TIME Investments, a specialist in managing real assets and sustainable investments, has adds one of the UK’s largest privately owned forests, Barracks Forest in Perthshire, Scotland, to its existing portfolio of forestry investments.The assets are all held within its Inheritance Tax (IHT) service, TIME:Advance, as forestry offers Forestry also offers valuable tax reliefs – no income or capital gains tax on timber sales, plus inheritance tax relief.
Barracks Forest offers over 11,000 acres of fast-growing Sitka spruce and pine trees, which provide FSC certified wood and timber for a range of products and markets including paper and cardboard, which are increasingly being used as alternatives to plastic as demand for sustainable materials continues to increase.
Commercial forests and woodlands are regarded as an increasingly important long-term asset class by UK investors because of their attractive investment characteristics. Forestry typically has a low correlation to other mainstream asset classes, making it an effective diversifier.
Investors in forestry have the opportunity to benefit from inherent organic growth and capital appreciation because of the increasing volume of timber as the crops grow – larger trees can be processed into higher value timber products, and as the value of the underlying land increases. In addition, the introduction of biomass energy installations in the UK and overseas is expected to further increase demand for timber production.
Demand for forestry has more than doubled since 2011, with 14,400 hectares of commercial forestry sold in the UK in 2019 with a market value of just over GBP121 million. Analysis of the forestry market shows that the average gross value increased by 17 percent in 2019.
Stephen Daniels, Head of Investments at TIME Investments says: “Forestry assets are becoming increasingly popular with investors because they provide access to a sustainable investment, but also one that we believe offers low volatility and stable returns. Our research shows that 58 per cent of retail investors said they need to think more about the future of the planet for their children – forestry helps them tick this box.”
TIME has a long track record of managing commercial forests and investors have held forestry investments since 2005 as part of a diversified portfolio in its Corporate IHT service. TIME:Advance also invests in a biomass plant in close to proximity to Barracks Forest, where the timber can be used to generate clean energy, reinforcing its commitment to sustainable investments.
The addition of Barracks Forest to the TIME:Advance portfolio, which also includes wind, solar and hydro renewable energy, means that three quarters of the portfolio is invested in sustainable and positive impact investments.