May 6, 2024

By Lynda Kiernan-Stone, Global AgInvesting Media

Climate Asset Management, a specialized firm solely dedicated to natural capital, announced the signing of agreements for the acquisition of 1,900 hectares of farmland in Spain and Portugal that will be financed by its Natural Capital Strategy (NCS).

These assets are being acquired from Borges Agricultural & Industrial Nuts, one of the top nut processors in Spain, which explained that the decision to sell was tied to its intended shift in focus to its industrial and commercial core business.

Climate Asset Management was formed in 2020 as a joint venture between HSBC Asset Management and Pollination, a climate change and advisory firm, with the goal of being the world’s leading asset management company fully dedicated to natural capital providing investment solutions that benefit nature, people, and the planet.

Through NCS, the team aims to deliver attractive, long-term risk return outcomes while creating impact at scale by protecting and restoring vital biodiversity; the result being the ability to unlock a supply of high-impact carbon credits for corporates and investors seeking to achieve net zero.

At the time, GAI News was told that the venture was launched with HSBC as a cornerstone investor in the initial vehicle – with a funding target of $1 billion from sovereign wealth funds, pension funds, institutional investors, and insurers – to be deployed across both emerging and developed markets in a diverse range of projects that will preserve, protect, and enhance nature over the long-term. A second carbon credit fund was to follow, with a funding goal of up to $2 billion.

Since that conversation, a lot has occurred. This diversified brownfield project represents the fourth overall large-scale regenerative agriculture acquisition by Climate Asset Management’s NCS, and its third in Spain. The total land comprises 1,640 hectares of productive orchards involving an aggregation of 14 properties producing almonds, walnuts, and pistachios across the Badajoz and Granada regions of Spain and Porto Alegre in Portugal. 

“It is clear that there is a growing appetite among institutional investors for opportunities in natural capital to rebalance investment portfolios targeting nature positive and net zero,” said Ben O’Donnell, chief investment officer, Climate Asset Management’s Natural Capital Strategy. “We are continuing to raise and deploy funds for our Natural Capital Strategy through a healthy pipeline of projects in ANZ, North America, and Europe.”

NCS will  be partnering for the second time with Bolschare Agriculture, a local experienced operating partner and industry leader in tree nut orchard management, who will employ the project’s existing operations team. The goal will be to transition management practices to regenerative methods with more than 10 percent of the land being managed exclusively for natural and biodiversity improvements and the encouragement of native flora and fauna.

“We are excited about the opportunity to increase crop diversification within the portfolio with the introduction of pistachios and walnuts. We should be able to see the difference made by introducing regenerative practices against the historical performance of the farms,” said O’Donnell.

This brownfield project, which has a proven production track record, provides MCS with a valuable baseline case against which regenerative agriculture practices will be able to be measured. These practices being implemented in partnership with Bolschare include cover cropping, enhancing soil organic matter, increasing resilience, improving water efficiency, and reducing synthetic chemical usage. 

Pedro Folos, CEO, Bolschare Agriculture, commented, “We are excited to have the opportunity to grow our partnership with Climate Asset Management and be involved in this large-scale diversified brownfield project that will have a great positive impact in our portfolio, and will help our two companies grow together towards a net zero carbon future.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and Agtech Intel News. She can be reached at lkiernan-stone@globalaginvesting.com.

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