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More property funds expected to buy woodland for carbon offset

Standard Life Investments Property Income Trust last week announced it had acquired national park land as part of carbon strategy

By ESG Clarity, 21 September 2021

The acquisition of national park land by Standard Life Investments (SLI) Property Income Trust to offset its carbon footprint could spark a trend for other property trusts to follow suit, according to investment company analysts.

Last week, the board of the SLI Property Income Trust announced it had purchased 1,447 hectares of upland rough grazing and open moorland in the Cairngorm national park for £7.5m. A statement explained the site supports 956 hectares for planting with natural broadleaf trees (about 1.5m trees in total) with around 115 hectares for peatland restoration, with the remainder open land to support biodiverse habitats.

Fund manager Jason Baggaley described the move as a “significant opportunity for reforestation as part of [the trust’s] carbon strategy”.

He added the investment company is not investing in commercial forestry, but is acquiring a gold standard carbon offset at a fixed price, and the purchase forms part of a wider strategy to achieve carbon net zero on the trust, based primarily on reducing operational carbon at the investment property assets with offsets for residual carbon that cannot be eliminated…

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Richard Williams, property analyst at QuotedData, said he could see this trend catching on: “SLI has a track record for being an early mover and is once again ahead of the curve with this acquisition. As carbon emission has risen up the agenda and consciousness of everyone, it is clear that more needs to be done to offset it. Property has a particular problem and we’re sure that others will have to follow.”

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