Port Gisborne parts with cash cow

By Campbell McIlroy

Friday 8th March 2002

BACK ON THE MARKET: A local hapu stopped the sale of the Tauwhareparae block in 1997

Five years after a local hapu scuttled attempts by Port Gisborne to sell the largest remaining single farm on the East Coast, the massive Tauwhareparae block is back on the market.

The 11,262ha block was offered for sale back in 1997 but a local hapu at Tolaga Bay took the port to the High Court to object to the sale.

But Port Gisborne chief executive Ben Tahata said clear title had now been established after the Privy Council upheld a Court of Appeal decision clearing way for the sale.

Mr Tahata said the market had changed a lot in the interim with forestry operators being the predominant bidders back in 1997 compared to large livestock operators showing the most interest now.

The block is divided into four separate farms for operational purposes with two units run by farm managers and the remaining to run by share farmers.

The port's financial statements to June 30 2001 showed a book value of $20 million for the block, which Mr Tahata expected to be a base price for the sale.

"If you look at farms sold in the district and of its type, it [the valuation] could only be a starting point."

Last year's bumper year in the farming industry saw the Tauwhareparae block record a net operating profit before tax of $2.7 million, compared to the previous year's $900,000.

The block holds a total of 54,450 stock units over the 7164ha of farmed land which is divided into over 200 paddocks.

A further 1218ha is dedicated to forestry with pruned plots of between eight and 10 years old.

Bayleys broker James MacPherson said there was potential to take the farm up to 80,000 stock units.

He said the value of the existing stock, which is split about 50/50 between sheep and cattle, would easily be between $6 and $7 million at today's prices.

The remainder of the property is either land which is not or cannot be farmed or is designated as protection management areas.

Mr MacPherson said land values in the region had been kept at sustainable levels with any increase in farm prices coming from increased livestock values.

"They've been waiting to sell for a while and it needs a bit of direction in terms of management.

"Because of its size it appeals to a different type of buyer including a number of property companies which have expressed an interest."

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