Northern Horizon Capital AS has approved the unaudited consolidated interim report of the Baltic Horizon Fund (the Fund) for the second quarter of 2025. The Fund’s strategy focuses on concepts with public and social sector tenants and the development of multi-purpose buildings in city centers, designed to inspire, encourage, and enhance the lives of today’s urban dwellers and communities.
Challenges in Implementing the Strategy:
Achieving a 90% occupancy rate has been difficult due to challenges in finding new tenants and retaining existing ones. The occupancy rate at the end of the second quarter was 84.2%. While some results have improved, certain leases in properties like Upmalas and Linconas exceed new lease volume. Net operating income per square meter (NOI/m²) has slightly increased from 107 in the first quarter to 109 in the second quarter. However, reaching the target of €130/m² in the medium term is challenging due to rising tenant operating costs and rental price pressure in a competitive market.
Financial Indicators and Outlook:
Achieving the 50% long-term loan-to-value (LTV) target may only be possible in the near future by selling some real estate assets and/or raising additional capital. The Fund’s net cash flow remains negative due to ongoing investment in asset transformation and existing loan burdens. The Fund is developing a new refinancing strategy to strengthen its capital structure in the second half of 2025.
Rental Results and Portfolio Occupancy:
The Fund signed new lease agreements for approximately 9,250 m² and extended leases for about 6,600 m² in the first half of 2025. The Fund welcomed 30 new tenants and retained 22 existing ones. Notable events included the opening of a new restaurant zone on the first floor of Europa and the signing of lease agreements for the operation of a sports center on the third floor, among other developments.
Property Investment and Financial Position:
As of June 30, 2025, the Fund’s portfolio had an occupancy rate of 84.2% based on the transfer date of rental space. The weighted average remaining lease term increased to 3.5 years, reflecting a positive trend. The Fund’s total assets decreased to €238.8 million as of June 30, 2025, compared to €256.0 million on December 31, 2024.
Consolidated Financial Statements:
In the second quarter of 2025, the Fund reported a net profit of €77,000, a significant improvement from the net loss of €12.2 million in the same period in 2024. The Fund’s financial position remains stable, with a continued focus on improving asset productivity and maximizing net operating income.
For more information, please visit the official Baltic Horizon Fund website or contact the fund manager, Tarmo Karotam, via email. The Fund’s goal is to enhance long-term investor value through strategic investments and asset optimization strategies.
Read more at GlobeNewswire: Baltic Horizon Fondi 2025. aasta II kvartali