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AIB Capital Markets Launches €400m Polonia property fund
AIB Capital Markets, and its wholly owned subsidiary AIB PPM Sp. z o.o., the Investment Manager, are delighted to announce the first closing of their Poland-based property investment vehicle, the Polonia Property Fund L.P (The Fund). The closed-end fund will operate in Central Europe through a Guernsey Limited Partnership.
The first closing has raised committed equity funds of Euro 100 million, which, with debt, will allow purchases of property up to Euro 400 million. A final closing is anticipated within the next few months which will take the total equity to the maximum level of Euro 125 million. The Fund debt and equity will be capped at Euro 500 million.
The Fund has been created specifically to invest in the emerging real estate markets of Poland, Hungary and the Czech Republic. It will have a life of up to 9 years with an investment period of 3 years, commencing in August 2003.
The Fund is supported by institutional and private investors from the UK, Ireland, Austria, and other European locations. The European Bank for Reconstruction and Development (EBRD) and IMMOEAST, a subsidiary of Austria's largest publicly traded real estate stock company IMMOFINANZ, specializing in real estate investments in Eastern Europe, are strategic investors in the Fund. There is also significant fund commitment from the Bank's customers through AIB Private Banking, AIB Corporate Banking and support from AIB Group’s bank subsidiary in Poland, BZWBK.
AIB Capital Markets is the General Partner for The Fund. Commenting on the first closing, Patrick Cunneen, General Manager, said “AIB Capital Markets is delighted to be the Manager and Sponsor of this property fund. The Fund, together with an earlier Polish Private Equity Fund, Nova Polonia, also sponsored and managed by AIB Capital markets, demonstrates AIB’s commitment to Poland and the perceived opportunities for investors in this market.” He added “Polish property is now at an attractive point in the cycle and should, given accession to the EU, provide good returns as values converge with other European markets. To date foreign capital has provided the main impetus to property development and investment markets. We hope the continuing development of the market will allow more local players including pension funds to participate in the investment property market in a way that mirrors the development in other countries.”
AIB PPM Sp. z o.o. acts as the Investment Manager for The Fund and is based in Warsaw with Ian Whiston as its Chief Investment Officer. The Investment Manager will be seeking commercial property investment opportunities primarily throughout Poland, while up to 20% of The Fund may be invested in Hungary and Czech Republic. The Fund’s investment activities in the region will be supported by external property advisors Knight Frank Nieruchomosci in Poland and ZKA Management GmbH, a joint venture company between Zwerenz & Krause AG and Akron Beleggingen Nederland 12 B.V. in Hungary and Czech Republic. Ian Whiston said “With broad geographical outreach in Poland through its banking and private equity connections, and the strength of professional teams on the ground in the Polish Regional Cities, Prague and Budapest, The Fund is well placed to secure a balanced spread of commercial investment opportunities throughout the region.” He added “I believe that we are entering the market at a significant time in the development of the Central European Property Markets. We anticipate a high level of development and investment activity during the next five to ten years and look forward to working closely with our investment partners, developers, owners, agents and the wider real estate market to achieve our medium term investment objectives”.
Edgar Rosenmayr, Director of Property & Tourism of the EBRD said: “With its focus on Central Europe, predominantly Poland, the Polonia Property Fund should contribute significantly to the development of secondary property markets in the region, which eventually will enhance the level of wealth creation in each country concerned.”
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