Forest investment: The emergence of timberland as an asset class

Forest management is a global business and forest ownership is changing. The new owners bring with them a new focus that is highly financially driven. As a consequence, forest management is also changing. The changes are most apparent when comparing various types of ownership of industrial forest, since who owns the forest largely determines management objectives and priorities. The Pacific Northwest of the USA is used as a case study to explore the emergence of timberland as an asset class. The increased investment in timberland by financial institutions has come about through weak financial performance of forest industries, stock market pressure on publicly-listed forestry companies, environmental risk, and a more attractive taxation system for trust fund managers. Trends in the USA can be related to similar trends in Australia: that is, the sale of government plantations and the substantial investment in managed investment schemes. © 2006 Taylor & Francis Group, LLC.