Why Invest in Tropical Hardwood Timber?

Reforestation: A profitable solution for global warming

Maderas Sostenibles SA is committed promoting sustainable investments through reforestation of deforested land with tropical hardwood species. Tree farms make excellent long-term investments, create short-term profit opportunities, capture carbon, replenish degraded soils and create jobs in the poor communities where they are located. Lumber is the third most important commodity in the world after oil and natural gas. Over the past 40 years timber holdings in general have out performed most alternative investments. Few investments combine great economic potential with the positive environmental and social impact that tree farms offer.

Secure Investment in Real Assets

Timber is one of the safest and steadiest growth investments available, protecting an investor from inflation, and providing returns above most alternative investments for the past 40 years. Precious hardwoods such as teak, mahogany, tropical oak, pochote, and Spanish cedar have shorter growth cycles and higher market prices than northern timbers, thus a higher rate of return overall. Most of our timber investments provide fee simple title to the land; an attractive investment apart from the timber. Investment in a well-managed tropical hardwood plantation provides both long-term return and short-term profit opportunities

Long Term Strategy

Timber is particularly suitable for SEP, retirement funds, or other long-term positions. The initial investment is relatively large, but the subsequent investment is minimal. The tropical hardwood growth cycle is typically 20-25 years, consistent with most retirement, pension, or long-term investment objectives. Once the plantation reaches the thinning stages in years 8-16 it will become self-sustaining and begin to provide revenue. Timber also provides diversification to any portfolio, a feature particularly attractive after the recent collapse of the typical equity investment portfolio.

Short Term Opportunities for Profit

Timber is typically considered as a long-term investment because of the hardwood growth cycle. Actually, plantation timber investments today also present short-term profit opportunities. Once established and certified, a hardwood plantation becomes an asset that can be sold in the open market before the growth cycle completes. A short-term business model that markets the plantation at 5 years or 10 years is as viable as a long-term model that manages and holds the timber to maturity. The market for short-term sale should steadily improve with the development of carbon credit funds and the continued growth of timber investment funds.

Why Maderas Sostenibles and Nicaragua?

Maderas Sostenibles offers a variety of ways to invest in reforestation. Our timber investments are completely scaleable as we can provide existing trees by the hectare or plant a large plantation for our clients on a contractual basis. You can own one hectare (2.5 acres) of teak or 100 hectares of various species on land selected by you.

-Our planting and maintenance contracts provide all necessary services from land acquisition to harvest.

-Our milling and export operation will ensure the maximum return for your investment when it reaches maturity.

-We operate in an area that we know and where our people have decades of personal and professional contacts.

-SW Nicaragua provides rich volcanic soil and a climate perfect for the hardwoods we are planting.

-The land costs are significantly less than similar land in Costa Rica or Panama.

-The government of Nicaragua is committed to reverse the centuries of deforestation and restore the Nicaraguan forest. The policies and laws favor the forestry business and investment in reforestation. The new forestry Law 462 has many incentives and tax benefits for people and companies who invest in reforestation.