So in this episode we examine an asset class that appears at first glance to have a powerfully persuasive set of positive attributes: forestry. To discuss this our guest is Olly Hughes, Managing Director of Forestry for Gresham House, the UK’s largest forestry investor. Olly describes his journey from studying Zoology at Oxford, to becoming involved in asset backed finance in Asia, before turning to renewables investing.He describes the key drivers of forestry investing, encompassing the macro forces of urbanisation, housing shortages and decarbonisation.

He explains the growing institutional interest in the sector, the challenges of supply and the changes in land use and opportunity set.He distils the investment proposition for forestry, reviewing its natural growth factor, inflation protection, low correlation to other assets but also reflects on the asset class’s low liquidity, vulnerability to natural disease and disasters and answers the question as to who this asset class is appropriate for.

Olly discusses the carbon capture and carbon credit elements that he believes are proving secular, not cyclical, before analysing both the beneficial tax status forestry enjoys, the opportunities across geographies, and why he remains firmly optimistic about future returns.