Natural real asset manager SLM Partners has secured new funding for its SLM Silva Fund II, which will invest in continuous cover forestry (CCF) projects across Europe.
Dutch pension investor APG, which currently oversees more than $700 million in assets, has committed €150 million ($167 million) on behalf of pension fund ABP. The investment represents SLM Silva Fund II’s first and final close.
“This new fund builds on the success of our earlier funds, our fund one, which is the SLM Sullivan Fund investing in Ireland,” says SLM managing director Paul McMahon. “That was where we first developed the strategy and then we began to see opportunity to replicate that strategy.”
As of June 2026, Fund I has acquired 2,000 hectares, with 67% of its forest area transitioned to CCF management. With Silva Fund II, SLM will support more CCF projects in Ireland before expanding to other countries in Europe, he adds.
‘More interest’ driven by climate
Somewhere between an estimated 22–30% of European forests are currently managed under CCF, but awareness of its benefits is growing, says McMahon.
“There has been a lot more interest in and attention towards this idea in the last few years than ever before.”
The EU Forest Strategy for 2030 highlights CCF as an approach to making forests more climate resilient, for example. Ireland, where SLM’s first forestry fund operates, has multiple grants developed to assist with the planting of more diverse forests.
“It’s been driven by a range of things,” says McMahon of this growing awareness and activity. “In particular, this issue of climate change and resilience. We’re seeing these pressures in forestry from storms, from fires, from pest disease as climate shift. So there’s an even stronger focus on making forests resilient for long term.”
In the last few years, there has been more interest from investment managers, too, he says.
Economic benefits of CCF
Unlike clear-fell forestry, the industry standard that involves clearing all trees from an area at once, CCF practices only fell portions of a forest at a time, so that canopy cover is always maintained.
This leads to well-documented benefits around biodiversity, soil health, carbon capture, and other environmental factors.
For forest owners, whether an individual or an institutional investor, CCF can also provide financial benefits, or as McMahon puts it, “a way to maximize economic value from the forest over a very long period of time.”
Clear-fell practices mean harvesting an entire forest; CCF can lead to stabler cashflows because the forest gets thinned on a regular basis, he says. It also helps owners avoid the cost of replanting, since a key component of CCF relays on natural regeneration.
McMahon emphasizes that CCF is not a “magic bullet,” and that continuous cover management is not always appropriate for every forest.
For example, a forest could be too mature, or prone to wind throw. Poplar forestry is by design grown on a rotational basis and difficult to do any other way, for example.
“We’re always very cognizant of the fact that this isn’t one solution everywhere,” says McMahon. “But having said that, it can be employed in many cases.”
Debate is more around where it can be applied versus not, he adds.
“We’ve definitely seen some resistance, but that’s gradually changing as people start to use these approaches in a broader set of geographies and forest types. Traditionally it’s been seen as something more for environmentalists or for non-commercial forests. That is also starting to shift, with people seeing it now as a commercial forest management strategy.”
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