Timberland Investment Resources Europe (TIR Europe) has closed its second Forestry Fund II, meeting its capital-raising target of $200m (€168m).
No investors were named but the company said it was seeing growing interest from institutional investors as they focused on ESG.
Hugh Humfrey, partner at TIR Europe, said: “We are seeing a huge rise in the number of institutions and pension schemes looking at ESG alternatives for their portfolios that deliver consistent returns.
“At TIR we practice sustainable forestry on all of the forest assets we manage for investors and we will continue to pursue the highest environmental stewardship and expertise in managing the forests.”
TIR Europe said interest in timberland was likely to increase in line with the growing recognition that sustainable forestry can help sequester carbon, citing UN forecasts that corporate demand for carbon removal and offsetting could reach $800bn per annum by the middle of the century.
The company tracks forest carbon-storage levels by property based on timber stocking data and projected biological growth rates and is already seeing an increase in the role of carbon sequestration in forests.
TIR Europe is part of the wider TIR group, which manages $1.65bn of asset comprising 835,961 acres of forest across the US.