July 22, 2021

By Lynda Kiernan-Stone, Global AgInvesting Media

This week is big for timber deals in the Pacific Northwest. 

BTG Pactual Timber Investment Group (TIG) has acquired the management of two timber funds, (Fund III and Fund IV), with a co-investment interest in both vehicles from Olympic Resource Management (ORM), a subsidiary of Rayonier Inc., for an aggregate sum of $35.9 million. 

Rayonier is a leading timberland investment trust with assets located in some of the world’s most productive timber growing regions of the U.S. and New Zealand. As of March 31, 2021, the group owned or long-term leased approximately 2.7 million acres of timber: 1.75 million acres in the U.S. South; 507,000 acres in the U.S. Pacific Northwest; and 417,000 acres in New Zealand.

“This transaction significantly expands TIG’s footprint in the Pacific Northwest and furthers our goal of investing in sustainably-managed commercial timberland,” said Gerrity Lansing, head of TIG and MD partner, BTG Pactual. “TIG is investing alongside its clients in both of these funds and looks forward to managing them alongside its current assets in the region.”

This deal will see TIG acquire approximately 110,000 acres of high-quality, diverse, SFI-certified timberland in the Pacific Northwest region of the U.S., with Rayonier’s ownership stake in the two funds on a “look through” basis equaling about 11,000 acres. And as part of the deal, TIG will hire operational staff from ORM who have significant historical experience with these particular assets.

“As previously communicated, the private equity timber funds business that we obtained last year through our acquisition of Pope Resources was not a long-term strategic fit for Rayonier,” said David Nunes, president and CEO. “We are pleased to transition management of these two timber funds to a well-qualified timberland investment manager.”

Nunes continued, “We believe this transaction reflects a favorable outcome for our shareholders, as it allows us to simplify our operations and allocate capital to other strategic priorities.”

Following the transaction, Rayonier will continue to own a 20 percent co-investment stake in Fund II – comprised of 31,000 acres of Pacific Northwest timberland – which Rayonier has commenced the process of asset liquidation. Fund II will continue to be owned by ORM until completion of the planned sale. 

– Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Oilseed & Grain News. She can be reached at lkiernan-stone@globalaginvesting.com.