NOVA Real Estate
In August 2023, the NOVA Real Estate Fund's appreciation reached 0.26%, and the year-to-date
performance is 2.64%.
As at 00:00 on 28 July 2023, the issuance and redemption of investment shares issued by the
Company to the Sub-Fund was suspended to protect the rights and legally protected interests of
the Company's shareholders. The period for which the issuance and redemption of Investment
Shares is suspended is 6 months, i.e. until 28 January 2024. The suspension also applies to
Investment Shares for which the issuance or redemption has been requested before 28 July 2023
and which have not yet been redeemed.
Investment activity in the commercial real estate market continues to experience a slowdown. In
the second quarter of 2023, transactions worth €278 million were completed, a year-on-year
decline of 43%. The market is driven by demand from domestic investors, who account for 79%
of the total volume. At the end of June 2023, 7.3% (i.e. 279,600 sqm) of office space was vacant
in Prague, representing the lowest vacancy rate recorded since Q4 2020.
As of the end of August, there is no change in the vacancy of the portfolio, which remains 99.5%
leased, of which Retail is 99.8% leased, offices are 97.1% leased and the industrial hall in Trencin
NOVA Green Energy
The valuation of Sub-Fund 2 in August 2023 was 0.38% and for 2023 it reached 4.04% YTD.
In August, work continued on the development of several PV plants mainly in the Czech and Slovak Republics. For
investment in these PV plants we are considering investment subsidy support from a subsidy programme of the
Ministry of Environment and Science or the Ministry of Industry and Trade. The remaining applications for
connection of the plants to the distribution network are being submitted, discussions are currently underway with
tenants on the purchase or sale of electricity at the site of the PV plant production/installation, and the first
applications for building permits are being submitted.
In May 2023, an austerity package was introduced by the government with the aim of saving government
expenditure, among other things in the subsidies provided, including support for RES. However, to date, no
concrete solution has been presented by the government and therefore the potential financial impact on Czech
assets cannot be assessed now.
However, analyses and some information from the government have been published which suggest that subsidies
are unlikely to be cut. In September, the replacement of the inverters of the other two Slovak PV plants should
start, with the replacement taking place in a similar way to the one already carried out in May/June this year. The
replacement will therefore take place during operation with only minimal downtime and should therefore not have
a negative impact on production. At the same time, the efficiency of these PV plants should increase significantly
in the coming years. The valuation of Sub-Fund 2 in August 2023 was 0.38% and for 2023 it reached 4.04% YTD.
In accordance with the current statute of Sub-Fund 1 effective as of 1 September 2023, the frequency of
announcement of the value of the investment share has changed, whereby the values will be announced semiannually as of 30 June and 31 December, in view of the liquidation of Sub-Fund 1. At the end of the month, it was
also decided to transfer the business shares related to the Hungarian Csabrendek PV plant to Sub-Fund 2, with
the transaction to be completed during September.
We are also working intensively on the remaining two main asset groups of Sub-Fund 1, namely biomass thermal
power plants in Slovakia. In view of the economically unprofitable operation of the biomass power plants, where
the costs of generating electricity from biomass significantly exceed the proceeds from its sale, production was
stopped in the first quarter of the year and preparations are underway to enter bankruptcy and subsequently sell
this resource in Krnč. In the TeHo matter, we are assessing published reports regarding the enforcement of lien
rights by the Natland group, which has taken over JT Bank's position.