Forestland investment is particularly distant from the volatility specific to financial markets and real estate and is supported by two types of assets – land and growing trees.
Investment in forest land is currently enjoying a favorable situation worldwide and in Romania. Increasing demand for products that contain wood fiber (energy, construction, furniture, etc.) is only partly balanced by the limited regeneration capacity of natural forests or plantations. Key factors for success in forest investment are: purchase price, operational management quality, proximity and stability of local markets for the main timber assortments trading.
An investment in the future by taking advantage of current opportunities
Investment in forests is compatible with long-term investment cycles. The presence of forests in an investment portfolio reduces exposure to risk and volatility which is more present in other markets. Although long-term value creation is generally linked to moderate economic return , investment context in Romania benefits from several favorable key factors:
- large standing/growing volume – volume of timber in cubic meters per hectare: in Romania – 322 cbm/ha compared to Baltic States – 200 cbm/ha or Sweden – 113 cbm/ha;
- moderate acquisition price;
- stable demand from both a modernized timber processing industry and local communities ( for firewood), etc.
In order to fully benefit from such an opportunity, the additional key factor needed is a modern, efficient, responsible and sustainable operational management. Here, GREENGOLD can come up with a solution specifically adapted for either a planned or an already completed investment.