Development

Czech Development Fund SICAV, A.S.

Qualified Investor Fund

Qualified Investor Fund

up to 6.75 % p.a.
target return
to 31.3.2022
CZK 1 billion
expected volume of the fund’s assets in 12 months
3 to 5 projects
in the course of 12 months

About the fund

Set your path and invest in development projects with added value.

Czech Development Fund SICAV, a.s. is designed for experienced and confident investors who value the attractive appreciation of their funds through participation in development projects. The fund focuses on investments in the development of residential, manufacturing and logistics properties in Central Europe. The implementation of the projects is overseen from start to completion by a project team of experts with many years of experience in real estate investment, project management and bank financing. This allows the fund to achieve maximum appreciation. You can invest in the fund starting from CZK 1 million.

Investment strategy

The fund’s strategy is to invest in development projects with interesting returns, in particular in logistics, light manufacturing and housing construction, to participate in their implementation and control, and to appreciate invested funds of investors through subsequent sales of completed properties.

Acquisitions are aimed at:

  • fully prepared projects, determined for immediate commencement
  • land plots with valid development consents and building permits
  • medium-sized projects up to CZK 100 million

The fund’s yield is generated from the increasing value of properties during construction, and from their subsequent sales. The recommended investment horizon is therefore 5 years.

Diversification of real estate supports long-term stability of the fund’s performance and growth of invested capital. The fund’s participation in a project from its very beginning until its sale allows the fund to actively influence the project design, construction progress, financing and thus its future market value.

The fund chooses partners with experience in the construction and financing of development projects who share the same philosophy and values.

Investors’ deposits in the fund
1.  Investors’ deposits in the fund
Acquisition of property/SPV
2.  Acquisition of property/SPV
Selection of the developer, funding
3.  Selection of the developer, funding
Project construction
4.  Project construction
Project completion and sale
5.  Project completion and sale
Yield
6.  Yield

Preferred shares

Attractive investment appreciation thanks to preferred investment shares.

Qualified investors can participate in the development of residential or industrial real estate through „preferred investment shares“ (PIAs) with a conditional guarantee of returns that provide them with a return of up to 6.75% per annum, but with a minimum return of 5.75% per annum of the amount of the fund capital of the performance investment shares (VIA I).

Set your path and invest in development projects with added value:

  • target return 8% p.a.
  • expected volume of the fund’s real estate: CZK 1 billion by the end of 2022
  • 3 up to 5 projects by the end of 2022

Therefore the fund founder is highly motivated in the successful project implementation. In the event that the fund’s performance is lower than expected, the minimum return* of 7% p.a. up to the amount of the fund capital appropriated to performance investment shares (VIA I), owned by the fund founder, is guaranteed to the holders of priority investment shares.

*Example of how the guarantee of minimum return on priority investment shares (PIA) up to the amount of the VIA I fund capital works

Guarantee of the minimum return on priority investment shares* (PIA) of 7% p.a., even if the fund’s profit is lower or the fund incurs a loss. The guarantee is a form of redistribution of the fund’s capital from holders of performance investment shares, class I (VIA I), held by the fund founder, for the benefit of holders of priority investment shares*, up to the amount of the fund capital appropriated to performance shares, class I.

* Note: Model of return in the event of a 10% founder’s share in the fund’s assets (PIA)

Graf

Model development of one-million investment

Model development of one-million investment
INFO

Information for investors

Legal form of the fund joint-stock company with a variable capital stock (SICAV)
Fund type qualified Investor Fund
Date of entry in the Commercial Register 1. 5. 2021
Supervisory body Czech National Bank
Manager/Administrator AVANT investiční společnost, a.s.
Depository Československá obchodní banka, a. s.
Auditor PricewaterhouseCoopers Audit, s.r.o.
Investment horizon 5 years
Minimum amount of investment 1,000,000 CZK
Entry fee (PIA) up to 3%, depending on the investment amount
Exit fee (PIA) 0% after expiry of 45 months from subscription, 3% after expiry of 36 months,
6% after expiry of 24 months, 9% after expiry of 12 months,
12% before expiry of 12 months
Maturity of purchased PIA investment shares within 3 months
Determination of investment share (PIA) value monthly in CZK

Why invest with CZECH FUND?

