Arceland ::

ADP – Arceland Developed Properties

On November 2008, Arceland launched a new initiative, called Arceland Developed Properties or “ADP” with the aim to enter the ‘NPL’ real estate business in Bulgaria. ADP intends to deploy €100 million to acquire well located, high quality ‘new build’ residential inventory in Sofia that is presently available at cost due to the current financial crisis. The significant change of the market since Q4 2008, has driven the annual absorption rate of new residential units in Sofia from nearly 4,000 units in 2008 per year to 2000 in 2009. As a result, a number of quality residential development projects are frozen, and ADP provides an exit strategy through which the developer can complete the project and capture profits from his initial ‘off plan’ sales, the bank can be repaid its construction loan and ADP can take delivery of carefully selected units in 2011 and beyond at prices below replacement cost.

Presently ADP has tentative agreements with developers and their banks to acquire an initial inventory of up to 1200 apartment units with average leverage of 65%, requiring an equity investment of €26,000,000.