Summary Update. Contents

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1 Contents Summary Update Timber Prices Product Prices Timberland Markets International Update Economic News The FIA Quarterly Dashboard Summary Update Timber and Product Prices Lumber and panel prices continue to perform positively despite uninspiring housing starts over the quarter. The reported composite panel price reached 13-year highs. In the Northeast, overseas demand for black cherry lumber has increased while domestic demand recovers slowly. Pacific Northwest markets continue their multi-quarter advance, as demand from both domestic and international sources persists. Solid wood markets in the Southeast remain below expectations. August housing starts dipped slightly to a seasonally adjusted annual rate of million units. This rate was 0.8% below the revised July rate of million units, but 1.4% above the August 2016 rate of million units. The average interest rate for 30-year fixed rate mortgages declined for the second straight quarter, falling from 3.97 in July to 3.81 in September. Timberland Markets The headline deal of the third quarter was Roseburg s announcement that it had purchased 158,000 acres in North Carolina and Virginia from Forest Investment Associates. The transaction marks Roseburg s first land purchase in the US South. Forest Investment Associates 15 Piedmont Center Suite 1250 Atlanta, Georgia Other large transactions included two purchases by Hancock. The first was a 48,500-acre acquisition in Oregon from a private seller for approximately $93.3 million and the second was a 79,500-acre purchase in Wisconsin from Lyme Timber for a reported $46.2 million. TEL: FAX: Forest Investment Associates 1 3 rd Quarter 2017

2 Sawtimber and Chip-n-Saw ($/ton) Timber Prices Southeastern Over the third quarter, prices for benchmark pine and hardwood species increased. Forest2Market reported a small 0.3% increase in pine sawtimber, ending the quarter 7.8% below year-ago levels. Pine chip-n-saw regained last quarter s losses, rising 6.5% over the quarter while pine pulpwood prices spiked 13.0%. Hardwood markets strengthened over the quarter, which led to a 2.2% increase in hardwood sawtimber and a 12.3% increase in hardwood pulpwood. Hurricanes Harvey and Irma continue to have lasting effects on specific local timber markets. Select mill closures and outages occurred in the immediate aftermath of the storms. The most direct impact on stumpage prices may be seen in the pine pole markets, as demand for utility poles has increased. Southeastern Timber Prices $35 $13 $30 $25 $20 Pine Pulpwood Hardwood Pulpwood Pine Sawtimber Hardwood Sawtimber $11 $9 $7 Pulpwood ($/ton) $15 Chip-n-Saw 3Q16 4Q16 1Q17 2Q17 3Q17 $5 Source: Forest2Market Northern Hardwoods Mirroring last quarter, hardwood markets continued their strong run in the third quarter. The driving force continues to be hardwood lumber and log exports as domestic hardwood consumption continues its slow progress despite lackluster improvement in new home construction and remodeling. According to the Pennsylvania Woodlands Timber Market Report, black cherry prices improved 14.9% during the second quarter (the most recent publicly reported pricing), ending 14.7% ahead of year-ago levels. Northern red oak prices increased 10.3% last quarter, finishing 15.3% above year-ago prices. Hard maple prices improved 21.4% over the quarter, ending down 4.3% yearover-year. Soft maple prices improved slightly, rising 3.2%, ending the quarter 18.9% above last year s level. In Wisconsin, hard maple sawtimber and veneer demand has started its traditional fall upswing resulting in improved pricing. Sawmills are poised to increase log inventories as most never really recovered from low inventories caused by an unusually wet summer. There is steady demand for ash, birch, and basswood. Pulpwood markets are stable to slightly increasing. Forest Investment Associates 2 3 rd Quarter 2017

3 Douglas-Fir, Sawmill #2 ($/MBF) Red Oak, W. Ash, Maples ($/MBF Doyle) Northeastern Hardwood Timber Prices N. Red Oak $800 Hard Maple Soft Maple $400 White Ash Black Cherry $300 $200 2Q16 3Q16 4Q16 1Q17 2Q17 Source: Pennsylvania Woodlands Timber Market Report - Northwest Region $1,500 $1,400 $1,300 $1,200 $1,100 $1,000 Black Cherry ( $/MBF Doyle) Pacific Northwest Pacific Northwest (PNW) timber markets continued to advance over the quarter, reaching regional average price levels not seen since According to Log Lines, Pacific Northwest average delivered prices for Douglas-fir #2 logs grew 7.4% over the third quarter, ending the quarter 15.8% over year-ago levels. Whitewoods (i.e., true firs and hemlock) average delivered log prices improved 9.9%, and ended the quarter 19.3% ahead of year-ago levels. Domestic delivered prices remain very high in most areas as both increased competition and low domestic inventories continue to enhance markets. Export competition continues to drive prices higher in market areas within reach of ports. $750 Pacific Northwest Log Prices Douglas-Fir, Sawmill #2 Whitewoods Whitewoods ( $/MBF) Source: Log Lines Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 $450 Forest Investment Associates 3 3 rd Quarter 2017

