Jeremy Keating of CBRE Agribusiness
A big forest with 1902ha of established trees and a freehold land area of 2411ha, is for sale in Marlborough 79kms southwest of Blenheim, along with significant forestry infrastructure. Source: The New Zealand Herald
“This is a rare chance for an astute purchaser to secure a well-managed forest of scale,” Jeremy Keating of CBRE Agribusiness said who, with fellow director Warwick Searle, is marketing Manuka Island Forest for sale by deadline expressions of interest with responses to be submitted by Thursday 1 June, to the agency’s Auckland office.
“With domestic log prices hitting record highs in recent months, underpinned by a boom in construction activity, the purchase of a large forest in Marlborough measures up as a very strategic investment,” Mr Keating said.
“The landholding, nestled among rivers and at the foot of the Richmond Mountain range represents an opportunity to acquire one of the most stunning and pristine natural landscapes in New Zealand.”
Mr Keating and Mr Searle, who are members of the New Zealand Institute of Forestry, say Manuka Island is a first rotation forest planted with the intention of supplying both domestic processors and the export market.
They say the forest draws its name from an island in the Wairau River which formed during a bood trapping livestock being herded down the valley.
The Wairau and Goulter Rivers form boundaries along with State Highway 63 and Department of Conservation land. Planting commenced at Manuka Island in 1994 and continued through to 1999 comprising 1709ha of pinus radiata trees and 193ha of douglas fir.
“With forestry now a very buoyant sector, coupled with the increased level of international capital looking to invest in the strong economic fundamentals of the New Zealand market, this landholding is expected to be highly sought after,” Mr Keating said.
“Being corporately owned and managed since establishment there has been considerable care taken with the land and forest management practices. As an example, fully mechanised production thinning has been a key part of the management process – a first for the local Marlborough region – and has been enabled by the largely flat and rolling terrain the forest occupies along the northern banks of the Wairau River.”
He said Manuka Island has generated a sizeable quantity of carbon credits for about 1108ha on post-1989 land and up to 300,000 units could be available as part of the sales process.
The significant number of carbon credits is a result of the land being registered under the New Zealand Emissions Trading Scheme (ETS) by Blenheim based Merrill & Ring staff and with regular and attentive oversight by the North American shareholders.
“Any enduring benefits will transfer to the purchaser of the forest.”
Mr Searle said that with much of the radiata planting nearing maturity at 18 to 23 years old, the owners have decided to realise their investment which spells a great opportunity for local or international investors.
He says a purchaser would have the benefit being able to undertake a productive and cost effective harvest of the stocked area for sale on a buoyant market.
“Advantages are: the topographical detail of the land, ease of access in the form of a harvest road running the length of the forest exiting directly onto State Highway 63; and well formed light vehicle access throughout.”
The productive area of the forest is a combination of predominantly easy contour rising from the Wairau River to steeper faces on the Water Hill area in the North East of the forest. Elevation ranges from 391m to 763m at the highest stocked point and the rainfall is fairly evenly spread across the year with April typically the wettest and July the driest month. The forest comprises 1709ha of pinus radiata trees and 193ha of douglas fir.
Other users of the forest include beekeepers licensed to place hives in the forest both for honey production and wintering.
“With State Highway 63 now serving as the primary arterial route between Picton and Christchurch, albeit on an interim basis, there is great potential to open up Manuka Island to a wider group of users if necessary as part of any sale approval process,” Mr Searle said.
“This is a large, high-quality landholding in a really picturesque part of the country. With 12km of frontage to the Wairau River and direct access to the Goulter River and bound by a Department of Conservation estate, the site offers untapped recreational opportunities.
Mr Searle said that “at a practical level,” the strategic location of the forest “offers huge incentives” in terms of future processing and growth.
“Manuka Island Forest is surrounded by a number of efficient and large-scale timber mills less than 100 km from the main gate.
These produce high grade appearance products suitable for furniture and finishing timbers; high-grade treated products suitable for outdoor use or in structural applications and cut of log and industrial grade.”
The forest also has easy access to two export ports just over 100km away: Picton or Port Marlborough, which is naturally deep harbour; and the commercial port facilities at Port Nelson where bulk cargo services include exporting logs.
Both ports provide ready access to the main log export markets in China and North Asia.
CBRE says that for planning purposes, the forest lies within the Marlborough District Council and is zoned Rural Four in the Wairau Awatere Resource Management Plan; and is expected to be zoned Rural Environment under the notified Proposed Marlborough Environment Plan.
There are two substantial areas of land protected by Department of Conservation covenant on the land title.
The Garden Covenant is on the banks of the Goulter River and consists of river terrace and hill country while the other is on the lower slopes of Star Hill and consists of regenerating beech forest and kanuka forest.
“With the Ministry of Primary Industries forecasting forest product export returns reaching $6.15 billion by 2020, from $5.14 billion in 2016, the substantial scale and positive fundamentals of Manuka Island Forest represents a valuable and timely long term investment,” Mr Keating said.
