Forest Capital Partners sells its timberland business

Enlarge Image

Matt Donegan, Forest Capital Partners' Portland-based co-president, said the time was right to sell the investment firm's timberland portfolio. 

Donegan said the time was right for Forest Capital to sell.

“Our view is that this is a very sensible conclusion to a very successful run,” Donegan said. “It was a company that set some very specific goals and we’ve exceeded every one of those.”

Donegan said that the deal flow for adding sizable parcels of timberland to a portfolio had slowed down considerably while the advantages to operating at a large scale — such as the research and technology to help trees grow faster and the muscle to weigh in on policy — were continuing to increase.

“When it comes to shaping policy such as global warming policy and renewable energy policy, you really need scale,” Donegan said. “And it’s the same for R and D.”

In a press release, officials from both Hancock and Molpus indicated their emphasis on environmental stewardship.

Donegan said that during its tenure in the timber investment management business, Forest Capital Partners added conservation easements across its portfolio, ensuring that significant swaths of the land will be maintained as forest land and not subject to other uses.

Its time in the industry also elevated Forest Capital Partners to be the third largest timber investment management organization, or TIMO, in the industry behind No. 1 Hancock and No. 2 Portland-based Campbell Group, according to D.A. Davidson's Chercover.

"There's really not that many portfolios of this size to go around," Chercover said. "This is a very substantial deal."

Donegan said he had mixed feelings about ending his work with Forest Capital's employees, but that he looks forward to focusing his attention on his family and his passions which include rural economic development and education.

Donegan serves as president of the Oregon University System Board of Directors and is a key figure in the Oregon Business Plan effort. He also worked on Gov. John Kitzhaber's recently released 10-year energy plan.