The Minister for Agriculture, Food and the Marine has been urged to declare if he signed off on a new €200 million Irish forestry fund that has been launched by a UK listed asset management company.
London headquartered Gresham House, which also has Irish operations, confirmed today (Friday, January 6) that it has teamed up with the state forestry company Coillte to roll out the new ‘Irish Strategic Investment Fund’.
In a statement, Gresham House said the fund has put in place “an operational management agreement with Coillte” and that the fund “would benefit from Coillte’s long-term track record operating in the Irish forestry sector”.
The UK asset management company also detailed that the fund will “acquire existing forest assets and when fully deployed, will represent a portfolio of approximately 12,000 hectares of new and existing forests” in Ireland.
Imelda Hurley, chief executive of Coillte, added that the new fund represented “an important first step towards accessing the capital required to enable the creation of new forests” .
According to Gresham House the Irish Strategic Forestry Fund has already attracted €35 million from Irish investors, including a €25 million investment from the Ireland Strategic Investment Fund (ISIF).
Coillte’s forestry strategic vision
Last month Coillte outlined its “forestry strategic vision” to the Oireachtas Joint Committee on Agriculture, Food and the Marine and stated that its aim was to “enable the creation of 100,000/ha of new forests by 2050”.
The chief executive of Coillte, told the committee that it would take up to “€2 billion in terms of cost between now and 2050” to realise its ambitions.
Hurley said this would require two investment funds, one of which would be a “traditional fund”.
“We do not have the level of capital that is needed, so we need to access capital,” she stated and declined to provide further details to TDs.
Members of the joint committee voiced concerns directly to Coillte about how it could achieve its ambitions, what role an asset management company would play and what control the government or state body would have over future investors.
The Independent TD, Michael Fitzmaurice, who is a member of the joint committee, also questioned Coillte on whether it would be competing with farmers to secure land for forestry development.
The Roscommon-Galway TD said during the meeting that “before any deal is done and before anything is signed and delivered, there is an onus on Coillte to meet this committee and the minister”.
Deputy Fitzmaurice today called on Minister Charlie McConalogue to clarify if he been informed in advance by Coillte about its “operational management agreement” with Gresham House.
“It is very disappointing to see Coillte moving on ahead with this without providing any answers to outstanding questions that were raised in the committee or informing the committee of this agreement.
“Is what we are seeing here really that Ireland’s assets are being bought by foreign investors? Where exactly will it acquire forestry assets, we know at the moment that land is tight for farmers, has that been considered?
“We need the Minister for Agriculture to intervene immediately and explain exactly what is going on – what he knew in advance before the announcement and how this deal was done,” the Roscommon-Galway TD said.