KLM retail park Žilina

Co-own a retail park in a strategic location with a confirmed large leaseholder

KLM Retail Park Žilina - Rosina is already the 5th investment on the Crowdberry platform with developer KLM real estate. It involves the construction of a commercial zone where investors, together with KLM real estate, a successful developer, will have the opportunity to participate in the proceeds from the development and lease of retail units such as LIDL, which has signed a future lease agreement for more than 50% of the space.

The goal is to complete construction by the middle of next year and sell the retail park within 3 years of its opening, which KLM real estate has successfully achieved in the past with several institutional investors such as Patria Investment Company, Tatra Asset Management, and the 365.invest fund.

Crowdberry investors have already participated in 3 successful KLM real estate sales, where the return exceeded 14% per annum, before Crowdberry's performance fee, while the expected planned return was 11-13% per annum.

The investment structure in the investment documents contains several elements protecting Crowdberry investors, the most important of which is the preference for the payment of the investment and a return of 11% per annum to Crowdberry investors before the payment of equity and the return offered by KLM real estate.

Investment parameters and investor protection:

• 3-year investment horizon with a preferred return of between 11% and 15%
• Preference for payment of 11% annual return for Crowdberry investors

Project and developer:

• 10-year (5+5 years) lease agreement with LIDL for 50+ % of the rental space in the retail park
• provision of investment in land with building permits and agreements on future lease contracts, or binding offers for at least 65% of the lease area
• stable developer with successful sales of portfolios of completed retail park developments to institutional investors such as TAM (Tatra Asset Management), Patria Investment Company, and the 365.invest fund.
• successful implementation of Crowdberry investors' investments in KLM real estate projects with an average annual return of over 14%.

Profit from rent and development:

• 20% share of profits from development
• 90% share of the rent for the premises
• expected sale at a yield of 7% with a return of 13.6% in the 3rd year

Protective mechanisms and securing investor returns:

• inflation protection – annual rent increase of 75% of the inflation rate
• mandatory repurchase of Crowdberry investors' shares after 3 years in case of lower market interest, with a minimum return of 11% per annum.
• guarantee of coverage of additional construction costs by KLM real estate
• preferential liquidity for Crowdberry investors – payment of equity and 11% annual return before the developer
• majority stake (90%) in the company owning the land and development

Investment in the development of a retail park with a total leasable area of approximately 3,000 m² represents an attractive opportunity for investors that is not commonly available on the market. Investors have the opportunity to co-own 90% and share in the development profit from the sale and lease of the property. The investment structure includes protection for Crowdberry investors in the form of liquidity preference, 11% yield preference, and a guarantee of project costs by the developer.

The investment includes land measuring approximately 9,300 m² and rental space covering approximately 3,000 m². More than 50% of the rental space has already been secured by a 10-year lease agreement with supermarket operator LIDL, which provides stable and long-term income.

• Market risk – medium  🟡 

There is a risk of selling the project on the market and secondary occupancy of the hall in the event of tenant default. In the event of unsuccessful sale after 3 years, KLM real estate a.s. guarantees to repurchase the project at an exit yield of 7.2%.

• Permit risk – low 🟢 

Crowdberry's investment is conditional on obtaining a building permit.  

• Tenant risk - low  🟢 

A preliminary agreement has been concluded with a creditworthy tenant for a period of 10 years, who cannot terminate the lease agreement prematurely.

• Construction risk – low 🟢 

Risks associated with construction, e.g., budget increases or construction delays. The general contractor will be a reputable construction company, and the contract will be concluded for a fixed price and a fixed completion date. Upon completion, the general contractor will provide guarantees.

• Financing risk – low  🟢 

The risk of additional budget financing from bank sources is minimized. Crowdberry releases capital only after receiving approved financing from the bank.

• Management risk – low  🟢 

Project management risk is minimized by appointed executives with clear responsibilities. Any deviations from the plan must be approved by the supervisory board. If an executive violates their responsibilities, Crowdberry has the right to replace them with their nominee.

A detailed description of the risks is included in the investment documentation, which investors will receive after expressing their interest in investing.

Investments involve the risk of partial or total loss of the invested funds. The investment opportunity in the target company is provided by Crowdberry Investment Platform j. s. a.