The domestic Arete group is launching its third real estate fund. It is planning the purchase of warehousing space and industrial halls in both the Czech Republic and throughout Central and Eastern Europe. It will also be launching its own developer projects for the first time. The portfolio target value should approach CZK 12 billion.
“In spite of the slowing of industrial growth in the Czech Republic and the short-term volatility of the stock markets, the overall economic situation in Central Europe is conducive to the further development of logistics and manufacturing. Hence the investment strategy underpinning our new fund once again focuses precisely in this direction,” stated Arete co-founder Robert Ides.
The new fund will be targeted at private and institutional investors. The minimum investment is to be EUR 200 000 (CZK 5 000 000). The first investors have already placed tens of millions of euros into the fund. Arete is also anticipating the use of bank loans of approximately the same amount as the total volume of own funds.
Specialists in commercial real estate say that the new fund’s strategy and focus make sense. “The market has sufficient reserves of both capital and demand from both foreign and domestic investors for this type of real estate. If we leave aside the acquisition of any already existing larger portfolio, the indicated volume can only be invested in several countries at once, and so the focus on the Central and Eastern Europe region is a logical one,” commented Alexander Rafajlovič of the investment team at the consultants Cushman & Wakefield.
The new fund plans with a six-year investment cycle. Its ambition is to accumulate 600 000 square metres of halls for leasing and 300 000 square metres of land for further construction. Arete’s Ides anticipates the completion of the initial acquisitions this summer.
“Considering last year’s construction of almost four million square metres in the Central and Eastern Europe region, the ambition of 600 000 square metres is definitely possible,” said Ferdinand Hlobil, responsible for international industrial transactions at Cushman & Wakefield.
The investment cycle for the second fund is currently coming to an end in the Arete group. It has appreciated investors’ capital by 90 percent since its opening in 2016. This second fund manages 125 000 metres of leasable space in the Czech Republic and Slovak Republic, including the international logistics headquarters of the C&A clothing chain.
According to information on the E15.cz server, Arete is currently finalising negotiations for the sale of this portfolio to the American investment giant CBRE Global Investors. Neither Arete nor CBRE GI have commented on this information.
The industrial real estate market is very active. The German Garbe Industrial Real Estate has announced its entry into the Central and Eastern Europe market. This company has constructed halls for Amazon in Germany, for example. Star Capital is one of the new Czech players to begin constructing industrial halls.
More at https://www.e15.cz/byznys/reality-a-stavebnictvi/novy-fond-realitni-skupiny-arete-bude-nakupovat-a-stavet-sklady-za-miliardy-1367431
