With prices of commercial and residential property falling, investors are increasingly turning to a more traditional asset: farmland. Long seen as a declining industry, farming has received a fillip in the last few months as global demand for food has increased. As a result, the cost of agricultural holdings across the European Union has risen to record levels. Financial Times

In response several funds have recently been set up to buy farmland. In particular the UK, where prices have risen 40 per cent over the last year, has been active. Braemar, a fund manager, is one example. The Manchester-based group has been swamped with offers since it launched a fund this year.

'We closed the fund in two weeks but we are going to reopen it,' said Marc Duschenes, chief executive. He would not reveal how much had been raised from wealthy individuals but said the fund would buy its first 200 acres soon. The land will be run by contract farmers so there could be revenue as well as capital gains.

While Braemar faced stiff opposition from farmers looking to expand, he said many were also looking to cash out after 20 years of flat land prices.