Atlanta-headquartered Forest Investment Associates has combined its North and South America units and added a sustainability director as part of a reorganization prompted by the changing make-up of timberland investors.
The effort is being led by FIA senior vice-president Mike Cerchiaro, who told Agri Investor that over about the past seven years, the US public pensions that had set the tone in timber markets have been joined by institutions from Australia, Asia and Europe.
“Those sources of capital on the equity side have become more and more important and they view the world through a global lens,” he said. “The increased openness in their real asset programs to go outside of the US creates this opportunity set for assets in South America and elsewhere outside of the US.”
Cerchiaro explained that the units had functioned separately and combining them into a single unit facilitates more comprehensive strategic planning. FIA has invested in South America for more than a decade and Cerchiaro said the firm has a generally positive view of the operating environments in Chile and Brazil.
Both countries have well-developed forest product markets, he said, adding that the relatively underdeveloped state of their timberland investment landscapes makes them attractive for FIA. Although covid-19 has further complicated political environments in both countries, he added, the firm’s experience in the region has served it well.
“When you are diligent and familiar and have an on-the-ground presence and knowledge, those challenges are knowable, and you are able to work through them,” he said. “We’re comfortable with both of those political landscapes for those investors that are long-tenured in their views.”
According to his LinkedIn profile, Cerchiaro joined FIA as a regional investment forester in 2004 after previously serving as a research forester at New York Stock Exchange-listed timber REIT Rayonier. At FIA, he has also been leader and director of its international investment unit and manager of its Broad Arrow Timber Company subsidiary.
As part of FIA’s reorganization, Cerchiaro has been elevated from vice-president and director of international investments and operations to the new position of senior vice-president and director of investment management.
New ESG role
Among other changes is the addition of MaryKate Bullen as FIA’s San Francisco-based director of sustainability and ESG.
Bullen joins the firm from Australia-headquartered New Forests, where her 12 years with the firm included time as the senior analyst for advisory services and director of sustainability and communications, among other Sydney, Singapore and San Francisco-based positions, according to her LinkedIn profile.
Cerchiaro said Bullen’s newly created role will focus on strengthening the firm’s ability to bring together various elements of sustainability, carbon sequestration and impact investing that are becoming more important to institutional timber investors worldwide. Bullen’s work will focus on ESG management and measurement for existing timber assets and the potential development of new strategies.
“This allows us more directly engage on the UN Sustainability goals, managing investor carbon footprints, thinking about conservation finance values,” said Cerchiaro. “It allows us to more actively respond to those interests, which are really helping the overall value proposition of timberland.”
FIA was founded in 1986 and manages $4.3 billion in assets distributed between separately managed accounts and co-mingled funds.