forestry investment funds

Joseph Zorzin redoak at forestmeister.com
Thu Oct 16 04:54:48 EST 1997


Jostnix wrote:
> 
> In article <01bcd9ba$753e68a0$1800a8c0 at javali>, "Carlos Rio Carvalho"
> <rio.carvalho at dirac.pt> writes:
> 
> >I´m looking for experience in forestry investment funds worldwide.
> >
> >Coments and tips will be helpfull.
> >
> >Carlos Rio Carvalho
> 
> Carlos:
> 
> A lot of US investment is going into North American forestland.   Several
> insurance companies are investing capital in forest properties.  Many
> retirement  funds are into timberland.  They believe that 12 to 18 percent
> returns are normal - I tend to agree.

Is that kind of return really possible when you factor in all the costs
of holding the land? Or is the investment being made on the speculation
that the land value will rise? At least in the northeast I can't imagine
anyone investing in timber growth. Land has become too expensive for the
prime purpose of growing trees. People invest in land because - "they
aren't making it anymore" and it's the best hedge against inflation.
Then, forestry is just frosting on the cake- to get further tax breaks
and some value growth in timber.

> 
> I am not going to give specific companies here.  Don't know the liability
> on investor advice.  But I have studied the market and know that there is a
> dollar to be made in undervalued forest property.
> 
> There are several takeover opportunities with companies that are land rich
> and company poor...

I have a forester friend who works for Canale Inc. (Sp?) a large
southeast USA forestry and land mgt. consulting firm. He has many years
forestry experience and then got his real estate appraisal MAI license.
He now appraises huge tracts of land which he says are traded for many
millions of dollars. And he is very well paid- much more than any "mud"
forester- I suggest any young ambitious forester to persue this
appraisal work. And he travels all over the southeast- a real jetset
forester.

Now if only the Russians would open up Siberia to forest investors.



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