EfTEN Kinnisvarafond news
EfTEN Real Estate Fund six-month sales revenue increased by 53%
According to the unaudited preliminary 2014 half year results the sales revenue of EfTEN Real Estate Fund, managed by fund manager EfTEN Capital, amounted to 6.448 million euros, increasing by 53% compared to last year.
The fund’s EBITDA for the first six months of the year was 5.4 million euros (2013: 3.4 million euros), an increase of 62% in year on year comparison. The consolidated net profit totalled 7.49 million euros, more than double when compared to the first six months of the previous year. This significant increase in net profit was due to an increase in the fair value of investment properties in total of 4.6 million euros, which was related to the falling yield levels in the Baltic commercial real estate market during the first six months of 2014. The total value of investment properties increased by 3.2% compared to the end of 2013. Colliers International undertook the valuation of the real estate portfolio. The current net yield of EfTEN Real Estate Fund investment portfolio is 8.2%. On the expenses side the fund manager success fee liability reserve, which is dependent on the increase of real estate investment value, increased by 917,000 euros (2013: 19,000 euros). In addition, the fund accounted an income tax on the dividends in the amount of 844,000 euros (2013: 354,000 euros).
According to the CEO of EfTEN Real Estate Fund, Viljar Arakas, the first six months of the year were active for the company: the two most important events were the re-opening of a completely renovated hotel Palace on Freedom Square in Tallinn and an acquisition of a DHL and Onninen logistics and production complex in Betooni Street in Tallinn. On 25 July 2014 a shopping centre called RAF Centrs will be opened in Jelgava being the first shopping centre developed by EfTEN Capital in Latvia.
After the first six months of the year the value of total assets of the fund reached 181.7 million euros, with an annual growth of over 62 million euros. The 12-month return on equity stood at 26.5%. The fund’s equity forms 46.4% of total assets and amounts to 84.4 million euros.
Arakas added that as EfTEN Kinnisvarafond has by now invested all of its paid-in equity, the fund plans to carry out an additional share emission this autumn to finance further growth. In the current real estate cycle we plan to focus mainly on investments requiring additional development or redesign and to expand geographically within the Baltic States.
Please find the portfolio valuation report as of June 2014, here: Portfolio valuation report, June 2014