Timberland Ownership Changes Explored in P&C Webinar

The University of Minnesota Sustainable Forestry Education Cooperative hosted P&C Vice President Sam Radcliffe’s webinar entitled TIMOs and REITs: The New Face of Industrial Forestry.

In it he documents the last 20 years of wholesale change in industrial timberland ownership, from integrated corporations to investment-oriented entities. Radcliffe identifies the economic and legal factors that motivated the transformation, including the investment characteristics of timberland that make it a desirable asset class for institutional investors. He also explains the differences between Real Estate Investment Trusts and Timber Investment Management Organizations, two distinct classes of new timberland owners. Along with the change in ownership came a shift in management focus from maximizing forest productivity to maximizing relatively short-term investment value.

This change in focus has had some unintended consequences on issues such as forest management intensity, timber supply for consuming mills, forest fragmentation, the conservation easement movement, forestry R&D, and forest certification. Radcliffe identifies these consequences and several trends to watch in the future as the new breed of timberland ownership matures.