What is a real estate fund?
Real estate fund is a special fund under the Collective Investment Act that aggregates financial means from the public/stakeholders and in accordance with its investment strategy it invests these means into quality real estate or to real estate companies.
How quickly can I access my money if I need it for something else?
ČS nemovitostní fond has the daily liquidity hence the investor cannot recognize the difference from other funds. However, one has to bear in mind that the investment involved is a long-term investment and therefore the investors shall carefully consider when they will need their financial means and subsequently they shall choose a suitable instrument.
How does a real estate fund operate?
The aim of the real estate fund is to valorise the financial means deposited by the unitholders in a conservative manner, whereas the income from the operation of quality real estate forms the core of the mutual fund yields. Such real estate is acquired indirectly or by acquiring stake in a real estate company, and together they form the portfolio of real estate fund.
What is a real estate company?
A real estate company is a limited liability company or a joint stock company or a similar legal entity under foreign law, with the main line of business comprising predominantly the real estate acquisition, operation of real estate and transfer of the ownership right to real estate for consideration.
Why to invest in the real estate fund?
The investors have the opportunity to share the benefits ensuing from ownership of the high-quality real estate, without personal responsibility for obligations resulting from activity of the fund/operation of the real estate.
The real estate funds participate in different segments of the real estate market (in particular office buildings, shopping malls and logistic complexes), with different life-cycle of development and hence with the possibility to further optimise the total income through the correct investment strategy.
In combination with the increase in the real estate value the funds can generate attractive yields, especially in the long-term horizon. Suitable for investors who are not interested in owning a real estate or who cannot directly own it.
How long do I have to remain in the fund?
The fund does not stipulate any mandatory period during which the investor has to remain in the fund. Nevertheless, this is a long-term investment for conservative to balanced investors, with the minimum recommended investment horizon of 5 years. The fund is totally unsuitable for short-term speculations.
What fees will I pay for the purchase and for the sale?
Current upfront fee: 1.50%
Exit fee: 0 %
For complete information, please refer to the Price List of Česká spořitelna – Services relating to securities trading.
Kompletní informace naleznete v sazebníku České spořitelny - služby poskytované v oblasti cenných papírů!
How can I buy ČS nemovitostní fond units?
The units of the fund can be currently purchased in the branch network of Česká spořitelna using the SERVIS 24 service and from the selected external distributors.
How is the NAV calculated?
The rate of the fund or the NAV – the Net Asset Value (equity per one unit) – is established by subtracting all liabilities from the sum of the market value of all the owned real estate units or real estate companies. If we divide this difference by the number of fund units, the result is the net asset value per one certificate.
How is the purchase price of real estate determined?
The key mechanism for determining the purchase price is primarily based on comparing the parameters of similar transactions at a given time and location. At least two expert appraisals are needed when purchasing real estate and the purchase price shall not differentiate from the price indicated in these expert opinions by more than 10%.
When and how often is the real estate price updated?
Under the law the real estate price is updated at least twice per year, however the revaluation that is performed several times a year is no exception.
Price of the real estate in the portfolio must reflect the fair market value of the real
estate.
Who sets/updates – revaluates this price and how is it done?
The revaluation process is quite demanding and complex and it is very strictly regulated. In simplified terms, we get an independent expert appraisal elaborated; based on this appraisal the Expert Committee of at least three appraisers (independent of REICO ČS) will determine the real estate value. Process for determining the real estate value is subject to the fund depository supervision.
How is the independence of such body (Expert Committee, see the previous question) ensured? Is this body held liable?
Independence of the Expert Committee is stipulated by the Collective Investment Act. This act also clearly implies the liability of each member of the Expert Committee towards the unitholders of the fund for the damage caused by the infringement of their duties. The fund depository bears the same liability.
Does the fund pays out the dividends?
The fund is a fully reinvestment fund. It means that all the yields generated by the fund are re-invested and thus not paid out as dividend. Hence the investor makes the profits from the difference between the purchase and selling price of the participation certificate. However, one has to bear in mind that the previous performance of the fund does not guarantee the same performance in the future. Value of the investment as well as income from the investment may increase as well as decrease, and the full return on the originally invested amount is not ensured. Investment into mutual funds is not insured by the Investor Compensation Fund.
