In the first quarter of 2025, EfTEN Real Estate Fund AS invested a significant part of the capital raised in the previous quarter, primarily in the elderly care home segment. In February, the Fund’s 100% subsidiary EfTEN Hiiu OÜ signed a binding agreement to acquire the property at Hiiu 42 in Tallinn, with the aim to developing a general care home in cooperation with Südamekodud AS. The acquisition price of the property was €4 million, with up to an additional €2.5 million for the reconstruction of the building. The expected return on the investment is 8% per annum. At the end of March, the real rights contract was concluded and the transaction finalized. As part of the transaction, EfTEN Hiiu OÜ signed a long-term (10+10 years) lease agreement with Hiiu Südamekodu OÜ. Part of the property continues to be used by the North Estonia Medical Centre Foundation. The building will be partially reconstructed into the “Nõmme Südamekodu” general care home, with future capacity for up to 170 clients.
In January 2025, the Fund’s subsidiary EfTEN Ermi OÜ commenced construction of the second phase of Tartu Südamekodu, which will add 60 beds and a solar park to the existing care home. The total project cost is approximately €1.3 million, with construction expected to be completed by July 2025. The expected return on this investment is 8.1% per annum.
Upon completion of these projects, EfTEN Real Estate Fund AS will own four elderly care homes with a combined capacity of nearly 800 beds.
On 31 March 2025, the Fund’s subsidiary EfTEN Seljaku OÜ terminated the lease agreement with AS Hortes (in bankruptcy) concerning the Laagri Hortes properties. A new lease agreement has been signed with Rikets Aianduskeskus OÜ, which will commence operations on the premises as of 1 April 2025.
In April 2025, the ICONFIT logistics building owned by the fund’s subsidiary EfTEN Paemurru OÜ was completed. The fund began earning rental income from the property starting from April 15.
Financial Overview
The consolidated sales revenue of EfTEN Real Estate Fund AS for Q1 2025 amounted to €7.858 million (Q1 2024: €7.961 million), and the consolidated net rental income (NOI) totaled €7.211 million (Q1 2024: €7.343 million). The net rental income margin remained stable at 92% (2024: 92%), indicating that costs directly related to property management (including land tax, insurance, maintenance and improvement expenses) and marketing accounted for 8% (2024: 8%) of revenue.
The Fund’s consolidated net profit for Q1 2025 was €4.167 million (Q1 2024: €3.808 million). A key contributor to the profit growth was the decrease in interest expenses due to the decline in EURIBOR—interest costs fell by €432 thousand, or 19%, compared to Q1 2024.
Real Estate Portfolio
As of 31 March 2025, the Group held 37 (31 December 2024: 36) investment properties with a total fair value of €380.160 million (31 December 2024: €373.815 million) and an acquisition cost of €376.906 million (31 December 2024: €370.561 million). In addition to properties held by subsidiaries, the Group owns a 50% stake in the joint venture operating the Palace Hotel in Tallinn, with a fair value of €8.632 million as of 31 March 2025 (31 December 2024: €8.630 million).
In Q1 2025, the Group made new and follow-on investments totalling €6.345 million.
In March 2025, EfTEN Hiiu OÜ acquired the property at Hiiu 42, Tallinn, for €4 million. The North Estonia Medical Centre Foundation continues to use part of the property under an existing lease. A long-term (10+10 years) lease was signed with Hiiu Südamekodu OÜ, a subsidiary of Südamekodud AS, which will develop the premises into the “Nõmme Südamekodu” general care home with capacity for up to 170 clients.
Construction of the C-building at Valkla Care Home continued in Q1 2025, with a total investment of €343 thousand. Construction of the second phase of Ermi Care Home in Tartu began, with works totalling €192 thousand during the quarter. In addition, construction at the Paemurru Logistics Centre progressed, with Q1 investment totalling €1.515 million.
In Q1 2025, the Group earned €7.673 million in rental income, remaining on par with the previous year.
