Nearly €180 million deal completed in the Baltic real estate market

This week marked the completion of a significant transaction in the Baltic real estate market. UAB Baltic Retail Properties (BRP), a closed-end investment company for informed investors, managed by UAB Žabolis ir partneriai kapitalo valdymas, sold its real estate assets.

BRP managed one of the largest income-generating commercial real estate portfolios in the Baltics – portfolio comprised 184 thousand sq. m of leasable property. Occupancy exceeded 99% on the date of sale. BRP sold the assets it had managed in Estonia, Latvia, and Lithuania upon reaching the end of its operational term. BRP’s management company, Žabolis ir partneriai kapitalo valdymas, announced that over its 10 years of operation, BRP increased investors’ capital by 2.4 times and achieved a 14% annual return after fund fees.

The transaction value amounted to EUR 177.5 million. In Lithuania, the assets managed by BRP were acquired directly, while in Estonia and Latvia the transactions were implemented through share purchase agreements by transferring shares in the companies that directly owned the buildings.

The Ellex team of lawyers in Estonia, Latvia, and Lithuania represented the seller, BRP, throughout the transaction.

Real estate market experts assess this transaction as exceptional in terms of both its size and complexity, while also viewing it as positive news regarding the return of foreign capital to the Baltic States.

“This transaction can rightfully be called the deal of the decade in the Baltic commercial real estate market – both because of its scale and its structure and geographic reach. It is one of the largest retail real estate portfolio transactions in the region over the past decade, involving assets in Estonia, Latvia, and Lithuania, and requiring the management of a complex multi-jurisdictional transaction. The deal also signals investors’ confidence in the Baltic commercial real estate market and demonstrates that high-quality retail assets in the region remain highly attractive even in a more challenging economic environment,” comments Dr. Olga Petroševičienė, Partner at Ellex Valiunas and real estate expert.

For nearly a year and a half, the client was advised on the transaction by a joint Ellex team of experts:

• Enrika Tamašauskaitė – responsible for shaping the transaction strategy and coordinating the entire implementation process;
• Olga Petroševičienė – responsible for shaping and implementing the transaction strategy;
• Miroslav Nosevič – responsible for structuring the transaction and implementing key strategic decisions;
• Edvinas Džulis – responsible for coordinating and implementing the real estate sale transaction;
• Inese Freivalde – responsible for implementing the Latvian part of the transaction;
• Ilga Gudrenika-Krebs – responsible for implementing the Latvian part of the transaction;
• Karin Tartu – responsible for implementing the Estonian part of the transaction.