News
New large forest completes portfolio
- Over 5,000 hectares of continuous forest acquired
- The window of opportunity for investing in Romania is beginning to close
- Nordcapital investors own a total of 17,500 hectares of high-quality forest
Hamburg, Germany, 1 November 2011. Nordcapital, the Hamburg-based investment company for closed-end funds, has acquired a continuous 5,056-hectare area of mixed forest in the Gura Teghii region of north-eastern Romania for its “Waldfonds 2” fund. This means that the fund’s portfolio of forested areas is for the time being complete. At 417 solid cubic metres per hectare the timber stocks of the forest are twice as large as those of an average European forest, which measure 178 solid cubic metres per hectare.
The purchase price of €4,305 per hectare is as much as 75 per cent below the west European level. “Today, the timber in the newly acquired forest alone is already worth over three times the purchase price,” said Florian Maack, a Managing Director at Nordcapital. “We are seeing increasing prices for forest areas. This confirms the value growth for the forests that we forecast, but also shows that the window of opportunity for investors is gradually closing,” he continued.
Seventy-five per cent of the second Nordcapital timber fund is currently placed. Equity was increased from €29.7m to €34.2m following the most recent land purchase, and the placement period was extended until December 2012.
The already valuable Gura Teghii timber stocks comprise mainly spruce, beech and fir. Around 60 per cent of the trees have been standing for more than 80 years.
Altogether the two “Nordcapital Waldfonds” funds cover 17,500 hectares of forest. The investors therefore own a total area that is bigger than the principality of Liechtenstein (160 km2).