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Timberland OwnershipDiversification and Long Term Growth

North American timberland ownership is a long-term asset based primarily upon the physical and economic growth of trees. Timberland ownership is well-suited to the patient investor seeking diversification with a long-term outlook focused on wealth preservation.

After six decades of guiding clients through forestry ownership and management, Fountains Land and F&W Forestry Services have consolidated their wealth of experience to assist family buyers with the acquisition and management of timberland tracts in North America.

Timberland Investment Drivers

Physical Growth

Timber volumes increase regardless of economic conditions with growth rates depending on the region of the country, sites, species, and silvicultural influences through direct management.

Ingrowth

Trees gain value as they grow into higher-valued products enhancing asset appreciation. Generally ingrowth will have a greater asset return impact on properties positioned at the cusp of product shifting during the ownerships tenure (i.e. acquiring stands with high components of pulpwood with diameters near the shifting point to the sawlog product size class). Active forest management has a positive influence on the level of product shifting through the silvicultural act of concentrating growth on selected crop trees.

Price Growth

The cyclical nature of wood markets, based on consumer demand, allows patient investors to capitalize on price trends that can boost appreciation.

Bare Land Appreciation

The land itself can appreciate depending on market cycles.

Active Management

Active field management is critical to ensure the highest potential returns from the forests. F&W offers the expertise that individual owners need to ensure they get the maximum returns from every parcel of timberland. Our active land management and financial reports are tailored to meet each client’s goals. We provide the counsel, technology and expertise needed to grow timberland investments.

Overall Return

Data for timber investments is well-established and supported by a diverse resource of publicly available information and actual client returns that commonly point to real returns (including management fees and holding costs) of 3.0 – 5.5%.

Timberland Ownership Characteristics

  • Long term, inflation hedged, uncorrelated investment
  • Low management risk (management is important but not complex)
  • Diversified timberland investment is low risk in terms of natural disaster (wind, fire, pests and disease)
  • Highly cyclical, as with many commodities
  • Taxed at capital gains rates and harvest can be timed for tax efficiency
  • Most investments self-fund or produce cash flow
  • Low liquidity: disposition of the asset can be 12 months
  • Investment that can be enjoyed

Environmental Characteristics

  • Sustainable and renewable resource
  • Can be certified through one of three independent, third party programs
  • Depending on location - production of native trees with natural regeneration

Direct Timberland Investment Partnership

If you are considering timberland ownership then F&W Forestry Services provides the necessary expertise to assist family buyers in the identification, analysis, and acquisition of timberland tracts.

We consider our clients to be long term partners and ensure that throughout the partnership (from acquisition, to asset management, to final disposition) their assets are managed in accordance with the business plans we develop with them. If you are considering a timberland purchase and would like to learn more about our acquisition and due diligence services, contact Michael Tragner if you are interested in properties located in the northeast and Jody Strickland if your interest is in other parts of the country (Appalachian Region, Southern US, Pacific Northwest and South America).