Timberland Investment Resources, the US forestry investment firm, has launched a new European business to serve high net worth and institutional clients and is shortly expecting to receive authorisation from the UK regulator to start marketing to investors.

TIR-Europe was co-founded by managing partners Hugh Humfrey and GianPaolo Potsios; the former is responsible for overseeing the firm’s investment strategy, while the latter is responsible for directing business development and investor relations.

Forestry has been attracting increasing interest from high net worth investors, with proponents lauding the asset class’s ability to aid diversification as, historically, correlation between forestry and the performance of more mainstream assets such as equities and bonds has been low. By way of example, the National Commercial Realtors Investment Fiduciary – T Index showed that returns in 2008 for timber were 9.45 per cent – a stark contrast with the double-digit losses in equities that year.

“Forestry investments also offer excellent inflation hedging characteristics and have generated a long history of stable investment performance consisting of both current income and asset appreciation,” Humfrey said in a statement.

“As a result, the asset class tends to offer a great deal of flexibility from both a tax and cash flow planning standpoint, which makes it very compelling given the prevailing market conditions.”

TIR-USA was founded in 2003 and now has over $750 million in assets under management.