VILNIUS - Lithuania's largest conglomerates, Invalda and MG Baltic, have teamed up in an ambitious foray on the Riga real estate market that could result in as much as 290 million euros in investments.
"Our entry into that market was very timely. Demand for such real property is high. Our portfolio in Riga is not as large as we want it to be yet, so we are on the lookout for more land or buildings," Invalda Real Estate director Tomas Bucas said.
"I think we could acquire another two or three, or perhaps even five, major pieces of real estate," Bucas said.
He said one major project, at a price of over 500 million litas, would be a multi-functional complex on a six-hectare territory owned by Celtniecibas Pasaule on the west side of the Daugava River. It will include residential, commercial and office buildings, Bucas said.
Also, Pozityvios Investicijos, a subsidiary of Invalda and MG Valda, part of the MG Baltic group, have purchased more than 50 hectares of land near a Riga bypass road where they will build a shopping center and warehouses. The total area of the buildings would be around 200,000 square meters.
Invalda and MG Baltic have also established Ammo, a Latvian company that has begun construction on a multistory building in downtown Riga. In addition, they own shares in Lapegles, an industrial and logistics center covering 50 hectares of land close to the capital, and Gravity, a company that owns a plot of land.
Previously Invalda set up a real estate subsidiary, Inreal, in Riga. Bucas said they expect it to become a major real estate agency this year.
Invalda has been particularly active on the Baltic real estate market in recent weeks. In December, it announced that Invalda Real Estate Fund bought eight buildings from Lietuvos Telekomas for 20 million euros. Rimas Kirdulis, head of the commercial department with InReal, said at the time, "The purchase of Lietuvos Telekomas' buildings is one of the major transactions both in Vilnius and all of Lithuania."
The Invalda Real Estate Fund also owns the Vilnius business center IBC. The fund said it intended to make a debut on the Vilnius Stock Exchange in the first half of 2006.
The Invalda group has interests in approximately 40 companies, including Sanitas, Lithuania's largest pharmaceutical company, Finasta, a leading brokerage, Vilniaus Baldai, a furniture company and Holiday Inn hotels.
MG Baltic, in the meantime, is continuing its reorganization, discarding smaller and loss-making companies and focusing on larger businesses. It has sold its stakes in Apavikta, a shoemaker, the Neringa Hotel, Elta and others. CEO and owner Darius Mockus said in October that the company was also eyeing a public listing, but only in four 's five years' time.
