First Property Group PLC New Investment in Poland (1830R)
13 June 2018 - 4:00PM
UK Regulatory
TIDMFPO
RNS Number : 1830R
First Property Group PLC
13 June 2018
Date: 13 June 2018
On behalf of: First Property Group plc ("First Property",
"the Company" or the "Group")
Embargoed: 0700hrs
First Property Group plc
New investment in Poland
As set out in our Preliminary Results announced last week, in
September 2017 the Group acquired the principal operating companies
owning the majority of properties situated in Krakow Business Park
(KBP), Poland. Krakow is the second largest city in Poland with a
population in its metropolitan area of some 1.5 million.
KBP comprises four Class A office buildings with a gross
leasable area of some 50,000 m(2) , half of which is vacant. There
is room in the park for additional development. It is close to
Krakow International Airport and has its own railway station.
At the time of our purchase the value of the investment was
compromised by the bank loans secured on the properties, which were
all in default. On 25 May 2018, after the Group's financial year
end, the bank loans were restructured so that the debt is no longer
in default. The total value of the bank loans is EUR47 million.
First Property is now pleased to announce that:
1. It has secured third party investor commitments from a group
of investors to invest some EUR33 million of new equity in Fprop
Phoenix Ltd, the holding company for KBP, with the aim of making it
the best business park in and around Krakow. These investors
include the Willis Towers Watson Partners Fund, Christ Church,
Oxford, St Catherine's College, Oxford and Christ's College,
Cambridge.
2. The Group, which is not participating in this fundraising,
now owns some 23.4% of the issued share capital of Fprop Phoenix
Ltd. The Group's share will be treated as an associate and, in
keeping with its accounting policies, will be held at cost plus
associated expenses of GBP900,000 (rather than at its market
value).
3. In addition to earnings derived from its shareholding in KBP,
the Group will earn management fees of EUR360,000 per annum.
With effect from later in June/ July 2018 the Park is to be
renamed Eximius Park to reflect its excellent future.
Ben Habib, Group Chief Executive, First Property said:
"We fully expect to make Eximius Park the best business park in
and around Krakow. The buildings on the park provide excellent
office space but we shall be expanding its facilities to make it a
home away from home for its tenants. Our plans include a new sports
ground, park area, additional car parking, a free bus service for
all tenants, a refurbished railway station with an improved
frequent service to central Krakow (some 15 minutes away), new
retail facilities, top of the range restaurants, a kindergarten and
much much more. And en route we expect to earn good returns for our
shareholders and our investors in the Park."
-Ends-
For further information please contact:
First Property Group plc Tel: +44 (20) 7340
0270
Ben Habib (Chief Executive Officer) www.fprop.com
George Digby (Group Finance Director) investor.relations@fprop.com
Jeremy Barkes (Director, Business
Development)
Arden Partners (NOMAD & Broker) Tel: +44 (20) 7614
5900
Chris Hardie (Director, Corporate
Finance)
Ben Cryer (Corporate Finance)
Redleaf Communications (PR) Tel: +44 (20) 3757
6865
Robin Tozer / Lizzie Cowell firstproperty@redleafpr.com
Notes to Investors and Editors:
First Property Group plc is an award winning property fund
manager and investor with operations in the United Kingdom and
Central Europe. Around one third of the shares in the Company are
owned by management and their families.
Its focus is on higher yielding commercial property with
sustainable cash flows. The company is flexible and takes an active
approach to asset management. Its earnings are derived from:
-- Fund management - via its FCA regulated and AIFMD approved
subsidiary, First Property Asset Management Ltd (FPAM), which earns
fees from investing for third parties in property. FPAM currently
manages twelve funds which are invested across the United Kingdom,
Poland and Romania.
-- Group Properties - principal investments by the Group, to
earn a return on its own capital, usually in partnership with third
parties. Investments include ten directly held properties in Poland
and Romania (including five held by Fprop Opportunities plc [FOP],
in which the Group is currently the majority shareholder), and
interests in nine other funds managed by FPAM.
Listed on AIM the Company has offices in London, Warsaw and
Bucharest. Further information about the Company and its products
can be found at: www.fprop.com.
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END
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