Timberland consultancy bolsters offering to reflect client ESG demands

American Forest Management has added new staff and is working in new markets to respond to client demands for investments with strong environmental, social and governance credentials, said new chief executive Brent Keefer.

AFM has recruited staff with expertise in mitigation banking and has started working on such projects in south-east US to gain exposure to the market, as well as strengthening its carbon offset accounting services and sequestration potential analysis, Keefer told Agri Investor.

“That is just a growing area of interest that we want to be able to respond to when we have requests from our clients,” said Keefer. “We are working towards having enough expertise to be able to identify opportunities that make sense and then work with our client, the landowner and a developer to put together a project.”

The growing acceptance of wood as a construction material for commercial buildings, said Keefer, has provided additional support to a market where sentiment has traditionally followed US housing construction.

“That has raised the profile of the idea that wood actually is a good building material; that it is sustainable and is a green building material. It’s been a helpful trend in our industry,” he said.

Keefer joined AFM earlier this year after more than 20 years with Hancock Natural Resources Group, where he was responsible for timberland acquisitions, dispositions and underwriting, according to his LinkedIn profile. He was appointed president of Hancock Timber Resources Group in 2014, before a 2018 reorganization that consolidated management under the HNRG brand made him senior managing director, head of timberland investments.

AFM’s client base includes non-industrial private landowners, public timber companies and timber investment management organizations, with the latter accounting for about half of its business, Keefer explained.

TIMOs’ utilization of third-party service providers like AFM has evolved over the course of his 30-year career, said Keefer, who worked for NYSE-traded forest products provider Rayonier before joining Hancock in 1998.

In the TIMO market’s early days, he said, many managers initially outsourced services like land management, financial accounting and sales. As investor interest and the market’s scale grew, some larger TIMOs moved to integrate property management and acquisitions functions in-house.

Over the past decade, he added, growth in the number of managers has plateaued and timber firms in the market have taken varied approaches to outsourcing.

“There is a split now. There are some TIMOs that have that in-house capabilities and some that do not and hence, outsource it to companies like AFM,” said Keefer.