|One of the major benefits of a timberland investment is that no matter what happens to the economy, the timber will always keep growing.|
These savvy investors are looking at timberland as a primary investment tool. A well managed stand of plantation pine can produce returns of better than 10% a year with proper management. The increased value of the land over time, improves the return of these investments. If the land is located in a growth corridor or an area where a future higher and better use may develop, the returns may be greater still. One of the major benefits of a timberland investment is that no matter what happens to the economy, the timber will always keep growing. Other advantages of a timberland investment are that it can be visited and inspected frequently by the owner, the value of the investment can't be stolen by unscrupulous CEO's, management costs are relatively low, risks of ownership are low as long as the timber is well managed and it is relatively easy to buy and sell the investment. The biggest disadvantage is that it is generally a long term investment. However, it doesn't have to be. An investor with a shorter time frame just needs to purchase tracts with well established stands of growing timber.
On the sellers side, there are many timber companies, pension funds and real estate investment trusts selling their holdings. Often these sellers are selling land they have held for years, to generate gains for their stockholders or investors. In other cases the lands have become surplus because of mergers, acquisitions, etc. In any case there are some extremely well managed tracts of timberland available, as well as many less desirable tracts. These sellers are professional land managers, or they employ professionals, so there generally are no "steals" in these offerings. However, there are many good solid investments waiting for the right buyer. As with any investment, the buyer needs to seek expert advice to analyze the investment and make sure it fits his/her needs and goals. This is especially true with timberland. Only an expert evaluation by a professional consulting forester can reveal the true potential of a timber stand. Many factors and conditions will not be obvious to the average buyer.
As professional consulting foresters and real estate brokers, we represent our client's best interests. If you are a seller, we will evaluate the strengths and weaknesses of your land, evaluate the current market conditions, price your land accordingly, advertise the land and represent you in the sale. If you are a buyer, we will work with you to identify the qualities you are looking for in a timberland investment such as location, size, cost, expense and income projections, investment period, etc. and represent you in locating a suitable timberland investment.
Give us a call at our toll free number to discuss the sale of your land or the acquisition of a new real estate investment. Call 800-962-2281.Reprinted from "Forest Management News" Spring 2004, Volume 24 Number 1, published by Timber Marketing & Management of the Carolinas, Inc.