Banks, Investments, Latvia, Markets and Companies, Real Estate

The company's representatives told a press conference today that the company had bought six properties in total – 15 Kalku Street, 12/14 Kalku Street, 6 Kalku Street, 1 Kungu Street, as well as 2 Kramu Street and 19 Skunu Street.

The total space of these buildings will be 14,000 square meters; it will be rented out to 35 local and foreign tenants.

Baltic RE Group is supported by ABLV Bank, it is planning to bring new brands to Riga and diversify Old Town by making it a more family-friendly place, for both residents and guests of Riga, and a quality shopping area in the very heart of the city.

At the beginning of 2013, real estate fund BPT Secura sold, via the real estate consulting company "Newsec", one of its premium-class properties in Riga, a historic building at 15 Kalku Street, to "Key 15", a subsidiary of the Italian company Baltic RE Group.

In the financial cooperation with ABLV Bank, AS Baltic RE Group has invested and breathed a new life in a number of historic buildings, which in addition were reconstructed according to the wishes of new tenants — the representatives of well-known brands. As a result, the Old Town will become a friendlier environment for Riga residents and its guests who want to have rest and enjoy shopping in the heart of the city.

“We are perfectly aware of how unique the Old Town is. This small area represents somehow not just the heart but also the soul of Riga. In several years of investing here, we always acted with a very clear view: the Old Riga has to be the city landmark, its living room, the place where to be, to walk, to do shopping and to have fun. We invested exclusively in this cluster being firmly convicted that a true “shopping experience” is and more and more will be possible only here: therefore, we know that a huge plan of territorial marketing is going to start at Kaļķu Street, to attract even more clients, young people and families, there and in neighboring streets. So that, in a completely new vision of the retail market, we manage our properties as a shopping center, but spread: thus, it’s possible to significantly reduce the risk and simultaneously achieve for each tenant the benefits of a shared magnet effect. This applied approach is rather new for Latvia; therefore, we are happy to underline that working together with ABLV Bank, we found a partner who really joined the vision, transferring that in a long-term agreement offering high professional standard and flexibility in understanding our needs, that allows us to set up together something really new”, says Giovanni dalla Zonca, CEO at Baltic RE Group AS.

This is not only one of the largest transactions in the Latvian commercial real estate market, but also unique in its essence. The so-called “high street retail” — real estate business for retail is difficult to assess, it requires in-depth expertise, evaluation of various factors and close cooperation of both parties. ABLV Bank could evaluate long-term potentials of the client’s business and provide adequate bespoke financing services which collateral consists of the portfolio of six real estate objects, located at the very central streets of the Old Riga, with a total leasable area of 14 000 m² and the cash flow ensured by more than 35 primary local and foreign tenants.  

“This concluded portfolio credit transaction perfectly illustrates our bank’s attitude and values. We do not just render high quality standard services, but having thoroughly examined the client’s business, understanding the client’s needs, we offer individually tailored solutions that are the most appropriate for a particular client. Offering “the value within” based on our experience and intuitive understanding of the client’s business and plans, having gained his trust; we literally become a long-term business partner for the client.  The cooperation with AS Baltic RE Group is double important for us as we share common values with our client and the vision of Riga as diversely developed and an active regional centre. We are convinced that AS Baltic RE Group will achieve their goals, and we are proud that the company's executives as their financial partners chose ABLV Bank”, says Oļegs Fiļs, ABLV Bank Chairman of the Council. On behalf of ABLV Bank, Oļegs Fiļs presented Baltic RE Group a sculpture created by Dainis Pundurs from the collection “Medus mānija” (Honey mania) that will further decorate the building at 15 Kaļķu street in Riga, owned by Baltic RE Group.

As an important aspect of this collaboration, AS Baltic RE Group and ABLV Bank (through ABLV Charitable Foundation) cooperate together in supporting the activities of the association “Kalku & Sides”, established by retailers and landlords of the Old Town to improve and popularize the image of Kaļķu street and its adjacent territory, attracting new stores and offering new activities, bringing back to this area the importance it deserves and helping to make it the most attractive place for citizens and families of Riga.

Henriks Danusevics, President, Merchants Association, pointed out to LETA that revamping Old Town's Kalku Street as A shopping strip closed to traffic cannot be justified because the street and its surroundings are packed with bars and restaurants not shops.

"I see no foundation for such a project; [the location] is a party place, not a shopping street. This proposal, instead of short Kalku Street, would be more suitable for wide and long Barona Street. Kalku Street is for sightseeing, not to be jam packed with stores," said Danusevics.

He added that the project's developers could inadvertently repeat "Stockholm's mistake". That is, shops instead of bars and bistros killed nightlife in downtown Stockholm – a regretful decision by city officials.