The Sunday Times March 2008
Farmers plough cash into offices

High Agricultural land values have prompted owners to invest in foreign fields, writes Gabrielle Monaghan

Michael Scully set up Castle Carbery Properties Ltd from his farm in Dunowen, near Clonakilty, after realising how disheartened he and other farmers were about the lack of profitability and opportunities in agriculture.He started investing in commercial property 10 years ago and then expanded into forming property syndicates for Irish farmers who wanted to invest in the Polish market.

The first investment, in 2003, was an office building in Warsaw.  Castle Carbery now has €100m worth of investments in the Polish capital's office market.  "We then found yields were compressing and it was getting harder to provide value to people, so we decided to get in earlier in the food chain and morphed into developers," said Scully, "Our model now is for farmers to invest as shareholders and we identify the sites and build them."

Castle Carbery currently has €1 bn worth of property under development in Poland, including five shopping centres, a hotel and 1,400 apartments in Warsaw.  It employs 35 full time staff in the country to oversee its business, which is so successful it doesnt feel the need to advertise or expand elsewhere.

"We looked at other countries, but because of the extent of our experience in Poland, there is no need to diversify," said Scully, "I think there is still 10 or 15 years left in the Polish market."

"We're finding Poland largely unaffected by the credit crisis and it's the biggest market in Eastern Europe, with 39m people.  There's a lot of investment in infrastructure, especially ahead of the European football championships there in 2012."

For farmers, property offers the opportunity to leverage off their main asset: the farm.

Castle Carbery Properties Ltd. - Dunowen Farm - Ardfield - Clonakilty - West Cork - Ireland.
Tel: +353-23-88 40635 - Fax: +353-23-88 57926 - Email: info@castlecarberyproperties.ie

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