Questions & Answers
You ask – BaumInvest answers
In order to provide you with as comprehensive a picture of BaumInvest AG as possible, we have compiled a list of the most frequently asked questions and their answers. These are regularly revised by us and checked for topicality. If your question is not included, you can of course send us further questions at any time via the contact form or by e-mail.
Questions about BaumInvest AG
Questions about the business model
How does BaumInvest AG generate a return?
The business model of BaumInvest AG is based on the principles of sustainable forestry: Only as much wood as can grow back is taken from the forest. We have adapted this principle for tropical regions and the tree species native to them. Our planting system is modelled on the successive development stages of a natural forest: This means that we combine pioneer tree species with semi-shade and shade tree species. This results in optimal growth conditions for the individual trees. The different rotation times of the tree species result in staggered harvest phases. In this rolling, permanent forestry system, we continuously replant and maintain the trees through natural regeneration. In the past years we have reforested at different times, further reforestations are planned. In this way, we can also ensure constant harvesting phases in the future. We achieve yields through sales or through further processing with subsequent distribution. This cross-generational replanting and harvesting is the basis of our business model – a sustainable forestry principle with no end in sight.
Questions about the reforestations in Costa Rica
Why Costa Rica in particular?
The small country in Central America is politically stable, economically sound and climatically ideal for a fast and healthy growth of our trees. Furthermore, the tax burden in Costa Rica is comparatively low. A double taxation agreement between Germany and Costa Rica has not yet been ratified. Due to an investment protection agreement between the two countries, German investors and capital investors in Costa Rica are legally equal to nationals. Thus, land and facilities are formally protected against nationalization and expropriation.
WHAT IS THE CURRENT STATUS OF REFORESTATION IN COSTA RICA? WHERE ARE THE REFORESTATIONS?
The reforestations of BaumInvest AG are distributed over five locations throughout the entire north of Costa Rica. Of the total property area of 2,051 ha, a total of 1,280 ha (62% of the total area) have been successfully afforested with various tree species in mixed stands of different composition; a small portion is still in monocultures. About 25% of the total area are protected areas.
WHAT DO THE WOOD GROWTH SCENARIOS LOOK LIKE AND HOW CAN I FIND OUT ABOUT THEM?
Our shareholders receive an annual summary of the current tree growth with the annual report. There you can also read how the main tree species are developing. We also inform our investors at the annual general meeting about the current status of timber development and future timber growth scenarios.
HOW DOES LAND PURCHASE FOR AFFORESTATION STAND IN THE CONTEXT OF "LAND GRABBING" AND LOCAL FOOD PRODUCTION?
For the reforestation we buy land that is freely available on the market. Some of the landowners have been with us for years – BaumInvest has been active in the region for 13 years. Often a generation change, in which the agricultural use is given up, is the reason for a land sale. And often the land has been lying fallow for years or has been used for extensive cattle breeding. Since the production of food in Costa Rica is concentrated in the more southern part of the country, we do not withdraw available land with the purchases of local food production. In addition, the land is not suitable for food cultivation due to years of intensive use. In the case of Finca El Concho, we were able to buy land already planted with monocultures from one company. This saved the land from being sold to a major pineapple-producing corporation. This allowed us to create a forested island in this region, which was characterized by pineapple monocultures.
Can the Fincas be visited?
In recent years, group tours with shareholders have been organized regularly in cooperation with the tour operator Aventoura. Until further notice, however, no BaumInvest trips to Costa Rica are possible due to the worldwide Corona Pandemic. Unfortunately, it is currently not possible to foresee when the next BaumInvest investor trip can be planned. We will keep you up to date!
IS IT POSSIBLE TO WORK OR DO RESEARCH ON SITE IN COSTA RICA?
Yes, there is the possibility to participate. In general, we have limited the cooperation on our fincas to the research area, i.e. we offer the possibility for students to carry out research projects in the field of forestry. Therefore we require that the students plan at least three months for their stay. Experience shows that a stay of less than three months is not reasonable, because otherwise we cannot integrate external people into our daily routine to the extent that independent work is possible. Spanish language skills should be at a conversational level. If you are interested, please submit an application: info(at)bauminvest.de.
