Timberland transaction costs: survey results and insights

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Andrew Hiegel https://orcid.org/0000-0002-0773-4942
Jacek Siry
Pete Bettinger https://orcid.org/0000-0002-5454-3970
Bin Mei


acquisitions, appraisal, capitalization, forest economics, real assets, REIT, TIMO


Timberland is a real asset that has been gaining significant attention and capital from investors over the last four decades. This paper describes and summarizes the results of a timberland investment survey conducted in early 2020. The survey polled timberland investment professionals active in the sector and provided insights into how transaction costs affect timberland investments according to the size and location of the timberland estate. Component costs were also obtained and summarized for each of the steps involved in typical timberland transactions. The survey also provided insight into investor sentiment toward timberland transaction costs as well as the process of accounting of these costs within the forest industry. Key results of the study showed differentiation in transaction costs by location and size of the timberland estates. The study also showed that transactions costs do not deter most investors from placing capital in this asset class. This manuscript provides a baseline of transaction cost information for investors and professionals interested in the timberland real asset space.

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