The Malta Independent 31 January 2023, Tuesday
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‘Sustainable diversification is key’

Dayna Camilleri Clarke Sunday, 23 October 2022, 08:15 Last update: about 4 months ago

Former Finance Minister and Executive Director at Von der Heyden Group Tonio Fenech says diversification in markets and investments is key in a world in constant transformation. In a recent interview with The Malta Independent on Sunday, Fenech adds that the Group’s initial focus on high-quality real estate has enabled them to branch into a series of high-end and complementary services with great success.

“Over our 33-year history, the Von der Heyden development brand has been highly successful in delivering sizeable top-quality projects across Europe that provide substantial financial returns and in turn contribute to the well-being of the communities in which we operate” – Tonio Fenech
“Over our 33-year history, the Von der Heyden development brand has been highly successful in delivering sizeable top-quality projects across Europe that provide substantial financial returns and in turn contribute to the well-being of the communities in which we operate” – Tonio Fenech

"Von der Heyden Group's Real Estate development arm remains the principal activity of our Group, driving our growth ambitions and supporting the Group's diversification strategy. Over our 33-year history, the Von der Heyden development brand has been highly successful in delivering sizeable top-quality projects across Europe that provide substantial financial returns and in turn contribute to the well-being of the communities in which we operate. This remains a core value of our Group".

Regarding key pipeline projects, Fenech expresses his enthusiasm for the fourth and final phase in developing the financial district of Poznań, a vibrant industrial and commercial city in Poland strategically situated between Warsaw and Berlin. 

"The Andersia Silver project is the current flagship commercial A Class Building investment of the Von der Heyden Group. It will be completed within the next couple of years. After the excavation and underground completion in 2021, the projected €105 million investment is due to commence its above-ground civil works phase imminently after the successful financing from a consortium of three reputable banks in Poland in March of this year. It's moving along very well despite the challenges caused by the current global economic environment, having already secured 10% of its tenant occupancy before building its first floor. Our cornerstone laying ceremony took place recently this month, headlining real estate news in Poland.

What makes this flagship project so unique with a realm of fantastic projects already on the Von der Heyden portfolio? Fenech explains, "Andersia Silver will complete what Poznań, cityscape is today: a energetic destination attracting multinational corporations and the best human resources. This new tower will be the highest building in town, a 40,000 sqm of prominent office and commercial space spread over 26 above-ground floors. Moreover, the fourth phase of this project will conclude a highly regarded and positive 25-year public-private partnership with the City of Poznań".

There's no denying Von der Heyden Group's proven track record continues for the company, with a reputation for delivering first-class landmark developments in prominent cities such as Munich and Poznań. "Our legacy and ability to deliver such best-in-class projects propel us forward".

The Group's hospitality arm is also going from strength to strength. The hotel Group continues to focus on more profitable and upmarket segments with a new focus on its luxury segment. 'We intend to do this by finding storied and special landmark buildings around the World that embody a destination's history and culture just like Cugó Gran Macina Grand Harbour'. Despite the covid 2019 challenges, accommodation revenues, are expected to increase by 41% over last year.

"Also within the local context, the Group continued to support the growth of its catering arm Hammett's Collection, that recently opened its 4th restaurant with an organic food concept, Hammett's Monastik, situated on the Sliema front overlooking Marsamxett harbour."

With many facets to the Group, Fenech states, "Sustainable diversification is key, we don't rush into decisions, and we do our best to ensure all decisions are sustainable on many levels, from careful consideration of the eco-impact to the surrounding environment and communities, to creating long-lasting spaces, whether that's a boutique hotel or office ultimately where people want to be"

The Group's trusted reputation in generating significant returns in new and emerging communities has enabled the Von der Group to enter three new markets recently, including two residential projects; one in Algarve, Portugal and the other in Re?evići, Montenegro and two hospitality related investments in Tuscany, Italy. The Group holds capital growth and income generation investments in 38 subsidiaries and associated companies across seven European countries.

Aside from Real estate and hospitality, the Group has also branched into Private equity, venture capital and capital markets investments. Fenech explains, "Our strong liquidity position has enabled us to continue financing our investments and enable us to seize new opportunities that may arise in the future. As such, we are expanding our existing portfolio of private equity and venture capital investments and selective capital markets instruments to generate stable returns on its excess working capital". The Group recently launched Von der Heyden yachting which has also been granted exclusivity dealership for the Riva brand in Malta.

In August, the Group further diversified its asset classes by securing a strategically located site in the south of the island to be developed into a multitenant A-Class warehousing and logistics park.

The Group has recently issued a €35 million bond approved by the Malta Financial Services Authority to support its investment strategy. The bond which will offer a coupon of 5% will be guaranteed by Timan Investment Holdings Ltd. It is the Group's policy not to cross-collateralise. Which means, that any bank financing a project of the Group is offered security at the level of the subsidiary undertaking an investment. Since the Group does not offer any general guarantees to its subsidiary companies, there is no risk of contagion if one project is in difficulty.

Although in the 33-year history of the Group there was no one company that ever defaulted on its commitments, the guarantee provided to the bondholders by Timan Investment holdings Ltd, is indeed a meaningful one considering the strong balance sheet of the Group which holds €135 million in assets.  

 


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