In autumn 2006 CA Immo International established the CA Immo New Europe property fund, which is geared specifically towards wholesale institutional investors, with a minimum subscription amount of € 5 m. As a fund under Luxembourg law, it is structured as a Société d’ìnvestissement en capital à risque (SICAR) and configured in the legal form of a Société en comandit par action (SCA). The general partner is CA Immo S.à.r.l., a whollyowned subsidiary of CA Immo International. The fund has a total volume of € 1 bn, of which € 400 m is to be made available as equity by institutional investors. CA Immo International will hold a permanent share in the fund of at least 51%, manage the fund and, in return, receive an acquisition, management and performance fee. The fund has a term of seven years and is to focus exclusively on the development of commercial property projects in Eastern Europe, notably the SEE and CIS regions. The fund was approved by the Luxembourg authorities on 5 December 2006; the fund is not listed on any stock market. As of 31 December 2006 the fund is shown in the consolidated balance sheet with 100% of the initial capital; third-party investors had issued binding commitments worth more than
€ 165 m by this time. The fund commenced its operating business at the beginning of the year.
If, by the end of February 2007, the full 49% target volume has not been placed with third-party investors, CA Immo International will subscribe for the relevant shares in order to offer them to external investors at a later date.
The committed equity will be called off in line with the progress of the development projects.
For investors the fund offers a number of obvious benefits: a systematic, strategic focus on property developments in Eastern Europe; comparatively high return on equity measured against the market at a calculable risk; the experienced management team and tax-efficient investment structures.
The fund‘s portfolio strategy is geared towards a balanced mix of properties as regards type of use and location. The regional presence is in keeping with a distribution of 20% CEE, 40% SEE and 40% CIS. Particular emphasis is being placed on the markets harbouring greatest potential, namely Romania, Russia, Serbia and Ukraine. The focus is generally on capital cities and other major metropolises, and on both acquiring existing properties with development potential and developing new buildings. The average project size is to be between € 40 m and
€ 70 m.
Experienced fund management
CA Immo International is responsible for managing the fund and has appointed its own, highly experienced employees to this task.
Thomas Erdmann has worked for CA Immo since 2003. He was previously responsible for all activities in Central, Eastern and South East Europe and has been instrumental in expanding the Group‘s portfolio. He has worked for more than 16 years in the property business, including 10 years in Eastern Europe. His areas of special expertise include project development, construction management, finance, marketing and building management.
Mag. Christian Schitton joined the CA Immo International management team from BA-CA in 2006. He has many years of experience in property financing, including five years in Eastern Europe.
An investment committee is being formed to take the fund‘s investment decisions. It is to comprise members of the Management Board of
CA Immo International and investors who subscribe equity in excess of
€ 50 m. In addition, all shareholders investing equity of more than
€ 7.5 m are to form a shareholders‘ committee, which will receive regular information on the progress of the investment and market development.