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Timber Private Equity Fund Managers – November 2013

by Christopher Hardy

  • 13 Nov 2013
  • PE
  • NR

Preqin’s Fund Manager Profiles online service shows that the universe of fund managers which invest in timber opportunities as part of a wider strategy continues to be dominated by US-based firms. Two-thirds of timber-focused fund managers are headquartered in the US, or 23 out of the 35 that are currently active in the space. Preqin’s Fund Manager Profiles shows that after the US-based firms (66%), the next largest proportion of timber-investing fund managers are based in the UK, with 11% of the total.

In terms of dry powder, or capital available for investment, US-based timber-focused firms command an estimated total of $1.7bn in dry powder, while UK-based managers have only $298mn at their disposal. The anomaly in terms of dry powder is Canada, with only one fund manager focused on timber based in the country, but with $1.4bn in estimated dry powder. This firm is Brookfield Asset Management, which has global operations focused on not only the timber industry, but also natural resources as a whole, including agriculture and renewable energy.

Unsurprisingly, Brookfield Asset Management is the largest firm that focuses on timber investments as part of a wider strategy in terms of total funds raised in the last 10 years. The firm has raised just shy of $4bn since 2003, which represents more than triple the amount raised by the second largest timber-investing firm. This is Timbervest Partners, a US-based private equity firm that has raised $1.3bn over the last 10 years. The next largest firm by total funds raised in the past 10 years is UK-based manager, Stafford Timberland. This firm is an international timberland fund of funds manager that manages pooled investment vehicles and co-investment opportunities and advises on timberland investments located in most major international forestry economies.

The breakdown of firms that invest in timber as part of a wider strategy is more evenly spread than first examination suggests. Despite the large majority of firms being based in the US, many of them are relatively small in size and by averages of both estimated dry powder and total funds raised in the last ten years, the US comes in third behind Canada and Australia each time. While the larger firms may inflate the results for this country, the US is only marginally above the UK in both metrics.

 

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