Stafford closes on first deals for new Carbon Fund
London, 12 August 2024 – Stafford Capital Partners (“Stafford”) has made the first two investments for its new Stafford Carbon Offsets Opportunities Fund (“Stafford’s Carbon Fund”) totalling over USD 70 million and comprising significant parcels of land in both Brazil and New Zealand.
The New Zealand acquisition involves a USD 12 million investment in three properties totalling 1,914 hectares. The majority of this land is lower-quality and suitable only for grazing or forestry. Approximately 1,356 hectares is being planted with radiata pine, while the remainder of the area will be managed for conservation purposes.
With these assets, Stafford’s Carbon Fund aims to achieve a high yield of carbon offsets, at 45,000 tonnes per million USD invested. Additionally, the investments provide the potential opportunity to acquire up to 10,000 additional hectares, offering an excellent platform for future growth.
The properties will be registered under New Zealand’s national Emissions Trading System (ETS). This scheme, which is part compliance and part voluntary, provides Stafford’s Carbon Fund with useful diversification across other carbon markets it expects to participate in, such as the global Voluntary Carbon Market (VCM), Australia’s ACCU Scheme, and California’s Cap and Trade Scheme.
The second investment is a USD 60 million commitment to acquire degraded pastureland in south-western Brazil with the objective of developing commercial timber plantations on 50% of the land, while the remaining 50% will be dedicated to protecting and restoring natural forest. This commitment far exceeds the current legal requirement in south-western Brazil for landowners to protect 20% of their land.
Extensive clearing of the natural forest in these areas commenced in the 1950’s and restoring these regions can therefore have a significant impact.. The commercial plantations will be managed on an extended rotation to produce sawlogs, underpinning the long-term financial viability of the project and building a resource that can help meet growing wood demand in a sustainable manner.
This project is expected to follow Verra's Verified Carbon Standard and generate 1.8 million VCUs for Stafford’s Carbon Fund.
Commenting on the two deals, Stafford’s CEO Angus Whiteley said today that interest in Timberland was growing amongst investors globally.
“Institutional investors appetite for investible climate solutions is only growing in the context of the race to Net Zero. The carbon sequestering properties of timber, the world’s only climate friendly building product, are compelling. Those deploying capital into timber will enjoy a first mover advantage as net zero deadlines loom and supply constraints of high-quality carbon removals and sustainable timber products start to have to an impact.”
Recently, Stafford Capital Partners alongside J.P. Morgan Asset Management (JPMAM) has been selected as managers for the ACCESS global core timberland offering. Additionally, Stafford has been selected as
ACCESS’ only global impact timberland manager. The total initial mandate size across both components will be c. £300 million, with potential to grow thereafter.
Media Enquiries
Sean Palmer
Director
Camarco
07591 760844
sean.palmer@camarco.co.uk
Amrith Uppuluri
Associate Director
Camarco
07763 083058
amrith.uppuluri@camarco.co.uk
About Stafford Capital Partners
Stafford is an independent private markets investment and advisory firm with USD %%AuM%% billion in assets under management and advice* for more than %%numClients%% institutional clients worldwide. Founded in 2000, Stafford has a global team of 85+ professionals investing in infrastructure, timberland & agriculture, and sustainable private equity through secondaries, primaries, and co-investments. Stafford has been a UN PRI signatory since 2010 and has committed to the Net Zero Asset Managers initiative. It puts sustainability at the centre of its investment process and implements a well-defined ESG program across all strategies. In the UK, Stafford Capital Partners Ltd is authorised and regulated by the Financial Conduct Authority (Firm Reference Number: 225586).
* As of %%AuMDate%%
This release neither constitutes an offer to sell nor a solicitation to invest in any of Stafford’s funds. It is for information purposes only and is not a recommendation. It does not constitute an offer to sell or a solicitation to invest in any jurisdiction where the offer or sale would be prohibited or to any person not meeting the required investor criteria.