German reinsurer Munich Re has raised more than US$200 million to support an equity fund focused on forestry.
The Sustainable Forestry Equity Fund was launched in 2022 by MEAG, Munich Re’s asset management arm.
It is classified as an Article 9 fund under the EU’s Sustainable Finance Disclosure Regime (SFDR).
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In total, it pulled in $207 million in its initial close from a number of German insurers and the pension scheme of a DAX-listed company.
The firm is targeting a volume of between $500 and $700 million for the fund.
According to MEAG, forestry funds provide low correlation to other asset classes and also offer long-term value potential due to the rising demand for wood as a critical component of sustainable construction.
The asset manager also believes that the asset class is under-invested with MEAG managing director Frank Becker describing the asset class as “unchartered territory for many investors”.
