Medical cannabis a lucrative option for buyers of Victorian farm

This farm could be used for a variety of different agribusinesses including growing medicinal cannabis. Picture: realcommercial.com.au/for-sale
This farm could be used for a variety of different agribusinesses including growing medicinal cannabis. Picture: realcommercial.com.au/for-sale

Owners of a Victorian farm have paved the way for potential buyers to begin business in the billion-dollar medical cannabis industry.

After cultivating dairy and beef herds for 20 years, the 102ha Mountain View Farm in Gippsland is now on the market and includes a licence to cultivate medical cannabis – and vendors Peter and Alison Drew are confident they’ve completed the hard yards necessary to grow the plant.

The Commonwealth Office of Drug Control (ODC)’s stringent application approval process was just the beginning.

Mr and Mrs Drew experienced a 19-month wait before their licence was approved.

ODC requirements included passing a “fit and proper person” test to ensure they could be entrusted to grow a “high value narcotic drug with a street dollar value”.

However, Mrs Drew said the farm’s new owners only needed to pass this test before buying the pre-approved cultivation licence from them.

The couple have also completed a business plan and have extensive details of operational equipment changes available.

But the farm’s saving grace is its three modern broiler sheds.

The property has three secure broiler sheds. Picture: realcommercial.com.au/for-sale

Forming the basis of the ODC’s mandatory infrastructure design, the sheds will enable buyers to enjoy cultivation savings.

“The footprint doesn’t need to be changed and no building works are required so it won’t trigger any council approvals,” Mrs Drew said.

She added that cultivating medical cannabis in sheds – which was a new wave or thought for production – enabled owners to grow five crops of medical cannabis every year, compared to just one in a broadacre situation.

“The remuneration for a hot house or greenhouse facility is four times greater than growing broadacre,” she said.

The sheds will also halve the cost of installing the ODC’s compulsory heavy-duty security points.

“Medical cannabis requires two ‘lines’ of security so if someone is growing it broadacre, they would have to have two lots of security fences around the perimeter of the crop,” Mrs Drew said.

“But in our case, because the cannabis will effectively be in greenhouses, the actual shedding is the first line of security because they are lockable sheds.

“Then the security fence will be built around the outside of that.”

Mrs Drew said the sheds give buyers a “double whammy” with both the cultivation and manufacture of medical cannabis open to them thanks to expansion possibilities.

There are three dwellings on the property. Picture: realcommercial.com.au/for-sale

As well, medical cannabis cultivation offers a high diversification factor.

“Medical cannabis is a new, emerging industry and for primary producers like us, it gives you another string to your bow for diversification,” Mrs Drew said.

Colliers Melbourne’s Duncan McCulloch said he’d received more than 40 enquiries about the property so far, with about six of the callers interested in the farm’s medical cannabis opportunities.

“We’ve had a mixture of private individuals and commercial businesses contacting us about the medical cannabis possibilities,” Mr McCulloch said.

“A substantial investment has already been spent on the property especially the sheds, so a lot of people are looking at it for its existing operations, too.

“Then we’ve had a lot of people looking at getting out of the city because of COVID.”

Mr McCulloch added that Gippsland’s real estate industry was “absolutely flying”.

“This property is circa an hour and 15 minutes from Melbourne plus it has high rainfall and it’s not far from the beach,” he said.

Mountain View Farm includes two three-bedroom homes and a two-bedroom staff dwelling, a 32-unit rotary dairy, chicken complex shed, machinery shed and livestock handling yards.

The property has a price range of high $4 million to low $5 million and is for sale via expressions of interest, which close Wednesday 31 March at 4pm.