Eften Real Estate Fund 4 has agreed to acquire a major logistics facility in Riga from Lords LB Baltic Fund III in the largest logistics deal in Latvia since 2018.
The asset - Bergi LC – provides around 50,000 m2 of space built in 2008. It is leased to two main tenants: DO IT, a Danish importer and distributor of home furniture operating under the retail name JYSK, and Orkla Logistics, a supplier of branded consumer good to the grocery, specialized retail, pharmacy and bakery sectors.
‘The logistics segment currently provides for one of the most interesting return stories,’ said Eften Capital’s Latvia CEO Viktors Savins. ‘Bergi LC suits our institutional portfolio well, due to its strategic and rapidly developing micro location in Riga city, quality tenants and acquisition yield. In the post Covid world, logistics is the growing trend. Bergi municipality is an ideal location for a logistics centre intending to supply the north/east regions (Scandinavia and CIS), and represents one of the best prime locations for logistics in Riga. In addition, the High Bay Warehouse and modern build of the property, combined with its ideal location ensure its future against alternative uses.’
Lords LB Baltic Fund III fund manager Efim Hiterer said: ‘Bergi LC disposal is an important milestone in our Baltic Fund III exit process. Agreeing on divestment of already the second asset in recent few months shows that our managed assets have a positive demand in the market, and we are aiming to proceed with successfully exiting the fund.’
‘We are currently observing a great pick up of interest for logistics assets in the Baltic market by both local and regional players. Due to Covid19 impact on other RE segments the sentiment towards logistics and industrial is very strong. We expect more capital to be allocated to L&I segment, which will inevitably result in larger transaction volumes and yield compression,’ added Andrius Svolka, head of transactions at Newsec.
The transaction is expected to be closed within several months.
