New Forests, the Sydney-based timberland investment manager, has purchased approximately 4,200 hectares of freehold land and softwood plantations in New Zealand from the Flight Group, bringing its ownership of New Zealand softwood plantations to more than 12,000 hectares.
New Forests is also, through portfolio company Timberlink, acquiring the sawmilling assets of Flight Timbers, a global supplier of timber also owned by Flight Group.
“New Forests has demonstrated that the model of aligning the plantation resource with the processing facility reduces risk and will steadily create value,” David Brand, chief executive of New Forests said in a statement.
This is the second deal the firm has struck in New Zealand in a little over a month, having purchased a 4,000 hectare forestry right in the Hautu-Rangipo region near Turangi in the central North Island at the end of June.
Completion of the latest deal is subject to approval by New Zealand’s Overseas Investment Office, which assesses applications from overseas investors seeking to invest in “sensitive” New Zealand assets. New Forests said it will appoint a New Zealand-based property management company for forest operations and will seek Forest Stewardship Council forest management certification for the plantation.
New Forests manages 620,000 hectares of forests, rural land and conservation investments for its institutional clients. Timberlink manages two softwood sawmills in Australia and the associated distribution network.
The timber fund manager is currently investing New Forests’ Australia New Zealand Forest Fund II (ANZFFII), which closed in early 2014 with more than A$700 million in commitments. The fund is more than half-deployed. In total the manager has more than A$2.5 billion in assets under management.