The Capitalica Baltic Real Estate Fund I, a real estate fund managed by the SBA Group company Capitalica Asset Management, ended the year 2021 while improving all key financial indicators – raised assets, equity, sales revenue and profit. This was achieved due to the fund’s continuous capital management strategy, with a primary focus on changes in the current office lease market and accordingly adopting its operational management solutions.
“Our fund demonstrated sustainable growth during last year. Followed by a high demand for quality business centers, our rental income from office space and conference services increased in 2021. Now, when the second year of the pandemic is over, we can state that Covid-19 did not have a significant impact on the fund’s revenue. We ensured income growth by offering our tenants flexible lease terms depending on the long-term period selection, and by applying the consumer price index in rental rates. Thanks to a preliminary agreement with the contractor, the increase in raw and construction material prices last year did not affect the development of our new business center in Riga”, said Andrius Barštys, CEO of Capitalica Asset Management.
According to the 2021 reporting data in the audited consolidated financial statements of the international audit and consulting company Ernst & Young Baltics, the company increased its consolidated assets to EUR 92.2 million, which is 34.2% more than in the same period last year (EUR 68.7 million). Investment assets grew by 46.6% and amounted to EUR 89.6 million.
Equity capital reached EUR 35.0 million, which is a 20.1% increase in comparison to the end of 2020 (EUR 29.1 million).
During the last year, the consolidated sales of Capitalica Baltic Real Estate Fund I amounted to EUR 5 million, while the consolidated gross profit was EUR 3.7 million. This is respectively 5.5% and 1.5% more than in the same period in 2020.
Last year, the fund recognized EUR 6.3 million valuation gain thanks to the made investments and the increase of their asset’s value. As a result, the uplift of the net profit was more than 3 times and reached EUR 5.8 million. This growth was mainly due to the change in the value of the business centers of Žalgirio 135 and Kauno Dokas – based on an independent valuation of the assets performed by Newsec Valuations.
Currently, the fund manages three commercial real estate properties in Lithuania – office buildings Žalgirio 135 in Vilnius and Kauno Dokas in Kaunas, and the shopping center “Luizė” in Klaipėda. Their occupancy reached 98.6% at the end of 2021.
In Latvia, Capitalica Baltic Real Estate Fund I is developing an A-class office complex Verde. In October 2021, the company issued bonds that amounted to EUR 5 million at a yield of 5.5% for additional funding for the Verde project. Known as the “greenest office complex in Riga”, Verde is in high demand among investors. Its first building will open doors to tenants this summer. More than 60% of office space is already leased out.
“We see a great demand for quality offices in the Baltics market. The opening of the Verde business center in the Latvian capital will support our further growth this year. Verde has already been selected by Swiss telecom service provider and software developer Swisscom, financial technology company Decta, an international provider of professional services KPMG Latvia and other companies operating in the Latvian market. Our success is based on providing sustainable and environmentally friendly solutions, flexible rental conditions and a high-quality working environment for tenants”, assured Andrius Barštys.
The fund invests in the Baltic real estate market and focuses on commercial real estate. It has already completed the active investment and acquisition phase. Once the Verde project is implemented, no further investment is expected in the fund. New real estate acquisitions and developments are planned in the newly established funds.
For more information:
Andrius Barštys,
CEO of Capitalica Asset Management
+370 612 30260
Upės g. 21-1, LT-08128 Vilnius, Lietuva
www.capitalica.lt
Annexes:
consolidated financial report of the CBREFI Fund for the year 2021
