Idaho Land Board picks up 32k-acre Molpus timber portfolio for $42m

Deputy director David Groeschl says the Land Board has $109m remaining for in-state ag and timber purchases.

Idaho’s Department of Lands has bought 32,160 acres of timberland in the state for $42 million.

David Groeschl, a deputy director at the Land Board, told Agri Investor the deal was finalized in late December and the seller was Jackson, Mississippi-headquartered TIMO Molpus Woodlands Group.

“For Molpus, Hancock or anybody else, they see value in having as many bidders at the table as possible,” Groeschl said. “They never envisioned the state, necessarily, being one of those potential buyers, but they also appreciate the fact that we’re at the table and we are a potential buyer – whereas if we weren’t at the table, and depending on what’s happening in the market, it could be very limited.”

The Land Board’s investment consultant, Callan, recommended last July it devote $180 million from the sale of residential and commercial real estate to purchasing in-state properties meeting a minimum annual return threshold of 4.5 percent for farmland and 3.5 percent for timber.

Groeschl said the Molpus transaction follows three smaller timber purchases with a cumulative value of $4 million. These were from another state-linked entity in Idaho, a private landowner and PotlashDeltic, a Spokane, Washington-headquartered forest products company listed on the NASDAQ exchange.

The Land Board uses in-house expertise, which it has maintained since 1891, to manage its one million acres of timberland to produce income for K-12 education through sustainable harvest and sale to local mills, Groeschl said.

In addition to investment returns, because some of the timberland purchased from Molpus neighbors existing Land Board properties, the December deal also allowed it to ensure the public would retain access to those properties, he added.

“People like the certainly of ownership by the state where those lands then remain open to public for recreation. In the counties, it gives those citizens some certainty of ownership because there have been a number of situations in the last few years where large tracts have been sold and that property has been gated off,” Groeschl said. “That has raised the concerns among Idahoans about being locked out of lands that they traditionally had access to.”

Groeschl said the Land Bank currently has about $109 million remaining of what has been earmarked for in-state ag and timber purchases in July. He added that the Land Board has hired a farmland advisor to help it evaluate three or four farmland properties, but it has yet to finalize an acquisition.

Molpus declined to comment.