One of the Australian Flavorite greenhouses is changing owners. In two phases, their Victoria greenhouse is acquired by private equity firm Roc Partners, while Flavorite Hydroponic Tomatoes leases the Warragul property. With the sale proceeds, they want to continue their growth strategy.
Things are evolving rapidly for Flavorite. The company has grown glasshouse tomatoes in Gippsland, Victoria since 1988. In July 2020 they partnered with Sydney-based private equity firm Roc Partners, and even back then it was already announced there would be rapid expansions.
First, the company merged its three business identities (Flavorite Hydroponic Tomatoes, Flavourwave, and Flavorite Marketing) into the Flavorite Group. In March 2021, they merged with two other glasshouse businesses: Murphy Fresh (Mansfield) and Tatura Fresh (Tatura). They announced to have diversified into commercial blueberry & cucumber plantings at their Warragul site, and commenced their strategic growth plans with the construction of a 45,000 m2 glasshouse also on the Warragul site, which was completed two months ago.
Now it is being announced that Centuria acquired a 50% interest in their Warragul property in Victoria for $88.5 million. The Warragul property will be leased to Flavorite. Glasshouses occupy 42% of the 78-hectare block. The holding also includes a nursery, production plant, and distribution center. A 10 hectare netted blueberry production area was being expanded when the asset was listed in June.
Flavorite Group will keep the other half. CNI is required to buy the remaining shareholding on the same conditions within six months. During this time, Centuria is expected to form a new fund vehicle that would eventually hold the whole asset. Earlier Centuria also invested in an almond orchard, owned by Roc Partners, and a Boneo celery farm.
According to local website realestatesource, Flavorite, will pay a starting annual rent of $10 million at Warragul, with fixed 3% rent rises.
It is becoming more common for greenhouses to sell and lease their assets in order to enable rapid upscaling and expansion. This is also what Roc Partners intends to do: “We are incredibly excited to continue the growth strategy with the Flavorite team, which is well ahead of plan and on track to making Flavorite a genuine powerhouse in the Australian fresh produce market,” investment director Frank Barillaro said in June when the property was listed.