Sustainability continues to be a key driver in the financial and real estate sectors, with timber construction playing a pivotal role. In this issue, we take a look at some of the groundbreaking developments that Timber Finance is spearheading.
Sustainability continues to be a key driver in the financial and real estate sectors, with timber construction playing a pivotal role. In this issue, we take a look at some of the groundbreaking developments that Timber Finance is spearheading.
In September, we published a feasibility study on a timber construction mortgage. The collaboration with the ZHAW School of Finance and Real Estate tested the feasibility of a mortgage product that offers interest rate reductions for the use of sustainable timber in construction. Such a product could incentivize the use of carbon-storing materials such as timber. We also provide an update on the progress of the pilot project which will generate the world’s first carbon removal credits for timber buildings. This carbon finance mechanism creates new revenue streams for developers and forest districts through the trading of carbon removal credits
Of particular note is the Pünt project in the municipality of Egg, an outstanding example of how certified timber in construction projects contributes to achieving climate goals and creates economic benefits for investors.
The newsletter concludes with a recent market analysis of publicly listed companies in the timber sector, which is showing positive signs of stabilization despite global challenges.
We look forward to working with you to seize the opportunities that sustainable construction offers for the financial sector.
Best regards
Thomas Fedrizzi, Managing Partner, Timber Finance
FINANCE SOLUTIONS
New Feasibility Study on Timber Construction Mortgage
Discover the feasibility study on the "Timber Mortgage," an innovative financing solution that offers interest rate reductions for the use of sustainable timber in construction while also contributing to achieving climate goals.
Carbon Storage through Timber Construction: Potentials and Certification Opportunities
The pilot has successfully launched with 20 selected innovative timber construction projects and half a dozen Swiss forestry districts. Carbon removal credits add additional value to construction projects, with part of the proceeds flowing into forestry districts for sustainable, climate-relevant forest management.
The use of timber in construction replaces emissions-intensive building materials such as steel and concrete, enabling the dual benefit of carbon storage and emissions reduction. Switzerland is a global leader in engineered timber construction and is taking another innovative step with the introduction of carbon removal credits. Builders in the DACH region are still invited to submit their timber construction projects for the next phase of the carbon project.
The Pünt building of the Eigengrund Housing Cooperative in the municipality of Egg, Zurich, is an outstanding example of sustainable construction. With a main usable area of 7,050m² and the use of regional and certified timber, it stores 1,462 tons of carbon in the timber load-bearing structure and additionally reduces emissions by another 508 tons of carbon. This project demonstrates how climate-friendly timber construction can be implemented economically using regional resources through carbon removal credits.
STUDIES & RESEARCH
2Q24 Results of Publicly Listed Companies in the Timber Sector
The industry is in a challenging phase of normalization, particularly in the European construction sector. However, after the exceptional period of 2021-2023, certain markets are showing signs of stabilization. Particularly strong were the results of Nordic forest owners, who benefited from high roundwood prices due to a continued imbalance between supply and demand. Further information can be found in the report.
10-Year Overview of the Publicly Listed Construction Sector
This quantitative analysis examines profitability, growth, and valuation across various niches within the construction sector, such as forestry, timber construction, and other areas particularly relevant for the decarbonization of the building sector.
CHART OF THE DAY
The chart below shows Bloomberg's projected market development of the demand for carbon removals (green line), with a significant increase around the year 2028. This time frame aligns perfectly with the planned market launch of our VCS Mass Timber Carbon Removals in 2025.
ASSOCIATION & MEMBERS
Member Profile: Interview with Mr. Wiesner, CEO of WIEHAG
In ourMember Profiles series, Mr. Wiesner, CEO and owner of WIEHAG, shares his vision for the future of timber construction. He discusses WIEHAG’s global projects, such as the tallest timber tower in the USA, and explains why timber is key to decarbonization. Additionally, he offers insights into how WIEHAG combines sustainability and international standards to set new benchmarks in engineered timber construction. >>> Read the Interview
New Member of the Timber Finance Initiative
We are pleased to welcome InvestInvent as a new member of the Timber Finance Initiative. InvestInvent is a Swiss pioneer in climate-friendly direct investments in renewable energy, with more than 20 years of experience.
With the planned timber real estate fund, InvestInvent aims to offer qualified investors the opportunity to invest in Swiss income properties with a focus on timber for the first time.
Become a member:
Learn about the benefits for our members and apply for your membership here.
MEDIA PARTNER
New Media Partner: Schweizer Holzrevue
The specialist magazine Schweizer Holzrevue publishes eight times a year, providing information on wood processing, woodworking, and the supply industry. It offers insights into work techniques, product descriptions, company profiles, and market overviews. Thanks to new techniques, timber is becoming increasingly popular among designers and buyers, and is gaining significance in architecture and large-scale construction.
EVENTS
We were very pleased with the demand for the "Timber Mortgage and Carbon Storage Certificates" webinar and are pleased to provide you with the following materials:
Frank Vasek, Head of Carbon Solutions, gave a presentation at the Swiss Green Economy Symposium (IF12) on decarbonizing the construction industry with timber construction as a negative emissions technology.
