Acquisition

25 Jun 2007 11:36

Fabian Romania Property Fund Ltd25 June 2007 Fabian Romania Property Fund Limited ("Fabian Romania" or "Fabian") Fabian Romania acquires a 50 per cent. interest in a residential developmentsite to build 250 apartments in Timisoara for €4.7 million Fabian Romania is pleased to announce that it has purchased 50 per cent. of adevelopment company owning a 1.1 hectare site in north Timisoara. The equityconsideration amounts to approximately €1 million. The land area totals approximately 11,000 square metres and has urban zoningapproval to build over 250 apartments (subject to building permits) comprisingover 30,000 square metres of residential development space. Coltex, theco-shareholder holding the other 50% interest, has entered into a partnershipagreement with Fabian. Coltex will also be the development manager and has aknown track record, having developed and sold the successful Banu Antonachebuilding to Fabian in late 2005. Timisoara is Romania's third largest city with a population of over 300,000 andis located in the West close to the Hungarian border. The Investment Managerbelieves the city has attractive characteristics for supply of modernresidential apartments. The purchase price for the land including acquisition expenses was €4.7 million.This equates to around €427 per square metre for the land and €157 per builtsquare metre overground, assuming 30,000 square metres. The development companyhas already secured and fully drawdown on a land finance facility from BancaRomaneasca for €3.6 million. Including near term working capital needs, thisleaves an initial net equity requirement of approximately €1 million for Fabian. Responsible for the acquisition, Mark Owen, Property Director of Fabian Capital,Fabian Romania's investment adviser said: "This is the first investment for Fabian outside Bucharest and our secondresidential scheme. The purchase price for the land is extremely attractiverelative to comparable plots in Bucharest. We are also happy to have enteredinto a new partnership with Coltex for this development. Whilst it is clearTimisoara is in its infancy within the development process, strong indicationsexist that the residential sector is very undersupplied and that demand existsfor good, mid market apartments against a background of increasing prices." For Comments: Fabian Romania:Mark Holdsworth +44 20 7499 9988 Nominated Adviser:Deloitte & Touche LLPJames Lewis +44 20 7936 3000 Broker:Shore Capital Stockbrokers LimitedDru Danford +44 20 7408 4090 This information is provided by RNS The company news service from the London Stock Exchange