4 NBSK, Freesheet, Boxboard Composite Price Indices Product Prices Lumber and Panels Lumber and panel prices performed well over the quarter. Specifically, panel prices reached levels not seen since early The Random Lengths Framing Lumber Composite Price surged 9.8% over the third quarter and exceeded last year s level by 22.5%. The Structural Panel Composite Price increased 25.7% over the quarter, ending a massive 37.9% ahead of yearago levels. Lumber and Panel Prices $450 $400 Structural Panel Composite Price $350 $300 Framing Lumber Composite Price $250 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Source: Random Lengths Pulp and Paper The benchmark NBSK (northern bleached softwood kraft) pulp price index increased 2.7% over the third quarter, its third consecutive quarterly increase, ending the quarter 13.6% over year-ago levels. U.S. Newsprint (30 lb.) remained unchanged over the quarter, matching levels seen in the third quarter of Uncoated freesheet (20 lb.) and boxboard prices experienced no change over the quarter. Pulp and Paper Prices ($/short ton) $1,200 $750 $1,100 $1,000 Newsprint $800 Sep-16 Oct-16 Nov-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Aug-17 Sep-17 US NBSK Index Uncoated Freesheet (20 lb repro) Bleached Kraft Boxboard -SBS (C1S) U.S. Newsprint (30 lb) EAST Source: FOEX Indexes, Ltd., RISI Pulp & Paper Week Forest Investment Associates 4 3 rd Quarter 2017

5 Timberland Markets Transactions In the South, Roseburg closed on a 158,000-acre package of high quality plantations in Virginia and North Carolina from Forest Investment Associates (FIA) for an undisclosed price. The deal marks Roseburg s entry into the US South, adding to its existing Pacific Northwest holdings. In the Northeast, Hancock (HTRG) purchased 79,500 acres in Wisconsin from Lyme for a reported $46.2 million. In Maine, FIA sold a 62,000-acre package to a private buyer for $27.5 million. The Forestland Group completed its sale of 23,000 acres in New York and Vermont to The Conservation Fund for approximately $25 million. In the Pacific Northwest, HTRG purchased 48,500 acres in dry-side Oregon from a private seller for approximately $93.3 million. In Washington, HTRG sold a 14,700-acre package to a private buyer for a reported $28.3 million. Transactions in Progress The largest offering currently on the market is a 1.1- million-acre package known as Caddo in east Texas from Campbell Global. Investment banker Perella Weinberg took third quarter bids on the massive property, held by CalPERS. There are many rumors swirling about the potential buyer(s) and transaction price, but investors continue to wait for final details. Also in the South, BTG Pactual is taking fourth quarter bids on a 155,000-acre package in Alabama, Mississippi, and Tennessee. Molpus is also taking fourth quarter bids on a multi-state property in the Southeast totaling approximately 46,000 acres. In the Northwest, HTRG is marketing approximately 33,000 acres in Washington with bids expected in the fourth quarter. Deal flow has continued to pick up throughout 2017, and if the Caddo package in Texas closes successfully, total domestic transaction value should top $2 billion. This falls within the run-rate range of transaction value for a given year, although the makeup of 2017 transactions has been anything but normal. There have been very few transactions this year, with a few large deals dominating the market. REITs and private buyers have dominated the market in 2017, and have been more competitive on these larger transactions in the South. Forest Investment Associates 5 3 rd Quarter 2017

6 International Update General International timber markets continue to remain stable; however, weakness has infiltrated the New Zealand log market reaching 2017 lows. Despite this softening, log prices are still at attractive levels from a historical perspective. Export log volume out of Australia moderated although still maintain the historically strong levels while prices are flat to slightly up on a year over year basis albeit at strong levels. In Chile, Arauco, the country s largest forest products company (controlled by Empresas Copec S.A.) announced two important investment projects for its Valdivia industrial facilities. The first, a $185 million project to convert its Valdivia pulp mill to textile pulp. The second, a $151 million investment to double the production capacity of its Valdivia sawmill through modernization of the existing lines as well as the addition of a new line. In Brazil, after losing the bid process to acquire Eldorado, Arauco acquired Masisa s Brazilian operation for $103 million making Empresas Copec S.A. the second largest global panel manufacture. As reported last quarter, the J&F Investimentos-controlled Eldorado pulp mill in Três Lagoas, Mato Grosso do Sul will likely be sold in the near-term; however, a dark horse bidder emerged. Paper Excellence, an entity controlled by the owners of Indonesia s Asia Pulp & Paper Co Ltd., won the competitive bidding process and will close the transaction within the next 12 months. Unrelated but in the same market area, Fibria s Horizonte II pulp line (1.75 million tons per year) is operational and in ramp-up mode. Despite this supply increase global BEK prices were adjusted in +$30 per ton as of Oct/1st, being the 9th consecutive increase this year. Forest Investment Associates 6 3 rd Quarter 2017

