Category Archives: investment

Plaza Centers sells “Prague 3”

Well now, this is interesting:

“Plaza Centers announces it has successfully completed the sale of 100% of its interest in a vehicle which holds the interest in the Prague 3 project (“Prague 3”), a logistics and commercial center in the third district of Prague. Earlier this year, Plaza completed its successful application to change the zoning use of Prague 3 to a residential scheme. The transaction values the asset at circa €11 million and, as a result, further to related bank financing and other balance sheet adjustments, Plaza has received cash proceeds of net circa €7.5 million.

Ran Shtarkman, President and CEO of Plaza Centers N.V., said:
“Less than two months after our first exit in India, we are pleased to announce the sale of our holding in Prague 3 in the Czech Republic. The sale is in line with our strategy and disposal programme of deleveraging and reallocating realised capital from stabilised completed projects and non-core assets to the core yielding assets across our portfolio.”

Vitek also making Ablon gains

We missed this little piece of news from the beginning of the week. It seems Mr Vitek is making quite the property play this year. Along with a suspected fight for control of Orco, the Czech billionaire increased his holding in the developer Ablon near the beginning of the month to 15.52%, before taking an even bigger slice:

ABLON Group Limited (“ABLON” or the “Company”), a leading real estate owner and developer in Central Europe, was informed today that Mr. Radovan Vítek, a Czeck national private person, owner of CPI Group, has increased his total holding in ABLON from 21,250,954 or 15.52% of the issued share capital, to 30,443,938 shares, equalling 22.23% of the issued shares and voting rights in the Company.

Ablon is holding an extraordinary general meeting on February 1st.

Hints of change?

Is the Basel effect finally kicking in?

After talking quite with a variety of people around the region, it certainly seems as if there’s a shift afoot. It’s become so fashionable to talk about banks doing The Ostrich over the past few years, that it would be easy to miss the signs of a changing market place.

In fact, whether it’s the Basel III effect, the cumulative effect of loans coming up for renewal or the realization that holding on to real estate assets eventually requires capital expenses, the big freeze seems to be thawing just a bit. There are lots of signs of this, whether you look at the appointment pages, the creation of new funds, the collection of equity for debt funds or the willingness of banks to call it a day with some sponsors.

It’s still but a fraction of what it was, and the geniuses in Brussels look no closer to making any hard decisions. But as we’ll be discussing in the September issue of CIJ, there does appear to be a greater willingness, at last, to start just getting on with it. If you disagree violently, make sure to let us know.

Warsaw Financial Center sold to Allianz and Curzon Capital Partners III

It’s tough to think of many more important transactions that could take place in Central Europe than one involving the Warsaw Financial Center. And that’s exactly what was announced today, with co-owners CA Immo and Pramerica Real Estate Investors agreeing provisionally to selling the asset to Allianz and Curzon Capital Partners III, a fund managed by Tristan Capital. JLL and Colliers advised the vendors on the deal, who acquired the building originally in 2005. The two held 50% shares each in the 50,000 sqm asset, but in the new arrangement, Allianz will hold 87.5%. The sale price was announced to have been €210m.

“Our investment strategy calls for 7-10 % of the overall portfolio to be sold every year in order to take maximum advantage of positive market phases and generate profits,” says  Bruno Ettenauer, Chief Executive Officer of CA Immo. “Capital released in this way is earmarked for debt reduction and the realisation of current development projects. We are looking forward to the successful sale of the Warsaw Financial Center, which has now been agreed. This transaction will have a significantly positive impact on the annual result for 2012.”

Papalekas and Dragos snap up Tower Center

According to ZF, the Tower Center on Victoria Square in Bucharest has been snapped up by Ioannis Papalekas and Bîlteanu Dragos, two of the strongest real estate investors in the local market. The two don’t tend to be excessively forthcoming about the deals they do, so it’s not a surprise that the pricing details haven’t surfaced yet. But they’re unlikely to have paid what the developers, Industrialexport and Avrig 35, originally envisioned, as ZF claims the building has no tenants yet. With its 22 floors and a height of 106 meters, it’s described as the tallest completed office tower in town since the doors opened in 2008.

HB Reavis acquires Metronom

CBRE has helped a private Austrian group dispose of the Prague 13 office project Metronom. The 34,000 sqm office project has been waiting to happen for at least a decade, but somehow never got built. That’s surprising, on the face of it, considering it sits right on top of the Nove Butovice metro station and across from a shopping mall (granted, not exactly the most successful one ever).

The owners, originally connected in some fashion with Doughty Hanson (which also used to own the Nove Butovice Business Park)  seem to have decided the current development environment didn’t suit them and sold it to a company (i.e. HB Reavis) better suited to the times. Originally, the project was being sold along with a 20,000 sqm residential component, but the owners were advised to split the plot into two separate investment packages to increase the final price (and probably its sell-ability). The residential portion could end up being sold soon as well, as it happens.

“I wouldn’t say it’s the best time to sell such projects,” says one market observer. “But it’s a good time to buy. A lot of companies are coming under pressure from the banks, so they have to sell. They’re not selling for the price they wanted to achieve, but the price that the market is telling them.”

This should be music to the ears of agents everywhere, but they’re hoping someone will turn up the volume a bit higher…

Der Spiegel: Investors search for alternatives

It’s the same old story in Der Spiegel, but it’s really the story: big funds with tons of cash can’t figure out where to invest. The answer for some of them is emerging market real estate. Though by that, they no longer mean CEE. Maybe some of our readers have suggestions for these guys.

As head of the Norwegian sovereign-wealth fund, Slyngstad collects his country’s oil revenues, which currently total more than €100 million — per day. The fund is supposed to use these revenues to provide the country with prosperity for the long term. It’s no easy task, because the government expects Slyngstad and his staff of more than 300 people to generate a 4 percent return on investment.

In the past, investment professionals would have dismissed this requirement as uninspiring. But times have changed. Between 1999 and 2007, the Norwegian sovereign-wealth fund achieved an average annual return of almost 6 percent, but since then it has slumped to only about 1 percent.

Read the whole story here.