Sustainable Asset Management Creates Institutional Trees

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Trees and timber have become a mainstream part of our everyday investments. Hedge funds and pension funds have long been investing in forestry & timber plantations along with their associated supply chains; these have even outperformed stock markets.

Sustainable Asset Management, Singapore, has developed the Aquilaria Forestry Income Investment, one of the most carefully structured and balanced forestry investment products available today for HNWI and institutional investors looking at exposure to this asset class as part of a risk balanced portfolio. After six months of due diligence, inspection visits, meetings with end users and Institutional Investors, SAM have partnered with Asia Plantation Capital to develop this new investment product; trees are now a risk assessed asset class.

The Aquilaria Forestry Income Investment is available to sophisticated and institutional investors in minimum tranches of US$500,000. SAM have access to around US$50M in inventory which will be managed by APC with leverage from their proven from soil to oil program.

Trees and timber have become a mainstream part of our everyday investments. Hedge funds and pension funds have long been investing in forestry & timber plantations along with their associated supply chains; these have even outperformed stock markets.

SAM has created a product that mixes limited numbers of mature CITES approved agarwood trees with new plantings creating a 7 to 8 year investment horizon which has capital growth and income throughout. Adam Sprague, Head of Risk Analyses at SAM, describes this as “a unique financial product in a sector where returns are usually either annual and low, or long term and potentially high.” This plan is a balanced structure of income and future returns creating a risk weighted portfolio product--an income of around 8% and variable final IRR of 12 to 24%.

Adam Sprague, Head of Risk Analyses at SAM, clarifies, “We have a solid and structured investment wrapper for forestry and plantations meeting all the criteria of stringent institutional and high net worth sophisticated investors with the added credentials of directly protecting an endangered species, agarwood. Our clients will become part of the process driving growth in a sustainable industry with benefits right down the chain, all the way to local communities on the ground; a net new economy and a real force for good. Investment at Sustainable Asset Management is all about people, profit and the planet.”

Pioneering companies such as Asia Plantation Capital have made plantations and trees more accessible to both large and smaller investors over the past decade by creating and managing specialist Agarwood plantations in Thailand and Sri Lanka. The Aquilaria Forestry Income Investment from Sustainable Asset Management enhances international accessibility to these plantations.

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About Sustainable Asset Management (http://www.sustainable.com.sg)

Sustainable Asset Management is a private Singapore based company funded by Africasia Private Equity. Africasia focus on providing seed capital and funding for companies within the agricultural domain. Sustainable Asset Management now advises on and deals with all the project evaluation and due diligence of businesses Africasia considers investing in, as well as offering the same service to private investors, institutions and alternative fund managers.

About Asia Plantation Capital (http://www.asiaplantationcapital.com)

Asia Plantation Capital is an owner and operator of a diverse range of commercial plantation and farming businesses across the Asia-Pacific region and globally, part of the Asia Plantation Capital Group of associated companies. Their focus is on multicultural and diverse plantation projects geared to the domestic and commercial demands of the countries in which they operate. Working closely with and supporting fragile local communities is an underlying core principle of the APC business, providing social and cultural support as well as investment to move these communities away from traditional deforestation and illegal logging activities as a main income source. Established officially in 2008, although operating privately since 2002, the group now has plantation and agricultural projects on four continents with operational projects at various stages in Thailand, Malaysia, Laos, India, Cambodia, Sri Lanka, Mozambique, The Gambia, North America and Europe.

About Agarwood

The threatened agarwood tree has been logged in the wild to near extinction for traditional uses such as incense and medicine. This situation has been exasperated over the past twenty years by global demand for both fine fragrance and medicines produced from these rare trees and the natural oil they produces, Oud. Trade in Agarwood is now covered by CITES, it was made illegal to harvest in the wild by international convention more than ten years ago but in the wild the species is teetering on extinction. A combination of science, research, practical experimentation and a considerable amount of investment by innovative companies such as Asia Plantation Capital has been salvation for the agarwood tree. APC provides an inspirational example of an environmentally successful and international commercial project which has the ability to; safeguard and protect the species; supply global demand in a sustainable way whilst generating revenue; guarantees the future of a rare species whilst benefiting the economies of fragile forest communities previously dangerously driven towards illegal logging simply to feed and care for their families. More infomration about Agarwood is available at CITES (http://www.cites.org)

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Mark Wills
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