Nest, the UK’s largest defined contribution (DC) master trust, has allocated an estimated £550m to a new sustainable timberland investment mandate, it announced today (4 August).
US-based BTG Pactual Timberland Investment Group (TIG) will run the mandate, which will invest in sustainably managed timberland across the Americas.
It is the second time Nest has invested in this asset class, following the appointment of Campbell Global, a subsidiary of JP Morgan Asset Management, last year.
The initial investment is worth $750m and serves to further diversify Nest’s investment portfolio, according to its head of infrastructure and natural capital Stephen O’Neill.
“Nest and BTG Pactual TIG share the belief that investing in a sustainable manner can achieve strong risk-adjusted returns,” O’Neill said, adding that the asset manager’s “sustainable forestry practices and commitment to maintain productive, respectful relationships with the local communities and workforce helped demonstrate that they are the right partner for Nest”.
In its announcement of the investment, Nest said well-managed timberland investments help to promote sustainable forestry and the responsible management of resources, while also preserving ecosystems and biodiversity.
Gerrity Lansing, head of BTG Pactual TIG, said: “Through this bespoke strategy, we will apply our large-scale timberland platform, on-the-ground expertise, and rigorous sustainability standards to seek to deliver financial and environmental outcomes for Nest and its members.”
The investments will be deployed through private investment vehicles managed by BTG Pactual TIG.
Nest is targeting significant allocations to private markets through various asset classes. This year it has invested significantly into infrastructure following its acquisition of a 10% stake in IFM Investors in February this year.
