Manulife Investment Management Announces Close of $480 million Forest Climate Fund
BOSTON, Jan. 27, 2025 /PRNewswire/ - Manulife Investment Management, the leading timberland investment manager in the world, with more than five million acres under management, today announced the third and final close of Manulife Forest Climate Fund LP1,2 (the fund). Along with its affiliated offshore vehicles, the fund has closed with $480.1 million in commitments from a diverse mix of investors including qualified U.S. investors, corporates and global institutional investors interested in the opportunity to promote climate change mitigation through investment in sustainably managed forests where carbon sequestration is prioritized over timber production.
"We are excited to announce this milestone for the Manulife Forest Climate Fund and have seen strong interest in the forest climate strategy from a broad base of global investors, further highlighting the acceptance and growing use of forestland as a climate change mitigation tool that has added new dimensions to timberland investment," said Tom Sarno, global head of timberland investments, Manulife Investment Management.
The Manulife Forest Climate Fund seeks to provide investors with an opportunity to own a diversified portfolio of sustainably-managed forestland assets where carbon is the primary value driver. The fund prioritizes climate change mitigation through sustainably-managed forests, aiming to sequester over 6 million tons of carbon dioxide over the fund term. The fund will look to deliver durable, high-quality carbon credits to investors and annual optionality for in-kind carbon credit distributions or offset sales.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 aims to maximize total return while preserving capital, providing moderate current income, and realizing profit from carbon value and long-term appreciation.4
Fund Acquisitions
The fund has already started to develop a diversified portfolio in support of its investment thesis. It has acquired more than 150,000 acres and is approaching 50% deployment. The team has identified a pipeline of additional opportunities in 2025 to further diversify and grow the portfolio.
The fund's first acquisition, Eagle Cap, is located in northeastern Oregon and southeastern Washington, and was acquired with the primary intention of generating consistent cash flow from sustainable forestry operations. Additional value was realized on the Eagle Cap property through a sale of approximately 1,072 acres to conserve and create public access to the land in perpetuity as part of the Minam River Wildlife Area. Achieved in partnership with state agencies and a conservation organization, this transaction is an example of Manulife IM's continuing commitment to managing and conserving sensitive lands with over 497,000 acres in its Sensitive Lands Program.
The second acquisition, Siscowet, is located on the upper peninsula of Michigan. Named for the deep-water trout native to nearby Lake Superior, it had been held by the seller for over a century and managed primarily for timber production. As a result of its history, growth rates and standing timber inventory, Siscowet is expected to provide a strong foundation for the Fund's carbon credit generation strategy and will provide significant optionality for increased timber harvests or carbon credit generation over the hold period.
The most recent acquisition for the fund, Oak Bluff, has a footprint that includes counties in Mississippi, Louisiana, and Arkansas. Much like Siscowet, the historical management practices and current timber inventory makes this investment well suited for the production of high-quality carbon credits while also exhibiting the potential to produce attractive income from other sources.
"Investors are showing confidence in forests as a top natural climate solution," added Eric Cooperstrom, managing director, impact investing and natural climate solutions, Manulife Investment Management. "With the interest we have seen in the fund, we will continue to pursue natural climate solutions to drive new opportunities for impact and results for our clients."
Manulife IM's $100 billion diversified private markets platform includes infrastructure, real estate, private equity, private credit, timberland and agriculture.5 The firm continues to enhance its capabilities in private markets to bring additional solutions to both institutional and retail investors to help them achieve their long-term investment goals.
1. Source: IPE research as of 1/24/2025. Ranking is based on total Natural Capital AUM, which includes forestry/timberland and agriculture/farmland AUM. Firms were asked to provide AUM, and the as of dates vary from December 31, 2023, to December 31, 2024.
2. Manulife Forest Climate Fund is structured as a private offering only for qualified purchasers to be conducted pursuant to Rule 506(c) of Regulation D promulgated under the Securities Act.
3. Manulife Investment Management, through its development and implementation of its Carbon Principles, has made a commitment to sourcing high-quality carbon credits. Generally high-quality carbon credits must be (a) additional, (b) not overestimated, (c) permanent, (d) exclusively claimed (no double counting) and (e) not associated with significant social or environmental harm. For more information on the Carbon Principles please visit our website. In addition, the Integrity Council for the Voluntary Carbon Markets (IC-VCM) Core Carbon Principles (CCPs) and Assessment Framework are intended to establish global standards for high-quality voluntary market carbon credits, provide guidance on how to apply the Core Carbon Principles and define which carbon crediting programs and project methodologies are eligible. The MIMTA Carbon Principles are aligned with the ICVCM CCPs.
4. There is no guarantee that this fund will achieve its investment objectives or goals or generate carbon credits or financial returns.
5. As of October 1, 2024
This press release does not constitute an advertisement or an offer to sell any security or the solicitation of any offer to buy an interest in the fund or any existing or future fund or investment vehicle managed or advised by Manulife Investment Management and/or its affiliates or any other security. Nor shall there be any sales of the fund interests in any jurisdiction in which such offer, solicitation or sales would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
The fund interests will be offered only to "qualified purchasers" as defined by Section 2(a)(51) of the Investment Company Act and in reliance on the exemption from registration set forth in Rule 506(c) of Regulation D promulgated under the Securities Act. Under Rule 506(c), general solicitation of offerings is permitted, however, prospective investors in the fund may be asked to provide supporting documentation satisfactory to the general partner of a prospective investor's status as a qualified purchaser. The fund has not been and will not be registered under the Securities Act or the securities laws of any state or other jurisdiction, and may not be offered or sold without registration or an applicable exemption from the registration requirements of the Securities Act and applicable state securities or blue sky laws and foreign securities laws.
Manulife Forest Climate Fund is closed to new investors.
Private market investments are speculative and considered risky, including potential loss of your investment, and may not be appropriate for every investor. Private investments are generally an illiquid asset class; shareholders cannot sell their funds when they want to without potentially facing high losses.
About Manulife Wealth & Asset Management
As part of Manulife Financial Corporation, Manulife Wealth & Asset Management provides global investment, financial advice, and retirement plan services to 19 million individuals, institutions, and retirement plan members worldwide. Our mission is to make decisions easier and lives better by empowering people today to invest for a better tomorrow. As a committed partner to our clients and as a responsible steward of investor capital, we offer a heritage of risk management, deep expertise across public and private markets, and comprehensive retirement plan services. We seek to provide better investment and impact outcomes and to help people confidently save and invest for a more secure financial future. Not all offerings are available in all jurisdictions. For additional information, please visit manulifeim.com.
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