Let me guess. You have questions… What is the coolest country in Europe? And what is this investment opportunity?
When it comes to combining incredible hospitality, delicious food and wine, natural beauty and remarkable affordability into just one place in Europe, the country that comes to mind is undoubtedly Georgia. Nestled in the Caucasus and along the Black Sea, Georgia is the one country that has it all. It has mountains, beaches, gorges, vineyards, monasteries, fortresses, iconic stone towers and a lit-up capital. Additionally, Georgia has a low cost of living, and a decade ago, the country adopted successful economic reforms, making it a friendly location for entrepreneurs and investors.
For these reasons and more, I love to visit Georgia. Not only do I often visit the country, I eat at Georgian restaurants when I am elsewhere in the world and I travel around with a Georgian debit card (FYI Georgia’s a great place for banking). Recently, as part of the Heuereka II tour, which followed my annual birthday conference, I led a group of 15 nomads on an excursion around Georgia.
Getting to know Kakheti
We flew into Tbilisi, Georgia’s scenic capital, and then headed to Kakheti, the country’s premier wine-producing region. Right in the heart of Georgian wine country, in the Signagi area, we tasted the renowned local Kindzmarauli wine. Along with the wine came a tasty Georgian meat dish called Ojakhuri, as well as bread and cheese.
Elsewhere in Kakheti, we got a taste of life in the fascinating and misunderstood Pankisi Gorge. This is an area of Georgia inhabited mostly by Kists, an ethnic group with Chechen roots. The area gained international recognition and scrutiny for allegedly being infested with Islamist militants, including Al Qaeda and ISIS fighters. But at least during our stay, the region was very peaceful, and the people were incredibly hospitable.
In true nomad spirit, we got on horseback and rode around the Pankisi Gorge before returning to Orthodox Christian Georgia and visiting the nearby Alaverdi Monastery. Parts of the monastery date back to the 6th Century. Alaverdi is one of numerous very old churches or monasteries in the country.
While still in Kakheti, the Heuereka tour group arrived at its primary destination and the site of a major project I am involved in. You know this is wine country. If you’re thinking it’s a vineyard or I am making some foray into the wine business, you are… wrong.
But you’re not too far off. I am part of a team that now owns and operates a walnut orchard located in southwestern Kakheti.
Yes, walnuts.
We are tapping into an agricultural investment that currently has more potential than growing grapes, which seemingly everyone in this region of Georgia does. We have a nearly 150-hectare farm, about half of which will be covered with walnut trees by the end of this year. We started planting trees in September, and the first harvest is coming in four years. One day, walnut trees will fill the whole farm.
Did you know?
Walnut trees are the oldest fruit tree known to man. They date back to 7000 BC. The ancient Greeks referred to walnuts as “God’s fruit.” In Greek mythology, coincidentally, Dionysus, the god of winemaking, once transformed Carya, the daughter of the Laconian King Dion, into a walnut tree. Throughout much of the ancient world, the walnut was also viewed as the fruit of royalty.
Why walnuts?
First of all, agriculture is a very important field. There is always a demand for food, and as an investment, agriculture is a strong hedge against inflation and economic downturn. Given the current state of global finances, with a paper asset bubble now being nearly a decade old, it is a great time to add a tangible asset to your portfolio.
Worldwide walnut consumption has grown by more than 50% over the last 10 years. And walnut consumption is expected to keep rising, thanks to more and more people trying to maintain healthy diets.
Walnuts have numerous health benefits. They are rich in protein, antioxidants and Omega-3 fats. Walnut consumption is also associated with reducing inflammation and improving gut health by promoting good bacteria in the stomach.
Why farm in Georgia?
Walnut trees grow very well in the Georgian climate, which has both hot summers and mildly cold winters — walnuts need the heat and the cold. Georgia also has an abundance of water and very good irrigation infrastructure in the Kakheti region. And as previously alluded to, the country is business friendly and has a low cost of labor.
Within the wider region, there is very high demand for walnuts, particularly in neighboring Turkey, which is the world’s largest importer of walnuts. Also, Russia, which borders Kakheti, offers a very high profit margins for walnuts.
What kind of walnuts?
We are planting Chandler walnut trees. The Chandler walnut is a hybrid that was introduced in 1979 and named after University of California Davis professor W.H. Chandler. It is the most commonly grown walnut tree in California, but also famous around the world. Chandler walnuts provide a high yield and have high-quality kernels.
Project scope
This is a $2.8 million project, with the running costs lasting five years. After that, the farm will be self-sustainable. However, we will need further investment to scale the project — which we would like to do as quickly as possible. Scaling plans include developing additional orchards, as well as creating walnut sorting, cracking and packaging facilities, which would allow us to sell finished products.
Walnut trees reach full maturity in year 7. Our orchard will reach full production by 2027, at which point we expect an annual revenue of $2.5 million.
So how can you invest?
You can invest through a royalty contract for Project 1 and Project 2 (first and second plantings). By purchasing the contract, you acquire the rights to royalty payments. After each harvest, the entire crop will be sold to a wholesaler. The proceeds will then be distributed to investors.
$10,000 is the minimum investment. For every $10,000 investment, you receive .1% of the orchard’s gross revenue.
Projected ROI
Starting In Year 4, the estimated annual ROI is 6%. Starting in Year 8, the estimated annual ROI is 25%. The estimated average ROI over the 30-year period of the royalty contract is 22%. Cumulatively, that means investors are expected to receive about a 610% ROI over the 30-year period.
Team
Our team is rich in international business experience, as well as in ties to Georgia.
David Bukhnikashvilli is our head of operations. David comes from a family of hazelnut producers in Georgia. He completed medical studies in Germany prior to returning to his family business.
Ivo Siewert, a derivatives trader with a focus on arbitrage and macro strategies, heads our investor relations.
The aforementioned Alexander Hay, our attorney, is a U.S. lawyer who relocated to Georgia and has worked as an international business consultant in both countries.
Irakli Panchulidze, our secretary, returned to Georgia after studying orthodontology in Germany and built and sold a multi-chain drug store and construction company before linking up with David to focus on agriculture.
Frank Colangelo, a chartered accountant and business angel, who previously built a multi-million dollar FBA business, is in charge of our accounting.
Lastly, I’m the lead investor. I think you know who I am, but you can visit sites like Christoph.today, Staatenlos.ch and Tax-Free.today to find out more about me.
What are some perks that come with investing in the orchard?
First off, any prospective investors can visit the farm. Our on-site team will be glad to show you around.
For those who do invest in the project, you can make the farm a regular vacation destination and view it as something like a timeshare. We are building guest houses, which will be available for use by investors. This will allow you to enjoy a comfortable stay in beautiful Georgian wine and walnut country.
Likewise, if you fly into Tbilisi — the airport is only 60 km away from the orchard — we will pick you up and take you to the farm. A highway is being constructed just three miles away from the orchard, so our location is becoming even more convenient.
And during your stay in Kakheti, you can of course venture off to vineyards, monasteries (David Gareja is a very interesting one ?), the Pankisi Gorge and more, while devouring delicious Georgian cuisine.
Here are a few more looks at how we greet our guests on the farm:
So will you join us in Georgia?
For more information about the project, view a PowerPoint presentation and a webinar with Q&A. Prospective investors may contact us at: info@walnuts.ge
