Toitu Te Waonui (TTW) director Te Taru White says the venture's promoters see Maori landowners as being key to the future of New Zealand forestry.

"Why? Because they own a good slice of the land which is in forestry at the moment and have the biggest potential for afforestation," he said.

"If we look at the legacy of forestry, Maori have passively leased their lands. And although they enjoyed the fruits of that land, things have moved on two rotations later. A number of the leases are expiring and crown forest land is coming back to iwi. And the ability of iwi has grown over those 50-odd years. There's no appetite to revisit [the old model], only an appetite to participate in the ownership of forests moving forward."

TTW has developed a forestry investment model with a twist, says its legal adviser Guy Royal.


"We want to create liquidity for investors so they can move in and out and we've designed it on that basis. We want Maori landowners to move into being forestry owners because of the value of the wood, rather than just being landlords."

Investors would be getting a rate of return to be negotiated, but somewhere between 7 and 8 per cent. But they would eventually have their interest bought out by the landowners.

"We're trying to grow a national model, we're not trying to build a little fund or a collective of land groups."

To help generate initial returns for investors, TTW will bundle forest hectarage to include some mixed age existing plantings across the 30,000ha. Mr White said TTW offered a liquidity model that enabled the investors to exit at various points in time and offer back iwi owners the opportunity to buy those parcels.

"What Maori have in their favour is they own the land and therefore they can choose to forgo rental, or parts of rental, and convert that to equity. And that takes away a big worry from the investor having to worry about land."