Ireland sovereign wealth fund helps seed forestry fund

Ireland Strategic Investment Fund, Dublin, committed €55 million ($58.8 million) to a new forestry investment fund managed by Dasos Capital.

The €8.1 billion sovereign wealth fund has backed the new Foraois Limited Partnership fund alongside the European Investment Bank, which has agreed to commit €28.5 million to the strategy. Additional support is expected from other investors, said a news release published on ISIF’s website Friday.

The pan-European forestland fund will address issues faced by small-scale forests across Ireland. It will aim to improve forest management and strengthen the supply of wood for commercial use. It will also support upgrades to Ireland’s forestry infrastructure.

Finland-based Dasos, which has about €600 million in assets under management, will support direct land acquisition, lease contracts, afforestation and other forms of land management. The intention is for the strategy to develop into a professionally managed portfolio of up to 15,000 hectares of forest across Ireland in the coming years, said the release.

“Forestry is a natural asset class for long-term, patient capital investors like ISIF and we are pleased to invest alongside Dasos and EIB in this initiative, which is very consistent with our mandate and with government policy,” said Eugene O’Callaghan, director of ISIF, in the release. “It will create a better structure to support availability of timber from Ireland’s private forestry estate and will seek to support greater afforestation levels.”

The sovereign wealth fund committed €30 million to a previous forestry fund, a spokesman said.

ISIF has a statutory mandate to invest on a commercial basis in a way that supports economic activity and employment in Ireland. The sovereign wealth fund is controlled and managed by the National Treasury Management Agency.