In the first fund launched by CEE Natural Resources, the CEE Group concentrates on equity investments in forests and forest land. We are investing in the southeastern United States, where we will buy and manage 30,000 hectares of pine plantations.
CEE Natural Resources
Learn more about our investments in natural resources:
The performance index for US forestry investments (NCREIF Timberland Returns) shows an average annual return of 7.6 percent over the last 20 years. The return is driven not only by market-independent biological growth, but also by the fact that harvesting can be deferred in periods of low timber prices (“value-enhancing storage”).
- Geographical advantage
The southeastern United States has a climate that benefits pine plantations. They grow there twice as fast as in Germany. It is hardly surprising therefore that forest plantations in the US have become a firmly established investment for US pension funds for example and that there is a transparent transaction market.
It is essential to protect natural resources. This is why our plantations are almost entirely certified under the common FSI/PEFC or FSC standards.
We are committed to maintaining high sustainability standards. For example, we do not, in principle, convert natural forests into plantations. Moreover, we undertake to comply with strict sustainability standards when we buy plantations. Our plantations are almost entirely certified under FSI/PEFC or FSC.
timba 1 – an investment in physical assets
Our “timba 1” fund will invest in productive forest land in the southeastern United States. We will buy about 30,000 hectares of pine plantations in various age classes at several locations and will then manage them (planting, nurturing and harvesting). Timber will be regular sold, especially to saw mills. The plantations are mostly sold at the end of the fund’s life. However, to optimise returns we may also carry out specific sales during the holding period.
Advantages offered by southern US states
The southeastern United States is the world’s top forestry region. With about 14.5 million hectares of plantations (more than twice the size of Bavaria), it accounts for 16 percent of global timber production. In addition to a transparent transaction market, the region offers an established industry and infrastructure. The region’s benefits are based on the numerous buyers in the woodworking industry, service providers for forestry operations and logistics infrastructure – roads, railways and ports. In addition, legal and investment certainty are guaranteed for foreign investors. Land can also be owned directly and absolutely.
Investment class – forestry investments
Forestry investments have been an established asset class for US investors for more than 30 years. Biological growth is the key factor that generates successful returns. Flexibility in thinning and harvesting in periods of low timber prices help secure and optimise the return (“value-enhancing storage”). Forestry investments show little correlation to investments in traditional classes such as equities and bonds. They also have a considerably better return-to-volatility ratio. They therefore offer outstanding capital and inflation protection.
Areas with forestry plantation in the Southeastern United States (marked in dark green):