Nanette buys into first Ukrainian project

London-listed residential real estate group Nanette has announced it has acquired a stake in its first development project in Ukraine. Nanette, which is registered in the Netherlands, is already active in Poland, Hungary, Croatia, and Romania. Nanette's announcement came on the same day as PIK Group, a Moscow-focused residential developer, said it is also moving into Ukraine.

Nanette said a 100% subsidiary had purchased 15% of the share capital of Olimpia Real Estate for the total of EUR 3.9mln from Olimpia Euro Constructions, a Holland-registered subsidiary of Tel Aviv-listed Olimpia Real Estate Holding.

Olimpia Real Estate LLC is a Cyprus company that holds 100% of the shares of a Ukrainian company that is the owner of a 118,000 m² plot of land in the centre of the Ukrainian capital Ukraine. According to the existing rights on the land it is possible to build approximately 2,000 apartments on the plot. The deal was financed from the existing resources.

Shaul Lotan, chairman of Nanette, commented: 'We have been investigating a viable entry into Ukraine for a considerable time. We intend to manage our risk, by partnering with other knowledgeable investors and reputable developers - as has been the case with all our projects in Central and Eastern Europe.'

'We and many other significant real estate developers believe that Ukraine and Kiev in particular show tremendous potential - and can potentially escape the effects of the credit crunch seen in the international real estate industry.'

Olimpia Real Estate, in which Oskar Kazanelson, the CEO of Nanette, is the chairman of the board, is a 29.9% shareholder of Nanette. The other major shareholders are Meshulam Levinstein Contracting & Engineering (19%) and Lehman Brothers. The partners intends to list Nanette's bonds on the Tel Aviv stock exchange by the end of the summer this year.