“The next growth phase is just beginning in Vienna”

Anleihen Finder: Dr. Urbanek, why are you issuing a corporate bond with Urbanek Real Estate GmbH? What exactly will the up to 50 million euros be used for?

Dr. Christoph Urbanek: We decided to issue a corporate bond with Urbanek Real Estate GmbH because this is a strategically sensible way to finance our growth and at the same time give investors the opportunity to participate in our success. The bond enables us to provide capital for the implementation of our projects without restricting our long-term flexibility.

The up to EUR 50 million that we intend to raise through the bond will be invested specifically in selected real estate projects. Specifically, this involves the acquisition of high-quality residential properties, primarily in Vienna, which are rented out and generate immediate cash flow. These properties will be purchased by us, professionally renovated if necessary and then returned to the market accordingly. In the current economic climate, we anticipate high demand and therefore attractive prices, particularly due to the looming housing shortage.

“We expect high demand and therefore attractive prices due to an emerging housing shortage”

Anleihen Finder: Why is the “bond” financing instrument suitable for your plans? What other financing channels are you pursuing to build up the real estate portfolio?

Dr. Christoph Urbanek: The “bond” financing instrument is particularly suitable for our project because it enables us to raise capital directly from investors for our projects. Bonds offer us flexibility in the use of funds, i.e. for suitable projects and the possibility of clearly calculating financing costs. They also allow us to make quick decisions, especially when it comes to acquisitions, which is essential in the current phase of building up a sustainable and attractively priced real estate portfolio. We also want to use this instrument to appeal to a broad investor base - from institutional investors to private investors who are interested in a stable return and want to participate in a rising real estate market.

Another advantage is the predictable structure: we can structure maturities and interest payments in such a way that they harmonize optimally with the cash flows from our real estate projects. This enables us to manage our liquidity efficiently and at the same time realize projects on a large scale. On the one hand, this gives us sufficient financial clout to exploit opportunities on the market and, on the other, to minimize our risk through a broad capital base.

Anleihen Finder: The real estate market has recently been a difficult place for investors due to high interest rates. To what extent has this now changed and why is the real estate market in Vienna in particular lucrative at the moment?

Dr. Christoph Urbanek: The real estate market has indeed experienced some challenges in recent months due to high interest rates: financing costs have risen significantly and demand has fallen in some markets. This combination has caused difficulties for a number of real estate portfolio holders and developers. This presents us with excellent opportunities to acquire lucrative properties in Vienna, not least thanks to the network we have built up over decades.

“As an investor, we now see the opportunity to invest in a stable and crisis-proof market like Vienna”

Vienna combines several factors that make the real estate market attractive: Firstly, there is a constant demand for housing, driven by population growth and the city's high quality of life. Vienna regularly ranks among the most liveable cities in the world, which attracts not only local buyers but also international investors. Secondly, compared to other European cities, the Viennese real estate market is less volatile, even in times of crisis. The city has a strong tradition of tenant protection and controlled construction activity, which prevents the market from overheating. At the same time, there are attractive yield opportunities, especially in the area of new construction projects or the refurbishment of existing properties. In addition, interest rates have fallen again slightly in recent months or have at least stabilized, which makes investments easier. In addition, significantly fewer new apartments have been built in Vienna in recent years, which has severely restricted supply. As an investor, we now see the opportunity to invest in a stable and crisis-proof market like Vienna. The next growth phase is just beginning here.

To summarize: Vienna currently offers a strong foundation consisting of stable demand, moderate prices by European standards and the prospect of long-term increases in value. All of this makes the Viennese real estate market particularly attractive.

Anleihen Finder: Which properties do you focus on with your business model? What criteria do the properties have to meet for a purchase and what happens to the property after acquisition?

“The classic Viennese apartment building is our target”

Dr. Christoph Urbanek: At Urbanek Real Estate GmbH, our business model focuses on existing properties with high potential. The classic Viennese apartment building is our target. Our focus is therefore on residential properties in attractive and fast-growing locations that can experience a sustainable increase in value through targeted measures.

The following criteria apply to acquisitions:

- Location: Preferably good urban regions or up-and-coming peripheral areas with good infrastructure and stable demand.

- Building fabric: Properties with a solid basic structure that can be optimized through renovation or modernization if necessary.

- Market value: Properties with an attractive initial valuation that offer scope for value creation. These opportunities arise through our intensive network and do not even come onto the market.

After the purchase, we first examine the need for optimization and develop a tailor-made, sustainable concept for the property. This can include measures such as renovations, energy-efficient refurbishments or conversions. Our aim is to increase the value of the property for our portfolio and to position it on the market in the long term. We attach great importance to sustainability and efficiency.

Anleihen Finder: How large is the Urbanek real estate portfolio at the moment? And how many potential properties do you currently have in your shortlist?

Dr. Christoph Urbanek: I have been working as a lawyer in the real estate sector for 20 years and in that time I have managed well over 1,000 real estate projects with a total volume of several billion euros. Our legal advice gives us good access to the market, especially in Vienna.

“Since the summer, the market has once again offered opportunities for attractive investments”

Thanks to the expertise we have acquired, we have been successfully investing in residential real estate through our own project companies for many years. Our track record includes an investment volume of more than EUR 50 million. This know-how and, above all, the network we have built up is now being bundled in Urbanek Real Estate in order to build up an attractive real estate portfolio. Now is the ideal time for this. In the past, real estate valuations were too high and in the end there were hardly any offers on the market. This has changed dramatically in recent months. Since the summer, the market has once again offered opportunities for attractive investments. We want to take advantage of this and have been preparing the issue of the bond ever since.

