In November 2021, EfTEN signed an agreement with the Lithuanian real estate developer UAB Etapas Group, to build two nine-story rental buildings in Kaunas. The houses are close to completion and the first residents have moved into the new apartments.
Two rental buildings have a total of 96 furnished apartments, of which 64 are two-room and 32 are three-room apartments. Before the completion of the construction works, already a quarter of the apartments are covered with lease agreements. There are many foreigners among the tenants, as the houses are located near the university clinic.
The construction cost per-square-meter, which also includes furniture, is approx. 2,200 euros. This is significantly lower than the square meter price of new apartments in Kaunas. "The construction costs of the house are significantly lower than the market price due to the wholesale purchase of construction works and negotiations with the developer. In this way, we were able to mitigate the risk of a rapid rise in construction prices and thereby create significant value for investors already in the construction phase," said Viljar Arakas, CEO of EfTEN Capital.
Arakas added that the prices of apartments in Lithuania have also increased rapidly and the availability of affordable housing for young families has decreased. "The rental apartments offered by EfTEN fill a largely uncovered niche, and families get their own living space on a turnkey basis."
Rental houses in Kaunas are the second investment of the EfTEN Residential Fund. At the beginning of last year, in Tallinn the Kadaka rental building with 113 apartments was completed. "The results of the first year of Kadaka rental apartments were better than expected. Essentially, from the moment of completion, all the apartments have been continuously rented out, and especially for the smaller apartments, there has been a considerable queue of tenants. This gives us confidence to continue building new houses in Vilnius and Riga as well. In Vilnius, our largest rental housing development with 145 apartments should be completed in about a year, and in Riga we plan to start with the development of 112 rental apartments this year ", commented Viljar Arakas on the progress of the fund and future plans.
In Estonia, investors can invest in EfTEN rental houses through the EfTEN United Property Fund.