Thanks to all the commenters. Re-reading my posts I was being very defensive, and sorry for that, it wasn't my intention. ( my tablet also autocorrected OECD to OPEC in the OP, so that didn't help)
But it did make me relook at the details behind the numbers and the risks. The prospectus was quite comprehensive and very transparent, but seeing it from your pov as non-new zealanders, was an eye opener. But it totally explains why returns may be higher as your risk views are incorporated into the price, which can create an opportunity.
First a comment on general risks.
NZ economy, stability, etc. I dont believe this is a big risk at all, except for possible tax increases on investments/ company tax ( currently the numbers assume a current 33% tax on profits when cal. after tax returns). Fair enough, although possibly offset by fact the rate is already high, and could come down! It's rated in the lowest risk category for FDI.
NZ$ exposure. NZ currency floats but central bank highly respected and interest rates are ok. Kiwi dollar is trading at a near high to US$. Offset by fact the trees will be primarily for export, and prices are thus effectively set in US$ anyhow.
Legal framework, management company, etc. Yes, always some residual risk I guess, and no federal deposit insurance (!), but the company is well respected in the industry, operating since 1972, and company you are investing in as a limited liability partner is audited annually, plus cashflow is minimal because these forests are already planted for 15 years or so, so there are no forward cash calls, all the money has been spent and now the trees are just growing. The companies carry no leverage at all, and own land freehold. The management company can demonstrate successfully operated forests all the way to replanted forests past harvest, so they have a track record of performance. It's good enough for me. Their communications over the past years with my existing forest investment has been outstanding, and every year the local investors meet up actually physically at the forest and discuss it with the independent forest auditor.
Specific risks wrt that 13%cagr and the investment inself:
The return has been estimated using a suite of assumptions about the future: harvest volumes based on observed growth to date and projections based on decades of research by an independent review. But actual grades and volumes could be a bit different on both upside and downside by 10%. Costs to harvest again are just a rough estimate based on other nearby forests and will need to be worked out closer to harvest more accurately. Demand and capacity and the multiple nearby log processing companies is also assumed, and current log prices at the point of export also assumed. Although harvest dates can be moved a year or two to avoid temporary drops or to take advantage of temporary spikes, this is probably the biggest sensitivity. Log prices are probably about 30% out of the slump caused by the recession, so I dont think there is as much downside as upside here. Given trends in sustainable timber demand and that 96% or so of most timber is not from sustainable managed forests, upside could be huge here IMHO.
That 13% growth is also subject to company tax at 33%, bringing after tax cagr (real - inflation excluded and would be in addition) to a more reasonable 9% per year between now and around 2025.
illiquid? Yes, but not totally. There is a secondary market where you can sell the shares but they are not publicly traded, so you would get a penalty if you have to sell early. This is also why the rate makes sense - it is not suitable for if you need the money within the next 12 years. So should only be a % of a large stash. In my case, a lot less than 5%.
I'll post a link to the website if people are interested, but I want to complete my purchase before the millions on MMM push the price up... given the low liquidity mentioned earlier, I'm hoping to use that to my advantage on the negotiation...
So, thanks for the face punches, and sorry I was coming off as an a**hole. You quite correctly did not have enough info.