The bet on the real estate is partially bet on the economy
Check out the interview by Prague Finance Institute magazine with Robert Ides, Managing Partner & Cofounder of ARETE, where they discuss the current economic outlook and investment themes. Highlights include: · Equities trends in the USA and the IT sector. · Implications of higher interest rates on financial markets and the real economy. · The impact of the Green deal and net-zero emission targets on investment opportunities. · Outlook on the commercial real estate (CRE) sector globally, with a focus on Europe. · Comparison of CRE valuations in the Czech Republic and Germany. · Optimistic outlook on the private equity (PE) industry, including trends in perpetual funds and global expansion. · Major risks for the world economy and financial markets, including interest rate dynamics and geopolitics. · Asset classes expected to perform well in the next decade, such as equities in developed markets, private markets, and real assets. What was also said: “The bet on the real estate is partially bet on the economy – CRE is basically the box in which the economy operates.” Check out the whole interview below.
We’re heading out for acquisition hunting, such an opportunity comes once in a decade
Lubor Svoboda, co-founder of the investment group ARETE, summarizes in an interview for the magazine Týdeník Ekonom how the group’s business has been affected by COVID and the war in Ukraine, and reveals plans for the next few years. We are the only entity on the Czech real estate market that has twice closed an investment fund and settled all investors, moreover, during very challenging times and exceptionally successfully. The first sub-fund was closed in 2017 with a gross yield of 39% p.a., and the closing of the second sub-fund followed in 2021 with an average gross yield of 11% p.a. Third close-end fund, focused on European industrial real estate, was opened at the end of COVID and is currently in an extension phase to monetize on recent real estate repricing. And our longer-term plans? Within few years we would like to manage assets exceeding one billion euros, which will be divided into multiple strategies and spread across multiple countries. We are working on transforming from an investment group focused on the Czech Republic and Slovakia into a European group that will attract capital to this continent from around the world. With several new, institutional-grade strategies being shortly introduced, we’re extending presence to new capital markets in Europe and APAC. The current situation in the industrial real estate market is playing into our hands. The market is experiencing a significant investment and price slump. As acquisition seekers, we face little competition, currently holding cash and with low indebtedness as a group. Moreover, in the coming months, we anticipate further corrections in property prices, making acquisitions even more advantageous. Such a favorable combination of conditions arises once in a decade. You can find the full interview below. More information about the ARETE INDUSTRIAL fund, which focuses on income-generating industrial properties from the European region and is still open to qualified investors, can be found here.
The time is right to reassess portfolios
Lubor Svoboda, co-founder of the ARETE investment group, explains in an interview for Euro magazine why the time is right to reassess portfolios. The financial market has shown an imbalance over the past year. The “old rules” no longer apply, investors are trying to find a safe haven for their capital, while eliminating the losses suffered during the covid crisis. This pressure on demand is causing prices to rise rapidly and US stock markets in particular have experienced meteoric growth over the past year. However, this high growth in share prices has also been accompanied by a significant increase in the P/E ratio, which indicates the ratio of share price to earnings and also the potential return on investment in a given share title. With share prices at their highs while real assets (and commercial real estate among them) have become significantly cheaper, an investment opportunity is opening up. This opportunity is particularly attractive to investors who want to invest for the long term and are looking for long-term stability. When investing in real estate, it is of course important to keep an eye on macroeconomic trends, regulation and the political environment, but also on asset-specific factors. Investors should focus primarily on the long-term performance and stability of the issuer, as well as the value of the LTV, which shows the proportion of equity and external financing and the risk arising from over-indebtedness. “A current view of equities suggests they are highly priced, while real assets appear relatively more affordable, and in some distressed situations, undervalued. One can infer that the time is gradually right to reassess portfolios and buy real assets such as commercial real estate.” The full interview is attached. For more information on the ARETE INDUSTRIAL fund, which focuses exclusively on income-generating industrial real estate in the CEE region and is still open to qualified investors, follow here.
Crises Have Benefited Real Estate
Among the best forms of alternative investments are real estate and real estate funds. The ARETE INDUSTRIAL fund focuses on high-quality industrial real estate as a form of asset with stable returns. Co-founder of the ARETE group explained more in an interview for Hospodárské noviny. You can find the full interview text in the prestigious Slovak newspaper below.
Lubor Svoboda, one of the TOP investors in the Czech Republic according to Forbes magazine
We are delighted that Forbes Czech Republic, in its investment-focused edition, recognized Lubor Svoboda, co-founder of the ARETE Group, as one of the top ten investment figures in the Czech Republic for 2023. Forbes handpicked individuals with the ability to enhance capital from among inspirational personalities deserving of attention. In the accompanying article, the magazine elaborated on and praised the consistent delivery of exceptional returns to fund investors within a closed investment cycle. It also highlighted the high-yield investment strategy and the stability of the presently open ARETE INDUSTRIAL fund for qualified investors. This fund manages a dozen industrial and logistics parks in the Czech Republic and Slovakia. We deeply appreciate being named among the top ten investors in the Czech Republic. This recognition reinforces our belief that ARETE is on the right track, and our distinctive strategy involving a closed investment cycle in high-yield industrial and logistics parks is noteworthy.
The future of alternative investments belongs to industrial parks
Alternative investments are an increasingly attractive topic for qualified investors. But what is worth investing the saved funds in? Wine? Antiques? Cryptocurrencies? All have their own drawbacks. But what about industrial parks? Dr. Josef Vojta wrote about their importance as an attractive alternative investment in the Slovak magazine TREND.sk.
Our earnings will not be threatened by rising European interest rates
You can read about the exceptionally high appreciation of the ARETE INDUSTRIAL fund at the end of 2021, the low share of bank loans to the value of the fund’s assets (LTV) and the fact that any increase in EUR interest rates will not significantly negatively affect the fund’s performance objectives, in the comment of our colleague Dr. Josef Vojta for Hospodářské noviny.
