Market Update by George Windsor Clive for Racing Post July 25th 2013

The Property Market for Stud Farms and Training Yards The Insiders Take on the Market Who actually has to buy a stud farm? - This is an important point to remember when selling into a market where the number of broodmares and foals has been in decline. The amount of land adapted for breeding and racing has probably doubled in the last 30 years and now there is spare capacity. The value of agricultural land has virtually caught up with stud land prices with the result that some newly developed stud farms have not increased in value by as much as the amount of investment. The result - value for buyers, however at least for the sellers it is not all doom and gloom, as sales are taking place and there is a market. Around Newmarket, the recently reported sale of Longholes has taken one stud out of the market of five stud farms on the open market. Brinkley Stud, available in 3 lots, gives an affordable and flexible entry in to the market: 63 acres and a modern stable complex are priced at £1m, and £1.1m is being quoted for a package of 64 acres with farm buildings and two houses both needing either rebuilding or renovation. In 2008, these figures would have been 30% higher. To continue the restoration theme, in the Chilterns, there is a real opportunity for the buyer wanting a project - 80 acres and stud buildings and a 5 bedroom house. This is a wonderful site for building a new house, with views for miles. For those needing a stud only 20 miles from the M25 this should one to consider - The price guide of £3m reflects the demand for really good sites to build a new country house, and also the local influence of the polo world. In Hampshire, Bill Smith, the Queen Mother's former jockey, is looking to sell Kelanne Stud at £1.95m with 61 acres and 2 houses - much of the interest has come not from the breeders but from the show jumping and eventing worlds rather than the breeders. and to some extent these are likely buyers for all but the core of thoroughbred stud farms. Ireland is where real value is found. I have advised some American clients in the purchase of Ardbraccan, a real palace in Co. Meath. The stud is being revived and will be perfect for the readymade brood mare band bought a few months earlier. While the value of good pasture can be about €12,000 to €14,000 an acre, the buildings are often valued at about half of their 2008 prices. Mellon Stud, a charming house with 5 cottages, high grade stud buildings and about 300 acres overlooking the Shannon Estuary is now selling, also to Americans, at well below the original price guide from 2011. These sales are disappointing for sellers who started off with 2008 aspirations, however they do show where values are and they give buyers confidence to bid in a market that has at last found its floor. Those wanting to buy into the bottom of a property cycle should take note... The dynamics of the market for training yards are very different to those driving the stud farm market. Trainers have businesses to run and in many cases sellers don't want to market publicly. There are two noticeable changes in the market place - one is the increase in the letting market, and the other is a drift towards the training centres, particularly Lambourn, since Jockey Club Estates have revitalised the gallops. At the foot of the gallops in Upper Lambourn, Newlands Stables, a well placed training yard with a cottage and up to 90 boxes is coming to the market with a price guide of £750,000. With a good rental income, this performs well as an investment, with a lease expiring in early 2015. As a comparison, in Newmarket, St. Gatien Cottage Stables, a 37 box yard with good four bedroom house at the foot of Warren Hill is available is available at £1.25m, or 23 boxes with a paddock and planning approval for accommodation has a price guide of £700,000. The market for training yards is very irregular, but location and ease of access to well run and maintained gallops is likely to prove an incentive for a purchaser. Every autumn a new crop of training yards comes to the market, and early preparations are made in the summer. This year is no different, and trainers tend to move in the winter months. Stud farms, on the other hand usually come to the market in the spring/ early summer, when they are looking their best. It is always dangerous to try to forecast the ups and downs of the property market, but there is definitely more optimism than there has been for three to four years. Time will tell.