Sorainen advised CPA:17-Global on the acquisition of a 70% position in a joint venture with Baltic Retail Properties. The portfolio includes eighteen retail stores and one logistics facility in locations throughout Lithuania, Estonia, and Latvia. The assets are leased on a long-term basis to Kesko Senukai, a prominent do-it-yourself retailer in the Baltic States.
The investment totaled approximately EUR 127 million including associated fees and expenses and is CPA:17-Global’s second transaction in the Baltic States following its acquisition in December 2016 of a modern Class-A central logistics facility in Lithuania, also leased to Kesko Senukai (as reported by CEE Legal Matters on December 19, 2016).
CPA:17-Global is managed by affiliates of W. P. Carey Inc., an internally-managed net-lease real estate investment trust based in the USA that provides real estate-based financing solutions primarily for companies in the USA and Europe.
Arvi Luoma, Managing Director of W. P. Carey Inc., commented: “We are delighted to continue investing in the Baltic States, while expanding our relationship with a strong tenant like Kesko Senukai in a sector recognised as one of the most promising in the region. W. P. Carey’s access to capital and ability to structure and underwrite a complex multi-jurisdictional transaction allowed us to provide liquidity to the owners of the real estate investment vehicle, while adding attractive income-generating assets that meet our investment criteria for the CPA:17-Global portfolio.”
Sorainen advised CPA:17-Global on Lithuanian law issues throughout the transaction as well as legal due diligence and negotiations. The Sorainen team was led by Partner Kestutis Adamonis and included Senior Associate Asta Augutyte-Rapkeviciene and Associates Karolis Kunigelis, and Ugne Trakymiene.
Sorainen also advised CPA:17-Global on debt financing-related matters, including on the structure of the financing and security portfolio and related documentation. Sorainen additionally represented CPA:17-Global in negotiations with a local bank on facility agreements and a transaction security document package governed by Lithuanian, Latvian, and Estonian law, as well as hedging documentation. The Sorainen team involved in financing matters included Counsel Augustas Klezys and Associates Lina Ragainyte, Urte Armonaite, Edvins Draba, and Erik Salur.
Editor's Note: After this article was published, Ellex announced that its team in Lithuania consisted of Associate Partner Indre Jonaityte-Grice, Partner Tomas Milasauskas, Senior Associate Donata Montvydaite, Senior Associate Ruta Besusparyte, and Senior Associate Laurynas Narvydas. Its Estonian team consisted of Senior Associate Alla Kuznetsova and Partner Martin Kaerdi. Latvia Senior Associate Maris Brizgo provided advice in that country.