New York, NY - September 17, 2008 - The Connecticut Lakes Headwaters Forest, a 146,000-acre parcel in northern New Hampshire that makes up 4 percent of the state and was purchased by a private investor in 2002, is up for sale again.
A forestland sale this size would normally be cause for great concern within the conservation community. This time, however, it isn’t, as its owner has placed a strong conservation easement on the forest, preventing future development and requiring that its buyer manage it in an environmentally sensitive manner.
Such an outcome may be the exception, not the rule, according to a new report by the Open Space Institute (OSI). The product of more than 25 interviews and eight months of research, Forestland for Sale: Challenges and Opportunities for Conservation Over the Next 10 Years uses the 600,000-acre Mahoosuc region on the border of Maine and New Hampshire as a case study to predict the volume and timing of future forestland sales. With frequent turnover a key of the new forest ownership model, the report finds it could cost a full $120 million—more than all the conservation funding currently available for New Hampshire and Maine both—to buy protection similar to that of the Connecticut Lakes Headwaters Forest for upcoming land sales.
“While most of the larger parcels in the region such as Connecticut Lakes are protected, there are many smaller unprotected properties that face an uncertain future,” said Peter Howell, OSI’s executive vice president. “Conserving them will take more money and time since there are many more landowners, and it will require creative new approaches.”
The report examines the changing times in the Mahoosucs, where forest product companies have been replaced by private timber investment management organizations (TIMOs) and other investment groups as the largest private owners of forestland in the U.S. Gone are the days when forest product companies managed huge forests as long-term assets that provided jobs and recreation for local residents and tourists. Today, forest ownership by TIMOs and other groups is marked by fractured ownership, frequent turnover and, in many cases, increased development as land gets more and more expensive and owners seek to maintain returns for investors.
“Since the late 1970s, when a lot of forest was owned by paper companies, the land has all been sold so we’ve got new owners with a different model,” said Lloyd Irland, a lecturer and senior scientist at the Yale School of Forestry and Environmental Studies. “The markets have allowed those people to make a quick buck by flipping and subdividing the lands, and that is still going on despite the downturn in real estate.”
Forestland for Sale suggests that the era of large scale conservation deals might be coming to an end. The Trust for Public Land, a national land conservation organization, was able to help the private investor, Lyme Timber, protect Connecticut Lakes Headwaters Forest in one fell swoop in 2002. OSI’s research, however, finds that fragmentation of forest ownership will limit the opportunity for such large conservation deals in the future. The average size of an individual forest ownership today is less than one-seventh the size it was in 1980, as ownership has shifted from three industry owners holding approximately 100,000 acres apiece to 22 owners holding an average of 13,000 acres each.
What is perhaps even more striking is that the land transfer epidemic doesn’t appear to be over. Even with land now selling for as much as eight times its timber value, it’s expected that another 25 percent of the Mahoosucs' forestland base will be sold in the next 10 years.
The coming land sales pose significant challenges for the conservation community. During past rounds of land sales by industrial owners, conservation groups could count on relatively plentiful state and federal funding for land protection. With state and federal coffers now having dried up, that is no longer the case.
“With this report’s release,” said OSI CEO Kim Elliman, “the Open Space Institute is hopeful that legislators, conservation groups, landowners and local planners alike can prepare for the next wave of sales.”
“I hope it does get on the desk of every legislator; it’s a piece of the puzzle,” Irland said. “We are pretty close to running out (of funding for conservation in Maine). We need to refill the gas tank.”