Harvard Diversifies into Dairy

University adds New Zealand farm to endowment portfolio

It’s unlikely Harvard’s endowment gained liquidity from one of its most recent purchases, but the move almost certainly increased the University’s holdings in powdered milk.

With the purchase of a 4,000-acre dairy farm in New Zealand two weeks ago, Harvard-owned farms there could produce nearly 4 million pounds annually, local newspapers reported.

Last week Harvard Management Company closed the acquisition of a “super dairy farm” in that country, paying more than 28 million New Zealand dollars, about US$20.7 million, for the property—and its 6,000 head of cattle. The farm once belonged to a local agricultural magnate, and Harvard snapped it up in liquidation.

“In America, [$20.7 million] seems like peanuts,” said Paul Y. Chong, a New Zealand native and first year student at Harvard Business School. “But in a small economy like New Zealand, that’s a pretty substantial investment.”

The New Zealand economy was hit hard by declining export prices during the recession, but has since bounced back and seen rising foreign investment. Nevertheless, local concerns have led to some limits on purchases by foreign organizations. In 2008, a $1.4 billion proposal for Canada’s main pension fund to buy Auckland’s airport was rejected by the country’s Overseas Investment Office, though smaller deals have been approved.

“I think it’s a sign of respect for Harvard,” said Belinda R. J. O’Donnell ’11, another New Zealander, of the purchase. “Quite often they have restrictions in place for foreigners to buy property.”

In addition to its dairy farms, Harvard has other investments in the country, including sizeable tracts of forest that are valued for the timber they provide.

“I had an idea that Harvard is quite creative in its investments,” O’Donnell said. “I was driving down to a rowing camp on the North Island and my dad pointed out a forest to me and said, ‘Oh you know your college bought that a couple of years ago.”

The University’s latest acquisition on the island nation lies in The Maniototo, a rural area some 900 miles south of Auckland, New Zealand’s largest city. Primarily farmland, the area is known for its wines and its appearance in the Lord of the Rings trilogy.

Harvard Management Company had no comment for this story. The University generally does not comment on investments or investment strategy.

—Staff writer Elias J. Groll can be reached at

—Staff writer William N. White can be reached at

This article has been revised to reflect the following correction:

CORRECTION: October 5, 2010

Due to an editing error, an earlier version of the Oct. 5 news article "Harvard Diversifies into Dairy" incorrectly attributed a value of $1.4 to a proposal that was actually valued at $1.4 billion.