SBA Urban successfully distributed a bond issue with a nominal value of EUR 5.8 million for the Hermanas business centre in Kaunas
Bonds issued to finance the construction of the Hermanas business centre in Kaunas’ Nemunaičiai district attracted demand totalling EUR 5.8 million in nominal value during the second phase. It exceeded the targeted amount of EUR 5 million by almost EUR 1 million, yielding a 7.5% return.
Fulfilled the entire demand
Nemunaičiai district in Kaunas is being developed by S3 Business, owned by SBA Urban together with TABA Invest. This is the second tranche of a bond issue worth up to EUR 23.5 million. All investments are secured by a mortgage on the project’s real estate and a pledge of the issuer’s shares.
Andrius Mikalauskas, CEO of Urban LIVE, the company developing Nemunaičiai:
The second bond offering for the Hermanas business centre attracted strong investor interest, despite the large number of other issuances at the same time. Investors appreciated the progress of the construction, the first signed lease agreements, and the growing infrastructure of the Nemunaičiai district. The high level of investment security also reinforced investor confidence – the bonds are secured by both real estate and the issuer’s shares. We had planned to raise EUR 5 million in investments. Still, after receiving demand totalling EUR 5.8 million, we decided to satisfy it in full.
According to Andrius Mikalauskas, the second phase of the issuance attracted 161 investors from across the Baltic states, with an average investment of over EUR 36,000. In the first phase of the issuance, 287 investors participated, with an average investment of more than EUR 24,000.
The second phase of the bond issue was distributed between October 13 and 24. Investors were offered bonds with an annual interest rate of 8% and a maturity date of November 29, 2027. The bonds were distributed at a price corresponding to an annual yield of 7.5%. The bond offering was organised by Luminor Bank, with Ellex Valiunas acting as legal advisor.
Gediminas Norkūnas, Head of the Securities Origination Department at Luminor Bank:
The bond supply in the market during this distribution period was record-breaking. The Hermanas bonds were competing with projects offering higher interest rates. It is encouraging to see that investors recognise a good risk-return balance even in such a noisy environment.
The first tenants will move in at the beginning of 2026
The new eight-storey Hermanas business centre, rated A++ for energy efficiency, will offer 10,600 sqm of modern, sustainable office and commercial spaces. Construction, which began in summer 2024, is progressing on schedule and is expected to be completed by December 2025.
Currently, the façade installation is being finalised, interior finishing works are underway, common areas are being developed, and engineering systems are being installed. Significant attention is being given to the quality of technical solutions, interior aesthetics, and sustainable resource use.
The first tenants – IT product customer service centre CyberCare and the restaurant chain iLunch – will move into the new spaces in the first quarter of 2026. CyberCare will occupy a 650 sqm office on the third floor, while the iLunch restaurant will take up 350 sqm on the ground floor, adjacent to green relaxation areas and outdoor terraces.
