Forests grow regardless of economic cycles, but the liquidity of the asset class is essential for investors, especially if returns are not sought solely through timber sales. The price development of forest land in Finland has been stable. With the right purchasing decision and a well-timed sale of the property, an 8 per cent net return on investment is not impossible to achieve. An expert investor acquires forest properties in a good development stage, owns them during the period of best value development – approximately 10–15 years – and realises a significant portion of the return as capital appreciation when selling the property.
The forest investment market has grown from €100 million in 2010 to over €400 million last year. Liquidity has been improved particularly by the forest assets brought to the market by forest companies and the increase in professional forest investment.
It is likely that forest investment will continue to grow. Foreign investors are only just discovering the Finnish forest property market. The structure of forest ownership is shifting in a more professional direction, and high-net-worth investors will continue to have good opportunities to balance their portfolios with direct forest investments.
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