MUNICH
,
July 11, 2022
(press release)
–
MEAG, the asset manager of Munich Re Group, is adding a global forestry fund to its broad range of investment solutions in the field of alternative assets. The fund gives institutional investors the opportunity to further diversify their portfolios and integrate sustainability, ESG and climate protection, because the forestry asset class is by nature a "green" sector with an attractive risk-return profile. The MEAG Sustainable Forestry Equity Fund invests in a global and diversified forestry portfolio with an attractive risk-return profile. Its focus is on established professional markets such as in particular the USA, New Zealand and Australia. In addition to regional risk diversification, the fund also achieves diversification within the asset class by investing, for instance, in different timber species and types of use. Holger Kerzel, MEAG Managing Director and Global Head Illiquid Assets: "Forestry investments are characterised by their low correlation with other asset classes. One of the reasons for this is that forests grow independent from capital markets. On top of that, they provide long-term value growth potential due to a globally increasing demand for wood, partly as a result of the trend towards sustainable housing construction and materials. This fund invests in one of the most important and oldest regenerative sources available to humankind and it will contribute to global climate protection with its certified sustainable management of the forests. It thus pays into several United Nations Sustainable Development Goals (UN SDGs)." Sustainability is not only an essential characteristic of the forest asset class, it is also an integral part of the MEAG Sustainable Forestry Equity Fund's investment strategy. This is also reflected in the fact that the fund meets the requirements of Article 9 of the EU Disclosure Regulation SFDR as a sustainable investment. In addition, its sustainable forest management sequesters atmospheric CO2 in line with the Paris climate targets. This underscores Munich Re Group's commitment to sustainability and helps meet the steadily growing demand for sustainable investments in the institutional sector. Frank Becker, MEAG Managing Director responsible for institutional clients: "Institutional investors are looking for alternative asset classes that offer ongoing returns and the potential for long-term value growth. They also increasingly want to integrate sustainable aspects into their investments. Forestry investments offer the opportunity to achieve these two goals. Forestry has once again proven its resilience as an asset class during the Corona pandemic and in the current market environment, giving demand for it a further boost. We are meeting this growing demand with our new fund, complementing our existing illiquid and liquid investment solutions." The MEAG Sustainable Forestry Equity Fund is a closed-end alternative special fund under Luxembourg law (Reserved Alternative Investment Fund - RAIF). The fund's management team has many years of experience with generating value through active asset management (afforestation, management, harvest planning, marketing)for forestry assets in the target regions. When purchasing and managing land, it can draw on Munich Re's expertise and data pool with regard to the risks of climate change and natural disasters. Munich Re Group has been investing in this asset class since 2009, and in twelve countries. At MEAG, the forestry asset class is the responsibility of the Alternative Assets division, which employs more than 200 staff and also includes agriculture, infrastructure and real estate investments. MEAG is the asset manager of Munich Re and ERGO. MEAG also offers its extensive know-how to institutional investors and private clients. MEAG currently manages assets to the value of around € 330bn, € 60bn of which for institutional investors and private clients from outside the company group.
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