Investment Management Group (IMG) has completed the acquisition of a 27% stake in a large-scale residential project in Volgograd, Russia, on behalf of its Russia Development Fund.
The residential project, located in the geographical center of Volgograd, was designed by the international architectural firm Nikken Sekkei and will introduce a unique mixed-use concept to the city. The project will consist of both business-class and affordable residential housing, with a gross building area of approximately 250,000 m² built on a 12.4 ha land plot.
It will be constructed over four phases and is anticipated to be completed in 2018. Construction of the first phase is currently underway.
The project's economy-class residential units will be built according to the '3D' concept pioneered by IMG in 2010, which combines modern engineering and high-quality materials with efficient layout and economical design to provide residents with high-quality affordable housing.
This latest residential project in Volgograd builds upon IMG's established presence in the city, where it also invested in a business-class residential project, Dominant, in 2010. Both the new project and Dominant are being constructed by Kvartstroy Group, a large Moscow-based residential developer with projects in the Russian Regions, and Almaty, Kazakhstan. IMG's Russia Development Fund acquired a 30% stake in Kvartstroy in 2009.
IMG is a real estate private equity fund manager. Speaking of the transaction, Maksim Kunin, Managing Partner at IMG, said: "The Russian real estate market continues to offer unique opportunities to earn attractive risk-adjusted returns by addressing the fundamental undersupply present in certain asset classes, such as high-quality affordable housing."
The residential project is the seventh transaction made by Russia Development Fund, which closed in March 2009. The Fund's investors include Aberdeen Indirect Property Partners II, EBRD and IMMOFINANZ.
Source: IMG Investment Management Group