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Investing in Forestry
Devil's Advocate
Posted: 22 February 2011 21:49:47(UTC)
#1

Joined: 16/09/2009(UTC)
Posts: 19

I am interested in investing in forestry for the long term, however, I do not have the money or knowlege to invest in a physical woodland. I have found a number of companies which allow small(ish) investments into forestry such as Capital Plantation and Robinia Invest - does anyone know any companies which do a similar thing for trees planted in the UK?

Also, has anyone had experiences with these or similar schemes?

All comments appreciated
James Hanlon
Posted: 23 February 2011 12:58:18(UTC)
#2

Joined: 03/09/2010(UTC)
Posts: 1

Hi there, indeed I work with a firm RE-Invest Partners who have launched a forrestry fund. It utilises a SICAV, which is a Luxembourg Exempt Unit Trust for which smaller sized investments can be made.

If you would like further information or perhaps contact details, please see www.reinvestpartners.com

Regards,

Devil's Advocate
Posted: 23 February 2011 15:27:15(UTC)
#3

Joined: 16/09/2009(UTC)
Posts: 19

Thanks for the reply.

I am really looking to avoid funds if possible and secure physical ownership (or lease) of the land and trees on it. The companies I mentioned seem to give direct ownership of the land or lease and the trees to the investor, making their money from the management and a cut from the sale price.

My worries come from the fact that the investment will be outside the UK for 10 – 25 years and whether these schemes area really just scams? Although one seems to now be FSA regulated.
Antony
Posted: 07 March 2011 21:55:02(UTC)
#4

Joined: 07/10/2009(UTC)
Posts: 98

Thanks: 11 times
Was thanked: 19 time(s) in 11 post(s)
I think this is something Citywire should examine (!) ...I know MoneyWeek wrote an article or two about this subject in the last year.
Jonathan Gain
Posted: 08 March 2011 09:50:22(UTC)
#5

Joined: 18/07/2007(UTC)
Posts: 3

Was thanked: 1 time(s) in 1 post(s)
There is essentially two providers who enable investors to participate in UK commercial forestry investment opportunities.

The key word here is commercial; these funds seek to acquire plantations where timber will be harvested and sold for a variety of uses including the bio-fuels market. These plantations typically consist of spruce trees which have a lifespan of c40 years.
Non commercial plantations are typically hard wood trees and have much longer life spans and therefore have a different return profile. The latter can be sourced from agents who operate in the sector.

The forestry commission owns large areas of woodland and is a seller ( and until recently almost a total seller) of plantations. They also "regulate" commercial activities to ensure any harvested timber is replaced and a management policy is in place so that it is well maintained.

The two providers are FIM and Stellar Asset Management both of which are experienced operators in the sector. Both funds acquire the underlying freehold land and the trees which grow upon it.

I am a director of Stellar and we currently have a fund open for subscription. FIM closed a fund earlier this year.

The market for UK forestry is not huge c50m changing hands per annum and the tax breaks - no income tax or capital gains tax and IHT free after 2 years - make it an interesting asset backed opportunity in a diversified portfolio.

Investors can also participate in other timber funds but these are more likely than not to be overseas based and one can add currency and political risk to the equation.

Hope that helps and feel free to ask any further questions.

kind regards
Anonymous Post
Posted: 08 March 2011 21:18:56(UTC)
#6
Anonymous 1 needed this 'Off the Record'

If you do not have any knowledge of investment in forestry. Why would you want to invest in a very specialist sector with no understanding? It does not sound like a sensible way of investing!
Devil's Advocate
Posted: 09 March 2011 20:05:00(UTC)
#7

Joined: 16/09/2009(UTC)
Posts: 19

Well anon, I sure know more about forestry than I do about retail or insurance or many other common investment areas. But the whole point of this post was to try and find out more. Thanks for your help, what is it you think I should invest in!?
blackandgold
Posted: 11 March 2011 12:01:29(UTC)
#8

Joined: 10/03/2011(UTC)
Posts: 17

Thanks: 14 times
Was thanked: 8 time(s) in 3 post(s)
Jonathan Gain gave you a very helpful reply. I also looked at FIM a few years ago but elected not to invest at that time though forestry can be a useful small portion of your portfolio. You need to be very mindful of the liquidity aspect. You can't just turn round and get your money out like selling shares in BP.

If you have sufficient funds to devote a portion to forestry by all means take a look and do the research as the tax benefits can make it particularly attractive. And if you want an expert's recommendation then Jeremy Grantham at GMO has been a fan for quite some time. You can probably find more on GMO's website.

Good luck.
Destroyed
Posted: 18 June 2017 10:22:49(UTC)
#9

Joined: 18/06/2017(UTC)
Posts: 1

Just heard Robinia invest are insolvent for anyone who doesn't know
Pamela Neal
Posted: 24 June 2017 01:43:02(UTC)
#10

Joined: 01/04/2017(UTC)
Posts: 10

Was thanked: 2 time(s) in 2 post(s)
I do not understand you want to invest money in the sector where you have no knowledge, I think it is waste of time.
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