Research - JANUARY 29, 2013

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Timber records highest returns since 2007

by Sara Kassabian

On the back of a housing market recovery, timberland has recorded the highest total return since fourth quarter 2007, coming in at 5.92 percent — split between 5.33 percent appreciation and 0.59 percent income — according to the NCREIF Timberland Index produced by the National Council of Real Estate Investment Fiduciaries.

The fourth quarter 2012 total return was timberland’s highest total return since fourth quarter 2007, when timberland had appreciation of 8.71 percent, which was the last time that figure surpassed 5 percent in a quarter. For full-year 2012, timberland returned 7.76 percent, split between 2.68 percent income and 4.97 percent appreciation.

The Pacific Northwest was the region with the strongest performance in the index for the sixth consecutive quarter, recording a total return of 10.02 percent, only 0.97 percent of which was income. The Lake States performed the worst, with a total return of 1.68 percent. NCREIF notes that

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