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UK Forestry’s year end report concludes in positive mood

UK’s commercial forestry market continues to forge ahead with average prices in the year to September 2006 rising by approximately 20% on the previous year for like for like woodlands. The findings are reported in the latest Forest Market Report, now available from UPM Tilhill and Savills.

Prices have risen by some 60% over the last four years with the average plantation price at £2358 ha. The year also saw the speed of sales double with an average 4 months from marketing to final completion against the previous year’s 8.5 months. In addition, the average premium over guide price reached 16% over the previous year’s 11% - all factors characteristic of a strongly rising market. The total market size in 2006 was £35 million with the average transaction value at £289,000.

“The year to September 2006 concluded in the most positive mood that the market has seen for some time”, said Ewan Berkeley of Savills. “The forestry market remains very buoyant with numbers of buyers exceeding sellers and further price rises expected.”

Now in its eighth year, the report provides an annual snapshot of the UK commercial forestry market on properties larger than 25 hectares. The report is an aid to agents and owners (buyers and sellers) involved in the commercial forestry market.

“The market is now dominated by UK-based private individuals and, increasingly, collective funds looking for predictable capital growth and the tax-advantaged status of UK forestry,” said Simon Hart, Woodland Investment Manager for UPM Tilhill. “Investors appreciate the green credentials of forestry, for example as a source of sustainable bio energy and as a place to sequester carbon, and with increasing focus on carbon footprints, the merits of sustainably grown UK timber are impossible to beat!”

For a full copy of the Forest Market Report – Spring 2007, visit www.upm-tilhill.com, or www.savills.co.uk. More detailed information on the timber market is contained in UPM Tilhill’s Timber Bulletin, also available at www.upm-tilhill.com (click on downloads).

For all forest buying and selling enquiries contact UPM Tilhill.
Scotland: Simon Hart, 01786 435000
South Scotland and north England: Jason Sinden, 01387 711211
England and Wales: Tim Kirk, 01678 530206 or Crispin Golding 07920 592973
Or contact Savills: Ewan Berkeley - 01356 628600

Notes to editors
Forest Market Report is sent to UPM Tilhill and Savills clients and is freely available to the media. This is the only published research of its kind in the UK and illustrates short-term market trends. It complements the Investment Property Data bank (IPD) Forestry Index which charts long-term financial returns from forestry. The analysis for the report is based on UK data over the year to 30th September 2006 and the previous eight years. It examines forests in excess of 25 hectares, (predominantly coniferous), which typify the investment market. The survey includes all known/recorded public and private sales of commercial plantations of over 25 hectares.

Press for further information contact:
Ruth Roy, Head of Marketing, 01892 861008/07771 940494, ruth.roy@upm-kymmene.com

UPM Tilhill Marketing. July 2007