Stellar Asset Management is set to launch a fund designed to capitalise on the developing property market in the Baltic States.
The Stellar Baltic States fund will “identify ‘off-market’ deals” through local firms Bristol and Stone and Capital City Developments.
Stellar says the product, which will seek annual total returns of 15%, is aimed at providing asset growth over the short to medium term and will explore “development and planning changes as well as more conventional opportunities”.
Jonathan Gain, Stellar chief executive, says: “This is a particularly exciting venture as the fund has been seeded with six properties, allowing investors entry at the original purchase cost.
“There is a window of opportunity to invest before the first valuation at which time there may be uplift in value.
“We have known Bristol and Stone, the fund’s property advisers, for many years and have been impressed with their unique ability to source interesting transactions where there is excellent potential for generating substantial returns.”
Stephen McKeever, property director at Stellar, adds: “The real estate market in the Baltics is not yet a decade old, so continues to change and develop quickly.
“It is important that any investment strategy maintains the flexibility to adapt with the market over the coming years.
“The fund will be investing in areas where the local market shows greatest demand.”
The Stellar Baltic States fund will be a closed-ended limited partnership and is seeking to raise £10m. Minimum investment is £25,000, with initial commission of 4% and 0.5% trail.
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