Jet Investment launches real estate investment fund
Jet Investment is opening a new fund, Jet Industrial Lease, which will focus on real estate investments.
In the first year, Jet Investment wants to raise CZK1 billion from private investors for the purchase and development of industrial and other real estates. Another CZK14 billion should be raised within five years. The subscription period of the fund starts on 1 November.
The Jet Industrial Lease Fund for qualified investors will focus primarily on the purchase of real estate from industrial companies, specifically creditworthy ones with a long-term perspective on the market.
"We have been managing and developing industrial companies for more than twenty years. During that time, we have discovered that the industry offers considerable potential outside its core business, specifically in real estate management and development," says the Managing Director Igor Fait. "We know from our experience that performing effective asset management can become burdensome for a company, especially when it requires too much money or excessive effort and time. The thoughtful sale of its real estate property, on the other hand, can be a welcome financial injection for a company and a major impetus for the development of its core business. Also, Jet Investment can correctly evaluate the prospects of the future tenant and reflect his specific needs in the transaction."
The Jet Investment team believes that it has found an ideal answer both for qualified investors, to whom it wants to bring high value with reasonable risk, and for the Czech industrial business.
"Leaving the ownership, management and development of the property to a real estate specialist, while the business owner is only engaged in business, is quite common in Germany or Austria," says Libor Šparlinek, Partner in Jet Investment. "From a tax point of view, the building is depreciated for up to 50 years and the land is not depreciated at all, while the rent can be used as a cost item in each accounting period. Abroad, many companies have already understood this and prefer renting to ownership."
Pavel Drabina, a new member of the Jet Investment team responsible for managing the real estate fund, assumes that during the first year the fund will invest an average of CZK 200–300 million in five properties respectively within Central Europe.
"We are currently evaluating around 30 exciting acquisition opportunities, primarily from the industrial sector," says the real estate team leader with 20 years of experience in real estate, project management and M&A. "Real estate investing is irreplaceable in every investor's portfolio, and not just as a hedge against inflation.”
The subscription period of the fund begins on 1 November with a minimum deposit of five million crowns; lower investments will be possible through the partner investment group Conseq. The expected return of the open-end fund with an investment horizon of five years or more is expected to be 8 per cent pa. Four Jet Investment partners, including Igor Fait, will participate in it in the first year with a deposit of about 15 per cent. The vision of the Jet Industrial Lease fund is to become a significant property owner throughout the European Union.
"We are looking for acquisition opportunities mainly from the industrial sector, but also retail and office development, and although we initially want to focus on the Czech Republic and Slovakia, we are also looking at interesting opportunities in Germany, Austria and Poland," says Drabina.
Jet Investment opens the Jet Industrial Lease fund after carrying out one of the most profitable divestments in the Jet 1 fund's portfolio in recent years. For the Jet 2 fund, in which 170 private and institutional investors invested 4 billion crowns, the Jet team has so far acquired the TEDOM group, the company 2 JCP, and plans at least two more acquisitions by the end of next year.