Why invest in Timber?

timber investment logs

Timber has outperformed Bonds, Commodities and Stocks with an average compound return of 16% between 1987 and 2006. These figures are also based on American and European Softwoods, which have a significantly reduced market price compared to their Tropical Hardwood (Teak) counterparts, therefore producing significantly lower yields.

Plantation Teak, can be purchased and planted at a fraction of its harvest value at maturity. As your trees grow, they appreciate in value. Once they achieve harvestable maturity, the value of your asset will have grown by a factor of five times your acquisition cost, before considering inevitable price increases and inflation. When historical Teak selling price and general inflation trends are included, your Teak asset could rise in value to over ten times it acquisition cost.

You will own a tangible, hardy asset and be positioned to take advantage of tremendous market dynamics, including a limited world supply and ever increasing demand.

In the Belem Sky Plantation Project, it is this and the following reasons that attracts companies to lease your plot(s) and pay you a regular rental fee for doing so.

Stable market dynamics

Growing demand for Teakwood coupled with limited geographical growing areas and shrinking international supply suggest that increases in Teak prices should continue, further driving up the value of your asset.

More promising performance than traditional investments

For decades Teak has demonstrated appreciation rates that consistently exceed the normal rate of inflation. Combining your green investment’s projected growth value with selling price increases; a parcel of Pacific Teak trees is likely outperform traditional investments by a wide margin as well as provide the security of a growing tangible green asset, free of the volatility and risks of conventional markets.

A real, tangible asset

Teak is a durable, appreciating physical asset that grows steadily and safely with little maintenance, putting you in control of your asset. Your Teak trees will grow substantially in value every year regardless of instability in global financial markets.

Safety and security

Once planted and fortified, Teak trees flourish in a protected rainforest environment practically impervious to destruction by fire and insects, while the politically-neutral government of Costa Rica provides a stable political and economic environment.

The great news about timber is that it is the only commodity that has had a steadily rising price over 200 years, 100 years, 50 years, 10 years.

Timber is the only reliable negatively correlated asset class. This is because timber owners can withhold the forest. If they find the price of lumber low, they just don’t harvest. There is no cost of storage and the tree continues to grow and increase in value.

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