DecisionConsent granted
Section 12(a) Overseas Investment Act 2005
Decision Date23 September 2016
Investment

An overseas investment in sensitive land, being the Applicant's acquisition of:

  • a freehold interest in approximately 630.8432 hectares of land being the Old Shed, Homestead, Fox, Woodslea and Tyneholm Blocks, Woodslea Downs Road, Pine Bush, Southland; and
  • a freehold interest in approximately 155.4193 hectares of land being the Driscoll Road Block, Te Wharau, Wairarapa; and
  • a freehold interest in approximately 77.1098 hectares of land being the Waipukurau Block, Hiranui Road, Wanstead, Hawkes Bay; and
  • a freehold interest in approximately 406.8000 hectares of land being the Fence Post, Morepork and Pukeko Blocks, Marainanga Road, Pongaroa, Tararua; and
  • a freehold interest in approximately 215.2689 hectares of land being the Ngahape Block, Ngahape Road, Ngahape, Wairarapa; and
  • a freehold interest in approximately 716.5873 hectares of land being the Pakowhai, Tinui Valley Stage 1, Tinui Valley Stage 2 and Tinui Valley Stage 3 Blocks, Pakowai Tinui Road, Wairarapa; and
  • a freehold interest in approximately 172.3600 hectares of land being the Riverina Block, Riverina Road, Marumaru, Hawkes Bay; and
  • a freehold interest in approximately 187.6100 hectares of land being the Putorino Block, State Highway 2, Putorino, Hawkes Bay.
Consideration$23,500,000
ApplicantWairarapa Estate Limited
Southland Estate Limited

The Trust Company (Australia) Limited as trustee for the New Forests Australia New Zealand Forest Operating Fund 2 (100%) which is wholly owned by certain overseas investment Funds. The New Forests Australia New Zealand Forest Operating Fund 2 is managed by New Forests Asset Management Pty Limited
VendorForestlands N.Z Limited and 18 other associated companies
Kearns Family Trust, New Zealand (100.0%)
Background

The Applicants are owned by overseas institutional investors via an investment fund known as New Forests Australia New Zealand Forest Fund 2 which is managed by New Forests Asset Management Pty Limited (New Forests).

New Forests has a mandate to invest in New Zealand and Australian forest assets. Since entering the New Zealand market in 2014, it has made various beneficial investments in New Zealand’s forest industry, including investments in downstream sawmilling infrastructure.

New Forests currently has significant committed funds available to continue its investment programme and is in the process of finalising the uptake of a new fund to undertake investment from the beginning of 2017.

New Forests considers Australia and New Zealand are two of the world’s most stable economies and the forestry industry is over 100 years old in each country with well-established productivity, operating history, and infrastructure. New Forests therefore sees New Zealand as an attractive investment destination to provide exposure to the rapidly growing Asian markets as well as the Australian domestic softwood lumber market which has a supply deficit.

The overseas investment transaction has satisfied the criteria in section 16 of the Overseas Investment Act 2005. The 'substantial and identifiable benefit to New Zealand' criteria were satisfied by particular reference to the following factors:

Overseas Investment Act 2005
17(2)(a)(iii) – Increased export receipts
17(2)(a)(iv) – Added market competition/productivity
17(2)(b) – Indigenous vegetation/fauna
17(2)(c) – Trout, salmon, wildlife and game
17(2)(e) – Walking access
17(2)(f) – Offer to sell seabed/foreshore/riverbed to the Crown

Overseas Investment Regulations 2005
28(a) – Consequential benefits
28(e) – Previous investments

More informationAlan Paterson
Russell McVeagh
PO Box 8
AUCKLAND