Acquisition of new subsidiary in Sofia
As first part of the Lozen deal signed in November 2017, on 30 January 2018, Arco Vara AS acquired 100% of the shares of Arco Lozen EOOD, a company registered in Sofia, Bulgaria. Arco Lozen EOOD owns 6 land plots in the outskirts of Sofia, close to Lozen village, of which 3 are intended for construction and the remaining 3 for street infrastructure. Total area of the land plots is 52 780 m2 (5.3 ha), of which 47 450 m2 (4.7 ha) is the area of the 3 construction land plots, on which the Group plans to develop a high-class residential project with apartment blocks, houses, and commercial units like supermarket, kindergarten, sports facilities, and other similar amenities. Detail plan for the area has been enacted and is in force since 2009; currently, the Group is awaiting results from ongoing design bidding. Technical design will commence and finish within 2018, by the end of which the Group also expects to obtain a construction permit for Stage 1 of the project.
As second part of the Lozen deal, by December 2020, Arco Vara AS shall acquire one more Bulgarian company, owner of 9 more land plots, of which 5 are intended for construction and the remaining for street infrastructure, with total area of 67 620 m2 (6.8 ha). On these plots, the next stages of Lozen project will be developed.
Arco Vara Group CEO’s comment: “Arco Vara is on the track of long-term growth and sustainable annual profitability which is based on cash. With the acquisition of Lozen development project in Sofia, and with the acquisition of Paldiski 74 land plot in Tallinn shortly before that, we have taken another important step in our long-term strategy. We have created a suitable land reserve with construction rights, which will allow us to create more than 1000 residential units in Sofia and in Tallinn in the next five years. This enables us to maintain a continuous real estate development and sale process both in Tallinn and in Sofia. Our development pipeline is focused on residential customers. We have chosen projects, where we can create whole living environments and provide our customers experiences beyond expectations. Arco Vara team will pursue the development and sale of Kodulahe and Lozen to customers according to current demand and at the pace that we consider suitable for maintaining good margins. The next objective is to improve the equity turnover and therefore also the profitability of the Group.”
Evelin Kanter
Head of Legal Department
Arco Vara AS
Tel: +372 614 4594
evelin.kanter@arcovara.ee
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