Baltic, Estonia, Investments, Real Estate

The fund's total volume of assets was 39.6 million euros and return on invested capital 11.2%.

The fund started its operations by conducting a public offering of shares in Estonia in July 2015. Altogether 160 investors participated in the IPO. The fund made its first investment in August 2015 by acquiring the Saules Miestas shopping center in Siauliai, Lithuania from E.L.L Kinnisvara. In December 2015 the fund made its second acquisition in Lithuania by acquiring the Ulonu office building in Vilnius.

The fund's return indicators are modest because the fund received a cash flow only during five months in 2015. The fund invested almost all of the equity raised during the public offering in the two facilities in Lithuania. The second share issue is planned for the end of March or the beginning of April 2016. The fund pursues a value-dded and opportunistic investment strategy.

"Fund managers are certainly pleased with the financial results of each of our fund last year. The current conservative investment policy, good mix of assets and the extremely favorable interest rate environment has ensured a good commercial performance of the funds," Viljar Arakas, Eften Capital CEO, said speaking of the performance of Eften's funds in 2015. "Given the rapid post-crisis recovery of real estate prices, we will not make any predictions as regards the pace of investments; we will proceed abiding by our successful conservative investment principles."

Eften Kinnisvarafond II, set up in January 2015, finished the first year of operation with a profit of three million euros. Its total asset volume was 77 million euros and return on invested capital 11.4%. The fund acquired the Radisson Blu Sky Hotel, the adjacent office building and the former Madisson pub in January 2015. In December 2015 the fund acquired a building at Duntes 6, Riga. The financial results of 2015 predominantly consist of the financial results of the hotel because the Duntes office building was acquired in the final month of the year.  

The fund holds 100% of the shares of the hotel operating company and the hotel's performance results are consolidated in the fund's balance sheet. Eften Kinnisvarafond II is mainly targeted at institutional investors and is a core and core plus investment strategy based real estate fund. Of the fund's assets 66% are invested in Estonia and 34% in Latvia.

Eften Kinnisvarafond AS earned a net profit of 12 million euros last year, 21% less than in 2014. The fund's financial results were in line with the expectations of the management board. Without asset revaluations, the fund's net profit increased by 16% in 2015.

Assets of the fund totaled 214.7 million euros and sales revenue was up 14.5% at 16.5 million euros. Net asset value grew by 6.3% during the year. Eften said the modest increase in NAV is due to the dividend payments made in the amount of 6.3 million euros inclusive of corporate income tax. Return on invested capital was 19.7%.

After the end of the investment period, the fund will go on managing its existing investments and will continue making exits from smaller investments. The fund focuses on larger assets having per unit value in excess of five million euros. Of the fund's assets 77% are invested in Estonia, 20% in Latvia and 3% in Lithuania.