Wholesale
Forest Enterprises

Wairarapa Group Forest Investment

Managed Investment Scheme

Register Interest
Transaction Size
NZD 4,600,000.00
Share Price
NZD 55.95
Minimum Investment
NZD 11,190.00
Issue Type
Managed Investment Scheme
Sector
Forestry

Wairarapa Group Forest Investment

Forestry Webinar 

Forest Enterprises are experienced forestry managers. For nearly 50 years, they have been helping Kiwis grow their wealth through affordable direct investments in some of New Zealand’s most exceptional Radiata pine plantation forests, and by expertly and sustainably managing the forests through their lifecycle. 

Join directors Bert Hughes and Gordon Wong to talk about their approach to forestry investment and for Q&A.

Click here to access the recording of the webinar from April 3rd, 2020

Previous Wairarapa Group Forest Investment Scheme Webinar

Scheme Overview

Forest Enterprises’ presents the Wairarapa Group Forest Investment, a managed investment scheme (MIS) owning 970 stocked hectares of superior forestry land over three forest properties in the Wairarapa.

This is existing forestry land of a high quality and was managed by Forest Enterprises through to the recent successful harvest of the first rotation crop.

This investment benefits from second rotation forest characteristics, namely that the land is conditioned for pine growth, it has been replanted with genetically superior tree stock, and harvest infrastructure (roads and log processing areas) is already in place for the next harvest. All of these enhance the return on investment.

Forestry is a long-term investment over an estimated 26 years (one crop rotation). Investment returns are projected to start in around 20 years when mature trees begin to be harvested. A return on investment will be dependent on log prices during harvest, sale of the land and any replanted trees at that time. See below for investor contributions and returns.

Forest Enterprises has been providing retail forestry investments for nearly 50 years. This is our second new offer in the last 12 months, there is demand for this sort of investment.

Carbon

This land does not qualify to earn income from carbon. However, the trees still perform the same environmental function of sequestering atmospheric carbon.

Forest Enterprises’ managed forestry sequesters an average of 35.9 tonnes of CO2e (carbon dioxide equivalent) per hectare per year until it reaches age 26. Therefore, any anyone investing 200 shares in the Wairarapa Group investment, equivalent to 1.94 hectares, will sequester an average of 69 tonnes of CO2e each year.

Investor Contributions & Returns for the Wairarapa Investment

Forestry investment is contributory, with tax deductions available each year against investors’ total income.

The initial investment and annual contributions are set at an affordable level for retail investors. Investors pay an initial upfront investment cost upon application, and then meet annual instalments (calls) each year until harvest for the ongoing forest and investment management costs.

·      Initial investment: Minimum initial application cost is $11,190 for 200 shares plus projected annual contributions (see below).

·      Additional shares may be purchased at $55.95 per share.

·      Projected annual contributions: Calls are projected to average around $1,044* per year for 8 years, then drop to an average of around $258* per year until harvest commences around 2039. The next call is 30 June 2021.

·      Projected total investment: $20,647*

·      Projected gross return: $115,531* (Harvest period (income) 2039-2045)

·      Projected gross IRR:  8.53%*

·      Annual investor administration fee $60 payable once per year per shareholder in this investment

* Per 200 shares, based on 2% per annum inflation-adjusted cashflow and a 36-month log price series to 30 June 2018. Refer cashflow pages 26-27 and section 6 of the Wairarapa PDS from page 23.

Investment Structure

Wairarapa Group Forest Investment is a registered MIS under the Financial Markets Conduct Act 2013, structured as a forest-owning limited partnership (LP). Investors buy shares in the LP and become a part-owner of the forest with other investors. The LP investment structure provides investors with limited liability and ultimate tax deductibility.

A Forest Enterprises investment is a direct investment in land and trees for one rotation of the forest crop, which for the Wairarapa Group investment is about 26 years.

Forest Enterprises, as the licensed MIS manager, runs the business of the investment including forest management.

To Register Interest

For further information, including the Product Disclosure Statement, click on the "RegisterNow" button. We will provide you access to that document and you will be connected with the advisor to the issue.

Other documents relevant to the offer are available to view at www.companiesoffice.govt.nz/disclose.

WATCH: Wairarapa Group Forest Investment Webinar
Why invest in forestry?

Forest Enterprises clients choose to invest in quality forestry:

·      To diversify their investment portfolio with a land-based asset

·      To change the weighting of their portfolio towards sustainability

·      To directly invest in a renewable resource that reduces atmospheric carbon

·      To play a part in growing New Zealand’s strong forestry economy

·      To supplement retirement income

·      For future generations of their family

About Forest Enterprises

Forest Enterprises is one of New Zealand’s leading forest investment companies and is unique in providing both forest and investment management services.

The Kiwi company has a track record over 47 years of helping more private investors grow their wealth via New Zealand pine plantation forestry. Forest Enterprises specialises in providing retail forestry investment opportunities and was the first in New Zealand to do so when it was founded in 1972 in Masterton, New Zealand.

On behalf of its 6,600-plus investors, Forest Enterprises manages more than 20,000 hectares in the Wairarapa, Gisborne and Hawkes Bay on the east coast of New Zealand’s North Island. It has around $450 million of assets under management. Forest Enterprises provides the benefit of scale and proven management experience.

Forest Enterprises has remained a locally owned and operated business, still based in Masterton. It now has an additional office in Gisborne city to locally manage its expanding harvest programme in the region. The company’s five shareholders are key managers in the business, and are professionals in technical forestry, harvesting, accounting and law.

Risks

No investment is without risk. With forestry, risks can include risk to the crop – for example from fire, wind throw or disease. As a commodity, the price of logs can go up or down meaning returns could fluctuate during harvest. However, time in the market is a positive and this is achieved by Wairarapa harvesting over 6-7 years.

There’s extensive insurance over Forest Enterprises’ managed forests, and the manager works on investors’ behalf to help mitigate any risks. A financial adviser can help you determine if forestry investment is suitable for you.

To Register Interest

For further information, including the Product Disclosure Statement, click on the "RegisterNow" button. We will provide you access to that document and you will be connected with the advisor to the issue.

Other documents relevant to the offer are available to view at www.companiesoffice.govt.nz/disclose.

 

The issuer of the shares in Wairarapa Group Forest Investment is the licensed Manager, Forest Enterprises Limited, and the offeror is Forest Enterprises Growth Limited (a related party of the Manager). Forest Enterprises Limited is licensed under the Financial Markets Conduct Act 2013 to manage Managed Investment Schemes (excluding managed funds) which are primarily Invested In forestry assets.

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