As Harvard expands its presence to the other side of the Charles River, it’s scaling back its investment on the other side of the globe.

The Harvard Management Company (HMC), which steers the school’s $29.2 billion endowment, has sold a minority stake in its 468,000 acre Kaingaroa forest in New Zealand. The buyer is a fund established by the country’s national government to provide for its aging population.

The New Zealand Superannuation Fund will acquire a stake of approximately $200 million from HMC, which has owned the forest estate since December 2003. The government land, initially sold to a group of investors in 1996 for $1.3 billion, was purchased by Harvard for roughly half that amount seven years later. The 1997 Asian financial crisis had put a dent in timber prices, contributing to the investors’ financial woes.

According to the initial purchase agreement, Harvard owns cutting rights in the forest, but the government retains ownership of the land, which is expected to eventually be ceded to Maori Indian tribes. The timber is grown on a managed basis with the express purpose of cutting it down to sell for profit.

“HMC is pleased to have the New Zealand Superannuation Fund join our Kaingaroa partnership,” Harvard spokesman John D. Longbrake wrote in an e-mail.

In a statement, a manager of the New Zealand fund said he was glad to find a business partner with similar goals as Harvard’s.

“As a long term investor, with no requirement for regular cash flows from investments, timber is an attractive asset class for the Fund,” said David May, chairman of the Guardians of New Zealand Superannuation.

The fund manages $10.7 billion in assets, and the country’s government adds over $2 billion a year to the fund’s coffers.

When Harvard initially purchased the forest stake, timber made up roughly 10 percent of the University’s endowment. HMC has reduced its timber holdings in recent years, selling two-thirds of its approximately 1.3 million acre global forest holdings. Before the announcement of yesterday’s sale, Harvard was the second-largest forest owner in New Zealand.

“We think that timber is quite attractive to what other asset classes have to offer,” then-HMC president Jack R. Meyer told The Crimson in 2004, a year before he left Harvard to launch his own hedge fund.

Timber “is also a good diversifier since its returns will not correlate closely with returns from equity markets,” Meyer added at the time.

The majority of the Kaingaroa forest, located in the Central North Island of New Zealand, is made up of radiata pine—generally used for building material. It is considered one of the “premier timber estates in the world,” according to a statement from the fund, pointing to the forest’s impressive growth rate, topography, and proximity to timber mills.

The head of HMC’s timber team, Andy Wiltshire, could not be reached for comment last night.

—Staff writer Cyrus M. Mossavar-Rahmani can be reached at crahmani@fas.harvard.edu.