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Timberland Transactions: Q3 Update

This blog represents our third update on timberland sales year-to-date. In Q1, we reported that sales were picking up, perhaps pulling us above 2020’s ten-year low. Activity dipped slightly in Q2, down from a hot first quarter. By the midpoint of the year, there were approximately 800,000 acres of completed timberland transactions. Since then, how have we fared so far in Q3? Will 2021 be a down year like 2020, or will we bounce back to pre-pandemic levels?

Fortunately, most signs point to the latter case. July and early August saw a flurry of activity, with completed deals across the U.S. and announcements for additional transactions expected to close by year’s end. Nearly half a million acres of timberland swapped hands in Q3 alone, much of that in the West. New Forests acquired roughly 156,000 acres in California and Oregon from the Fruit Grower’s Supply Company for an undisclosed price[1]. Weyerhaeuser also closed on its previously announced sale of 145,000 acres of Washington timberland to Hampton Resources for $266 million[2]. All told, over 1.3 million acres of timberland deals closed year-to-date.

There are also several transactions on the horizon. In possibly the largest transaction of 2021, Catchmark announced it had agreed to sell 301,000 acres of East Texas timberland to a Hancock client for an estimated $498 million[3]. Also, SDS lumber continues to market its nearly 100,000 acres in Oregon and Washington. Lastly, the Flambeau River timberlands tract, a 75,600 acre parcel in Wisconsin composed of three separate units is being marketed by AFM in a bid sale process. With the Catchmark deal expected to close by the end of the third quarter, completed sales would rise to just over 1.6 million acres, approximately the same level as the entirety of 2020. With several other listings still available, we appear on track to surpass 2020’s level of transactions. May the fourth (quarter) be with us.

For details on recent timberland transactions and mill investments, subscribe to the Forisk Market Bulletin

[1] https://newforests.com.au/fruit-growers-acquisition/

[2] https://investor.weyerhaeuser.com/2021-07-08-Weyerhaeuser-Completes-Sale-of-145,000-Acres-of-Timberlands-in-Washingtons-North-Cascades

[3] https://catchmark.investorroom.com/2021-07-30-CatchMarks-Triple-T-Joint-Venture-Reaches-Definitive-Agreement-on-Sale-of-301,000-Acres-of-Prime-East-Texas-Timberlands

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