The real estate investment company INVL Baltic Real Estate shall have the ability to buy-back its own shares. That and other decisions on amending the company’s Articles of Association were adopted at a general meeting of the company’s shareholders held today, 14 January.
“The right to buy-back own shares will be used if the share price on the market is smaller than the net asset value (NAV). That will give shareholders additional liquidity opportunities, and when INVL Baltic Real Estate acquires shares for less than the NAV, the value of the remaining shares should grow,” said Vytautas Bakšinskas, the real estate fund manager at INVL Asset Management, which manages INVL Baltic Real Estate.
It was also decided at the meeting to adjust the methodology specified in the Articles of Association for calculating the performance fee paid to INVL Baltic Real Estate’s management company, INVL Asset Management. The updated methodology will ensure that the rules for calculating and paying the fee comply with international best practices and cover all amounts in fact paid out to shareholders.
Considering the regulator’s opinion that some of the decisions on changes to the Articles of Association are material, shareholders of INVL Baltic Real Estate who held shares of the company on 7 January 2021 and did not take part in the meeting held on 14 January or opposed the adopted decisions, shall be given an opportunity to sell their shares for the net asset value.
According to Vytautas Bakšinskas, this share redemption is a formal part of the process of implementing the changes, thus selling shares in it is not mandatory. The main goal of INVL Baltic Real Estate’s team is to increase the value of investors’ assets, so for those who believe in the company’s prospects, continuing to hold the shares is also a good decision.
INVL Baltic Real Estate owns real estate in Vilnius and Riga: office buildings in the Old Town of the Lithuanian capital on Vilniaus Street and in Šiaurės Miestelis, and the Dommo Business Park manufacturing, warehouse and office complex beside the Riga bypass.
The company’s properties had occupancy of between 69% and 100% as of the end of September 2020. INVL Baltic Real Estate’s property holdings currently have a total area of 25 800 sq. m. and a value of EUR 23.5 million.
Since its launch as a collective investment undertaking (on 22 December 2016), INVL Baltic Real Estate has been one of the Baltic real estate funds open to retail investors with the highest stable returns. The fund operates as a closed-end investment company. Management of the company was assumed by INVL Asset Management, one of Lithuania’s leading asset management firms. The company will operate as a closed-end investment company until 2046, with extension possible for a further 20 years.