Investment firm Nest allocates £550 million towards timberland management company
Nest Invests £550 Million in Sustainable Timberland Across the Americas
In a strategic move to diversify its investment portfolio and potentially enhance returns, Nest, an investment organization managing £45bn for over 13 million members, has appointed BTG Pactual Timberland as a timberland manager. The initial commitment is an impressive £550m.
This is Nest's second timberland fund manager appointment since launching its procurement two years ago. The timberland investments are not limited to a specific fund but are part of the default fund, making them accessible to all its members.
BTG Pactual Timberland Investment Group, a US manager offering exposure to sustainably managed timberland across the Americas, will manage these timberland investments for Nest. The aim for a high return of 8% indicates a strategic investment approach by Nest.
The performance emphasis is on long-term steady returns, inflation protection, and environmental benefits. Nest highlights that well-managed timberland not only provides renewable resources (e.g., construction materials) but also delivers ecosystem services such as carbon capture, soil preservation, biodiversity protection, and water filtration, which enhance the environmental value of the investment. BTG Pactual’s stewardship is expected to align with Nest’s dual goals of sustainability and financial performance.
Last year, Nest appointed Campbell Global, a timberland investment advisory company owned by J.P. Morgan Asset Management, to manage an initial £550m of its timberland allocation. Over time, Nest plans to invest 2% of its total Assets Under Management (AUM) in timberland.
The focus on achieving a specific internal rate of return indicates a proactive approach to managing and monitoring the performance of timberland investments. The internal rate of return target suggests a focus on generating significant financial returns from timberland investments. This approach marks Nest’s continued commitment to building a diversified, sustainable investment portfolio that balances economic and ecological objectives.
Sources: [1] Nest Corporation. (2021). Nest appoints BTG Pactual Timberland as timberland manager. Retrieved from https://www.nestcorp.org.uk/media/11356/nest-appoints-btg-pactual-timberland-as-timberland-manager.pdf [2] Pensions Age. (2021). Nest Corporation appoints BTG Pactual Timberland as timberland manager. Retrieved from https://www.pensionsage.com/2021/07/20/nest-corporation-appoints-btg-pactual-timberland-as-timberland-manager/ [3] Investment Week. (2021). Nest Corporation appoints BTG Pactual Timberland as timberland manager. Retrieved from https://www.investmentweek.co.uk/nest-corporation-appoints-btg-pactual-timberland-as-timberland-manager/ [4] Nest Corporation. (2021). Sustainable timberland investments. Retrieved from https://www.nestcorp.org.uk/our-investments/our-investment-strategy/sustainable-timberland-investments/
- Nest's £550m investment in sustainable timberland across the Americas falls under the category of environmental-science, as it focuses on forestry and natural resources management for ecological benefits.
- Their strategic investment in timberland, a real-estate asset, is also seen as a business move, with a goal of achieving an internal rate of return, indicating a focus on finance and investing.
- This investment in home-and-garden resources like timberland aligns with sustainable-living principles, as well-managed timberland provides renewable resources and contributes to environmental protection.
- The lifestyle implications of this investment decision by Nest promote the idea of green living, as their members can benefit from investing in a socially and environmentally conscious way.
