A Sydney-based forestry investment company is collaborating with international partners to launch a world-leading globally diversified forestry investment vehicle that will also give investors exposure to environmental markets, such as carbon trading.  New Forests Pty Limited (www.newforests.com.au) in partnership with U.S.-based funds manager Cogent Partners, LP (www.cogent-partners.net/) has designed a publicly-listed fund that incorporates assets with a wide range of characteristics to maximize overall fund returns.

According to New Forests’ Managing Director, David Brand, the forestry sector can be considered a fairly new investment market outside of the U.S.  New Forests notes that non-U.S. institutional investors will likely increasingly invest in the sector given the asset class’s attractive portfolio characteristics and rising demand for timber.  Investment in Asia-Pacific is expected to increase due to higher risk-adjusted returns and under-developed assets available in the region.  New value streams from the environmental benefits of forests, such as carbon credits and bio-energy, are also poised to increase returns. 

Asset management responsibilities for the new fund will primarily be run out of Australia, where New Forests will conduct acquisitions in the Asia-Pacific region, as well as act as the fund’s asset management coordinator.  Additional asset managers will be located in the U.S. and will focus on regional areas of expertise, such as the U.S. Pacific Northwest, the U.S. Southeast, and South America.  New Forests says that the regional expertise and management afforded by this “fund of managers” approach provides effective portfolio diversification to achieve higher risk-adjusted returns.

The sterling-denominated Cambium Global Timberland Fund will be managed by Cogent Partners and intends to seek a listing on the Alternative Investment Market in London in 2007 with $1 million minimum subscription investments.  Cambium is currently looking to attract initial investors with commitments in the minimum range of US$10-20 million.  Interested parties may contact New Forests at +612-9406-4100 or dbrand@newforests.com.au.