23 March 2006
Equest Balkan Properties plc (“EBP” / “Company”)
EQUEST ACQUIRES SHOPPING MALL IN IASI, ROMANIA DEYAN KAVRAKOV JOINS EQUEST PROPERTY TEAM AS PARTNER
Equest Balkan Properties plc, the property investment company focused on commercial, retail and industrial property in South Eastern Europe and primarily Bulgaria and Romania, is pleased to announce the acquisition of The Moldova Mall, a retail mall in central Iasi, Romania, for a total cash consideration of EUR 34.5 million. This represents an unleveraged investment yield on full occupancy estimated to be in excess of 9%.
EBP's shares commenced trading on the Alternative Investment Market (“AIM”) on 14 December 2005, having raised ?140 million to invest in the target region in or around the major cities of Bulgaria, Romania, Albania, Bosnia & Herzegovina, Croatia, FYR Macedonia, Serbia & Montenegro and Turkey.
In its AIM Admission Document, the Company's Investment Adviser, Equest Partners Limited (“Investment Adviser”) outlined a pipeline of target acquisitions in line with EBP's investment objectives. Since Admission, the Company has continued to work on the completion of these acquisitions, including the asset in Iasi, Romania which was subject to previously obtained exclusivity arrangements.
The Moldova Mall shopping mall in central Iasi, Romania comprises 19,000 sq m of built area and 9,500 sq m of lettable retail space on five levels, the mall was initially built in 1972 as the central department store in Iasi. During the past 18 months, the mall has been completely refurbished and it is anticipated that it will be re-opened to the public by the end of March 2006. The mall currently has 95% of the lettable area contracted to more than 100 individual tenants, with anchor tenants including Altex (largest electronics retailer in Romania), Glandale Multiplex Cinema, Pizza Hut and KFC. Additionally, the Moldova Mall has above-ground parking for 150 cars and the opportunity for underground parking for a further 250 cars and a land plot for developing up to 1,000 sq m of additional retail space.
Equest Partners Limited, the adviser for Equest Balkan Properties plc, is also pleased to announce the nomination of Mr Deyan Kavrakov as a Partner in its property management and investment team.
Mr Deyan Kavrakov (CRE, FRICS, CIPS, CLHMS), who is a Bulgarian citizen, holds a B.A. in Law, an M.A. in Public Administration from University of Charleston, South Carolina (US), and a M.A. in Business Administration from Bocconi University, Milan (Italy). Prior to joining Equest, Mr Kavrakov was the CEO of ADIS, one of the largest Bulgarian property management companies with more than 120,000 sq m in of office, retail and residential space in management and ownership in more than 60 properties and with more than 110 employees involved in property management, acquisition and agency.
Mr Kavrakov is one of the leading property specialists in Bulgaria and a Member of National Property Association (NRPA) of Bulgaria as well as a founder and Chairman of Honor of the Bulgarian Chapter of the International Real Estate Federation (FIABCI), Paris, France. His international memberships include being a Fellow of Royal Institution of Chartered Surveyors (FRICS), London, UK as well as a Member of The Counselors of Real Estate, Chicago, USA; Certified International Property Specialist (CIPS), NAR, USA. He recently won the highest economic award in Bulgaria for year 2005 granted by Bulgarian Industrial Capital Association for his overall contribution to national economic development.
Commenting on this announcement, Petri Karjalainen, Managing Partner of Equest Partners Limited, EBP's Investment Adviser, said:
“We are pleased to announce our mall acquisition in Iasi and the nomination of Mr Deyan Kavrakov as a partner in our property investment and management team.
“The Moldova Mall in Iasi is one of the exclusivities we had mentioned during the EBP flotation and we are pleased to have completed on the purchase following a period of full technical and financial due diligence. The expected returns are in line with our return targets and we expect to add further value through the active management of the asset, which will include the planned development of underground parking and additional retail space for food retail. The mall has a prominent location on one of the main streets in Iasi, Romania's second largest city, and is one of the landmark buildings in the city.”
Mr Karjalainen continued:
“We are also delighted with the appointment of Mr Deyan Kavrakov for his new role as he brings a wealth of property management expertise to the EBP investments in Bulgaria and the region. We are confident that his skills and experience will prove invaluable as we develop our property portfolio and establish EBP as a leading investor in commercial property in the Balkan region.
"EBP continues to execute on its property acquisition strategy in accordance with the plans outlined in our Admission document, with a continuing focus principally on Bulgaria and Romania as well as the neighboring countries of Serbia and Montenegro, Croatia, Turkey, Bosnia and Albania. The current focus of our activities is on converting the properties under exclusivity into investments as well as selecting new investments that have been identified by Equest. The pipeline of investment projects that meet the investment target returns of EBP is strong and the Company expects to be in a position to announce further property acquisitions in the near future.”
For further information please contact:
Equest Partners Limited
Petri Karjalainen
Naomi Kora
+44 (0)20 7240 7600
Financial Dynamics
Stephanie Highett
Ed Gascoigne-Pees
Dido Laurimore
+44 (0)20 7831 3113
Notes to Editors:
Equest Balkan Properties plc is a commercial property investment company focused on South Eastern Europe and primarily Bulgaria and Romania. Its investment objectives are to invest, principally, in a range of income-producing commercial, retail and industrial property opportunities in or around the major cities of Bulgaria, Romania, Albania, Bosnia & Herzegovina, Croatia, FYR Macedonia, Serbia & Montenegro and Turkey, where it sees such investment as having the potential for capital appreciation. The Company may also invest opportunistically in late stage development projects with a capital constraint and where it expects high rental yields. It may also invest selectively in land acquisitions.
Equest Partners Limited, the Company's Investment Adviser, is an independent investment management and advisory firm regulated by the FSA. Headquartered in London and with offices in Sofia and Bucharest, Equest Partners comprises more than 20 professionals with valuable experience of investing in emerging markets and particularly Central and Eastern Europe. Equest Partners is currently one of the largest dedicated investment and advisory companies for Bulgaria.
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