No to pines
OPINION: Forests planted for carbon credits are permanently locking up NZ’s landscapes, and could land us with more carbon costs, says the Parliamentary Commissioner for the Environment (PCE).
The estate comprises five individual properties with a total area of approximately 2,400ha, and was purchased at an acquisition cost of approximately $63 million.
The entire estate has been leased to New Zealand Forestry Leasing (NZFL) for a period of 20 years, with the first year’s payment being approximately $5m.
Co-founder and New Zealand Rural Land Management director Richard Milsom says the purchase was funded using a combination of debt and equity.
Debt was provided through an increase in borrowings from Rabobank of $25.2m.
“The equity component has been funded from the proceeds of NZL’s recent capital raise offer and from the proceeds of a $12m convertible note issued to an entity associated with NZFL.
“This forestry estate acquisition means NZL now owns 141,101ha of rural land with a 12.1 year weighted average lease term (by value), and 100% occupancy across eight tenants. It adds materially to the scale and diversity of NZL’s asset and tenant base,” says Milsom.
Rabobank regional head of sustainable finance for Australia & New Zealand Jurre Smits says the Rabobank green loan was provided to support NZL’s forestry acquisition and established a Green Financing Framework that will set out the eligible asset classes and how the proceeds from the loan will be used, managed and reported on, in line with the Asia Pacific Loan Market Association’s Green Loan Principles.
“Rabobank is proud to have partnered with NZL on this transaction as it contributes to climate change mitigation by protection and conservation of forestland, and therefore preserves the CO2 sequestering capability of the land,” Smits says.
“In addition, the green loan also supports improved biodiversity of the assets,” he says.
