The Primeros Property Fund is the first western standard investment vehicle to offer investors access to the Ukrainian real estate market. The Fund has been structured to offer access to a diversified portfolio of real estate objects with maximum transparency and security. Ukraine is certainly an attractive investment market however it is not an easy market to operate in for a new investor, because of quirks in Ukrainian law and the unusual characteristics of doing business in Ukraine.
The offering was structured with extensive input from international law firm Baker & McKenzie, with input from partners in their offices in Kyiv, Amsterdam and Geneva. The Fund contains many safety mechanisms to protect investors from potential downside, including: establishment in the very well regulated but tax efficient domicile of Jersey, investors monies held in an Escrow account (managed by Equity Trust Services Limited in Jersey) until released for acquisition of property object, approval of the Fund Board of Directors (the majority of whom are appointed by Equity Trust Services Limited in Jersey) on all acquisitions, an Investors Committee to provide a platform for twice annual communication between major investors and the Funds' managers, and transparent reporting to investors is ensured by an annual audit of the Funds financial statements by Moore Stephens International.
The real estate managers for the Fund are NAI Pickard, a firm established in Kyiv by Mr. Terry Pickard, a British national, in 1992. Mr. Pickard is also one of the founders of the Fund and as such the role of the real estate advisors is not (as is usually the case) one of a one-off deal brokerage. The relationship between the Fund and the real estate advisory services of NAI Pickard means that the long term interests of the Fund, and therefore the investors in the Fund, are aligned. What is most beneficial for the investors in the fund is also the most beneficial for the founders of the Fund and therefore investors can be sure of the very best advice in identifying, acquiring and managing the properties of the portfolio to maximise returns.
Based on the target acquisitions already identified, which are a mix of pre-tenanted business centres, some office space which will be purchased newly completed "shell and core", and a small element of new build, the Funds promoters are confident that they have an investment strategy which will provide the best possible mix of immediate cash generation and capital growth. Based on cash flow analysis of these acquisitions target return to investors are predicted of 12% in investment year one and 18% during investment year two.
Source: Primeros Property Fund General Partner Ltd.