In what looks like the second phase of its CEE expansion strategy, the Slovak property company HB Reavis has launched a €165m real estate fund that will focus on assets in the core CE markets. It’s seeding the fund with five of its properties: two Bratislava office blocks, one of its Auparks and a pair of logistics parks. So you get some sector diversification as well, and HB Reavis is throwing in 7 year principal protection for good measure.
It hopes to raise €100m in equity commitments and is estimating it will provide 11% returns (50% of which is to be distributed). Spokesman Roman Karabelli explained the rationale:
We see a post-crises come-back of commercial properties, while the economies of core CE countries are expected to achieve growth above the EU average. We therefore believe the time is right for us to launch a new business line of real estate investment management. Our management company is regulated by the Luxembourg authorities and the management team has experience with management of private equity funds in the UK.