Business news from Ukraine

DRAGON CAPITAL CEO NOTES GROWTH IN NETWORK TENANTS IN SHOPPING MALLS

The share of chain tenants in tenant-mix shopping and entertainment centers of the Dragon Capital investment company increased due to a decrease in the share of non-systemic tenants, a trend noted by Tomas Fiala, founder and CEO of Dragon Capital, which actively invests in real estate.
“We get our rental income more as percentage of turnover. The base rental rate during COVID-19 has become significantly lower, and percentage of turnover – higher. Therefore, we are more attached to the success of our tenants and are interested in their profitability. It happened so that the share of non-systemic tenants – private entrepreneurs who supply goods non-systematically – decreased, while the share of chain tenants increased,” he said in an exclusive interview with Interfax-Ukraine.
According to the head of Dragon Capital, the company monitors the real turnover of tenants, which is one of the terms of the lease.
According to Fiala, the share of electronics stores in the tenant pool has increased, sales of which have grown significantly during the pandemic.
According to him, in shopping centers there is still no trend towards a reduction in retail space due to an increase in the share of online trading.
“We already have good traffic in some shopping centers. Although even with a decrease in the number of customers amid COVID-19 [last summer, the attendance in malls was 20-25% lower], on more rare visits, they bought more, made larger purchases, so the turnover recovered,” Fiala said.
Speaking about investments in shopping mall projects, the head of Dragon Capital noted that large shopping centers are a risky investment, and the company prefers small projects.
“We prefer such small malls as Piramida or Aladdin, located in a densely populated residential area near the subway. But such objects also require attention, they need to be dealt with, they need to be modernized, adjusted to the needs of customers,” he said.
Fiala, in particular, specified that the company had invested about $9 million in the construction of a gallery expansion and completion of an office center of Piramida mall.
The head of the investment company added that Dragon Capital was also considering the acquisition of Dream Town mall.
“We considered Dream Town. Ocean Plaza is also kind of for sale. But in such huge malls there should be a very interesting price, because they will work for the next five years, but with the development of e-commerce, the tenant-mix will also change there. There will be more entertainment and dining, less commerce, as it has been in America for the past five years. So far it is not very visible, but sooner or later it will also start to happen in Ukraine,” Fiala summed up.

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DRAGON CAPITAL ACQUIRES NEW BUSINESS CENTER

Dragon Capital investment company has completed the acquisition of a new A class Viking business center in Lviv, the press service reported. “This is our second business center in Lviv and the 14th in the Dragon Capital portfolio of office real estate in Ukraine,” CEO of Dragon Capital Tomas Fiala said.
The business center, located at the intersection of Zelena and Pimonenko Streets in Sykhiv district of Lviv, was commissioned in August 2021. The object consists of two sections (9 and 12 floors) with a total area of 18,700 square meters, and includes a parking lot for 102 cars.
The business center was built according to the “green” BREEAM certification standards.
Dragon Capital is one of the largest investment groups in Ukraine in the field of investment and financial services, providing a full range of investment banking and brokerage services, direct investments, asset management for institutional, corporate and private clients. The company was founded in Kyiv in 2000. One of the key activities of Dragon Capital is investment in the real estate market.
The commercial real estate portfolio is managed by Dragon Capital Property Management. As of September 2021, it manages 31 commercial real estate objects, including 14 office objects, six retail real estate objects and 11 logistics complexes, with a total area of 778,000 sq m.

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DRAGON CAPITAL GETS $12.5 MLN LOAN FROM EBRD

Investment company Dragon Capital intends to partially refinance the Grand business center (Kyiv), as well as logistics complexes Diana Lux Logistic (Brovary) and Terminal Kharkiv with a loan from the European Bank for Reconstruction and Development (EBRD) in the amount of $12.5 million, the press service of the company reported.
“We are very pleased to begin our cooperation with the EBRD in the field of sustainable real estate investments. This loan will also allow Dragon Capital to expand investments in the commercial real estate sector, especially in the development of our two industrial parks: M10 in Lviv and E40 in Kyiv,” Dragon Capital Head Tomas Fiala is quoted as saying in the press release.
Dragon Capital has already received green certificates for four buildings in its portfolio (including BC Grand) and expects to double them in 2021. In addition, lease agreements for the company’s facilities will now include “green clauses” to minimize environmental impact.
Capital BC Grand (leasable area – 9,100 sq. m.), Diana Lux Logistic (15,000 sq. m.) and Terminal Kharkiv (11,700 sq. m.) were acquired by the company in 2017-2019.
Dragon Capital is one of the largest investment companies in Ukraine. It works in the field of direct investment and financial services, provides a full range of investment banking and brokerage services to corporate and private clients.
The commercial real estate portfolio is managed by Dragon Capital Property Management. As of January 2021, it manages 29 commercial properties, including 13 office properties, six retail properties and ten logistics complexes, with a total area of 662,000 square meters.

DRAGON CAPITAL PLANS TO RETURN TO PRE-CRISIS INVESTMENT RATES

Dragon Capital plans in 2021 to return to the rates of investments that were before the pandemic, Dragon Capital Head Tomas Fiala said.
“In the first half of the year, we plan to close five deals together with co-investors and Western funds for about $200 million. We hope to close them in the first half of the year, so we will return to the rates of investments that were before coronavirus [COVID-19],” he said at the EBA Global Outlook meeting hosted by the European Business Association on Thursday.

DRAGON CAPITAL SELLS OMEGA-2 LOGISTICS COMPLEX IN BROVARY

Dragon Capital has completed the sale of the Omega-2 class A logistics complex with an area of ​​32,700 square meters in Brovary (Kyiv region), according to its press service on Monday.
“This is our first closing of a commercial real estate sale deal after we made a bet on this segment in 2016, and it demonstrates that there are opportunities in this market not only for profitable investments, but also for exits,” Dragon Capital Managing Director Volodymyr Tymochko said.
According to him, the company also continues to consider the possibility of spot acquisitions in the warehouse real estate sector. In addition, the plans also include the development of the company’s industrial parks in Kyiv (E40 Industrial Park) and Lviv (Ryasne-2).
Dragon Capital is one of the largest groups of companies in Ukraine, which works in the field of investment and financial services and provides a full range of investment banking, brokerage, and asset management services to institutional, corporate and private clients.

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DRAGON CAPITAL SELLS LOGISTICS COMPLEX

Dragon Capital has completed the sale of the Omega-2 class A logistics complex with an area of ​​32,700 square meters in Brovary (Kyiv region), according to its press service on Monday.
“This is our first closing of a commercial real estate sale deal after we made a bet on this segment in 2016, and it demonstrates that there are opportunities in this market not only for profitable investments, but also for exits,” Dragon Capital Managing Director Volodymyr Tymochko said.
According to him, the company also continues to consider the possibility of spot acquisitions in the warehouse real estate sector. In addition, the plans also include the development of the company’s industrial parks in Kyiv (E40 Industrial Park) and Lviv (Ryasne-2).
Dragon Capital is one of the largest groups of companies in Ukraine, which works in the field of investment and financial services and provides a full range of investment banking, brokerage, and asset management services to institutional, corporate and private clients.

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