Gresham House could allocate up to half of its global forest funds into Australia and New Zealand, as the UK-based alternative asset manager expands its footprint in timberland, afforestation, and carbon-related projects across the region. Speaking to Agri Investor yesterday, CEO Tony Dalwood confirmed that approximately 40% of the firm’s forestry funds could be directed toward Australasia. “We’ve got very good track records now in Australia and New Zealand,” Dalwood said, noting the firm’s growing interest in natural capital programmes and the emerging biodiversity credit market.
Gresham House is positioning itself to take advantage of Australia’s new Nature Repair Market, which enables investors to earn biodiversity credits for environmental restoration projects. The initiative aligns with its sustainability strategy, outlined in its 2024 Sustainability Investment Report, which highlights active development in biodiversity credits, carbon forestry, vertical farming, and habitat banking to support what it calls “the sustainability economy.”
Dalwood emphasised that the scope of these investments will vary depending on individual project opportunities. “It’s about culture,” he said. “We’ve seen the likes of [asset manager] Nuveen [Natural Capital] come into Australia and try to spend more time there, and we are on the same path.”
Nuveen has publicly expressed its intent to participate in the Nature Repair Market and is currently in discussions with Australia’s Clean Energy Regulator to explore how its existing carbon projects could be adapted to the new framework.
And in a move to strengthen its capabilities, Gresham House last year appointed former Nuveen senior portfolio manager Eoin McDonald to lead its sustainability strategy. “He’s part of our culture, and he will look at each project for where you can improve its additionality or net positive on the sustainability front,” Dalwood said. Wood Central understands that Gresham House’s new fund will target returns of 9–12% and seek capital from institutional investors, including pension funds, sovereign wealth funds, and family offices.
Last month, Gresham House said that global timber is spiralling towards a tipping point, with demand for fibre outpacing supply, and it’s just a matter of…by how much. In their most recent assessment, the UK fund said rising timber prices and a growing focus on ESG make timber assets a strong investment.
“From our analysis, future supply is projected to fall short of demand, with the best scenario showing only a 1.1x increase in supply compared to current levels – significantly short of the projected 1.5-1.8x growth in timber demand,” it said. “This demand-supply gap is even worse under the base case scenario, where projections remain static at current levels, and the downside scenario, which assumes supply will fall below today’s levels due to forest disturbances.”
- To learn more about Australia’s Nature Repair Market, click here for information from Australia’s Department of Climate Change, Energy, the Environment and Water.
