Bulgaria AIF has initiated a modest allocation to Advance Terrafund REIT, BG1100025052 as part of its diversification strategy, aiming to achieve higher returns compared to near-zero yields on bank deposits. The investment approach is conservative, based on entry levels close to the REIT’s 52-week low.
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The Fund’s current exposure is limited, with a subscription of 4,606 shares at €1.345 per share. This position represents a small portion of the portfolio and offers an expected dividend yield of approximately 4.8% (based on €0.065 per share). While not a high-return investment, it contributes to building a balanced portfolio focused on capital preservation and steady growth. Bulgaria AIF intends to maintain a controlled exposure to Advance Terrafund REIT, with a maximum allocation of up to €100,000.
Advance Terrafund REIT is the largest agricultural land REIT in Bulgaria and the largest public owner of agricultural land in the country. It is included in all major BSE indices, including SOFIX, BGBX40, BG TR30, and BG REIT. The company’s business model is focused on land acquisition and rental income, providing stable and predictable returns. Under Bulgarian legislation, REITs are required to distribute at least 90% of their income as dividends, supporting consistent income generation with relatively low risk.
Alignment with Government Objectives
Although limited in size, this investment contributes to improving liquidity on the BSE. Increased participation from private and institutional investors supports more efficient price discovery and a more stable capital market environment.
Strategic Objectives of Bulgaria AIF
Bulgaria AIF is focused on long-term investments in key sectors such as energy, infrastructure, healthcare, and construction. These projects typically require substantial capital commitments. While the Fund continues to accumulate capital for such investments, it remains essential to manage existing assets prudently, ensuring steady growth and capital preservation during this phase.
