Growing interest in forestry
Last year there was clear evidence of new buyers entering the UK forestry market attracted by the recent performance of the asset class, but also drawn to the environmental benefits of forestry.
There was, according to Savills Spotlight: UK Forestry report, a perceptible shift in public attitude towards the climate emergency and investors concerned with ethical governance looked to forestry to provide some of their solutions.
While interest from new buyers was a feature, some recent trends continued including low supply, strong competition and reasonable timber prices, as well as rising asset values. Our analysis of the 2019 data shows the average gross value increased by 17 per cent to £9,900 per hectare, which translates to an increase of 25 per cent per net productive hectare to £13,100.
Due to the drop off in forest planting in the 1990s, even aged properties are now rare and restructured properties with a wide age range of mature and immature timber are now the market norm.
The growing interest in forestry has now filtered through into tree planting as we saw in many of the political party manifestoes last year. These positive pledges are very welcome, but there was little detail on how additional planting would be achieved against a backdrop of complex grant schemes, slow processes, lack of nursery stock and the higher value of competing land uses.
Jamie Adamson, head of forestry investment at Savills
