Jerry Barag, president and CEO of CatchMark Timber Trust, Inc. (NYSE: CTT), joined REIT.com for a CEO Spotlight video interview during REITWeek 2015: NAREIT’s Investor Forum, held in New York.
Barag began the interview with an overview of the company’s acquisition activity. He noted that the first half of 2015 has been quite different from 2014. Whereas 2014 saw a steady stream of medium-sized deals, the first half of 2015 has seen either very large deals or very small ones.
Barag stressed the complexities of underwriting a timberland transaction, which means that potential buyers do not have the opportunity of working on multiple transactions at the same time.
“While we haven’t been overly-excited about the slate of offerings for the first half of 2015, it’s our expectation that there are quite a few more deals that will come to market in the very near future and we expect to be successful on some of those,” Barag said.
Meanwhile, Barag observed that timber prices have been somewhat volatile in North America for the first half of the year. Demand for timber in the first quarter was negatively impacted by weather, which put a damper on new housing starts, he noted. However, the outlook improved in the second quarter and the spring selling season seems to be on track to deliver full year results that are in line with CatchMark’s and forecasters’ expectations, he added.
“We went into 2015 with the understanding that prices would be fairly flat in the first half, followed by a modest acceleration of prices in second half, and so far that appears to be on track,” Barag said.
CatchMark’s CEO also noted that the company had an active first quarter in terms of small land sales to recreational buyers.