Gisborne forest bought by offshore investor in collaborative deal

Gisborne forest bought by offshore investor in collaborative deal  hero

A substantial Gisborne forest has been bought by an offshore investor in a collaborative transaction concluded by Colliers International’s specialist forestry teams in New Zealand and Germany.

Te Rata Forest is a 2,008ha freehold property, predominantly planted with mature radiata pine, located 80km north of Gisborne.

It was marketed for sale by Colliers’ Forestry team in New Zealand and purchased by an institutional investor who engaged the German Land and Forestry team in an advisory role.

Warwick Searle, Forestry Director at Colliers New Zealand, says the transaction highlights the benefits of having a truly global reach.

“Overseas funds are key investors in New Zealand’s forestry sector, but the global pandemic has brought a new set of challenges when it comes to matching offshore capital with local assets.

“The sale of Te Rata Forest demonstrates the importance of international collaboration in this uncertain environment.

“While the purchaser was unable to inspect the asset firsthand, we were able to leverage our combined expertise in both New Zealand and Germany to give the buyer a high level of comfort.

“The resulting transaction, which is pending Overseas Investment Office approval, is a great outcome for both our vendor and the buyer.

“Once the deal has been finalised, Colliers Germany will advise the forestry business in matters of strategy and operations.”

Nils von Schmidt, Co-Head of Land and Forestry at Colliers Germany, says New Zealand’s sustainability credentials were important in securing the deal.

“Our client was interested in a number of factors including sustainable, profitable and climate change-resistant timber production as well as compliance with the social and ecological criteria of the United Nations' sustainability targets.

“New Zealand has been pursuing an effective CO2 trading scheme since 2008, in which forestry plays a key role."

Eckbrecht von Grone, Co-Head of Land and Forestry Colliers Germany, concludes: "This deal confirms the importance of having an international presence and an excellent network, especially in times of Covid-19, which is exactly what we are able to offer.”

Te Rata Forest has a net stocked area of 1,039ha on relatively steep hill country, requiring a mix of ground- and hauler-based extractions methods at harvest.

It is located in a region that has limited domestic processing, but excellent access to foreign markets via Eastland Port in Gisborne.

Mangaotane Stream, which runs through the property, is excellent for trout fishing, while a large area of native bush makes for exceptional hunting. There is a good range of accommodation to maximise the recreational potential, including a three-bedroom dwelling in good condition and a shearers’ quarters.

In addition, the native bush could sustain an estimated 150 beehives, accessible via extensive tracks throughout the property. This could provide a significant potential source of additional income.

Te Rata Forest was put up for sale as part of the substantial Timber No. 1 Estate, which also comprised one forest in Waikato and two in Southland.

The 242ha Waikato forest was bought late last year by an Australian entity, while the Southland forests, which have a combined stocked area of 1,367ha, were purchased by an American entity.

Timber No. 1 Estate was marketed by Searle – who last year transacted the first forestry sale under the government’s new overseas investment rules – with Forestry Broker Angus Robertson.

Related Experts

Warwick Searle

Director

Auckland Forestry

Warwick has a business degree in Accountancy and Property along with almost a decade of experience in the New Zealand rural property market ensuring you receive professional, knowledgeable service from start to finish.  

Specializing in forestry sales and transacting the bulk of the on market forests in the last few years Warwick fully understands the NZ market from small woodlots through to large scale forest estates and how it can best work for you.

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Angus Robertson

Broker

Auckland Forestry

Angus has a strong finance background, this accompanied by his facilitation of some large forestry transactions  gives him an in depth understand of the NZ forestry market. Angus brings youth and enthusiasm to each transaction to ensure a comprehensive sales process with all avenues explored.

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