AVANT - Česká pole 2015 otevřený podílový fond

We and our business partners have created several attractive investment opportunities for qualified investors. We are preparing others.

Key indicators

Establishment of the fund:

06/2015

Current value of the investment certificate as at 31.12.2018:

1,6438 CZK

Current value of assets as at 31.12.2018:

CZK 211 535 238

Fund performance over the last 12 months as at 31.12.2018:

6 %

Minimum investment in the fund:

CZK 1 million

ABOUT THE AVANT FUND – ČESKÁ POLE 2015 OPF

Thanks to investments mainly in high-quality agricultural land in the Czech Republic, the fund AVANT - Česká pole 2015 OPF enables protection against potential adverse market developments to be achieved in the economic sector for its investors. Since the fund was established, the value of a certificate of participation has increased by about 65 % after deducting all cost (as shown in the chart below), which means an average appreciation of more than 16 % per annum after all costs are deducted.

The price of arable land has risen sharply around the world in recent years. The Czech Republic is no exception, despite the fact that the price growth slowed down in 2018. On the other hand, the value of a certificate of participation for 2018 increased by 6 % despite the minimal increase in agricultural land prices, in particular as a result of our careful land purchase strategy and an emphasis on maximizing returns from the usufructuary leases of the land owned by the fund. Another factor was the effective use of free monetary means in cases where some of them were used for the provision of loans secured by agricultural land.

It still holds true that the price of arable land in the Czech Republic is significantly "undervalued" compared to Germany or Austria. It is valued similarly in Slovakia. We expect the price of agricultural land in the Czech Republic and Slovakia to converge to the European average. What makes arable land in the Czech Republic and Slovakia interesting is the growth potential of prices resulting from convergence to the European average, but also from the global trend. The demand for arable land as an alternative investment around the world and in the Czech Republic is growing strongly, which is why the price of land is growing as well, also due to the decreasing total area of arable land in the Czech Republic.

INVESTMENT STRATEGY OF THE AVANT FUND – ČESKÁ POLE 2015 OPF

In order to achieve the investment objective, the fund's assets may be invested primarily in the following types of assets:

  1. agricultural real estate, including any components or accessories;
  2. participation in legal persons that have agricultural real estate or of whom it can be reasonably expected that they will acquire agricultural real estate;
  3. participation in legal persons whose principal activity is crop and animal production, hunting and related service activities (CZ-NACE 01);
  4. receivables from credit or loans provided to legal persons that have agricultural real estate or of whom it can be reasonably expected that they will acquire agricultural real estate;
  5. bonds issued to legal persons that have agricultural real estate or of whom it can be reasonably expected that they will acquire agricultural real estate;
  6. movable property whose purpose is linked to agricultural real estate;
  7. property rights to agricultural real estate.

AVANT IS (the fund manager) searches for agricultural land at an attractive price through purchase partners. The aim is to purchase land in selected locations with a discount of at least 15 % compared to the market price by reaching out to the owners directly.

The manager also tactically directs its activities towards specific selected cadastres so as to obtain a significant land area, which can then be sold with a premium on top of the market price. So far, almost 530 hectares of land have been purchased in this manner (31.12.2018). At the same time, the fund's investments can be further increased in these locations, improving its position in relation to tenants and prospective buyers.

The source of the fund's returns is therefore not only changes in the market price of the agricultural land itself, but also the ability to buy land at a discount and sell it with a premium. In the second half of 2018 and in the first half of 2019, the fund made several sales at a price that is more then 50 percent higher than the sales price after all costs are figured in.

FORECAST OF THE FURTHER DEVELOPMENT OF AVANT - ČESKÁ POLE 2015 OPF IN 2019

In previous years, the price of agricultural land grew considerably, with year-on-year growth exceeding 10 % since 2014. Compared to that, agricultural land prices grew only slightlyin 2018. The average price of land in the Czech Republic in the year-on-year comparison increased by approximately 3 % to around CZK 24.5/m2, and at the beginning of 2019, we see a stagnation of the entire market.

In view of the current market situation, the fund will evaluate new investment opportunities during 2019, such as purchases of larger compact agricultural land with an area of about 50 ha or more or the expansion of its operations to new regions. However, we also see an opportunity in the stagnation of agricultural land prices, as we expect more room for the purchase of agricultural land from short-term investors who want to realize their profits in 2019. We thus still see great investment potential in the area of Czech agriculture.

Following the development of the Czech agricultural land market, the fund is currently evaluating several investment opportunities in Slovakia, where the price of agricultural land of a comparable quality is lower than in the Czech Republic. Together with our Slovak partners, we are also analysing whether there is space in Slovakia for repeating the significant rise in land prices, which we have correctly estimated to be the case in the Czech Republic.


Notice for investors

The Fund is a fund of qualified investors pursuant to Act No. 240/2013 Coll. and its shareholder may only become a qualified investor in accordance with Section 272 of this Act. The manager alerts investors that the value of the investment within the fund may decrease and increase and that the return of the originally invested amount is not guaranteed. Fund performance in previous periods does not guarantee the same or higher performance in the future. The investment in the fund is intended to achieve yield in its medium and long term possession and is therefore not suitable for short-term speculation. Potential investors should, in particular, consider specific risks that may arise from the investment objectives of the fund as set out in its statute. The investment objectives are reflected in the recommended investment horizon, as well as in the fund's fees and expenses.

Sharing of Key Fund Information (KID) is available at https://www.avantfunds.cz/en/obligation/. The information can be obtained in paper form at the registered seat of AVANT investiční společnost, a.s. ROHAN BUSINESS CENTER, Rohanské nábřeží 671/15 (reception B), 186 00 Prague 8.

The information given is only informative in nature and does not represent any agreement proposal or public offering, pursuant to the Civil Code provisions.

For more information about Common Reporting Standard (CRS) and Forein Account Tax ComplianceAct (FATCA), visit https://www.avantfunds.cz/en/important-information/.

Are you interested in the fund? Let us contact you.






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