Estonia, Funds, Good for Business, Real Estate

International Internet Magazine. Baltic States news & analytics Sunday, 09.08.2020, 02:06

EfTEN to buy the property of ABC Motors sales and service centre in Tallinn

BC, Tallinn, 14.12.2018.Print version
EfTEN kolmas OÜ, a subsidiary of EfTEN Real Estate Fund III, has signed a contract with ABC Motors to buy their properties on Paldiski road in Tallinn. ABC Motors will continue the sales and servicing of Renault and Dacia vehicles on the same premises as before, informed EfTEN representative.

Until now, the properties were owned by ABC Vara AS and once the contract goes into effect, EfTEN Real Estate Fund III will lease the purchased properties back to ABC Motors AS. The total area of sales and service centre is 2400 square meters and the overall size of the property is 9008 square meters.

According to Viljar Arakas, member of the board of EfTEN Real Estate Fund III, the centre is very well located, especially for the customers of the car service who don’t need to spend their valuable time on logistics while taking their car to and back from the service. “In addition - almost all space of the compact centre is being used and it has a reliable tenant who has been operating on the premises for over 15 years,” added Arakas.

“As the experience of food stores has shown – our business objective is not to own the real estate, where ABC Group is operating, so we prefer to invest our assets into our core business activities,” said chairman of the supervisory board of ABC Grupp Mart Vips.

The purchase price of the properties is 3 mln euros, VAT excluded. “The net entrance yield is 8%, not considering the bank loan - which is an appropriate level for the fund. We also plan to use up to 65% of loan capital to finance the deal which will further increase the operational return of the equity capital. The transaction size of the deal makes less than 3% of the total assets of the fund,” said Arakas.

The deal goes into effect once it has been approved by Estonian Competition Authority and will be concluded in January 2019.

EfTEN Real Estate Fund III AS is public closed alternative investment fund founded in 2015 by fund manager EfTEN Capital AS, which is listed in Nasdaq Baltic Main List. The fund invests in the commercial real estate in the Baltic States. EfTEN Capital AS is an asset management company, founded in 2008, specializing in commercial real estate investments in the Baltic States. The company is also managing EfTEN Kinnisvarafond AS, EfTEN Kinnisvarafond II AS and EfTEN Real Estate Fund 4. EfTEN Capital group of companies (EfTEN Capital AS with its subsidiaries) manages 43 commercial real estate buildings and more than 1100 tenants. Total market value of the real estate assets under management is above 600 million euros. EfTEN Capital is authorized and regulated by Estonian Financial Supervision Authority.

ABC Motors AS is a subsidiary of ABC Grupp whose core business is the sales of new and used cars, sales of spare parts and servicing the vehicles. ABC Motors AS represents Renault and Dacia trademarks. ABC Motors has been active for 16 years and currently operating with two car centres and one sales site. The sales profit of ABC Motors in 2017 was 40 mln euros, which exceeded the sales profits of the previous year by 14%. In 2017, altogether 2407 new vehicles were sold.


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