Latvian Forest Development Fund: A New Note Issuer Coming Soon to Debitum Investments

Debitum Investments is expanding its range of investment opportunities for our investors. On February 14, 2025, we are introducing the Latvian Forest Development Fund (LFDF)—a strategic player in Latvia’s forestry sector. LFDF bridges the gap between independent forest owners and major institutional buyers like SODRA and IKEA, creating value at both ends of the market.

Forestry investments offer strong returns with relatively low risk, and LFDF plays a key role in transforming smaller forest properties into institutional-grade assets. The fund acquires land from owners typically holding 10 to 50 hectares and manages every stage—timber harvesting, exports, land optimization, and finally, legal preparation for resale. By the time institutional investors step in, LFDF has consolidated these assets into a structured portfolio, allowing the former to acquire large-scale forestry investments in a single transaction. This streamlines the process for both small landowners seeking efficient sales and institutional buyers looking for scalable, high-value opportunities.

A High-Growth Sector with Strong Returns

LFDF operates in one of Latvia’s most promising investment sectors—forestry. The fund focuses on strategic acquisitions, sustainable management, and optimized exits, ensuring maximum land value appreciation.

Latvia’s forestry sector is positioned for long-term growth, driven by several key factors:

• Undervalued land prices compared to Western Europe, providing strong capital appreciation potential.
• Rising timber demand, with global consumption increasing in construction, energy, and manufacturing.
• Consistent land value appreciation, with Latvian forestland prices steadily rising between 2016 and 2024.

LFDF has already acquired 2,600 hectares of forestland and successfully sold 800 hectares, achieving an average margin per transaction of 35%. By 2026, the fund aims to expand its portfolio to €40 million, capitalizing on a growing market with strong institutional demand.

Security and Stability in Forestry Investments

Forestry is recognized as a low-volatility asset class, offering intrinsic stability and long-term appreciation. Unlike financial markets, forestland remains a tangible, income-generating resource that continues to grow regardless of economic cycles.

LFDF minimizes risk through:

• A structured, long-term investment strategy focused on sustainable land appreciation.
• A strong legal framework in Latvia, ensuring investor protection and regulatory oversight.
• An experienced leadership team, led by Janis Upenieks and Gatis Melderis, with extensive expertise in forestry investment, land valuation, and financial structuring.

LFDF’s financial discipline is also well-established. The fund successfully secured and repaid €7 million to Mundus Bridge Finance, managed by INVL, one of the Baltics’ leading investment management firms.

Liquidity and Market Accessibility

Forestry investments are often perceived as illiquid, but Latvia’s forestry market is active and integrated into international trade. Latvian timber is exported worldwide, with strong demand from Scandinavian countries and China.

• Forestry represents 20% of Latvia’s total export value, generating over €4 billion annually.
• Major buyers, including IKEA, SCA, and SODRA, acquire significant volumes of Latvian forestland.
• Over 54% of Latvia’s forests are privately owned, creating ongoing investment and acquisition opportunities.

This steady demand for timber and land ensures that forestry remains a highly liquid and accessible investment sector.

Investing in LFDF Through Debitum Investments

Traditional bank financing can be slow and restrictive, limiting the ability of funds to act on high-value opportunities. LFDF’s partnership with Debitum Investments provides investors with faster, more efficient access to forestry investments.

Investors benefit from:

• Collateral-backed investments, ensuring security.
• Regular financial reporting for full transparency.
• Access to a proven investment model without the delays of traditional financing.

With its established track record, stable asset base, and structured investment strategy, LFDF offers a combination of high returns and low risk for investors looking to diversify into the forestry sector.

LFDF Trust Score: A

LFDF has been assigned a Trust Score of A, reflecting its strong financial standing and operational transparency.

• Legal Factors (B): While LFDF meets high standards across most criteria, the highest possible ranking is not assigned due to its collateral structure, which does not include real estate. Instead, a commercial pledge is in place over all shares and assets of the issuer, allowing enforcement against receivables, timber products, and other assets.
• Financial Factors (A+): LFDF maintains a strong financial position, supported by its structured approach to land acquisition and value appreciation. The company consistently generates high margins from strategic forestry management and has demonstrated financial discipline, having successfully secured and repaid €7 million in previous financing.
• Other Factors (A+): LFDF has been highly cooperative, maintaining open and transparent communication. The company provides regular financial reporting, ensuring investors have full insight into performance metrics. Its leadership team brings extensive industry expertise, further strengthening operational execution and investor confidence.

LFDF Launching Soon on Debitum Investments

Forestry investments offer strong returns, low volatility, and long-term capital appreciation. LFDF’s business model, market positioning, and transparent approach make it a compelling opportunity for investors seeking exposure to Latvia’s expanding forestry sector.

LFDF will be available soon on Debitum Investments—stay tuned for more details.

This is a marketing communication and should not be interpreted as investment research, advice, or an endorsement to invest. The historical performance of financial instruments is not indicative of future outcomes. Investing involves risks; the value of investments may fall as well as rise. Be sure to assess your knowledge, experience, financial situation, and investment goals before investing.