One of the first private-sector affordable housing projects in the Czech Republic, Opatov II with 300 flats in Prague 11 by developer Sekyra Group, has reportedly been sold. The transaction has not yet been announced by the buying parties, but credible sources have confirmed it. The transaction was also confirmed by an advisor to the selling party. According to the information available, part of the flats are to be acquired by the insurance company Kooperativa from the Vienna Insurance Group and part should be bought by Dostupné bydlení České spořitelny (subsidiary of Česká spořitelna bank) as the company's second housing project in Prague. The transaction amount has also not yet been disclosed.
The Opatov II project in Prague 11 district will become one of the first cases of affordable housing sponsored by the private sector in the Czech Republic and one of only a few cases of rental housing projects in general. This is part of a new trend in the residential market in the Czech Republic as soaring mortgage rates limit buyer demand and force developers to adapt their business strategy to offer more rental projects than before the current crisis. Sekyra, the company building the project in Prague 11, has sold the project completely to two other entities - to the insurance company Kooperativa from the Vienna Insurance Group and the second part to the Česká spořitelna company – Dostupné bydlení České spořitelny (Affordable housing of Česká spořitelna). The advisor of the selling party, the Sekyra Group was Wolf Theiss.
The project will comprise over 300 flats, half of which will be rented to key workers in local municipalities 20% below market value in a similar way to the first housing project of Dostupné bydlení České spořitelny on Prague Prosek that is especially focused on medical staff from the Motol Hospital. "For us in Sekyra Group, the Opatov II project was a first major venture into the B2R market and we’ve chosen Wolf Theiss as our legal counsel to guide us through the process. We had the pleasure of working with the Wolf Theiss real estate team headed by Tomáš Kren, who oversaw a large amount of documentation that had to be drawn up and who always made sure our best interest was represented during negotiations. As the deal featured two large institutional investors, an agreement with a general contractor, an arrangement of bank financing and an ever-changing contract structure, it was crucial to keep track of all connections and implications across all of the contracts," said Ondřej Bílek, Development Financial Manager of Sekyra Group.
"This was one of the most complicated transactions our real estate team has worked on in recent years, not only due to the complexity of forward deals in general but also because both sides of the deal have entered quite a new territory compared to their usual scope of business which together with build-to-rent (BTR) still being quite a new product, led to detailed negotiations of otherwise standardized provisions. We are happy to have helped our client Sekyra Group become one of the pioneers in the BTR sector and affordable housing development", said Tomáš Kren, Head of the Real Estate and Construction Team at Wolf Theiss Prague.
The Wolf Theiss team working on the transaction was led by Tomáš Kren (Counsel, Real Estate) and consisted of Barbora Malimánková (Senior Associate, Real Estate), Dan Schneeweiss (Associate, Banking & Finance) and Matěj Korger (Associate, Real Estate) from the Prague office. They provided a complex legal advisory, including negotiation of the acquisition documents, development management agreement, leaseback of parts of the premises and development financing by a major Czech bank.
Sekyra Group has operated in the Czech real estate market for more than 20 years and is currently developing projects with a total area of over 1 million sqm.
