First Provincial Growth Fund business loan paid back
Published: Nov 12, 2020
- Media release
- Northland/Te Tai Tokerau
The first Provincial Growth Fund (PGF) loan to a commercial business has been repaid.
The loan to Whangarei based family horticulture business, Maungatapere Berries, was paid back last week to the Provincial Development Unit (PDU) which manages the fund.
The loan repayment is the first of approximately 100 PGF loans and equity investments the PDU has committed to worth around $604.7 million. The PDU also administers around 1170 grants around the country worth approximately $2.24 billion.
In July 2019 Maungatapere Berries received a $2.28 million loan for the first phase of its plan to rapidly expand its high-tech hydroponic berry growing operation throughout Northland.
“The PDU is pleased to see the first of our loans repaid just a little over a year since it was taken out. It shows that our belief and calculated investment in the business has paid off and the public benefits realised,” says Robert Pigou, the head of the Provincial Development Unit.
“The aim of PGF funding is to unlock the potential of our regions and accelerate its economic development. Sometimes this means investing in a commercial business, particularly where we can accelerate an expansion or bring an initiative to fruition.
“We invest in companies that are not only sound businesses but which also provide a public benefit, such as contributing to regional economic growth, creating jobs, undertaking skills development and improving cultural and social indicators. These are not things commercial banks typically look at when considering lending money,” Mr Pigou says.
The loan allowed Maungatapere Berries to expand their existing high-tech hydroponic berryfruit operation with an additional 4.2 hectares, which now includes high-value raspberries, blueberries and blackberries, with a focus on creating long-term sustainable employment and careers in the horticulture industry in a way that can be replicated in other areas.
“The business was able to employ more staff, with 56 extra full-time locals taken on. During peak picking seasons, which now runs from August to June, up to 180 people are employed which is brilliant news for locals,” says Mr Pigou.
Patrick Malley from Maungatapere Berries says the PGF support allowed his business to employ staff for longer.
“Our business was able to investigate alternative crops which enabled us to provide a reliable 12-months of work to our employees. We were able to train our new people through the development phase and have provided many of our full-time employees with ongoing tertiary training and extensive pastoral care.
“The repayment of our loan to the PGF is a great indicator of how hydroponics can be commercially successful and also deliver increased employment opportunities to the Northland region,” Mr Malley says.
Apart from loan and grants the PDU administers a number of other Government funding allocations. This includes funding from the COVID-19 Response and Recovery Fund (Infrastructure Reference Group), the Strategic Tourism Assets Protection Programme, Regional Investment Opportunities and the COVID-19 Worker Redeployment initiative, as well as Skills and Training programmes: Te Ara Mahi, He Poutama Rangatahi; the Māori Trades and Training Fund and the Sector Workforce Engagement Programme.
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