“About twenty funds were interested in our product. We continued to negotiate with six of them. We chose Zeitgeist for several reasons. The primary reason was price. Equally important for us, however, was their strategy to participate in creating a new standard of affordable rental housing, “said Finep CEO Tomáš Pardubický.
The exact price of the current transaction in Barrandov was not disclosed by either party. According to information from the E15.cz server, the value of the trade is in the hundreds of millions of crowns. The yield for the new owner from the annual rent in relation to the total price ranges between four and five percent.
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“Cooperation with developers has been and is one of our long-term strategic goals, which we are successfully developing not only in the Czech Republic, but also in Germany, Poland and Hungary. We believe in the product of rental housing and the signing of a contract with the largest residential developer in the Czech Republic is a crucial step for us to fulfill this strategy, “said Peter Noack, CEO of Zeitgeist.
The trend of institutional investors’ inclination towards rental housing is also confirmed by investment specialists. “The limited supply of investment opportunities and active demand clearly lead to a gradual increase in the share of rental housing in development projects,” commented Petr Kozojed, head of the real estate team at EY consulting.
“The lack of flats and their high prices will force those interested in housing to prefer rent to their own purchase,” he added.
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The project in Barrandov is specific in that it was intended for rental housing from the beginning of the construction. The developer made the apartments, including the interior equipment.
The transaction began negotiations this spring. “I am optimistic that even in the current situation, deals can be resolved. We are already negotiating with Zeitgeist about other projects, but we have not yet agreed, “said the head of Finep.
Finep is one of the largest builders of new apartments in Prague. In addition to owner-occupied and newly rented housing, the developer also builds cooperative flats.
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Zeitgeist Asset Management deals with the development and management of real estate for private and institutional investors. It currently manages assets worth around 515 million euros. Among other things, the company operates private student accommodation in Prague.
So far, individual investors have mainly bought new flats for the purpose of further lease. Real estate funds and other investment corporations have so far focused mainly on building portfolios from older apartments. The largest domestic transaction of this kind was undertaken at the beginning of this year by the Swedish company Heimstaden. For about 31 billion crowns, it bought almost 43,000 flats from OKD in the Moravian-Silesian Region.
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