VILNIUS - Norwegian investment company NOR Property Investments AS has purchased Megarenta, the owner of a 30,000 square meter logistics center in Vilnius, for 78 million litas (22.5 million euros).
NPD Industrial, which is owned by Inova Baltic, facilitated the purchase. NOR Property Investments AS is managed by real estate fund Orkla Finans.
The buy is seen as a good find because of Lithuania's strategic geographical position. "Being situated in a favorable geographical position, Lithuania acts as a key transport hub in the CEE region linking Western and Eastern Europe. The transportation and logistics sector enjoys substantial growth every year and markedly contributes to the growth of the national economy," a company spokesperson said.
Lithuania and the Baltic region has seen a remarkable transformation with the replacement of old Soviet-style warehouses with contemporary logistics and distribution facilities, a change driven by demand from strong local and international forces. "As a fact, the region starts providing more and more secure and appetizing investment opportunities to institutional investors as well as development companies," the spokesperson said.
The logistics center was built in two stages in 2005 and 2006 and now is fully leased to the leading companies in their own sectors. Mineraliniai vandenys, Lithuania's largest alcohol and tobacco wholesale trader, and MAP Lietuva 's a pulp and paper wholesale
Leading Lithuanian property developers MG Valda, which belongs to the MG Baltic Group, and Ormina, which is a member of Ogmios Group, jointly developed the property.
Re&Solution acted as agents in the sale. Andrius Stonkus is a Re&Solution partner and said that more and more people are becoming interested in the Baltic region. "We constantly observe growing appetite from investment funds and developers, seeking opportunities to acquire existing contemporary logistic centers as well as searching for possibilities to cooperate with local retail chains, distributors, logistics service providers or manufacturers," he said.
"We are glad to respond positively as far as the Baltic region starts enjoying more and more inviting propositions matching investor requirements in terms of technical grade of the properties, institutional lease contracts and strong occupiers securing steady cash flow," Stonkus added.
Norwegians are not the only people investing in Lithuania. Recently the Germany company Deko Immobilien invested in Lithuania by buying retail center Akropolis in Kaunas. The Frankfurt-based parent company DekaBank believes that Lithuania is showing potential despite its current downturn.
"We expect that GDP growth in Lithuania will moderate in 2008, from 8 percent year on year in 2007 to 5.5 percent year on year in 2008, due to decelerating investment growth and a widening current-account deficit. However, in comparison to Estonia and Latvia the economy remains strong," DekaBank media officer Thorsten Meier told The Baltic Times.
Lithuania is currently experiencing a slowing economy but has avoided the hard landing felt in Estonia and Latvia, where negative growth has begun.
