The closed-end investment company INVL Baltic Real Estate (hereinafter may be referred to as the Company) gives notification that, after negotiations were renewed, on 6 March 2020 a real estate sale transaction was completed with the subsidiary companies Juozapavičiaus 6 UAB and Ateira UAB of the closed-end investment fund for informed investors Lords LB Baltic Green Fund (V), which is managed by Lords LB Asset Management UAB, regarding the sale of the IBC Business Centre on A. Juozapavičiaus and Šeimyniškių streets in Vilnius which the Company owns. Also sold was real estate at the address Kalvarijų Street 11a belonging to the INVL Baltic Real Estate company Rovelija.
The value of the transaction is EUR 33 million. It is assessed that its impact on INVL Baltic Real Estate’s 2019 profit will be EUR 7.6 million and its impact on the company’s net asset value (NAV) per share will be EUR 0.58. At the end of September 2019, INVL Baltic Real Estate’s NAV per share was EUR 2.72. The proceeds of the transaction will be used for pay-outs to shareholders and to reduce outstanding loans of the Company.
The transaction for the sale of part of the Company’s real estate portfolio has no impact on the rights and/or duties of the shareholders of the Company or on the Company’s operations.
Additional information:
The real estate investment company INVL Baltic Real Estate sold the IBC Business Centre in Vilnius for EUR 33 million; companies owned by the Lords LB Baltic Green Fund (V) investment fund acquired the property. Proceeds from the transaction will be used for pay-outs to shareholders of INVL Baltic Real Estate and to reduce loans.
The transaction was completed on 6 March. It is assessed that its impact on INVL Baltic Real Estate’s 2019 profit will be EUR 7.6 million and its impact on the company’s net asset value (NAV) per share will be EUR 0.58. At the end of September 2019, INVL Baltic Real Estate’s NAV per share was EUR 2.72.
“We’re pleased to have successfully closed this deal and increased INVL Baltic Real Estate’s share value. In competing with other exchange-listed real estate funds, we give priority not to the size of assets managed but to the return earned for investors, seeking to take advantage of the opportunities that arise in the market and the potential of the assets held,” said Vytautas Bakšinskas, the real estate fund manager at INVL Asset Management, which manages INVL Baltic Real Estate.
He noted that for the last several years, from the spring 2016 completion of a public share offering to the end of 2019, the company has earned investors a high 18% average annual return.
“Those results are due both to our professional team and our long groundwork in the area of commercial real estate. We strive to create long-term value for investors not just by managing assets effectively –in this period we developed part of the Vilnius Gates complex we own and have worked steadily with other properties– but also by implementing other original and relevant projects, like creation of the Talent Garden Vilnius coworking space. Considering further prospects, we’re ready to take advantage of opportunities that arise in the market in specific properties or transactions, and so expand the real estate management business,” Vytautas Bakšinskas said.
The IBC Business Centre on A. Juozapavičiaus and Šeimyniškių streets in the Lithuanian capital has a gross floor area of 22,700 sq. m. and a leasable area of 17,600 sq. m. Its occupancy level at the end of 2019 was 97%. Also sold during the transaction was the building of the company Rovelija, which INVL Baltic Real Estate owns, at Kalvarijų Street 11a, which has a gross area of 276 sq. m.
The transaction has an impact on 2019 profit and net asset value, and in INVL Baltic Real Estate’s balance sheet as at the end of 2019, the properties sold in the transaction will be valued at the transaction price, as required by accounting standards.
INVL Baltic Real Estate’s portfolio of real estate holdings without the IBC Business Centre includes properties in Vilnius and Riga: office and commercial premises at the Vilnius Gates complex in the Lithuanian capital, office buildings in the Old Town on Vilniaus Street and in Šiaurės Miestelis, and the Dommo Business Park manufacturing, warehouse and office complex beside the Riga bypass. Occupancy levels at the company’s properties at the end of September 2019 ranged from 67% to 100%. As of 30 September 2019, INVL Baltic Real Estate’s property holdings had a total area of 56 900 sq. m. and a value of EUR 60.5 million.
“We’re steadily developing alternative investments and striving to create value for investors. In February we held the final close of the largest private equity fund in the Baltic region, the INVL Baltic Sea Growth Fund, where investors entrusted us with EUR 165 million. Meanwhile, in other products we’re demonstrating ability to not just raise but also return capital – in December last year we sold a portfolio of quality forest, generating an average annual rate of return of 27%. This transaction for sale of the IBC Business Centre will also contribute to increasing the value of INVL Baltic Real Estate’s shares,” said Vytautas Plunksnis, the head of private equity at INVL Asset Management.
Since 22 December 2016, INVL Baltic Real Estate has operated as a closed-end investment company. Management of the company was assumed by INVL Asset Management, one of Lithuania’s leading asset management firms. The company will operate as a closed-end investment company until 2046, with extension possible for another 20 years.
The person authorized to provide additional information: Real Estate Fund Manager of the Management Company Vytautas Bakšinskas E-mail vytautas.baksinskas@invl.com
The Canada Mortgage and Housing Corp. says construction of new homes in Canada’s six largest cities rose four per cent year-over-year during the first half of 2024, but housing starts were still not enough to meet growing demand.
The agency says growth in housing starts was driven by significant gains in Calgary, Edmonton and Montreal.
A total of 68,639 units began construction, the second strongest figure since 1990, however the rate of housing starts per capita meant activity was around the historical average and not enough “to reduce the existing supply gap and improve affordability for Canadians.”
The report says new home construction trends varied significantly across the markets studied, as Toronto, Vancouver and Ottawa saw declines ranging from 10 to 20 per cent from the same period last year.
Apartment starts in the six regions increased slightly, driven by construction of new units for rent, as nearly half of the apartments started in the first half of 2024 were purpose-built rentals.
But condominium apartment starts fell in the first six months of the year in most cities, a trend which the agency predicts will continue amid soft demand as developers struggle to reach minimum pre-construction sales required.
This report by The Canadian Press was first published Sept. 26, 2024.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.