Malmö-based housing landlord Heimstaden Bostad has exchanged contracts to acquire the shares of a residential property portfolio in the Czech Republic owned and operated by Residomo from funds advised by Blackstone Tactical Opportunities and Round Hill Capital for €1.3 bn.
The package, the largest privately held residential portfolio in the Czech Republic, provides high-quality affordable homes and consists of approximately 4,515 assets with 42,584 residential units and 1,675 commercial units.
Funds advised by Blackstone Tactical Opportunities and Round Hill Capital acquired the portfolio in 2015. Through multiple capital investments including significant refurbishment and maintenance expenditure and corporate and social responsibility (CSR) programmes, Round Hill Capital has significantly improved the quality of the underlying assets and neighbourhoods for the long term and consolidated them into an enhanced in-house management platform, which was rebranded as Residomo in 2017.
The portfolio is focused mainly in the Moravia-Silesia region, which has over 1.2 million inhabitants and is the most densely populated region in the Czech Republic after the capital city Prague. Approximately one-third of the portfolio is in Ostrava, which is the second largest urban area in the Czech Republic and located approximately 350km East of Prague.
Round Hill Capital was advised by Evercore, Arcadis, PWC, Simpson Thacher and Dentons on the transaction. Heimstaden was advised by J.P.Morgan, Clifford Chance, Sentient and EY on the transaction.
The transaction is subject to customary anti-trust clearance and is expected to close in Q1 2020.
Commenting on the transaction, Michael Bickford, founder and CEO of Round Hill Capital, said: 'This sale is in line with Round Hill Capital’s strategy of investing in high-quality portfolios and improving the value and enhancing the quality of the underlying assets for the long term by optimising their operational performance in a responsible manner. Round Hill Capital’s proven track record and our professional, hands-on residential property management expertise ensures that we provide our tenants and wider neighbourhoods with well-invested and improved homes, communities and management platforms and services that are sustainable over the long term.'
Patrik Hall, CEO of Heimstaden, commented: 'In Residomo, we see a great opportunity to live out the vision of Heimstaden with a well-managed and fully insourced platform, and we look forward to continuing to strengthen the work that has been done to improve the quality of offerings to the customers and society over the last years. Heimstaden’s investment in the Czech Republic and the Moravian-Silesian Region is a lifetime investment. We are a long-term owner that invest in our customers’ homes and neighborhoods. And we´re not just buying into a portfolio of apartments, but rather many individuals and important homes. We also invest into the work ethics and thriving business community of this country. We believe strongly in the future of the Czech economy and are here to stay.'