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TIAA-CREF began investing in timberland in 1998, with foresight now endorsed by a growing worldwide awareness of the value of sustainable production.

The organization now manages a forestry portfolio of over $1.3 billion, and growing—with the investments covering 840,000 acres across 23 states in the U.S., and seven other countries.

The investment focus has been to achieve attractive, risk-adjusted returns, while building a global portfolio of high-quality, sustainably-managed timberlands that can be held over the long term.

To ensure sustainability, TIAA-CREF places strong emphasis on environmental stewardship and works with only managers or partners who are in alignment with this philosophy.

Almost all of the organization’s timber investments are third-party certified under sustainable forestry management programs, such as the Forestry Stewardship Council or the Sustainable Forestry Initiative, or are in the process of being certified. These certifying bodies require forests to be managed to the highest social and environmental standards.

By actively supporting forest research, often in conjunction with universities, TIAA-CREF is working to advance knowledge of forest-management and tree-improvement programs.

In addition to providing a broad range of revenue opportunities, timberland helps society advance to a more sustainable economy, through both primary and secondary reduction of CO2 emissions, and by providing sources of renewable energy for cleaner burning biomass facilities and potential sites for wind farms.

The environmental equation is attractive—a wood factory is a forest, using solar energy to produce wood. As a substitute for steel, concrete, and plastic, timber requires less energy to produce.

The investment opportunity is also attractive as global growth generates increasing demand for timber products.

Innovative Investing:

In addition to enhancing the long-term value of the investments, TIAA-CREF’S responsible stewardship of its timberlands provides additional benefits for future generations.

Examples of such initiatives are the improvement of water quality and enhancement of fish breeding habitats in a recently acquired 142,000-acre forest between the Clatsop State Forest and the Oregon coast with the Campbell Group.
In addition to providing for the sale of approximately 30 acres of riparian land and channel zone of the Necanicum River, the organization has supported the restoration of the Circle Creek stream by State and Federal fish and wildlife authorities and the Necanicum Watershed Council. This included moving a road outside the area of stream influence, rebuilding culverts to make them “fish-passable,” strategically placing large pieces of timber in the stream to provide natural breeding habitats, and planting trees and native plants along the creek bank where a road once ran.

A second phase of the restoration project—cooperating with the Oregon Watershed Enhancement Board—involved building five “fish-friendly” crossings and the removal of a road.

The Oregon initiative is not an isolated example of TIAA-CREF’s involvement in environmental improvement activities in its timberlands. At every location, the policy of ensuring sustainable, responsible investments has been applied. This has led to the organization winning the Conservation Leadership Award for Biodiversity Research for the protection and restoration of longleaf pine woodlands in east Texas. The Sustainable Forestry Initiative bestowed the prestigious award.

In other areas, a Safe Harbor Agreement has been executed with the Louisiana Department of Wildlife and Fisheries, and in Texas, where a 10,671-acre conservation easement has been added to the Turkey Creek Forest Legacy Project.

Oregon Timberland Assets Yield Returns For Investors and the Environment

WITH SANDY LABAUGH, SENIOR DIRECTOR, PORTFOLIO MANAGER, NATURAL RESOURCES & INFRASTRUCTURE INVESTMENTS

TIAA-CREF began investing in timberland in 1998, before many other companies were even aware of the value of sustainable production.

In addition to increasing the long-term value of the investments, responsible stewardship of our timberlands provides additional benefits for future generations.


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