THE Gresham House Forest Growth & Sustainability Fund has held its first close with £127 million in subscriptions, substantially exceeding the initial target of £100 million.

Launched in June of this year, the Forest Growth & Sustainability Fund aims to deliver sustainable capital growth through the creation of new productive woodland, while providing exposure to existing income-generating forestry in the UK.

The strategy will target generating returns through the sale of timber and the capital growth of land and trees, while also producing carbon credits from the creation of new woodland.

Investors are expected to receive distributions in the form of verified carbon credits that can be retained for ‘insetting’ purposes – to address carbon emissions in their sphere of influence or portfolio – or sold to provide income.

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Managing roughly 140,000 ha of forestry worth more than £1.8 billion, Gresham House is the UK’s largest commercial forestry manager. The business also manages a forestry mandate in Ireland and expects to complete on a further international forestry mandate in Australia, subject to regulatory approval.

Olly Hughes, managing director of forestry, Gresham House, said: “This impressive first close is testament to Gresham House’s long-standing track record in the forestry space and shows clear and growing appetite for the asset class from institutional and private client investors. This flexible strategy allows investors to choose to use the carbon credits generated for offsetting purposes or sell the units to generate income.

“As investors increasingly focus on sustainable investments, forestry is emerging as one of the most impactful solutions, which combats climate change and enhances biodiversity, while also serving as an excellent investment diversifier and producing meaningful uncorrelated returns.”

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