February 17, 2022

By Lynda Kiernan-Stone, Global AgInvesting Media

BTG Pactual Timberland Investment Group (TIG) has partnered with British Columbia Investment Management Corporation (BCI) to launch Caddo Sustainable Timberlands LP (CST) – a platform through which to build exposure to southeastern U.S. timberland with the goal of generating superior risk-adjusted returns while accounting for ecological integrity and sustainability. 

BTG is the largest investment bank in Latin America, with BTG Pactual Asset Management having an international presence with more than US$100 million in AUM. As a division of BTG Pactual Asset Management, TIG is one of the world’s oldest and largest timberland investment managers with nearly US$4.5 billion in AUM and 3 million acres managed on a global scale as of Q3 2021.

Sameer Jinnah, managing director, BCI said, “BCI is an active investor in the timberlands sector and CST is an example of our commitment to a market that can generate attractive risk-adjusted returns for our clients over the long term. We are excited to be working with trusted partners to continue to increase our exposure to high-quality, sustainably managed forests in core markets.”

This newly launched platform already controls approximately 772,000 acres of Sustainable Forest Initiative (SFI) certified timberlands in East Texas and Louisiana, and has an impressive roster of customers, including Georgia Pacific, Louisiana Pacific, International Paper, West Fraser, and Roy O. Martin.

To lead this enterprise, John Lock – a former region manager for Arkansas and Texas for an undisclosed institutional timber management company – has been appointed as president, and Patrick Chambless – a former financial reporting manager for a Texas-based institutional timberland management company – has been named chief financial officer.

Lock commented, “Having previously spent 22 years of my career managing the assets that comprise the Caddo Sustainable Timberlands, I am very familiar with the significant economic, conservation and environmental contributions these properties have made to wood consumers, East Texas communities, and the forest industry, as well as the need to continue that legacy.”

He continued, “Our team at CST is committed to delivering exceptional stewardship, sustainability, and value through the implementation of science-based forest management practices that promote healthy, vigorous forests while protecting water quality and critical habitats. We are also excited to partner with the Texas Forestry Association, conservation groups, local communities, and regional stakeholders to continue the rich history of timberland and natural resources management that has been the fabric of these properties and the East Texas culture for well over 100 years.”

Northwest to Southeast

CST marks the second significant move by TIG in the U.S. timber space in less than eight months. In July 2021 the manager acquired control of two 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. 

This deal saw 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.

“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 at the time. “TIG is investing alongside its clients in both of these funds and looks forward to managing them alongside its current assets in the region.”

Now, through its partnership with BCI and through its newly launched vehicle CST, TIG will further expand its footprint and its investment mandate into the U.S. Southeast.

“I’m grateful for the opportunity to be part of Caddo Sustainable Timberlands and work alongside John and the teams at TIG and BCI,” said Patrick Chambless, CFO, CST. “We are striving to build a best-in-class organization that generates immediate yield on investment for our shareholders, while sustainably managing our portfolio and implementing the highest standards of environmental, social and corporate governance.”

Gerry Lansing, head of TIG and board director at CST, added, “We’re thrilled to once again be partnering with BCI, one of the largest institutional investors in Canada, who shares our long-term commitment to the deep and diverse market of East Texas, as well as our emphasis on environmental and social sustainability. In John and Patrick, we’ve hired an amazing team to lead CST, who have decades of experience with these specific assets and the East Texas communities where they are located.”

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– 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.