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Investment Thesis

Forestry is a proven asset class for institutional and private investors. Recent returns have been driven by rising land values and increasing timber prices.
 
The combination of value in a naturally growing commodity and the security of ownership of the underlying land provides investors with income and long term capital appreciation in a sustainable and tax efficient manner.

Negative correlation with other asset classes can provide extra diversification while helping reduce volatility.

 
Commercial Forestry Returns
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  • We realise value by harvesting the crop or disposing of the asset. Returns are driven by three component parts;

  • Biological growth of the crop

  • Increases in the value of timber

  • Increases in the value of land

Industry Trends
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  • Increased demand for housing in the developed world

  • Increasing use of wood in construction

  • Rising consumption per capita in the developing world

  • Development of new timber markets

Tax Benefits
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  • Tax free income

  • Tax free capital gains

  • Capital gains roll-over 

  • Reduced inheritance tax after 2 years of ownership

New Timber Markets
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  • Biomass energy generation

  • Cross Laminated Timber use for construction

  • Traditional packaging changes - as consumers and governments continue to reduce the use of plastics

Secular Drivers Behind Timber Demand

TRADE & COMMERCE

Construction

 

Packaging

POPULATION

Furniture

Home renovation

Energy

Urbanisation

SCARCE RESOURCE

Animal & Plant Species

Woodland Naturalisation

Water

NEW MATERIALS

& APPLICATIONS

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Smart Packaging

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CLIMATE & ENVIRONMENT

Carbon Emissions/Credits

Recreation/Health

Biodegradability

Biomass

GROWTH

DRIVERS

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