Martynas Žibūda, CEO of real estate (RE) project management company UAB “EIKA Development”, says that RE developers are usually approached for two main purposes. Some come with finances and choose to invest in projects proposed by the RE developer, while those who own plots of land or other RE “buy” professional advice on how to develop their RE – from the project idea and management to after-sales service of the created RE.
Who is applying to EIKA Development regarding real estate project management?
Real estate project management is sought by those who have accumulated investable capital from their business activities or their sale, or who have real estate – plots of land, buildings – that they want to “employ”. They ask for advice on where to invest their money or existing real estate. In each case, we first thoroughly clarify the client’s goals, as they are different.
We are usually approached by legal entities and individuals who own real estate of at least 1 million euros or a similar value and want to invest. Most often, they invest about 3 million euros in a project (including the value of the existing real estate), because in this case it is still possible to borrow from a bank and invest a total of about 10 million euros.
What do you offer them?
Basically, there are two main options available.
The first option is to join a project that is already being developed or is planned to be launched and invest the desired financial resources in it, for example, office or residential buildings under development. This can happen only at the initial stage, when a plot of land is purchased, a project is being prepared, etc., or in a project that has already started.
Another option is when a person or company has production or other purpose premises on a plot or simply an area that is in a particularly attractive urban or natural location and it is not practical to develop production there, and wants to convert it. In this case, clients seek help and our advice on how to use a plot managed by the Real Estate Agency so that it brings the greatest benefit: should they build residential houses, rental housing, or maybe offices or other purpose buildings? In other words, they turn to us to get the experience accumulated by our team over 30 years know-howso that, after analyzing the client’s needs and goals, we can offer them the most suitable solution.
Are the goals of investors different?
As I mentioned, we first analyze the client’s wishes in detail.
For some, the most important thing is to use their existing real estate to obtain maximum return within their desired time frame, for example, to build something and sell it.
For others, the plot of land they have, another real estate, raises sentiments and they do not want to say goodbye to it, that is, we must develop the real estate in such a way that, for example, it would remain the client’s property or a certain desired activity would be developed in it. With those who choose to develop the real estate and not sell it, contracts are signed for a decade, because it takes time to create an idea, plan the territories, design and construct buildings, and after this is implemented, we take care of the client’s property rental, warranty service, and solve other needs related to his real estate. In this case, we help the client create a source of permanent income.
It is also very important what risk the investor is willing to take. Does he want to choose the direction of investment in a popular, traditional real estate, or a niche project, which, for example, we can still call apartments for rent. By the way, with the arrival of the German brigade, which will consist of about 4,800 soldiers and about 2,000 civilians, the demand for official apartment rentals in Vilnius and Kaunas should increase significantly.
What advice would you give to those who are planning to turn to professionals for real estate project management?
First, I would advise them to clarify their essential needs and goals.
For example, one of the most important goals is investment security. In this case, we would probably advise investing in an operating and rental-generating real estate, for example, an office building, without taking on the risk of developing such an asset from the initial stage. In this case, you can expect an annual return of 12–13%. And if you choose to invest from the beginning of the project development, for example, when a plot of land for apartment buildings is being purchased, a project is being prepared, etc., you can expect at least 15% of the average annual return every year over a period of approximately 4–6 years, which is how long the implementation of a real estate project usually takes.
By the way, our first residential development fund, Eika Residential Fund, has already closed. It was very successful, generating returns for investors that were twice as high as previous expectations – despite operating in a stressful period, the average annual return after management and performance fees reached 31.37%.
“Invest” magazine, May 2025.