  • Yield up to 8% p.a., minimum yield 7% p.a.
  • The risk is diversified into various projects in terms of segment and region
  • External independent valuation by reputable international companies
  • The fund is controlled by the administrator, depository and regulated by CNB
  • Cooperation with quality partners, suppliers and leading banks
  • Experienced team for construction control and financial management of projects

Statutory information – notice for investors

Czech Development Fund SICAV, a.s. is a fund of qualified investors according to Act No.240/2013 Coll., on investment companies and investment funds; only a qualified investor according to Section 272 of this Act can exclusively become the shareholder or stockholder in this fund. In the case of an investment between CZK 1,000,000 and EUR 125,000, the suitability of such investment for the investor is assessed by the fund manager or administrator. The administrator warns investors that the value of investment in the fund might decline and rise and the return of the initially invested amount is not guaranteed. The fund performance in the previous periods does not guarantee the same or higher performance in the future. Investment in the fund is determined to achieve return during its long-term holding and it is therefore not appropriate for short-term speculation. In particular, potential investors should consider the specific risks that may arise from the investment objectives of the fund as set out in its statutes. The investment objectives are reflected in the recommended investment horizon as well as the fees and expenses of the fund.

Detailed information is contained in the fund or sub-fund statutes, which can be obtained upon request at the AVANT IS registered office, or by sending a request to info@avantfunds.cz.

For further important information, please refer to the Key Information Document (KID). The fund’s Key Information Document (KID) is available at: https://www.avantfunds.cz/en/obligation/ or can be obtained by sending a request to info@avantfunds.cz. In paper form, the above information can be obtained at the registered office of AVANT investiční společnost, a.s. CITY TOWER, Hvězdova 1716/2b, 140 00 Prague 4 – Nusle. The specified information only has an informative character and neither constitutes a proposal for entering into a contract nor a public offer as defined by the provisions of the Civil Code.

Information on the processing of personal data related to Act No. 110/2019 Coll., on personal data processing, can be found on the website of AVANT investiční společnost, a.s.: www.avantfunds.cz/en/gdpr/.

More information can be found under this link Important information about funds for investors | Avant (avantfunds.cz)

FAQ

Frequently asked questions

  • Why invest in a real estate fund with development projects?

    The implementation of development projects usually generates higher profits than existing, fully leased properties. These profits, as well as risks, are shared by the developer and the investor, i.e., the fund in our case. Thanks to investment in development projects in residential and industrial construction that are attractive in the long term, the fund diversifies income and thus diversifies the risk as well. A decrease in the fund’s performance below 5.75% p.a. will be borne by DRFG first.

  • What is the minimum investment in the DEVELOPMENT fund?

    The minimum investment in the fund is CZK 1 million. The fund allows experienced investors to invest in more profitable assets in the form of development projects.

  • How does an investment in the fund exactly work?

    The Real Estate Fund that focuses on development projects gathers deposits of individual investors for which the fund buys land plots, development projects or ownership interests in companies with development projects. The yield is generated from the increasing value of the properties during the construction, and primarily from the sale of the properties to final owners. Investors buy shares through which they become co-owners of developed properties.

  • What are priority investment shares?

    Holders of priority investment shares have a priority over holders of other classes of performance investment shares to crediting the fund’s yields at the minimum rate of 7% p.a. and at the maximum rate of 8% p.a. If the fund’s performance drops below the level of the minimum yield, this yield will be added from the assets appropriated to Performance Investment Shares, class I, of the fund.

  • What is the recommended investment period?

    In consideration of the fund’s focus and development of development projects in time, the investment horizon is at least five years, during which time the investor’s investment will significantly appreciate.

  • What fees are associated with an investment?

    An entry fee is associated with investments in the fund, which is 0-3% of the invested amount, depending on the investment amount.

  • Who ensures the fund administration?

    The fund administrator is AVANT investiční společnost, a.s., an investment company. Czech Development Fund SICAV, a.s. is regulated by the Czech National Bank.

  • How can I monitor the fund’s performance and implemented projects?

    Investors are informed on the current performance of the fund in regular reports that are sent to their contact address. The fund publishes the Annual Report on the fund’s activities every year. These and other materials are also published on the fund’s website and on the website of the fund administrator.

  • Who is the founder of the fund?

    The founder of the fund is DRFG, an investment group that focuses on investments in real estate, telecommunications and financial services. In real estate, DRFG has a ten-year experience in acquisitions and management of retail, warehousing and office properties throughout the Czech Republic, also as part of the Czech Real Estate Fund (CREIF). In 2021, they ensured the technical administration and operation of properties exceeding CZK 8 billion. The total value of the managed real estate exceeds CZK 10 billion.

More questions?

If you have more questions regarding this fund, or if you want to directly contact our representative for the sale of Czech Development Fund shares, you can use the link below, and we will promptly answer you.