Europolis III

Location:

Regional

Project number:

36975

Business sector:

Property and tourism

Notice type:

Private

Environmental category:

C

Target board date:

19 Sep 2006

Status:

Completed

PSD disclosed:

04 Aug 2006

Project Description

EBRD together with the Sponsor to invest up to EUR 300 million in equity to create a regional portfolio of 15 to 20 property assets (‘Sub-Projects’) under the name of E3. E3 will seek long-term capital gains by investing in commercial real estate in Russia, Ukraine, Serbia, Montenegro, Bosnia-Herzegovina, Macedonia and Bulgaria. The investments will be for the purpose of developing, renovating, reconstructing, acquiring, owning/managing commercial real estate.

The proposed project will promote the primary and secondary property markets across the Region by:

  • Targeting exclusively less developed property markets, placing at minimum 70% of the E3 capital in Russia and the Ukraine as “Prime target market” and up to 30% in Bulgaria, Serbia & Montenegro, Bosnia-Herzegovina and Macedonia as “Secondary target markets”.
     
  • Allocating more than half of E3 to development-sub-projects.

Transition Impact

Promotion of less developed primary property markets to improve supply of quality commercial space in these markets.

Support the development of a more liquid secondary property market on a regional scale and primary markets in Ukraine and Russia and South-eastern Europe. A mature secondary market should eventually lead to the acceptance of local property as an asset class and the entrance of non-specialist investors seeking to diversify portfolios and encourage primary investors to move further east to the early and intermediate countries.

 

The Client

Investkredit Bank AG, an Austrian commercial bank specialised in medium and long-term financing to corporate customers and public institutions. Investkredit Bank AG is 100% owned by Österreichische Volksbanken-AG (“OEVAG”), the central institution of Austrian credit cooperatives.

EBRD Finance

Commitment of EUR 52.5 million in equity and quasi-equity instruments to participate with up to 35% in the First Closing of E3.

Option to invest up additional EUR 52.5m at Second Closing of E3.

 

Project Cost

Up to EUR 300 million in equity and quasi-equity investments,

Capital for E3 investment programme will be raised in two stages:

First Closing: EUR 150 million in 2006

Second Closing: EUR 150 million in 2007/8.

 

Environmental Impact

The project was screened C/1.

Europolis has been successfully implementing the formal environmental due diligence procedures based on EBRD’s Environmental Procedures for Property Funds and agreed with the Bank under the Europolis 1 and 2 transactions. This has involved

  • reviewing the environmental issues of each sub-project including potential soil and groundwater contamination of the site,
     
  • managing construction-related environmental issues (noise, dust, traffic disturbance) and worker health and safety issues, safety of construction materials and life and fire safety issues of the building, and:
     
  • submitting annual environmental reports to the Bank.

Under E3, the Investment Programme Manager will continue to implement the environmental due diligence procedures in order to ensure that the E3 property developments and investment are undertaken with full respect of environmental issues including compliance, at minimum, with national environmental, health and safety standards and requirements, national public consultation requirements where the sub-project is located and implementation of good international practice applied by Western property developers as well as submission of an annual environmental report to the Bank.

Technical Cooperation

None.

Company Contact

Europolis Real Estate Asset Management GmbH (“Europolis”)
Kolingasse 12,
1090 Vienna,
Austria

Tel: +43 (1) 319 72 00
Fax: +43 (1) 319 72 00 - 10

Website: www.europolis.at

 

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

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Text of the PIP

Project Complaint Mechanism (PCM)

The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer (pcm@ebrd.com) is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.