Passion Investing - 13.08.2019 - 2 min read time

Seeing the Wood for the Trees: Turning forest into an investable, bankable asset



Are you, as a financial intermediary, feeling increasing pressure to diversify your offering? Do you wish to improve your performance? Convert unconventional assets into an investable solution that can be added to your portfolio. Today’s example: trees.

 

Like never before, financial market participants are facing critical challenges to their long-term success. To support your success in a tough market GENTWO clients are working on new and innovative solutions to not only strengthen the bond to your customers but also release untapped growth potential.
 Click on the video to learn more about Eastwood and its fantastic tree plantation program.


Sustainable high-quality timber production is a new, innovative alternative asset managed by experts. Until now, such exposure to the forestry industry was not possible, timber producing trees were not bankable assets. A traditional asset manager could simply not access the returns for their investors. A new generation of asset managers are responding to investors demand by taking these assets and plugging into GENTWO’s off-balance-sheet issuance setup. The result is an exciting real alternative investment growth opportunity.

The Eastwood Investment: a Certificate giving exposure to the returns generated by trees

Paulownia trees are extremely resistant and their timber is used for precious wood instruments, furniture, interior linings and wood construction of highest quality. Eastwood AG manages the planting, growth, and harvesting of the trees using traditional modern methods. The trees are planted in rows to ensure efficient care and irrigation. Following the harvest of timber, the tree roots will drive out again. From the same foundation, a tree of about one cubic meter can re-grow and be harvested. Growth takes on average ten years. Thanks to its micro-honeycomb structure, the wood has unique properties and, thanks to its low weight and high strength, is considered to be the aluminum of timber. At the same time, Paulownia is extremely resistant to moisture and mold. Approximately Co2 storage of about one ton per tree during the growth phase can even be expected.

Learn more about Eastwood growing plantation program

Eastwood is a company lead by Michael Oschwald, a former patron of a computer science company, and Daniel Ballmer, a banker, and son of a farmer. Eastwood focuses on the efficient and sustainable production of timber from the Paulownia trees. Since 2012, the Eastwood team has grown to include additional experts and to start a collaboration with the Agricultural University of Timisoara. After finalizing the successful pilot of 40,000 m2, Eastwood decided to launch the full plantation program making 160,000 m2 of trees available for investment. There is an option for a further 3,000,000 m2. In the long term, the project could be extended to 1,000 to 10,000 hectares.

GENTWO, as a securitization expert, builds the bridge for innovative asset managers like Eastwood to reach conscious investors. Managers of sustainable but not previously bankable investments can use the GENTWO framework to securitize their assets, to bring investors to a new level of portfolio diversity.




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