Luminor grants EUR 7 million to Prosperus Real Estate Fund III for the acquisition of a retail property

Luminor Bank has granted EUR 7 million to the real estate fund of Prosperus asset manager for acquisition of the retail centre at Valdeķu Street in Riga. The centre’s anchor tenant is Lidl, a retailer that has recently entered the Latvian market.

Approx. 5,000 sq.m premises host such stores as Pepco, Dino Zoo, Spirts & Wine, Apotheka, etc. The trading centre was commissioned at the end of 2021 and developed by VPH Latvija.

“Investors’ active interest in the commercial real estate market is still noticeable, which is a positive trend. It is evidenced by last year’s investment volumes in this sector of economy that have reached a new record high level over the last decade. Although inflation rate and lack of quality investment property seem to contribute to the growth in property prices, however, the return-on-investment ratio for investments in commercial real estate in our region is still higher than on other European markets, which allows to maintain the persistent interest. Although it is unclear how the pandemic affects commercial tenants’ behaviour in the future, the properties whose tenants are well-known retail chains will be preferred by investors. We are glad that we are able to continue cooperation with Prosperus Group, granting financing for the fund’s careful strategic investments in all Baltic States,” Uģis Počs, Real Estate Financing Expert of Luminor Bank tells.

Established in February 2020, Prosperus Real Estate Fund III actively invests in commercial property rented by major food retail chains. Currently, Fund’s portfolio totals to EUR 39.15 million with a goal to reach EUR 100 million.

Gedimins Baltakis, Head of Prosperus asset management, points out that this transaction perfectly suites the investment manager’s strategy: “We carefully follow the market and look for such assets. Acquisition of the trading centre in Riga thanks to Luminor Bank is already the sixth investments over almost two years. We have purchased a commercial building where the major tenant is a reliable and successful retail chain. This is a great compliment to our portfolio that already includes property rented by Maxima, Rimi and Iki.”

The real estate fund already owns buildings rented by a retail chain Maxima in Riga, Palanga and Kaunas, a property rented by Rimi in Klaipeda and financed development project of IKI in Vilnius.