The performance of private equity timberland funds in the United States between 1985 and 2018

Between the end of 1980s and today, the timberland asset class managed by timberland investment management organizations in the United States has grown from one to over 30 billion USD. However, to date, the application of scholarly research on the assessment of the performance of private equity timberland funds has been limited. In this study, we attempt to fill this knowledge void by investigating the performance of private equity timberland funds in the United States between 1985 and 2018 based on confidential data from Preqin Pro (February 2020). Our results show that the historical returns of private equity timberland funds (4–6%) were close to the returns of the bond markets (3.4% and 7.6% for 3-Month Treasury bill and US treasury 10-year bond, respectively) and much less than BAA Corporate Bond (9.7%) and stock markets (12.6%). The results may help investors better understand privately placed timberland as an asset class and therefore improve their strategic investment decisions.

Duke Scholars

Author Bin Mei Environmental Sciences and Policy