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International Internet Magazine. Baltic States news & analytics Sunday, 22.04.2018, 13:43

Swedbank and LHV pension funds set up fund investing in Estonian forest land

BC, Tallinn, 11.10.2016.Print version
– The Estonian Financial Supervision Authority on Oct. 10 registered the terms and conditions of Birdeye Timber Fund 2, an Estonian real estate investment fund investing in forest land that has Estonian pension funds of Swedbank and pension funds of LHV as anchor investors, reports LETA/BNS.

A fund investing in Estonian forest land helps to hedge against inflation risk and presumably offers a more stable yield than investments in stock markets, for instance, Sander Pullerits, fund manager of the new fund, said. He said the anticipated yield will be made up mainly of natural increase in the timber stock and increase in the value of the portfolio as a result of its prudent and sustainable management.

The board chairman of Swedbank Investeerimisfondid, Kristjan Tamla, said Swedbank Investeerimisfondid was looking at this as a long-term investment made in Estonia that should help to better hedge the risks of pension funds. Forest growth and forest management that shape the yield on investments made in forest are components which generally do not depend on developments on the international financial markets, he said.

LHV pension funds already are investors in the first Birdeye Capital fund investing in forest land.

"In the low interest environment pension funds need to search for yield opportunities in real assets, such as real estate and forest land. On the financial markets the prices of securities have risen substantially after the crisis years, which makes finding favorable investment opportunities more difficult," the manager of LHV Pensionifondid, Andres Viisemann, said.

Birdeye Timber Fund 2 is a non-public, closed-ended investment fund supervised by the Estonian Financial Supervision Authority.


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