Columbia Threadneedle Real Estate has entered the natural capital market with the acquisition of a 490-acre estate in North Yorkshire on behalf of its open-ended fund, Threadneedle Property Unit Trust (TPUT).
Carlshead Farm was acquired for an undisclosed sum to support the fund’s decarbonisation goals and provide exposure to the UK’s biodiversity net gain (BNG) market, the manager said.
Carlshead Farm will be managed by natural capital asset manager NatureReturn.
Columbia Threadneedle said 365 acres of the overall estate will operate as a BNG habitat bank under a conservation covenant, with plans to explore further revenue from carbon credits, ecotourism and power provision.
Liam Taylor, portfolio manager of Threadneedle Property Unit Trust, said: “Carlshead Farm represents an important first step in our natural capital strategy. We believe biodiversity net gain presents a compelling real asset opportunity, supported by regulation, long-term demand and diversification characteristics.
“The investment offers multiple routes to value creation, while the underlying agricultural land provides an element of downside protection. As the market develops, we believe natural capital can become an increasingly important component of institutional portfolios and we are pleased to partner with NatureReturn to deliver this business plan.”
Ed Harden, asset manager at NatureReturn, said: “We are excited to work with TPUT on rolling out the nature restoration project at Carlshead. The long-term strategy for the land is to consolidate farming operations alongside a greater focus on the creation of a diverse habitat bank of significant scale.
“The land will be managed to develop a variety of high integrity habitats, while also integrating food production and local employment.”
Ben Goldsmith, nature campaigner and natural capital investor, said: “It is great news to see an institution of the calibre of Columbia Threadneedle Investments entering the nature restoration market.
“Private nature markets are playing an increasingly significant role in solving real world problems by financing the restoration of our terribly depleted nature. From natural flood management to nutrient mitigation, voluntary carbon to biodiversity net gain, Britain is becoming a leader in natural capital. I can’t wait to visit this new project.”
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