Money should work, not lie in a stash. But you need to invest in long-term assets that will be relevant not for 1-2 years, but for decades, while maintaining high profitability and strengthening your confidence in the future. In addition to real estate, I consider agriculture to be such a source of income that will literally feed you and your family for many years. Today I will tell you about my personal experience of investing in Turkish land, about the three most profitable segments of the agricultural market, as well as about our service for launching a turnkey agricultural company, which allows you to enter this area quickly and for a long time.

Agribusiness in Turkey: why is it growing so actively?

Already by the huge assortment of Turkish vegetables and fruits in the markets of the CIS countries, it can be understood that the agricultural sector is actively developing in Turkey. Thus, the export of agricultural products from 2016 to 2020 increased by 27.4%. But, nevertheless, the main consumer of Turkish agricultural products is the growing domestic market, which is actively supported by the government.

The rapid growth of the agricultural sector is associated with an active policy of import substitution, which is carried out by the authorities, providing agribusiness with various support tools. Once Turkey was very dependent on food imports, but now the country is not only providing itself with its own fruits and vegetables, but also increasing exports to other countries. That in itself speaks volumes.

Against the background of constant growth, which accelerated in 2016-17, the profitability of agricultural companies is also growing, today exceeding 20% per annum in a number of areas. This is one of the reasons why the demand for the purchase and lease of land is actively growing in Turkey. Especially in the South of the country, near Antalya, where the main agrarian capacities of the state are concentrated.

For 6 years, my husband and I have been located there, an agricultural company that controls several greenhouses with an area of up to 3 hectares. And I can say that this business is really profitable because. One banana greenhouse gives about 200 thousand dollars. net profit per year with an initial investment of $ 500,000. But it will be interesting not only how much the greenhouse gives, but also what we grow on it – bananas!

What are the most profitable areas of the agro-industrial complex?

Fertile land is Turkey’s most expensive asset. There is not much of it here, but thanks to careful care and an irrigation system, it gives very high yields. And the warm climate allows you to grow not only traditional plants for the region, such as durum wheat, but also exotics. Such as bananas and avocado. They are also the most profitable and dynamically developing segments of the agro-industrial complex of Turkey. The third most profitable segment is the cultivation of strawberries.

In all three categories, the yield is up to 25% per year. Strawberries have been popular before, but bananas and avocados are relatively new trends – the banana industry has been developing in Turkey for 6 years, and avocados for 3 years. The growth rate here is very high. We have not yet worked with avocado, but we have partners who are very satisfied with their avocado growing business.

Why did we choose bananas? Because this plant is very unpretentious, requires a minimum of care (accordingly, a minimum staff is needed), and such a business itself is very easily scalable. At the same time, the demand for bananas both in Turkey and in neighboring countries is great, and the closest competitor – Ecuador – is very far away. Logistics affects the freshness of the product and its value, which makes your own Turkish banana preferable for the local buyer.

However, it is too early to talk about exports, because Turkey’s domestic market is only 60% secured. This means that growth will continue to be observed. And when the domestic market is filled, exports to neighboring countries, including the CIS, will begin. This allows us to make very optimistic forecasts for this segment of the agro-industrial complex.

Banana business: how to enter it and gain a foothold

Before offering customers a turnkey agribusiness launch service in Turkey, we tested the advantages of this segment on ourselves. Everything that I will describe here, my husband and I checked on personal experience. At the moment we have two banana greenhouses – for 1 and 2 hectares, respectively. Moreover, we built the second one by reinvesting profits from the first.

There are two ways in which you can enter this sphere. The first option is to buy a land plot. The second is land lease. In general, the second option is more relevant for a foreign investor, because it does not require additional costs for the purchase of land, and fertile land in Turkey is not cheap. In addition, you can do as we do – first take over the management of a small plot of land, and then scale it at the expense of the funds received.

The average rental period in Turkey is 10-15 years. Then the tenant can extend the term for another 10 years and so on. 10-15 years is the depreciation period of invested funds. That is, after this period, greenhouses and all fixed assets in any case will have to be updated or even completely changed. I note that in Turkey, the lease contract states that until you return your investment, no one will take away this site.

Next, it is necessary to build the greenhouse itself, purchase axial material and equipment. Greenhouses, by the way, we stand ourselves. The staff here needs a minimum. In fact, only two people take care of a greenhouse of 3 hectares – a gardener and an agronomist who controls the condition of the plants. After planting, the banana gives its first fruits after 7-8 months. Usually the crop is harvested in May – early June. Moreover, it is possible to plant greenhouses at different times, so that the trees will not bear fruit at the same time, but in stages, with an interval of two to three months.

We recommend that you do the following – rent a large plot of land at once, on 10 or even 30 hectares. But at first, allocate only 2 hectares for a banana greenhouse, and then, as income is generated, scale the business with new greenhouses, growing by 1 hectare every year. That is, it is necessary to establish a constant flow of funds so as not to go into losses immediately at the start. And when the model of growing and marketing products is established, then expand production, reinvesting profits.

The volume of investments and the help of Expert Property specialists

The volume of capital investments in the banana business is 500 thousand dollars. and higher, and the payback period is 2.5-3 years. You can invest less capital, but, in our experience, this is the minimum amount that allows you to reach a good stable profit. The higher the area, the higher the percentage of profitability on each hectare. From a greenhouse of 3 hectares, we get a harvest of 250 tons per year, and a profit of 1 million 300 thousand lire. This is about 200 thousand dollars. We are expanding our banana lands to increase profits.

Many people are afraid that they will have to do business in another country, with their own specifics, mentality and taxes. It will also be necessary to hire a local manager and other employees, as required by local law. But there is a solution – to contact the Expert Property agency and get a turnkey business service.

We provide support to the investor at all stages of the transaction – from market analysis and purchase of land to hiring a top manager and creating outsourced accounting. Moreover, we can take over your agribusiness until the company gets back on its feet – the contract is for 3 years with the possibility of prolongation. This system is absolutely transparent – we create a legal entity-contractor that will be fully accountable to your company. Accountable literally – at the end of each quarter, a report will be sent with a full description of the affairs in your agribusiness.

Our company will carry out full operational management of the investor’s company, including the sale of products, which no one else will provide you. The investor can only receive passive income. We have already established this system – we offer only what we have already checked ourselves. When the investor’s company becomes completely self-sufficient or simply at the request of the investor, we transfer all matters to his top management.

The Expert Property agency has a ready-made business plan for an agricultural company, with a volume of 80 pages. It spells out all the details, up to the description of competitors and promising areas for export – including to the CIS countries. If you are interested in banana or any other agricultural business in Turkey, you can feel free to contact me personally or any of our highly qualified specialists by phone, messenger or in any of our offices in Antalya, Istanbul, Moscow, Kiev or Almaty. We are always glad to see you!

Tatiana Güneş and the Expert Property team were with you