Lithuania-based Lords LB Asset Management (LLAM) is expecting Nordic pension funds and other institutional investors to back its office development project in Riga, in which it will invest over €200m.

The development – the biggest office development in the Baltics – will be built on a 5.8 hectare site acquired for €16.8m from the Latvian Shipping Company, which includes the former Press Chamber in Riga.

It is being led by the Lords LB Special Fund V, set up to invest in real estate projects in Latvia.

Private investors and family offices from Sweden, Denmark and the Baltics have already invested in the initial fundraising stage.

LLAM said it expects institutional investors to join at a later, more advanced stage.

The company described the location as “exceptionally attractive”, since the vicinity will become the city’s main business area in the near future, and already has good communications with the city’s old town and airport.

Aivaras Abromavičius, chair of the project’s supervisory board, said: “Currently, Latvia is among the EU’s most rapidly developing economies, so we see perfect opportunities on the class-A office space market.”

The fund’s initial size is €20m, with a maximum of €40m. The rest of the financing will come from borrowings, as well as the possible sale of assets at the mid-stage of the development.

The fund will be active for at least eight years, with investments carried out over several phases.

The project is LLAM’s first commercial real estate development outside Lithuania.

Domas Kačinskas, CEO at LLAM, said there were two reasons for the growth of the company’s investment portfolio.

“First, investors’ confidence is attracted by the high quality of real estate assets, developed in good locations,” he said.

“Second, investors value the highly transparent, reliably managed and properly supervised activities of the fund.”

LLAM now has €320m of assets under management.