.

“Good quality farmland with water costs $40,000 to $60,000 (range) in the Northwest.”

Historically, land in Tasmania attracts buyers due to reliable rainfall, access to irrigation systems and fertile soil.

Warren said these are still important attributes, but investors are increasingly paying attention to the potential of farms for carbon and renewable energy projects.

“They may be reporting to investors or shareholders on more than just the rate of return, but these are boxes they have to tick,” he said.

“There are external influences everywhere that we may not have seen five years ago.

“Is the facility suitable for the use of renewable energy, is it to be sold to the wider grid, or is it to offset the energy consumption of existing operations.

“People mention to us about carbon audits and whether any have been conducted.”

Woolnorth Dairy, located in the state’s northwest, is another iconic farm in Tasmania that is also very popular with buyers.

The last remaining piece of what was once Australia’s largest dairy farm was put up for sale in April this year by its billionaire Chinese owner.

Businessman Xianfeng Lu lost a major milk supply contract to New Zealand dairy giant Fonterra.

In 2016, it paid $280 million to Van Diemen’s Land Company and its Circular Head dairies.

“There are some wind farms there, and I would imagine from some of the inquiries we’re getting that some type of renewable energy will play a role in the final purchase for sale,” Warren said.

“It’s this influence that’s coming to the market now that wasn’t there maybe 10 years ago and how everything has changed.”

– This story was first published by ABC