EfTEN Kinnisvarafond news
EfTEN Real Estate Fund earned EUR 1.3 million in profits in the first half of 2011
EfTEN Real Estate Fund managed by asset management company EfTEN Capital earned in the first half of 2011 EUR 1.319 million in net profit, the fund’s annual sales revenue increased by 1.7 times.
According to Viljar Arakas, the fund manager of EfTEN Real Estate Fund, the fund´s performance was as expected. “As a real estate fund founded during the market downturn, we have kept the conservative approach and valued the quality of the objects above all other factors. We have trusted the views of our tenants and this cooperation has been successful on both sides,” said Arakas.
The weighted average net entrance yield has been 9.54 percent and after the semiannual revaluation the current portfolio net yield is 8.9 percent. The size of the fund as of the first half of 2011 is EUR 28.5 million and the share net asset value has increased 2.3 times after the establishment of the fund in 2008.
According to Arakas EfTEN Real Estate Fund has shown the best performance among the real estate funds in the Baltic States. “At any given time we have always preferred quality over quantity. Considering the cooling of global economy and international concerns towards the European banking sector it would be naïve to assume, that our small and open economy will be left untouched. It will definitely have an effect on Estonian real estate sector. When the yield levels in Estonian commercial real estate sector have descended to 200-250 base points compared to 2009, it can be presumed that in the best case scenario the yields will stay the same or in case of the negative scenario rise by 50-150 base points from current levels. Therefore, our conservative business strategy has proven itself right. We have preferred cash flow over the speculative asset value growth, “said Arakas.
EfTEN Real Estate Fund holds eight real estate investments and one real estate development project in Viljandi, where the fund is planning to build a commercial center covering 7000 square meters.
According to the investment capacity and transactions done, EfTEN Real Estate Fund is one of the most active market participants. Arakas says the company will continue to invest into quality real estate.
EfTEN Kinnisvarafond AS is a real estate fund founded in 2008, which invests in cash flow generating commercial property. The fund’s commercial real estate portfolio holds Lõkke 4, A. Lauteri 5, Narva road 59 office buildings in Tallinn and Premia Foods cold storage warehouse in Tallinn, Ülikooli 6A in Tartu city center and K-Rauta store in Võru, but also Lepa Commercial Center in Pärnu and Rakvere Police and Rescue Department building.