Natural real assets manager SLM Partners is seeking to raise €200m to invest in sustainable forestry and carbon in Europe.
The SLM Silva Fund II – a successor to its Irish forestry fund – has been launched with an expanded investment strategy covering Ireland, the UK and select EU countries, the manager said.
The Irish forestry fund has acquired approximately 80 properties, establishing a portfolio of 1,900ha in Ireland.
Fund II expects to consolidate fragmented privately-owned forests, implement continuous cover forestry (CCF) for sustainable management and capitalise on carbon and biodiversity benefits where possible. While primarily focused on acquiring existing forests, the fund will also undertake some afforestation.
The fund, which is currently under due diligence by several European institutional investors, with a first close expected later in 2025, targets a net internal rate of return in the upper single digits without leverage.
Paul McMahon, managing partner, SLM Partners, said: “As governments and investors scramble to unearth new carbon capture technologies, we must ensure we take better care of the carbon sinks we know work.
“Regenerative agriculture has made headlines in recent years, but the mainstream adoption of regenerative forestry is now more urgent than ever.”
Darius Sarshar, principal, SLM Partners, said: “Conventional forestry continues to increase carbon emissions, reduce biodiversity, degrade soils and water and leave our commercial forests ill-equipped to cope with climate change.
“It is now well documented that continuous cover forestry offers a way to reverse the decline and is likely to increase profitability at the same time. CCF can deliver the multi-functional forests we need to face the challenges of the 21st century.”
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