7 Economic News Housing Housing starts in August came in at a seasonally adjusted annual rate of 1.18 million. Starts slid 0.8% from a revised July estimate of 1.19 million. Mortgage Rates As of the end of the quarter, the 30-year fixed-rate mortgage averaged around 3.8%. This compares to 3.42% a year ago. Jobs The September jobs report showed a loss of 33,000 jobs, vs. an expected gain of 90,000. Presumably a result of hurricanes Irma and Harvey. The unemployment rate dropped to 4.2%. Consumer Confidence Consumer confidence in the U.S. fell slightly in September, hurt in part by hurricanes Irma and Harvey, but most Americans remain quite optimistic about the economy. The consumer-confidence index slipped to from a revised in August. Inflation August update of the consumer price index (CPI) showed that for the fourth month in a row, headline CPI inflation was below 2%, the Fed s target. Core inflation, often considered a more reliable measure of the trend, held below 2% for a fifth month. Trade Deficit The trade deficit narrowed to $42.4 billion in August, down $1.2 billion from July. Exports for the month were $195.3 billion, while imports came to $237.7 billion. Rising exports and falling imports shrank the United States trade deficit in goods and services to the lowest level in nearly a year. Interest Rates Rates on the 10-year note ended the quarter around 2.3%. Oil Prices Oil prices moved between $40 and $53 per barrel over the quarter, settling around $50 as of the end of the quarter. U.S. Dollar The DXY dollar index declined for the third straight quarter, its longest quarterly losing streak since the financial crisis. The dollar index, a measure of the buck against a basket of six global peers, fell 2.7% in the third quarter to about 93. Forest Investment Associates 7 3 rd Quarter 2017

8 Douglas-Fir, Sawmill #2 - $/MBF NBSK, Freesheet, Boxboard ($/Short Ton) Sawtimber and Chip-n-Saw ($/ton) N. Red Oak, W. Ash, Maples ($/MBF) The FIA Timber Economics Quarterly Dashboard Southeastern Timber Prices Northeastern Hardwood Timber Prices $35 $15 $1,800 $30 $25 $20 $15 Pine Sawtimber Hardwood Sawtimber Pine Pulpwood Chip-n-Saw Hardwood Pulpwood $13 $11 $9 $7 Pulpwood ($/ton) $800 $400 $300 N. Red Oak Hard Maple Soft Maple White Ash $1,650 $1,500 $1,350 $1,200 $1,050 Black Cherry ($/MBF) $10 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 $5 $200 Black Cherry 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 Source: Forest2Market Source: Pennsylvania Woodlands Timber Market Report - Northwest Region Pacific Northwest Timber Prices Pulp and Paper $750 $1,200 $750 Douglas-Fir, Sawmill #2 Whitewoods $450 Whitewoods - $/MBF $1,100 $1,000 Newsprint ($/Short Ton) Source: Log Lines 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 $400 $800 Sep-14 Dec-14 Apr-15 Jul-15 Oct-15 Jan-16 May-16 Aug-16 Nov-16 Feb-17 May-17 Sep-17 Source: FOEX Indexes, Ltd., RISI Pulp & Paper Week Forest Investment Associates rd Quarter 2017

9 Index (1982 = 100) 000's in thousands The FIA Timber Economics Quarterly Dashboard Housing Starts 30 yr. Mortgage % % % 600 4% 400 Aug-12 Feb-13 Aug-13 Feb-14 Aug-14 Feb-15 Aug-15 Feb-16 Aug-16 Feb-17 Aug-17 3% Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Source: NAHB.org Source: The Federal Reserve Lumber Inflation (CPI) $260 $240 $220 $200 $180 $160 $ % 2.0% 1.0% 0.0% -1.0% -2.0% -3.0% -4.0% $120 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Source: U.S. Department of Labor, Bureau of Labor Statistics -5.0% Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Source: Forest Investment Associates rd Quarter 2017