Manulife Investment Management, the world's largest manager of natural capital with nearly $15 billion in assets under management in timberland and agriculture combined, today announced the initial close of Manulife Forest Climate Fund LP1,2 (FCF or the fund). The fund is a closed-end fund providing qualified U.S. investors and certain global institutional investors with the opportunity to promote climate change mitigation through sustainably managed forests where carbon sequestration is prioritized over timber production. Along with its affiliated offshore vehicles, the fund has secured commitments totaling up to $224.5 million towards its $500 million targeted offering.

The investment objective of the strategy is to provide investors with an opportunity to invest in timberlands which will be managed in a way that seeks to create high quality carbon credits through enhanced sustainable forest management practices which purposefully add to the stored carbon in the forest.3 An additional part of this strategy includes establishing new forests through afforestation or reforestation to generate high-quality carbon credits and long-term sustainable timber value. The fund intends to use carbon credits, conservation easements, non-timber income generation strategies, and limited timber harvests to capture potential climate benefits and competitive financial returns for investors.4

"The broad demand for climate change mitigation solutions can't be understated and there is strong investor interest in strategies that may help support carbon emissions reductions and net zero commitments," said Tom Sarno, global head of timberland investments, Manulife Investment Management. "We believe that an investment in Manulife Forest Climate Fund can help support  investors' various climate goals and objectives and that the experience we have in sustainable forest management, as well as our commitment to high-quality  carbon sequestration, brings additional value to the strategy."

Manulife FCF will focus on generating a long-term supply of high-quality carbon credits to be available through direct in-kind transfers for investors' own climate goals or for purposes such as monetizing  in the carbon markets via offset sales to realize financial value.4 As a carbon-focused impact investment strategy, it's the firm's first natural capital fund to be categorized as a product under Article 9 of the European Commission's Sustainable Finance Disclosure Regulation (SFDR).

"The Manulife Forest Climate Fund expands on our decades of sustainable timberland management experience and is one of the natural climate solutions we have developed to sequester carbon more intensively and drive broader impact," added Eric Cooperstrom, managing director, impact investing and natural climate solutions, Manulife Investment Management. "Responsible commitments to reducing and removing emissions, inclusive of high-quality forest carbon credits, are extremely important to help investors meet their climate and financial goals."

Manulife Investment Management oversees approximately 5.5 million acres of timberland across the United States, Canada, New Zealand, Australia, Brazil, and Chile and 100% of those forests are certified under either the Sustainable Forestry Initiative® (SFI®) or the Forest Stewardship Council® (FSC®). It also manages approximately 400,000 acres of prime farmland in major agricultural regions of the United States and in Canada, Chile, and Australia as part of its comprehensive private markets strategies. Its entire U.S. agriculture platform is certified to the Leading Harvest Farmland Management Standard demonstrating a commitment to sustainable practices, robust management, and continuous improvement.

 

Source: prnewswire.com

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