Forestry Investment Management (FIM) has launched a UK forestry fund offering investors tax-free ret...
Forestry Investment Management (FIM) has launched a UK forestry fund offering investors tax-free returns targeted at around 5% per annum.
The Timber Growth Fund, an unregulated investment vehicle, will invest in undervalued timber stocks where the base return is made through the growth of trees, offering the best prospects for capital growth, according to FIM director Colin Lees-Millais.
Because the fund invests in a tangible asset, growing timber, it is free from income and capital gains tax. Returns are achieved through the physical growth of the trees and will benefit from any increase in timber prices.
Millais added: 'UK timber is currently undervalued in comparison to European with standing timber prices in southern Sweden some two and a half times the level in the UK. Continued weakness in sterling should encourage new investment in processing capacity by overseas producers, to the longer term benefit of timber prices, while also assisting in increasing output for existing capacity.'
The trust aims to commence annual distributions from December 2006 after raising a minimum of £250,000 for the fund.
Commission to intermediaries is 3%, minimum investment is £10,000 and the annual management fee is 0.5% of the capital invested, subject to an increase on a yearly basis in line with rising RPI.
The closing date for applications is 19 September 2003 and there will be an exit route for investors from 2013.
For further information call 01451 844 655 or go to www.fimltd.co.uk.
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