Sustainable timber fund raises $130m

The US TIMO combines revenue streams from conservation easements and working land operations.

The US timberland investment management organisation (TIMO) Lyme Timber Company has raised nearly $130 million in the past year for its Forest Fund IV.

Filings with the US Securities and Exchange Commission (SEC) show the fund has raised $127.6 million from 169 investors in the 12 months since the fund’s launch in December 2014.

Lyme Timber focuses on acquisition and sustainable management of North American timberland. The TIMO combines revenue streams from conservation easements, a US method of ensuring land is treated sustainably, with working land operations like timber production, recreational leasing and alternative energy supply agreements. It also invests in mitigation banks, selling credits to offset the impacts of infrastructure and real estate development projects by preserving wetlands and endangered species.

Lyme’s previous fund raised $160.4 million in commitments and acquired 12 properties with a combined 230,000 acres between 2010 and 2014. The firm currently maintains 550,000 acres of land spread across 11 US states and Quebec. The company has conserved roughly 750,000 acres of forest through the sale of working forest conservation easements and other conservation tools, according to the company website.

A representative from Lyme Timber declined to comment on its funding activities, citing SEC regulations.

Lyme Timber’s strategy of delivering investment returns while focusing on positive environmental impacts is part of a broader trend toward sustainable investment. The trend has been particularly evident in timber and agriculture, where sustainability is increasingly seen as not only a way to look good, but also to ensure the long-term stability of returns. Most recently, Edmond de Rothschild’s Moringa fund raised $92 million to implement an agroforestry strategy in Latin America and sub-Saharan Africa, in which crops and timber space are mingled together to improve soil health and combat deforestation.

“What we are seeing now is a market move,” Edmond de Rothschild Private Equity chief executive, Clément Chenost, told Agri Investor earlier this year. “We see more and more consumers that want healthy food that doesn’t have negative environmental impacts.”