August 17, 2023

By Lynda Kiernan-Stone, Global AgInvesting Media

Domain Capital Group and its subsidiary Domain Timber Advisors announced the successful completion of the sale of nearly 2,900 acres of timberland in southeast Arkansas via an unsolicited, off-market deal.

Based in Atlanta, Georgia, Domain Capital Group manages approximately $8.2 billion in total AUM (as of September 30, 2022) spread across its two registered subsidiaries: Domain Capital Advisors and Domain Timber Advisors. These assets are comprised of approximately $7.2 billion in real estate, debt, alternative, and other assets constituting Regulatory Assets Under Management (RAUM) and approximately $1 billion in non-RAUM assets including real properties and additional loans services. 

Originally acquired by Domain earlier this year, the tracts are located in Hot Spring, Grant, Jefferson, and Pulaski counties and were targeted as they met the company’s core investment criteria – a focus on smaller, non-contiguous parcels that generally run from 2,000-30,000 acres with the potential for significant biological growth and income generation. 

“While we felt the Arkansas footprint was high-quality timberland, with strong long-term growth potential, we were presented with an unsolicited offer in-line with our strategy and that was accretive to our underwriting,” said Peter Walker, vice president of investments and timberland assets, Domain Timber Advisors. 

“We believe the sale of the Arkansas assets is a clear example of the firm’s strategy to achieve returns above traditional core timberland through the implementation of opportunistic land sales and other value-add initiatives.”

In February of this year, Domain executed a major transaction when it acquired 22,000 acres of timberland throughout the U.S. Southeast via six separate deals spanning October 2022 – January 2023. 

Domain explained at the time that this string of asset acquisitions located in Arkansas, Texas, Mississippi, Alabama, Georgia, and Virginia present a geographically diverse footprint offering exposure to several different timber and land markets with higher-and-better use potential.

“We believe these acquisitions demonstrate Domain’s ability to source quality assets in a competitive market environment and complete transactions expediently,” said Walker.

“Our plan to target value opportunities in lower-to-middle tier land markets has continued to produce consistent results. We look forward to being good stewards of these properties and managing them to high standards that preserve and enhance the environment.”

Known as the U.S. “wood basket” the U.S. Southeast region is responsible for more than 55 percent of the country’s timber harvest by volume. It produces more wood products than any country on Earth except the U.S. as a whole, and has been a hotbed of recent timber deals. 

Among many, a few examples include:

~ In November 2022, it was announced that Rayonier Inc. entered into two agreements to acquire 172,400 acres of commercial timberland in Georgia, Alabama, Texas, and Louisiana from Manulife Investment Management for $474 million.

~ In February 2023, Campbell Global, the wholly owned timber investment manager of J.P. Morgan Global Alternatives, led the acquisition of more than 250,000 acres of commercial timberland across three properties in the Southeastern region of the U.S., through a deal valued at more than $500 million.

~ And in April 2023, timberland and agriculture investment manager Manulife Investment Management (Manulife IM) acquired 55,000 acres of timberland in South Carolina from global sustainable packaging company Sonoco for $72 million in cash. 

For Domain Timber Advisors, the closing of this latest transaction in Arkansas puts them on pace to achieve 75 sales from multiple accounts this year, involving more than 17,500 acres from a total inventory that after the Arkansas deal, stands at more than 254,000 acres. 

~ 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, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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