RUSSIA - The Baltic Property Trust Group (BPT) has beaten off Russia-hungry rival investors to acquire its latest asset in the market: the first phase of the Country Park business centre in Moscow.
The firm acquired Country Park - its third acquisition in the Russian market - for an undisclosed amount, to be held as part of Arista, a Russian SICAV.
The 18-storey business centre in Khimki houses the Russian headquarters of BMW and Volvo.
But BPT also has an option to acquire a second phase, while a third phase - a hotel - is being planned by the developer.
"It is quite difficult to find these assets, since most of them are off-market," said BPT Asset Management acquisition manager Ilya Kutnov.
"The competition can be also significant."
Among the fiercest competitors for assets he cited Ivanhoe Cambridge, a subsidiary of the CA$155.4bn (€98.3bn) Caisse de dépôt et placement du Québec. Real estate makes up real 18.7% of the Caisse's overall portfolio.
Arista's focus is on income-producing commercial assets, according to Kutnov.
"We do not have direct allocation for residential properties at Arista, since the fund is focused mostly on income producing properties, and rental residential market virtually does not yet exist in Russia," he said.
"However, if income producing residential investments appear on the market, Arista could consider them. A typical Russian residential investment project would be pure development: purchase land, develop, sell the apartments, and exit," added Kutnov.
Residential property in Russia is still at the development stage. However, GIC, the Singapore sovereign wealth fund, in February announced it would develop a new suburb outside Moscow in a joint venture with Russian residential developer PIK. GIC acquired 25% of the joint venture project for US$233m (€157m).
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