Building a real forest business takes time, discipline, and patience.

But milestones matter.

Reaching the first independent valuation of FF Forest marks an important step in the company’s development. Not only because it measures growth, but because it helps us monitor portfolio quality, operational performance, and long-term execution.

We deeply value the trust of everyone participating in FF Forest. Transparency and regular portfolio monitoring are part of our long-term commitment.

As part of this approach, FF Forest completed its first independent portfolio valuation in May 2026, covering the FF Forest portfolio built up to February 2026.

The purpose was simple:

• monitor portfolio performance

• independently assess asset quality

• measure operational progress

• provide participants with a transparent view of portfolio development

Forestry is a long-term business. Independent valuation helps ensure that long-term decisions continue moving in the right direction.

The independent valuation of the portfolio built up to February 2026 showed an estimated value increase of approximately 51% on a per-hectare basis over a three-month period, compared to the average acquisition cost.

The valuation reflected not only land ownership, but also forest quality, biological growth potential, timber resources, operational forestry potential, and long-term asset value.

The independently valued portfolio consisted of:

• 166 land properties

• 1,648.9 hectares

• More than 153,000 cubic meters of timber resources

• Forest and agricultural land across multiple Latvian regions

The portfolio was built with a clear strategy.

Geographic diversification matters

FF Forest land is distributed across Latvia:

• Latgale - 55.95%

• Vidzeme- 42.81%

• Kurzeme - 1.24%

But diversification is not the only goal.

FF Forest also aims to acquire land plots that are located close to existing holdings whenever possible.

Why?

Because larger connected forest territories create operational advantages:

• easier forest management

• more efficient maintenance

• better long-term planning

• stronger refinancing opportunities in the future

Nearby properties can potentially be combined into larger operational forest clusters.

Scale creates efficiency.

Forest quality is unusually strong

An independent valuation highlighted a very important factor:

“Very high land fertility indicators.”

Forest quality is measured using productivity classes called bonitet.

FF Forest portfolio quality indicators:

• Highest productivity classes (IA + I): 64.2%

• Highest three productivity classes (IA + I + II): 82.2%

This matters because productive forest land creates stronger biological growth over time.

Forests do not only occupy land.

Healthy forests grow.

Timber monetization potential already exists

FF Forest is not simply holding land. The forest portfolio already contains operational timber potential.

Independent analysis shows that between now and 2036 the portfolio could support:

• 250.55 hectares of harvesting activity

• Approximately 62,186 cubic meters of timber resources

Estimated discounted timber cash flow value:

€1.93 million

This creates an important advantage. FF Forest combines:

• land ownership

• biological growth

• operational forestry potential

Multiple value drivers exist inside the same portfolio.

The portfolio becomes stronger over time

Forest assets are unusual because time itself creates value.

Current long-term projections show:

By 2036:

• Young forests expected to reach 51.4%

• Medium-age forests expected to reach 32.1%

• Cleared areas expected to decrease from 21.9% to 3.8%
  

This means future biological growth is already built into the asset base.

Trees continue growing. Forest quality improves. Timber volume expands.

Time becomes part of value creation.

Latvia’s forest land market has been growing for years

Independent market analysis shows average Latvian forest land prices increased from:

2018 → €1,837 per hectare to 2025 → €3,506 per hectare

Almost 91% growth in 7 years.

Several factors are driving this trend:

• institutional capital entering forestry markets

• pension funds increasing exposure to real assets

• limited supply of quality forest land

• growing demand for productive land assets

Forestry is increasingly viewed as long-term infrastructure rather than only timber production.

Independent valuation confirms management quality

The external assessment also highlighted operational quality indicators:

• forest restoration quality is good

• young forest maintenance is actively performed

• forest conditions match reported portfolio data

Forests require long-term discipline.

Growth comes from management quality, patience, and operational execution.

FF Forest continues building exactly that.

Looking ahead

This valuation represents an important milestone for FF Forest. The independently assessed portfolio built up to February 2026 demonstrated approximately 51% value growth on a per-hectare basis compared to the average acquisition cost.

We want to sincerely thank everyone who has trusted FF Forest and supported the business during this stage of development.

Because FF Forest operates using operational capital, independent portfolio assessments are an important management tool. They help monitor portfolio quality, measure performance, and support long-term planning.

They also help build a foundation for future institutional capital participation.

As a next step, FF Forest expects financing to gradually move toward a larger institutional capital share, as institutional financing can create greater efficiency for long-term business growth. At the same time, retail participants remain an important part of FF Forest. FF Forest was built around the idea of Family and Friends Forest.

While public access may become more limited over time, we plan to continue preserving participation opportunities through invitation-based access and referral mechanisms.

We believe forests are built over decades.

Strong businesses are built the same way.

Thank you for being part of this journey.

Let us continue growing together.

Independent Expert Assessment

The portfolio valuation referenced in this article was prepared by an independent valuation expert:

VCG ekspertu grupa SIA

Kr. Barona iela 31, Riga, LV-1011, Latvia

Registration No. LV40003554692

info@eksperti.lv

+371 67229008

The assessment covered the FF Forest portfolio built up to February 2026.