PORTLAND, OR, October 24, 2018 – The National Council of Real Estate Investment Fiduciaries (NCREIF) has released third quarter 2018 results of the NCREIF Timberland Index. The index returned 1.02% for the quarter, up from 0.48% last quarter and 0.60% in the third quarter 2017. The EBITDDA return, at 0.81%, increased by 6 basis points from last quarter and 8 basis points from a year ago. Appreciation in the third quarter increased by 0.21%.
The Total Timberland Index had a 4.00% trailing year return, with 2.44% as the 2018 year-to-date total return.
Timberland Quarterly Total Return Trends by Region
The Northwest led regional returns for both the third quarter and for the trailing year. The total quarterly return for the Northwest was 2.76%, fairly evenly split between appreciation and EBITDDA return. The South continued to drag the index through 2018, with a third quarter total return of 0.33%, driven by a negative appreciation return of -0.25% and a below index average EBITDDA return of 0.57%. The Lake States saw a bounce back after reporting negative or flat returns over the past year to report a total return of 0.77%, driven by a third quarter EBITDDA return of 0.89%.
Timberland Market Value per Acre in USD by Region
Timberland market value per acre, at $1,834 as of the third quarter, saw a slight increase from $1,804 over the past year. Within the regions, the Northeast region saw the largest percentage increase in value, increasing from 3.43% quarter over quarter. Market value per acre for the South region continues to follow closely with the Total Timberland Index market value per acre.
The NCREIF Timberland Index consists of 461 investment-grade timber properties with a market value of $24.4 billion. This includes 311 properties in the South, 92 in the Northwest, 40 in the Northeast, and 17 in the Lake States. This data enhances the ability of institutional investors to evaluate the risk and performance of timberland investments across the United States.