UAB Capitalica Baltic Real Estate Fund I
SBA Group's Capitalica Asset Management chose Latvian contractor Velve to build an office complex in Riga
The Verde business center in downtown Riga will be built by the Latvian construction company Velve. Velve signed a €49 million general contractor’s agreement with Capitalica Asset Management. Construction of the business center is set to begin as early as October, and the entire complex is scheduled to be completed by the end of 2023.
“This is one of the largest and most innovative projects that Riga’s construction sector has seen in the last few years, therefore, the tenderers were subject to very high standards. We evaluated the proposals of the five largest construction contractors in the Baltic States, their experience in implementing similar projects, the quality of work, their ability to implement complex engineering solutions, and good reputation and selected Velve as a company that fully meets all these criteria,” said Andrius Barštys, CEO of Capitalica Asset Management, an SBA investment management company developing the project.
Verde will be one of the largest business centers in the Latvian capital. Its area, including underground parking, will reach 45 thousand square meters. The complex of two class A business centers will be built on a 1.3 ha plot in Skanste neighborhood in the center of Riga. The total of €65 million is to be invested in the project.
According to Mr Barštys, the analyzes showed that the COVID-19 pandemic did not negatively affect the office market in Latvia. Working from home did not reduce the demand for innovative and sustainable buildings, as the world begins to treat offices not as basic workplaces but as an important component in creating a corporate culture.
“During 28 years of operation, we have implemented hundreds of projects, that required professionalism, accuracy and impeccable quality, such as the installation of the Air Baltic headquarters, the construction of a modern National Library of Latvia, and the reconstruction of the symbol of Riga - House of the Black Heads, which is an architectural monument of the 14th century. The implementation of the Verde project is one of the most interesting challenges in the company’s history. This project is a sign of appreciation for our experience in large projects. We are proud to have the opportunity to establish a new quality sustainability standard in the Latvian construction sector,” said Chairman of the Executive Management Board of Velve, Kaspars Rokens.
Verde project is very important for the developer and Velve will take a special care to deliver the project on time and in highest quality, says Ivo Bralēns, Member of Executive Mananagement Board, whose experience in construction business is more than 25 years long and projects like concert hall Great Amber in Liepāja, Skanstes residential buildings in Riga are just some among his extensive list of references.
Capitalica Asset Management announced a new contractor’s tender after the termination of the contract with the winner of the previous tender, the Latvian construction company Merks, in August due to breaches of contractual obligations.
The European Investment Bank (EIB) has provided a €22 million loan for the construction of the Verde green office complex, with funding from the investment package to combat climate change, as the business center is planned to be a nearly zero-energy building. The project is also financed by commercial banks and the real estate fund Capitalica Baltic Real Estate Fund I.
At the design stage, the complex was awarded the BREEAM Excellent sustainability certificate. It received the highest evaluations in the categories of ecology and land use, water management, transport, and waste management.
The Verde complex will be equipped with silent ventilation systems. It will also have a maximum amount of daylight per workplace. The internal spaces of the buildings will allow for modification to adapt the interior to individual needs. The buildings will have innovative engineering systems, such as raised floors and a modern chilled beam system for cooling. Fifth floors of both of the buildings will house green terraces. The project will use renewable energy sources that meet the high requirements for a modern building and the NZEB standard for near-zero energy buildings.
The construction company Velve, which belongs to the MN Holding Group, is the third-largest construction company in Latvia and one of the largest companies in this sector in the Baltic States. The company has implemented over 250 major construction projects: shopping malls, industrial enterprises, hotels, public use and residential buildings.
The Verde Business Center will belong to Capitalica Baltic Real Estate Fund I, a real estate fund managed by SBA Group company Capitalica Asset Management. According to the audited data, in 2019, Capitalica Baltic Real Estate Fund I made €4.4 million in profits.
Capitalica Baltic Real Estate Fund I, established in 2016, also manages the business center 135 in Vilnius, the business center Kauno dokas in Kaunas and the shopping center Luizė located in Klaipėda. Its controlling shares (70%) belong to one of the largest Lithuanian capital business groups SBA, 30% of the shares belong to Mr Barštys’ company Fox Holdings.
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