By Tim Gray
Trees don’t watch the stock market. Forests keep growing — and potentially increasing their value — even when inflation surges or the market swoons.
Big investors, like university endowments and insurance companies, have long allocated money to timberland in places like Oregon’s fir-and-spruce forests, Georgia’s pine plantations and Appalachia’s hardwood groves.
Until a few years ago, retail investors were mostly shut out of this market. The deals were too big, involving thousands of acres and tens of millions of dollars.
That changed over the last 15 years with the introduction of two timber-focused E.T.F.s — the iShares Global Timber & Forestry E.T.F. and the Guggenheim MSCI Global Timber E.T.F. — and the evolution of big forest-products companies like Weyerhaeuser and Rayonier. Today, the big timber companies are organized as real estate investment trusts (R.E.I.T.s) focused on managing forestlands, having sold off many other operations.
Ordinary investors can now put money into timber without venturing into the woods. Buying shares of an E.T.F. or a R.E.I.T. won’t replicate the benefits of directly owning vast timberlands, but it does enable one to bet on timber.
And there’s an old-fashioned option: buying a little woodlot of one’s own. That’s more akin to a part-time job than a passive investment, but it can yield financial gains.
More than 290,000 acres of northern Maine forestlands in Aroostook, Penobscot and Piscataquis counties have been sold to Tall Timber Trust, according to forestry consultant Gary Bahlkow.In the private transaction, the price of which has not been disclosed, Canopy Timberlands, LLC, sold two major blocks of forestland to Tall Timber Trust, said Bahlkow, who is overseeing the transition of lands and the forestry and contracting teams for Tall Timber. The deal closed Sept. 30, he said.“They both have been working forest for a long time and continue to be,” Bahlkow said of the two blocks of the land, both comprised of mixed hardwood and softwood forests.Bahlkow declined to share more information on Tall Timber Trust’s ownership or the extent of its land holdings in Maine, saying the company wants to maintain a “low profile” during a “routine timberland investment transaction.” A quit claim deed filed with the Penobscot County Register of Deeds lists D. Ben Benoit as a trustee of Tall Timber Trust, created in Connecticut in 2007.