The change in its shareholder structure with the exit of RMH rings in a new era for Atterbury Europe. CEO Henk Deist reflects on what the future holds.

What are the implications for Atterbury Europe of having new investors, now that RMH has sold its share?
Atterbury Europe acquired RMH as a shareholder at a time when we needed to expand the business. In June 2019 Pareto became a 25% shareholder, with RMH (37,5%) and Brightbridge (37,5%), as the other two shareholders. The idea was to have two “balance sheets” partnering with Atterbury Europe, with Brightbridge contributing the management expertise. Unfortunately, this scenario was not in place for very long as RMH took the strategic decision to end the era of holding companies and unbundle its investments. This left Atterbury Europe in the uncomfortable position of having a “for sale” sign on one shareholder’s stake in the company. It is not an easy task to monetise a minority interest in an unlisted real-estate company, so after much deliberation, we decided that three is a crowd, and so a deal was negotiated that brought the incumbent shareholders Brightbridge and Pareto each a 50% share of Atterbury Europe.

What can you share about these two big shareholders, and how do you anticipate it will impact having two equal partners on board? Do you foresee any noteworthy changes?
For Brightbridge to fund its increase to 50% of Atterbury Europe, it took new private-equity shareholders on board which in itself strengthens the Brightbridge board and its balance sheet. I very often get asked the question how we handle deadlocks in our 50/50 joint ventures. Firstly, it is not such a regular occurrence as people tend to think, and the answer is quite simply that we sit around the table and talk it through. In my view, forcing through a decision as a majority shareholder when the minority is not on board can be equally damaging for a business. Pareto already had minority decision-making rights at 25%, so in that sense the 50/50 arrangement is not much different, as both parties are strong business-minded partners.

How has the war in Ukraine changed the real-estate outlook in the territories where Atterbury Europe is operational?
It seems as if there will always be some external black swan event somewhere in the world! Just as we were packing away our Covid masks, the war came. For me it just accelerated the inevitable, because for how long could Europe still have negative interest rates? We did start to believe that it might never end, and we were spoilt with bundles of cheap money. The war sparking the energy crisis brought an abrupt end to that party, though – as if all the guests left at the same time! But real estate is an inflation hedge as it keeps its value through indexation; and interest rates are expected to remain well below development yields in Eastern Europe. So, in short, the outlook for 2023 is more negative and will require us to manage the controllable elements well.

Have you adapted strategies because of the war?
We’ve not really made strategic changes, but management attention is shifted to things such as interest-rate management, cost control and managing the effort ratios of our tenants to retain long term sustainability. With the shareholder matters resolved, we have time for this.

What is your future vision as CEO for Atterbury Europe with this new share structure in place?
Moving from three to two shareholders should make it easier to achieve our strategic objectives. Quite simply those objectives are to exit mature assets and invest where there is growth. It is easier said than done though, so we will keep our eye firmly on the prize.