EfTEN Capital acquires part of residential block in Justiniškės from REWO
Estonian investment company EfTEN Capital and real estate developer REWO have agreed on the sale of part of the real estate project TALINO in Justiniškės, Vilnius. The buildings to be constructed during the first phase of the development project, with 145 apartments, will be transferred to the Estonian fund.
“The strategic direction of EfTEN Residential Fund is to develop mid-range or economy class family-friendly modern apartment projects with a well-developed infrastructure, implemented by a reputable developer. The TALINO project met all these criteria, so we are happy that we managed to reach an agreement with REWO,” said Mr Laurynas Žilys, CEO of EfTEN Capital Lietuva, adding that this was the fund’s first, but likely not the last, transaction in Vilnius.
Number of transactions with investment funds to increase in future
Mr Edvinas Malevskis, CEO of REWO, noted that institutional investors have also joined the demand side for rental apartments in Vilnius, and he has no doubt that they will be increasingly active in this market.
“I believe that the high-quality rental fund will creates value for all the residents of the TALINO project. We have been preparing for the entry of such investors into the rental market for several years, and the current transaction is a natural outcome of that preparation. In the next four to six years we will offer approximately 2,500 apartments to the market, 20-25 percent of which should be purchased by this type of buyers,” he said, adding that REWO was also in contact with other institutional investors, and the company’s projects were already attracting attention from them as well as from family offices.
Although the value of the transaction has not been disclosed, Mr Evaldas Klimas, an attorney with Walless who represented REWO, says this is the largest residential property sale to an investment fund in Vilnius so far.
“It’s always pleasant and exciting to work with new products and to develop new practices. In this case, the two professional business partners had a clear commercial objective for which they needed to find a suitable legal form. The market is already seeing the emergence of standard forms and wording for such transactions as well as the distribution of obligations between the partner parties. I have no doubt that such transactions will only increase in number in the future,” Mr Klimas said.
“We have assisted EfTEN in concluding its second rental housing transaction in Lithuania. We are glad that we can apply the experience we have gained to the largest transaction of this type in Vilnius,” said Ms Rūta Radzevičiūtė-Meizeraitė, an attorney at FORT, who represented EfTEN.
High-quality services for tenants
All parties to the transaction agree that the entry of institutional investors into the rental market will primarily benefit tenants. According to Mr Žilys, renting apartments will become simpler and more secure. “We are a landlord focused on the needs of our clients and the continuity of rental agreements; our activities will be transparent, we will provide our tenants with quality property maintenance, smart solutions, and additional services,” the CEO of EfTEN Capital Lietuva added.
The block in Justiniškės at Talino street 9 will be developed in four phases. A total of 447 apartments are planned, ranging in size from 25 to 80 sq m. Construction of the buildings has already started and the first phase, which has already been taken over by EfTEN, is scheduled for completion in Q3 2024.
REWO currently has a number of housing projects in its portfolio in Vilnius: Žygimantų 12, Žvėrynas City, Skvero Namai, Mo Garden, Talino, as well as projects still in the planning stage in Lazdynai and Turniškės.