Issue link: https://maltatoday.uberflip.com/i/1484365
17.11.2022 11 INTERVIEW this unique opportunity. Together with our partners, we established the restora- tion process for the site and immediate- ly wanted it to be a high-class boutique hotel. Today, our confidence in the busi- ness has allowed us to not only operate the hotel but to own the property. With a purchase agreement in place, the Cugó Gran Macina exists as the Group's flag- ship hotel in Malta. In your 2017 bond issue prospectus, the Group intended to look at operating more hotels in Malta. Is this still the case for the Group? e Group in its 2017 prospectus es- tablished intentions to open two ho- tels, and still hold such ambitions in the hospitality industry in Malta. We iden- tified a boutique hotel in Valletta – the Merkanti Hotel – but unfortunately the owner of the hotel was not able to finish the work in the timelines stipulated and work had to stop in the run-up and dur- ing Valletta's time as European Culture Capital and Malta's presidency of the EU. Because of this we did not pursue this business venture but rather invest- ed in the Hammett's restaurant brand with our partner Chris Hammett. We have proudly grown this operation from one restaurant to five outlets in just five years, with the latest outlet being the Hammett's Monastik in Sliema over- looking Marsamxett Harbour. Besides the operation of its flagship hotel, such were the key investments held in Malta. What are your plans for Malta with this new bond issue? With the coming bond, we're looking to do more in Malta. We want to con- tinue growing our accommodation seg- ment, so we are looking at possible ac- quisitions or leasing of boutique hotels to add to the Cugó Gran brand. And we have also entered into a joint venture with another local partner for the development of a €20 million ware- housing park in the south of Malta, in which we hold a 60% shareholding. We have identified a site and are now in the process of submitting designs and plan- ning applications. Complementing this, in Malta we have also invested in the yachting industry. We have been granted the Riva deal- ership brand and we also own a yacht which we charter in Malta, Sardegna and Italy. But as I said our focus is not just Malta. We want to grow the hotel brand inter- nationally; we already have eight hotels but are now looking at expanding the luxury hotel brand in Tuscany in Italy. We have already identified a property in Siena, where we are planning to build a 70-bed hotel. We have also already invested in a villa on the hills of Lucca and we are converting this into a luxury property that will include the main res- idence and an additional wing with five luxury apartments, which we will oper- ate within the Cugó brand as a luxury bed and breakfast. e idea is to hold this asset and eventually sell it. We had already done this successfully with Cugó Gran Menorca, where we sold our bou- tique hotel there for around €10.5 mil- lion. What of your office portfolio? We were very successful on closing a deal on the Bavaria Towers in Munich, where we had developed four towers over a number of years. We finished the last tower – and leased it out – in 2019. e group of investors of which we were the lead partners with 25%, invested €120 million in that project and sold it for €267 million. is gave our group a huge cash in-flow of over €40 million. And that was in the prospectus of your first bond? Yes, we had planned our issue for seven years but achieved its objectives within five. is gave us a huge cash surplus which meant we could repay the bond at that point in time. But tech- nically you can't just repay because you would be short-changing the investors and so we had to revise our investment strategy. So, we decided to start work on an- other office tower within a develop- ment we already had in Poznań in Po- land. We have been in Poznań for over 20 years and the development is part of a private-public partnership with the city which wanted to develop its finan- cial centre. is latest project is a €105 million 26-storey building and ground works started on 11 October. We've already built the three floors of under- ground parking and now construction will continue at the rate of one storey every two weeks. By November 2023, it should be built and completed by March 2024 when we will start leasing out space. Our philosophy, and this is how we always work, is to secure the equity required. With €55 million in bank fi- nancing proves that the project is a sound investment from the get-go. is gives us the capital we need to build this project without the need to pre-sell any space at discounted rates. We've already secured 15% in pre-leasing, since this a premier A-class listing. It will surely interest premier financial institutions who always invest in long-term assets. Our tenants recorded in our sold com- mercial buildings in the area such as Santander and Radisson