We know the Viennese real estate market very well and have already identified eight attractively valued properties in the city and secured most of them through purchase offers. The average usable space per property is around 1,550 square meters.

Anleihen Finder: Back to the bond: Why are you also offering the “Vienna Opportunities Bond” on the German capital market? Who are you specifically addressing with the bond?

Dr. Christoph Urbanek: We decided to offer the “Vienna Opportunities Bond” on the German capital market because Germany is one of the largest and most dynamic bond markets in Europe. German investors are known for their affinity for solid and high-yield forms of investment, especially when it comes to real estate investments in stable markets such as Vienna. In addition, the geographical and economic proximity between Germany and Austria offers ideal conditions for creating trust and interest.

With the bond, we are addressing private and institutional investors who value security and stable returns. Thanks to its robustness and long-term prospects for value appreciation, the Viennese real estate market offers an excellent foundation that is highly valued, especially in times of economic uncertainty. The “Vienna Opportunities Bond” is a particularly attractive option for investors who want to diversify their portfolio and invest in real assets. The expansion to the German capital market also gives us the opportunity to reach a larger investor base and build long-term relationships across national borders.

Anleihen Finder: The interest of 10% p.a. is to be paid out monthly. Why did you decide to do this and how will you manage it? What are your financing plans in this regard?

Dr. Christoph Urbanek: Our strategy is aimed at creating sustainable living space at a good price, but also within our financial means. We use the market conditions in conjunction with our extensive network to obtain attractive properties and can offer exciting alternatives with our expertise. As a sign of this clear strategy, we have decided to give our investors a share in the success of the product right from the start, as we can only grow well together with a stable investment.

By rapidly implementing projects that generate immediate cash flows, we can also guarantee that the company has sufficient liquidity to make monthly payments.

Anleihen Finder: What rental income do you expect? What does the rent index in Vienna currently look like and how do you expect it to develop?

Dr. Christoph Urbanek: The level of rental income naturally depends largely on the location, the type of property and the condition of the property. In Vienna, rents currently vary greatly depending on whether it is subsidized housing, apartments in old buildings or new construction projects. On average, net rents for new buildings are currently around 13 to 16 euros per square meter, while they are often somewhat lower for apartments in older buildings, between 8 and 12 euros per square meter.

Rents have risen moderately in recent years due to high demand, continuous population growth and Vienna's attractiveness as a business and cultural location. This is due to the Viennese model. A combination of subsidized housing and strict rent regulations ensures that rent growth remains subdued compared to other major European cities.

Anleihen Finder: How do you protect yourself against general risks on the real estate market?

“We avoid many risks by focusing on existing properties”

Dr. Christoph Urbanek: At Urbanek Real Estate GmbH, we focus exclusively on existing properties, as they offer a solid basis for sustainable and predictable value creation. Portfolio properties allow us to rely on proven structures and existing markets, while we increase the value and attractiveness of the properties through targeted modernization and optimization. This focus minimizes development risks, ensures stable income immediately after acquisition and at the same time opens up potential for long-term increases in returns.

In our opinion, construction risks, necessary rezoning or excessively long approval procedures are one of the triggers for projects that fall into crisis, not purely due to the project developers' own fault but rather due to external influences such as increased construction costs, rapid interest rate increases, high inflation and ultimately also pandemic-related disruptions to the authorities' processes. We avoid these risks by focusing on existing properties, which we merely renovate but do not construct entirely new residential space. The lead times for the reuse of properties remain short and efficient in terms of costs, especially in a housing market that is currently experiencing very high demand.

Anleihen Finder: Urbanek Real Estate GmbH itself is still a young company - still without revenue or a track record of its own. Why should bond investors entrust you and your team with their money?

Dr. Christoph Urbanek: As already mentioned, we have managed well over 1,000 real estate projects in the last 20 years, primarily in Vienna, with a total volume of several billion euros. We know the market and the “Vienna Opportunities” and we are now bundling our expertise in Urbanek Real Estate GmbH together with a strong team of experienced real estate experts.

“We focus on attractive, high-growth segments of the real estate market”

Transparency is our top priority and we want to clearly demonstrate why an investment in our team and our concept is a sound decision. We have developed a clear and focused approach and a precise market strategy. We concentrate on attractive, high-growth segments of the real estate market - especially in regions with high demand and stable development potential. At the same time, we rely on conservative financial planning and, thanks to our long-standing presence on the real estate market, we have established partnerships with experienced service providers and consultants who support us in the successful implementation of our projects. And we offer attractive conditions for our bond investors and a clearly defined security concept that secures repayment in a structured manner. We are convinced that our business model, coupled with our expertise, enables sustainable growth - and therefore also represents a worthwhile investment opportunity for investors. We see it as a leap of faith, and we are determined to justify this trust with results.

Anleihen Finder: What are your goals with Urbanek Real Estate GmbH? How do you want the company to develop operationally in the coming years during the term of the bond?

Dr. Christoph Urbanek: Urbanek Real Estate GmbH's goal is to focus on the acquisition, optimization and sale of existing properties in order to realize long-term increases in value. We aim to expand our portfolio in a targeted manner and prepare the properties for successful resale through strategic modernization and value enhancement measures.

During the term of the bond, we will concentrate on developing the properties, increasing their market appeal and then selling them at a profit. Our focus is on quickly realizable but also sustainable value appreciation. Through targeted sales, we want to both increase the value of the portfolio and generate attractive returns for our investors.

Anleihen Finder: Dr. Urbanek, thank you very much.