Baltic Horizon Fund: Strategic Moves Set to Reshape 2025 and Beyond
March 31, 2025 - The Northern Horizon Capital AS has greenlit the unaudited financial results for the Baltic Horizon Fund for 2024, aligning perfectly with prior disclosures. As the Fund ventures into a crucial year, let’s delve into the strategy adjustments and accomplishments that define its current trajectory.
Executing a Robust Strategy
In 2024, Northern Horizon’s management took a calculated approach by implementing key performance indicators (KPIs) to sharpen the measurement of growth and success. The strategy emphasizes transparency, accountability, and better decision-making, focusing on achieving portfolio occupancy above 90% by 2025 and maintaining a Loan-to-Value (LTV) target at 50% or below.
With clear foresight, the Fund’s unequivocal aim is also to pursue ESG strategies, enhancing the portfolio’s net operating income (NOI) to €130/m² by 2027. As stated in GlobeNewswire, these forward-looking initiatives demonstrate an unwavering commitment to stabilizing financial standings amidst economic uncertainties.
Examining the 2024 Financial Landscape
Despite a net loss of EUR 16.8 million in 2024, compared to last year’s EUR 23.0 million dent, Baltic Horizon achieved significant BREEAM certifications across its portfolio. Even with the shortfall in occupancy targets (86.5% by end 2024), progressive actions are in place to bolster these figures as the year progresses.
The Fund is making strides with its disposal strategy, effectively reducing LTV levels with sales transactions slated for completion in 2025. The proactive reduction of leverage through bond repayments positions the Fund for enhanced stability.
Sustainable Vision for 2025
The leap toward 2025 is aspirational, focusing on adopting adaptable and sustainable property solutions to meet the evolving demands of tenants. With 98% green leases in 2024, a waste-not approach will carry this initiative forward effectively.
The debt service ratio and LTV reductions remain pivotal points of concentration. Adaptive leasing strategies coupled with astute investments in sought-after segments ensure resilience within a dynamic market model.
GRESB Rating: A Benchmark for Progress
Though receiving a 3-star GRESB rating in 2024 due to data constraints from property sales, a clear action plan is now in action to rejuvenate the standing to 4-stars. This reinforces Baltic Horizon’s tenacious initiatives to strengthen both its social and environmental commitments.
Outlook on Asset Valuation and Rental Income
Differences in valuation and rental income reflect economic fluctuations. In 2024, portfolio properties in the retail sector contributed the lion’s share of 53.3% in net rental income. The active pursuit to improve occupancy, followed by asset repositioning, will maximize asset yield during adjusting market phases.
Investment properties’ fair value hit €241.2 million by the end of December 2024. Despite a slightly lower Gross Asset Value (GAV) standing at EUR 256.0 million from EUR 261.1 million in the previous year, emerging initiatives like the private unit placement in September increased funds significantly.
Reinforcing the Financial Armor
Interest-bearing loans and bonds saw a slight hike, reflecting the volatility of interest rates, yet robust cash and equivalents paint a positive financial picture. Moreover, prepayment of short-term loans furthers Baltic Horizon’s agenda for financial autonomy.
Nurturing a robust financial standing involves careful maneuvering and businesses must remain agile to harness opportunities for growth. Through adaptive strategies, Baltic Horizon is crafting a promising narrative for 2025, merging financial agility with sustainability for substantial investor value creation.
The Management Board is bound to steer the ship toward calmer waters, emboldened by strategic disclosure as outlined under the EU Market Abuse Regulation.
For further insights or queries, stakeholders are encouraged to engage directly with the Fund. Interested parties can subscribe for updates on Baltic Horizon’s projects and strategies through specialized channels, promising a steady stream of comprehensive news.