As of 31 March 2025, the vacancy rate of the Group’s real estate portfolio was 4.4% (31 December 2024: 2.6%). The highest vacancy was in the office segment at 17.7%, where filling vacant spaces has taken longer than previously.
Financing
In Q1 2025, the Fund’s subsidiary EfTEN Riga Airport SIA extended its loan agreement with the bank. Over the next 12 months, six of the Group’s subsidiaries have loan agreements maturing, with a total outstanding balance of €20.38 million as of 31 March 2025. These maturing loans have LTVs between 29% and 48%. Given the stable rental cash flows of the properties, the Group’s management does not foresee obstacles in refinancing these loans.
As of 31 March 2025, the Group’s weighted average interest rate on loans was 4.37% (31 December 2024: 4.89%) and the loan-to-value (LTV) ratio stood at 40% (31 December 2024: 40%). All loan agreements of the subsidiaries are based on floating interest rates. The Fund’s interest coverage ratio (ICR) was 3.4 as of 31 March 2025 (31 March 2024: 2.9).
Share Information
As of 31 March 2025, the registered share capital of EfTEN Real Estate Fund AS was €114.403 million (unchanged from 31 December 2024), consisting of 11,440,340 shares with a nominal value of €10 each.
The net asset value (NAV) per share as of 31 March 2025 was €20.74 (31 December 2024: €20.37), representing an increase of 1.8% over the first three months of 2025.
CONSOLIDATED STATEMEMT OF COMPREHENSIVE INCOME
| I quarter | ||
| 2025 | 2024 | |
| € thousands | ||
| Sales revenue | 7,858 | 7,961 |
| Cost of services sold | -506 | -418 |
| Gross profit | 7,352 | 7,543 |
| Marketing costs | -141 | -200 |
| General and administrative expenses | -1,006 | -939 |
| Other operating income and expense | -37 | 42 |
| Operating profit | 6,168 | 6,446 |
| Profit/-loss from joint ventures | -58 | -50 |
| Interest income | 83 | 101 |
| Other finance income and expense | -1,803 | -2,235 |
| Profit before income tax | 4,390 | 4,262 |
| Income tax expense | -223 | -454 |
| Net profit of the financial year | 4,167 | 3,808 |
| Total comprehensive income for the period | 4,167 | 3,808 |
| Earnings per share | ||
| – basic | 0.36 | 0.35 |
| – diluted | 0.36 | 0.35 |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
| 31.03.2025 | 31.12.2024 | |
| € thousands | ||
| ASSETS | ||
| Cash and cash equivalents | 19,038 | 18,415 |
| Short-term deposits | 0 | 2,092 |
| Receivables and accrued income | 1,645 | 2,055 |
| Prepaid expenses | 128 | 138 |
| Total current assets | 20,811 | 22,700 |
| Long-term receivables | 140 | 154 |
| Shares in joint ventures | 1,902 | 1,960 |
| Investment property | 380,160 | 373,815 |
| Property, plant and equipment | 121 | 134 |
| Total non-current assets | 382,323 | 376,063 |
| TOTAL ASSETS | 403,134 | 398,763 |
| LIABILITIES AND EQUITY | ||
| Borrowings | 25,858 | 30,300 |
| Liabilities and prepayments | 3,056 | 3,245 |
| Total current liabilities | 28,914 | 33,545 |
| Borrowings | 123,813 | 119,120 |
| Other long-term liabilities | 1,923 | 1,928 |
| Deferred income tax liability | 11,244 | 11,097 |
| Total non-current liabilities | 136,980 | 132,145 |
| TOTAL LIABILITIES | 165,894 | 165,690 |
| Share capital | 114,403 | 114,403 |
| Share premium | 90,306 | 90,306 |
| Statutory reserve capital | 2,799 | 2,799 |
| Retained earnings | 29,732 | 25,565 |
| TOTAL EQUITY | 237,240 | 233,073 |
| TOTAL LIABILITIES AND EQUITY | 403,134 | 398,763 |
