The Overseas Investment Office (OIO) has approved the sale of a mid-Canterbury property to a Luxembourg-based investment fund.
The manager of a Luxembourg investment fund, Dynamic Asset Management, sought consent to buy about 355 hectares of land at Mayfield, near Ashburton, for $10.8 million.
The company has plans to convert the existing property into a dairy farm that, once operational, will milk about 1200 cows through a 64-bale cowshed.
The OIO granted the application, saying the company's plan would create jobs, increase export receipts and increase the processing of primary products.
The application said the farm would use the latest infrastructure and technology to run efficiently and meet sustainability requirements.
The same company received approval to buy two Southland farms last year, including one formerly owned by Solid Energy.
Federated Farmers mid-Canterbury president Willy Leferink said overseas investors would continue eyeing up the country's dairy industry, despite the recent collapse in prices.
He said dairying was about the long-term, not the short-term, and said the outlook for the industry remained bright.
He said mid-Canterbury was an attractive region for overseas investors eyeing the primary sector because it had "good water and good soil".
"Just add water as they say and you can grow pasture."
Buying land to convert into a dairy farm was "not for the faint hearted" and required equity and knowledge, Mr Leferink said.
"They're not going to run the farm from Luxembourg ... so the manager lives on the farm, he's going to spend his money in town, the fertiliser comes from here so there's still a good distribution of income."
He said as long as the workload was distributed and overseas investors paid taxes in New Zealand then he was "quiet comfortable with the whole situation".