Coming Second

Today MyFarm 'came second' on the purchase of a good mid-Canterbury dairy farm.  The process was a private treaty deadline sale, a.k.a. tender.

We normally avoid these competitive sales processes as often there is a lot of work required without a certain outcome.  And that is what happened this morning when we were politely told there was another better offer.

The farm itself is an attractive property on the outskirts of Ashburton.  It had many good aspects but wasn't perfect either.  Actually to get it to a really top level of development and performance could have costed $7,000 to $8,000 per hectare.

We had most of a syndicate group together and would, within a 10 day period, have completed the syndicate we are sure.  But we were beaten by a stronger offer on the day.

There are a number of moral's to the story;

1. Actually, it is good that MyFarm isn't always successful in buying farms.  We certainly know the market and we don't want to be 'sucked in' into paying the highest price in the district.  There will always be another farm and our business is based on finding farms at a price that is good for investors.
2. The market in Canterbury for properties that have good location and water rights is quite buoyant.  We have missed out a number of times now.
3. It is hard to value location and surplus water.  We were right at and even above what the valuer thought was a fair price.  The valuation was very much a 'farming valuation' and perhaps ignored the considerable location benefits.

So we were disappointed - but never-the-less if you are in business you won't always win.  And we are more often successful than not.  But we won't pay the top price.