Questions on socio-economic added value
WHAT DISTINGUISHES THE SUSTAINABILITY OF BAUMINVEST REFORESTATION?
Our cultivation system consists of a mixture of mainly native tree species. The diversity of tree species offers individual niches for animal species. Just like in a natural forest, the undergrowth is left and, due to the danger of snake bites, only removed where concrete work is done on the trees. A quarter of all plots of land are nature reserves, which are left to natural development. Our research cooperation with the Senkenberg Institute has shown that after only 9 years the number of reptile and amphibian species has increased from 20 to 89. Since our reforestations are managed as permanent forest, timber harvesting is only carried out selectively. This ensures a continuous tree population and at the same time the next generation of trees grows in the planting network.
Questions about the forest share
Questions about the forest share
What is a BaumInvest share?
BaumInvest shares are “registered shares with restricted transferability”, which are not traded on the stock exchange. Several shares are certificated and combined in so-called collective certificates. These collective documents have a number and are kept in a collective certificate register.
WHERE AND HOW CAN I PURCHASE SHARES?
Within the context of a capital increase: BaumInvest AG issues new shares in the context of capital raises. These shares are first offered to existing shareholders within the scope of the subscription right. Shares that are not purchased by existing shareholders can be purchased by new shareholders. You can find out whether and when a capital increase of BaumInvest AG is possible on our website.
Within the scope of the secondary market: BaumInvest AG shares are also traded on a secondary market for sustainable shares. There you can check whether shares of existing shareholders are offered for sale. You can also place a buy order yourself there. Our partner for this secondary market is Umweltfinanz GmbH, a professional, transparent, experienced and secure trading platform for unlisted shares (so-called secondary market). Under WWW.UMWELTAKTIENHANDEL.DE Umweltfinanz GmbH maintains a price list for unlisted environmental shares. Here you will find supply and demand for unlisted shares and other sustainable investments – in open order books without proprietary trading interest. The company acts as a trustee, which receives the payment from the buyer and in return releases the transfer of ownership of the shares.Click here for the BaumInvest AG order book. The documents for this and the instructions for a buy or sell order for BaumInvest shares can be found here. If you would like to place an offer to sell, the staff of Umweltfinanz GmbH will be happy to help you.
Kontakt:
Umweltfinanz GmbH
Berliner Straße 36
10715 Berlin
Tel.: 030/88 92 07-30
E-Mail: wertpapier(at)umweltfinanz.de
How can i sell my shares?
If you want to sell your BaumInvest shares, you can do so on the so-called secondary market. For legal reasons, BaumInvest AG is not in a position to act as a direct intermediary between prospective share sellers and prospective share buyers. In addition, the sale between two parties entails risks for both parties with regard to payment and transfer of ownership. We are pleased therefore to have gained an experienced, competent, secure and transparent partner in Umweltfinanz GmbH in the trading of non-listed shares. On its portal umweltaktienhandel.de Umweltfinanz GmbH maintains a price list for unlisted shares from the environmental sector. Here you will find supply and demand for unlisted shares and other sustainable investments – in open order books without proprietary trading interest. The company acts as a trustee, which receives the payment from the buyer and in return releases the transfer of ownership of the shares. Click here for the BaumInvest AG order book. The documents for this as well as the instructions for a buy or sell order for BaumInvest shares can be found here: umweltfinanz.de/download/zweitmarkt.
If you would like to place an offer to sell, the staff of Umweltfinanz GmbH will be happy to help you.
Kontakt:
Umweltfinanz GmbH
Berliner Straße 36
10715 Berlin
Tel.: 030/88 92 07-30
E-Mail: wertpapier(at)umweltfinanz.de
What effect does the dollar exchange rate have on my investment?
A weak dollar rate is advantageous for land purchases and ongoing reforestation and maintenance costs. However, a strong dollar is advantageous for later harvest yields and the associated distributions. We assume that if the dollar depreciates further, timber prices will not remain pegged to the dollar course. It is important to know that the market for timber, as well as for other raw materials, does not depend on a specific currency. It depends on supply and demand.
What kind of control do i have over my investment as an investor?
