BOSTON— Manulife Investment Management, the world’s largest manager of natural capital with over $16 billion in assets under management in timberland and agriculture combined, today announced the second close of the Manulife Forest Climate Fund LP1,2 (the fund). Along with its affiliated offshore vehicles, the fund has now secured up to $334.5 million in commitments towards its $500 million targeted offering. Subsequent and final closings are expected later this year. The fund is a closed-end investment vehicle providing qualified U.S. investors and certain global institutional investors with the opportunity to promote climate change mitigation through investment in sustainably managed forests where carbon sequestration is prioritized over timber production.
The Manulife Forest Climate Fund seeks to provide investors with an opportunity to own a diversified portfolio of sustainably-managed forestland assets where carbon is the primary value driver. The fund will seek to deliver durable, high-quality carbon credits to investors and annual optionality for in-kind carbon credit distributions or offset sales.3 An additional part of this strategy includes establishing new forests through afforestation or reforestation to generate high-quality carbon credits and long-term sustainable timber value. The fund intends to use carbon credits, conservation easements, value-added strategies including non-timber income generation, and limited timber harvests to capture potential climate benefits, and promote biodiversity, ecosystem resiliency, and watershed protection and to generate competitive financial returns for investors.4
“We have seen strong interest in the forest climate fund strategy from a broad base of investors – including the first corporate investors – in this close. We believe we offer an innovative strategy for investors seeking a differentiated solution for net zero goals and climate change mitigation,” said Tom Sarno, global head of timberland investments, Manulife Investment Management. “We have already started to deploy the fund’s capital into timberland assets aligned with the fund’s objectives and have built a strong pipeline of opportunities. We look forward to creating a diversified portfolio of sustainably – managed assets where carbon value is the primary driver of potential return through high integrity carbon insets or offsets.”
“We believe that Manulife Forest Climate Fund allows for a degree of optionality that clients may be looking for in a natural capital solution,” added Eric Cooperstrom, managing director, impact investing and natural climate solutions, Manulife Investment Management. “This brings additional opportunity to investors as they can rely on our experience to access a scaled solution that can help support their climate goals through carbon insets or offset sales while creating additional value from sustainable traditional timber economics and practices.”
Manulife Investment Management oversees approximately 5.4 million acres of timberland across the United States, Canada, New Zealand, Australia, Brazil, and Chile and 100% of those forests are certified under either the Sustainable Forestry Initiative® (SFI®) or the Forest Stewardship Council® (FSC®). It also manages approximately 400,000 acres of prime farmland in major agricultural regions of the United States and in Canada, Chile, and Australia as part of its comprehensive private markets strategies. Its entire U.S. agriculture platform is certified to the Leading Harvest Farmland Management Standard demonstrating a commitment to sustainable practices, robust management, and continuous improvement.
