Scottish Border Pension makes Nuveen timberland commitment

The pension is the latest to warm to forestry, after the ACCESS Pool signaled its intent to deploy £300m into the asset class earlier this month.

The Scottish Border Council Pension Fund has made a commitment of an undisclosed size to Nuveen’s Global Timberland Fund.

A statement from Nuveen said it was the pension’s first allocation to natural capital. The asset manager did not disclose the current size of the open-end timberland fund, which launched in 2022.

Nuveen added that the SBCP is also looking at the potential of making further allocations to the asset managers suite of natural capital strategies, across both farmland and forestry.

“The pension fund’s core objective is to provide our end investors with stable returns and we are increasingly putting their capital to work to drive positive environmental and social outcomes,” said David Parker, chair of Scottish Borders Council Pension Fund.

“The Nuveen Global Timberland strategy and its investment philosophy is fully aligned with these ambitions and will help us in our journey towards a more sustainable portfolio. Moreover, the depth of Nuveen’s overall investment platform, the strategy’s global scope and income profile were key factors in forming the partnership.”

SBCP is part of the national Local Government Pension Scheme and has assets of £900 million ($1.1 billion; €1 billion) under management with investments spanning across both traditional and now alternative asset classes.

Nuveen’s Global Timberland Fund seeks to seeks to provide consistent, long-term risk-adjusted returns through a portfolio of diversified timberland assets.

The strategy is led by head of timberland investments Chris Lipton. Nuveen currently manages more than $2.1 billion of timberland assets consisting over 873,000 acres of forestry globally.

Natural capital in vouge

The ACCESS Pool, which manages assets worth £35 billion on behalf of UK local government pension schemes, announced earlier January it is looking for a timberland fund manager through which it can invest £300 million.

ACCESS intends to make two separate allocations, one of which will go to a core timberland strategy with the other going to a timberland impact fund.

In February 2023, the £24.4 billion British public pension scheme Nest signaled its intent to make commitments to natural capital funds.

The pension said it could deploy as much as 5 percent of its AUM to natural capital, which would represent £1.2 billion.

London CIV, which is an investment manager responsible for 32 London local authority government pension scheme assets, appointed consultant Redington to support its launch of a natural capital investment vehicle in October.

“A natural capital fund is London CIV’s latest endeavor in helping our partner funds reach their ambitious investment and net-zero goals, and it’s great to have Redington join London CIV again to assist in building out this latest product,” said London CIV CEO Dean Bowden.

“It’s anticipated that large-scale carbon capture will play a fundamental role in the path to net zero. Indeed, we could achieve a 30-40 percent reduction in CO2 emissions by restoring natural habitats across the globe, according to one academic study.”