Former Close managers launch Eastern Europe fund

Stellar, a firm launched by former Close Brothers managers, is focusing on the Baltic States.

Stellar Asset Management has launched the Stellar Baltic States fund to invest in partnership with property advisory firms Bristol and Stone and Capital City Developments, targeting both development opportunities and acquisitions. The fund is targeting annual returns of 15 percent.

The vehicle is being seeded with six properties in the Baltic. The target for this first foray is £10 million ($20 million), with an anticipated larger follow-on fund coming later down the line.

According to the firm, the fund's investment strategy is to develop a diversified portfolio aimed at providing asset growth over the short to medium term, exploring development and planning changes as well as more conventional opportunities.

Chief executive Jonathan Gain said in a statement, “This is a particularly exciting venture as the fund has been seeded with six properties, allowing investors entry at the original purchase cost. There is a window of opportunity to invest before the first valuation at which time there may be an uplift in value.”

Gain and his co-managers Craig Reader, Gordon Pugh and Stephen McKeever are all former Close Brothers employees who left the firm in April to launch Stellar.