by Ted O’Kane, Goulburn DPI Rural Resilience Officer.
As featured in The Country Web 2016 Annual.
Respected Monaro grazier and cattle breeder, Howard Charles, cites a number of logical
reasons for ‘half retiring’ and leasing his property but admits that if it were not for his
wife Anne’s declining eyesight, he could well have put the decision off for some time yet.
Breeding his celebrated Kydrabah Murray Grey stud cattle and merino sheep, it would have been easy for the still fit 72-year-old to maintain the status quo and keep running his 1375 hectare Nimmitabel property, Rockybah, as he has done since 1980.
But with neither of his adult children interested in taking over the farm and, by his own admission, starting to feel his years, Howard knew retirement was something that could not be put off forever. Still, he concedes that, “Anne’s eyes (she has macular
degeneration) were the real catalyst for the change.”
The change, though, is a transitional one where the Charles remain happily living in their home among the magnificent country garden Anne has developed from something akin to a moonscape 35 years ago. They remain happy to do so, contributing to the local community they love, as long as Anne’s eyesight allows her to drive.
“I can’t stay here if I can’t drive and Howard has to drive me everywhere. We don’t know
when that will be, but when it happens it will mean moving to a town,” she says.
The flexible lease arrangement the Charles’ negotiated with two local landholders, Jim
Haylock and Charles Keighley, in September 2014 also means Howard remains involved
to some extent in both management and the physical running of the property.
Anne and Howard enjoying their ‘half retirement’ at their home, Rockybah “I do believe that farming is a young person’s game, not only physically, but keeping up
with the technical advances as well. I am now what is called the ‘weeds, wire and water
man’ and that’s a bigger job than I thought,” Howard explained.
“I’m only half retired so I am not walking around saying, ‘What will I do now?’ But if
Anne’s sight deteriorates quickly, we are in a better position to change our arrangements
than if we were still running everything.”
The innovative lease was negotiated by farm consultant, Jim Symon, McMichael
& Associates, Albury, who consults independently to all three parties. Two events on flexible transition options have been held (one in Cooma in 2015 and most recently August 2016) where Howard outlined aspects of the lease and answered questions for people wanting to know more about the process. The lease conditions provided a good example of how a well-considered and flexible lease could provide a viable option for farmers wanting to retire from the business but still wishing to live in their own homes, he said.
Based on the rationale that farm wealth was built from the capital growth of the asset more than from income, Mr Charles wanted a lease that prioritised the protection of the asset.
“We built flexibility into the agreement that meant the lessees weren’t put under pressure when the season gets tough. We certainly needed an income but our main focus was to protect the asset. It’s not perfect but we are still working on it,” he said.
Mr Symon said the lease aimed to bring the right people together in a deal that wasn’t necessarily about maximising monetary gain but rather tried to meet everyone’s needs in a way that was sustainable. This was the key, he said, to the success of any farm lease.
The lease of Rockybah has also provided an opportunity for Jim Haylock and Charles Keighley to expand their grazing enterprises though a newly formed business partnership, although they were not previously close friends and live some distance from each other and the lease property.
The partnership runs merino wethers and agistment cattle, allowing the flexibility to trade in line with seasons and also to minimise labour. Farm jobs are prearranged and performed together. For both Jim and Charles, the deal provides extra scale and income for their farm businesses and the possibility of being able to hand a viable operation onto their children.
“It is a good short-term option to increase income but should also lead to me being able to increase my capital base as well— depending on whether the kids want to carry it on. There is no need for me to knock myself into the ground into my 60s and 70s if the kids are not interested,” he said.
Similarly, for 59-year-old Mr Keighley, leasing more land as an adjunct to the 890 hectare property, Woburn, he owns at Bungarby, will hopefully assist at least one of his three sons to get a start in farming.
“We are talking to Jim Symon now about farm succession issues and while Woburn still needs a lot of investment, we hope we can set up the transition to the next generation over the next 10 years or so,” Mr Keighly said.
More Information: Ted O’Kane, DPI Rural Resilience Officer. m: 0427 781 514