Northern Horizon Capital’s Baltic Opportunity Fund has paid out 7 percent on invested equity to its investors. Over the past 3 years, the Fund has paid out a total distribution of 19 percent and has therefore reached its target to pay regular dividends 3 years in a row.
“The investment strategy to make acquisitions in Baltic capitals into well located assets has paid off,” said Fund manager Tarmo Karotam. The Fund has made a total of 5 investments in Tallinn, Riga and Vilnius with the most prominent properties being Coca Cola Plaza and Europa Shopping Center in the heart of Tallinn and Vilnius respectively.
Through close attention to property management and tenant dialogue, the Fund management aims to make sure that the properties remain fully leased under long-term non-breakable lease agreements with reputable tenants. At the same time the team has sought ways to add value to investments through expansion and tenant mix management, as seen in Domus PRO and Europa Shopping Center this year.
“In the current environment, where vacancies and cost of debt are low, higher cost of borrowing down the road has to be addressed with increasing rental incomes by active asset management today,” said Tarmo Karotam. Launched in December 2010 the portfolio today houses more than 150 tenants operating on the gross area of 85,000 sqm.
The Fund is a registered real estate investment fund under the license issued by Estonian Financial Services Authority. Its number one goal is to pay investors regular cash dividends from the portfolio’s rental operations. “The unique contractual REIF structure has proven to be highly efficient and flexible in being able to achieve our targets,” concluded Tarmo Karotam.