are testament to the future success of Andersia Silver. Why did you ask for 10 years on your new bond? We asked for 10 years to have complete flexibility when it comes to leveraging the sale of the tower. But also because we wanted to give a new opportunity to our investors that was not possible in the 2017 bond issue, where the projects were completed close to the maturity of the bond, making it impossible to in- vest in other major projects. In this, one would invest in the cash in-flow in the bonds and equity markets. But by doing so, you would expose your investors to market risks, which would not have been intended or planned. So what led you to go early? e rationale behind the new bond is simple. With the cashflow/equity in hand we asked the regulating Authority for a longer paper for our existing inves- tors with preferential opportunity for them to roll over. With the money to re- pay the bond now, giving the Group per- mission to seek approval from the bond- holders to redeem the bond was in the hands of the MFSA. After this approval, the bondholders voted 98.69% in favour of the bond-roll over, which is testament to our credibility in the market. Does it make a difference that the majority of your investment now is in Eastern Europe? e Group's investments and opera- tions are established in Poland, Germa- ny, Italy, Sardinia, Spain, Portugal and Montenegro. Within Europe there are still emerging countries, and in the real estate market, it is these emerging coun- tries that offer real returns on invest- ment. Obviously, they do expose you to risk where due diligence and experience ahead of time to mitigate all risks are an essential recipe to success. is is what makes the Von der Heyden Group. Von der Heyden Group Finance plc was granted approval by the Malta Financial Services Authority for the listing of a new ten-year €35 million bond issue with an annual interest rate of 5% on the Official List of the Malta Stock Exchange. The new unsecured bonds, having a nominal value of €100 per bond issued at par, are guaranteed by the Group's parent company, Timan Investments Holdings Limited. The proceeds from this new bond issue will be used for the redemption of the previous 2017 issuance of €25 million 4.4% unsecured bonds due to mature in 2024, subject to the early redemption of the said maturing bonds to be placed for the approval of the holders thereof. The remaining proceeds will be on-lent to the guarantor, Timan Investments Holdings Ltd for the part-financing of the Andersia Silver project, and for general corporate funding. The company will be giving preference to the present bondholders of the €25 million 4.4% unsecured bonds 2024 for the €25 million dedicated for the roll- over while €10 million will be available for subscription by new investors. Any balance from the new Bonds not subscribed to by existing bondholders shall be offered for subscription by authorised financial intermediaries through an intermediaries' offer. Andersia Silver, the Group's flagship project, a 40,000 sqm A-class office tower having an investment value of over €105 million, has secured bank financing as well as 15% of its office tenancy in pre-leases ahead of its construction. The 116m high skyscraper will be Poznań's highest building after its Andersia Tower (105,2 m) being developed through a joint venture company between the Von der Heyden Group and the City of Poznań. Applications will be made available to preferred applicants on the 1st November and through an intermediaries offer from the 18th November. Subscriptions will close on 2nd December, or earlier if the bond issue is over-subscribed. The minimum subscription amount is €2,000 and in multiples of €100 thereafter. The bonds to be issued are expected to be admitted to the Official List of the Malta Stock Exchange on 16th December and trading is expected to commence on the 19th December. The value of investment can go down as well as up and past performance is not necessarily indicative of future performance. Prospective investors should consult their Financial Advisor prior to investing in the bonds and to read the full details of the prospectus, including the Risk Factors. Scan the QR code for the Prospectus: The bond The Cugó Gran Macina is the Group's flagship hotel in Malta BOND ISSUE APPLICATIONS NOW AVAILABLE INVESTMENTS SET IN STONE MALTA | POLAND | GERMANY | MONTENEGRO | PORTUGAL | ITALY | SPAIN DIVERSE REAL ESTATE PORTFOLIO WITH A SOLID TRACK RECORD A STRONG BALANCE SHEET THAT GUARANTEES THE BOND OVER 30 YEARS OF TRUST IN EUROPE 27792200 | www.vonderheydengroup.com | vdhgroup@vdhgroup.com Sponsor, Manager & Registrar Scan the QR code for Prospectus VON DER HEYDEN GROUP FINANCE P.L .C. (C 77266) €35,000,000 UNSECURED BONDS 2032 5% Fixed interest per annum with a nominal value of €100 per Bond issued at par by G U A R A N T E E D B Y T I M A N I N V E S T M E N T S H O L D I N G S L I M I T E D ( C 6 3 3 3 5 )