The audited results of Arete Invest for 2016 confirmed a revenue of 25.7 %.
Prague, 25th of May 2017
Arete Invest, a fast-growing fund focused on investment in real estate, published its audited results for last year. The total audited profit after tax reached almost CZK 92 million, and the gross revenue of the currently open sub-fund of Arete Invest, CEE II, amounted to as much as 25.7 % for 2016. The results were audited by auditors from Deloitte.
“We established the fund as late as 2014, and we can already be proud of the successes we have achieved since then. We have confirmed that the Czech market offers an interesting investment potential, and we believe that we can make the most of it. Our investors expect above-standard revenues, and we have therefore also entered the Slovak market in light of the growing economy and increasing prices of real estate in the Czech Republic; the Slovak market offers interesting investment opportunities while maintaining the risk profile within our acquisition strategy,” says Lubor Svoboda, co-founder and Chairman of the Management Board of Arete Invest.
The year 2016 was a turning point for the fund. During that year, the investment story of the first sub-fund of Arete Invest, CEE, ended by selling off the entire residential portfolio consisting of several hundred housing units to a foreign financial investor. In February 2016, the second sub-fund of Arete Invest, CEE II, was established. This sub-fund is gradually creating a homogeneous portfolio of high-standard revenue-bearing industrial real estate. “The economic situation in Central Europe favors the development of logistics and production. That is why the investment strategy of our second sub-fund is oriented that way. The situation is manifested in record-breaking profits of multinational companies and the highest turnovers of automotive plants in history,” explains Robert Ides, co-founder and member of the Management Board of Arete Invest.
The expected value of the assets managed by CEE II over the anticipated five-year investment cycle is 200 million euros. The sub-fund aims at the continuous improvement of the investors’ funds in the amount of 11-16 % per year, of which up to 6 % per year are regular dividends paid on a quarterly basis. As can be seen in the audited results for 2016, the current revenue rate far exceeds the 16 % announced.
In 2016, we acquired five logistics and production complexes in the Czech Republic. The properties in Uherské Hradiště, Lovosice and Písek combine logistics, production and offices. Their occupancy rate is 100 %, and they include leasable space with a total area of 35 thousand m² and space for further development comprising a total area of 29 thousand m².
In 2017, two more extensive complexes, this time in Slovakia, were added to the CEE II sub-fund as part of the planned expansion. Thanks to them, the total leasable area of the entire sub-fund portfolio was increased to approximately 80 thousand m² while maintaining a 100 % occupancy rate. At the beginning of the year, a production hall in the vicinity of the KIA automotive plant in Žilina was acquired. In April, we announced the purchase the industrial and logistics complex Prologis Park Nové Mesto, which constitutes one of the largest real estate transactions made in the Slovak industrial sector this year in terms of the financial volume.
By the end of this year, the fund is planning to invest another 60 million euros in the Czech and Slovak markets and thereby shift the volume of the assets owned to the threshold of approximately 120 million euros.