Property Frontiers

Tropical Hardwoods in Puttalam, Sri Lanka

Sustainable Tropical Hardwood

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Teak Investment,
Puttalam,
Sri Lanka

NA Bed Tropical Hardwoods from £11,000

Minimum investment £11,000
Medium to long term return up to 17% IRR
Fully inclusive of maintenance fees
Investments open to private clients and institutions

Summary

Minimum investment £11,000
Medium to long term return up to 17% IRR
Fully inclusive of maintenance fees
Investments open to private clients and institutions
Invest with cash or via a Self-Invested Personal Pension (SIPP)
Guaranteed tree replacement for the first five years
Insurance cover after year five
Your asset is registered in your own name
Tree exchange programme
Grower has over 20 years experience in forestry
All plantations are freehold
UK based company

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Description

Teak is one of the most beautiful and durable of the tropical hardwoods. Its true value as an investment lies in its versatility. As practical as it is valuable, these qualities are reflected in the many uses to which teak has been put. The furniture industry accounts for around 85% of teak use today. However it is also the essential timber in ship and yacht building, because its high oil content gives it properties that other woods do not possess. Teak is used in joinery, cabinet-making, turnery and panelling, in the carving of ornaments and the manufacture of tanks and vats requiring high resistance to acids.

There is now an extreme shortfall between demand for teak and its supply. Its value has made it especially vulnerable to illegal logging, which has depleted supplies. Some governments have responded by making teak exports illegal, and this in turn has increased the cost of this precious tropical wood.
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Location

The grower’s plantation is located near Sri Lanka’s western coast, in conditions ideal for teak growing and harvesting. The area has remained free from political conflict, but the recent peace settlement has put the whole country back on the global economic radar. Sri Lanka’s government is fully committed to clamping down on the illegal logging of teak forests. This greatly increases the desirability of investing in sustainably farmed teak in Sri Lanka.

Sri Lanka now has a stable, democratically elected and accountable government, which is welcoming foreign investment, especially eco-investments which help preserve its great natural beauty and its resources. There is a focus on sustainable forestry, farming and tourism, making full use of the benign tropical climate moderated by gentle ocean winds.
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Property

There are two investment packages, one at £11,000, the other £18,000. Both are one-off payments, fully inclusive of management and maintenance fees. The parcel of land in which you invest is part of the growers’ freehold teak plantation and is leased to you for the duration of the teak trees’ growing schedule. Private plantations are available in 25 acre sites and bespoke investment plans are welcome.

The first option (£11,000) offers an annualised Return On Investment (ROI) of 99% over the full planting timeframe of 25 years. The second option allows you to invest £18,000 and over the full timeframe offers an annualized ROI of 161%. Trees that fail to thrive are replaced by the growers during the first five years as part of the investment package. After this time, the trees have full insurance cover as they grow towards maturity.
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Amenities