Livestock Wealth has introduced Farmland Investment to satisfy South Africans’ hunger to own productiveland.
Livestock Wealth is an FSCA Authorised Financial Services Provider and a registered credit provider with the National Credit Regulator. Furthermore, Livestock Wealth is also regulated as an agricultural producer agent with the Agriculture Producer Agents’ Council and was also registered with SAMAC (Macadamias South Africa NPC).
The company, founded in 2015, is led by South African-born entrepreneur Ntuthuko Shezi, and backed by an experienced advisory board.
When investing in the Farmland Investment, the value proposition was clear as the value of the farm grows with a productive and profitable farm and the value of the investment grows in accordance with the increased value of the land over time. In addition to this, if the land was resold at a later date, the owners could earn a higher pay-out by selling at a higher value.
To put it practically, the company said when one invested R50 000 in a Farmland Investment, one would see rental returns at a minimum of 4% per annum.
Shezi, Founder said the idea was simpl: "Livestock Wealth researches and sources strategic farms to purchase, whether at auctions or private direct sales with farmers. Each investor buys a portion of a farm that you will own. Both parties reap ongoing, annual rental income gained from the leasing of the land. Should there be a need to sell the farm, investors receive a high return on the sale proceeds. It’s a win-win for everyone."
Since 2015, Livestock Wealth has gained over 3 600 unique investors, who have invested more than R100 million and have been paid out over R30m in profits.
Livestock Wealth has more than 30 vetted partner farmers around South Africa.
Shezi said when investing in farming land, a number of vital ingredients were needed, namely shared costs through co-ownership; professional and vetted farmers to ensure sustainability and profitability; as well as excellent management.
“Your land investment will be safeguarded by us, ensuring it becomes a cherished legacy to nurture and pass on to future generations,” said Shezi.
With the myriad options in the investment space, it was difficult to know which horse to back-or in this case, which “tangible, growing assets” to invest in. The differentiator at Livestock Wealth was the “CrowdFarming” concept that lived the African concept of sharing resources to reap joint rewards.
Shezi said there was much to be said for being able to leave a positive, lasting legacy for future generations, but creating wealth through the world’s oldest investment class was the goal for their Farmland Investment.
Last month, Peter Setou, CEO of Vumelana Advisory Fund said they have learnt that throwing money at the problem of land reform was not the magician’s wand that would change the fortunes of the land-reform programme.
Setou points out that lack of good governance in many CPAs (Communal Property Associations) – the juristic bodies that oversaw the management of the claimant land was one of the major impediments dissuading potential investments.
In a bid to improve good governance, Vumelana Advisory introduced a programme called the Communal Property Institution Support Programme, or Organisational Development and Capacity Building, to support the development of well-governed CPAs.
Setou said that the programme does not take a blanket approach but was tailored to meet the differing capacity needs of each beneficiary community.
The support given to claimant communities in accordance with this programme included practical programmes such as institutional development support which entails providing CPAs with support to draft their constitutions, develop trust deeds, and shareholder agreements. The support also included giving governance support to assist with beneficiary verification, preparation of accounts and the convening of annual general meetings.
In addition, beneficiary communities were assisted with policy and procedures development and given management support. This encompassed support and advice on administration issues including, among others, remuneration, procurement, finance, human resources and benefit distribution policies. Guidance was given on operational issues such as acquisition of premises, appointment of staff, selection and appointment of accountants, registration with the South African Revenue Services and opening of bank accounts. This assistance also extended to capacity building and training in financial management, record keeping, and corporate governance support.
This was one of the flagship programmes that was designed to support land reform beneficiary communities and investors conclude Community Private Partnerships.
BUSINESS REPORT