BaumInvest AG is a stock corporation under German law and is therefore required to maintain a balance sheet. This means that annual financial statements have to be presented every year and a general meeting is convened to which all shareholders are invited. The shareholders elect a supervisory board from their ranks which represents their interests vis-à-vis the management and which exercises far-reaching control functions. In addition, the shareholders are continuously informed about business developments. And they have the opportunity to participate in investor trips to visit the reforestation projects in Costa Rica.
Is there an obligation to make additional contributions or a loss sharing?
No. There is neither an obligation to make additional contributions nor a loss sharing. As a shareholder, you bear the maximum risk up to the amount of the purchase price for which you acquired the share(s).
Questions about the CO2 forest
Questions about CO2 compensation
How is compensation measured?
The CO2 compensation or storage capacity is measured taking into account the following parameters: the tree species mix, the density of the plantation as well as the measured growth of the tree. Preliminary values are based on the gold standard certified calculation values of the BIAG afforestations. For the calculation, measurement plots are installed in the afforestations.
How is it ensured that the afforestation permanently stores CO2?
The crucial issue to guarantee CO2 storage through reforestation projects in the long term is the disposal of the land on which the forest is afforested. BaumInvest buys the land for the compensation forest. According to the current legal situation in Costa Rica, forested land may no longer be cleared for economic use. This ensures that the forest is protected from deforestation even after the end of the project period.
How does certification work as proof of offset credit?
We use recognised certification standards such as the Gold Standard or VCS for our offset afforestation projects. These use a defined calculation methodology for afforestation projects that is based on the international specifications for CO2 compensation projects. For the first certification, tree growth values for the projection for CO2 storage are taken from our empirical values. Every five years, a calculation is made based on the growth data collected and a further release of certified CO2 offsets (Certified Emission Reductions). In order to ensure that not too many certificates are issued for storage services in the future, a so-called buffer is included. With the gold standard, 20 per cent of the calculated storage capacity is not shown as a certificate.
How is the purchase of land and afforestation prevented from having a negative impact on local people?
BaumInvest has now been active in Costa Rica for 13 years and is closely connected to the local communities at our five locations in the north of Costa Rica. Our land acquisition practice involves direct contact with the landowners, who often approach us directly. This is predominantly land that was previously used for grazing but is no longer farmed by the following generation. Our workers come directly from the communities where our afforestation sites are located. They have fixed contracts and have often been working for BaumInvest’s afforestations for several years.
Why plant a forest in Costa Rica and not in Germany?
In the tropics, afforestation has a twofold benefit for the climate. The time factor plays a major role, because the year-round growth stores more carbon per year and thus removes it from the atmosphere. This applies both to the storage in wood and in the soil, which develops a high storage potential especially under mixed forest. The cost factor means that more area can be afforested with the same investment than in Germany. Not only does the climate benefit, but also the high biodiversity in the tropical rainforests, for which every hectare of reforestation also means a piece of habitat recovery.
Are the afforestations affected by the negative impacts of climate change?
Our locations are mainly in the tropical lowlands of Costa Rica. Here it is tropically humid and rainy almost all year round. Depending on the location, we plant tree species that are adapted to the climatic conditions. Since our focus is on native tree species, they are very well adapted to the climatic conditions in Costa Rica. The diversity of species also contributes to risk management, so that not all tree species are affected in the event of losses. The diversity of tree species also ensures a resilient ecosystem that defies the massive impacts of climate change in Central America, such as strong storms/hurricanes, droughts or floods, and also mitigates the regional impacts. With regard to the coming changes due to climate change in Central America, we are working together with researchers from the University of Freiburg. This will enable us to adapt our forestry to future conditions. It is not to be expected that the future consequences of climate change will lead to losses for our type of forestry with native tree species in mixtures. On the contrary: forests stabilise the regional climate and promote rain cycles.
Why cooperate with BaumInvest?
BaumInvest has been replanting managed mixed forests and natural forests in Costa Rica for 13 years. We have many years of experience with the reforestation of different native tree species. We now manage 2051 hectares of land at five locations in the north of Costa Rica. In this way, we create long-term jobs in a structurally weak region. Our office is located in the regional capital, Ciudad Quesada, so that there is continuous monitoring of the forestry activities.
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