Listed housebuilder Trafalgar Property Group is planning to invest in the hydroponic vertical farming sector, to run as a new business unit alongside its property development operations.
Trafalgar said it had identified “significant growth opportunities” in the sector. It is in early stage discussions with a potential hydroponics operator.
It cited data from Allied Market Research showing the global vertical farming market, valued at $2.2bn in 2018, is projected to grow to $12.8bn by 2026, in line with rising demand for organic food.
The company also pointed to “significant capital” flowing into the sector, citing investment activity from Softbank, Amazon’s Jeff Bezos, and Google’s Eric Schmidt regarding the Plenty project in the US in 2017; Google Ventures investing $80m (£70m) into Bowery Farming in 2018; and Ocado entering the market in 2019, when it took a majority stake in Europe’s largest vertical farm.
Trafalgar stressed its group parent will be a holding company, with hydroponic investments sitting in a new division, and that its existing property divisions’ activities will continue.
The Kent-focused residential property developer expanded into the assisted living sector in 2018, but said that since then it hads experienced difficulties in securing finance for developments in the sector.
It added that its residential division had experienced delays to building programmes, combined with a lack of activity in the market for homes.
The company will seek shareholder approval at a general meeting on 27 March.
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