Topic No. 1: History and portfolio

When and by whom was the Salutem Fund founded?

The fund was formally founded in 2020, its founder is Jaroslav Ton, who used his more than twenty years of experience in the real estate market. Thanks to his and his team’s of professionals long-term experience, he continuously achieves growing numbers in this area of business. The establishment of one’s own real estate investment fund was thus an organic consequence of long-term, successful real estate investment activity.

What does the Salutem Fund portfolio look like?

Salutem Fund focuses on both residential and commercial income real estate, especially on a regional level. When making investment decisions on which real estate to include in the portfolio, we take into account current market opportunities reflecting the development of real estate prices and rents in a given location.

 The fund’s portfolio currently includes the following real estate companies: 

REAL-VITA Prostějov a.s., company ID: 04657438, founded in 2015, it owns a fully leased industrial complex Vitareal Prostějov with warehouses, production and office spaces, which is a stable source of income for the fund. It is located in Prostějov, right next to the Prostějov-centrum motorway exit. The composition of tenants is distributed among various industries, and construction of a new hall is currently underway. More information can be found at www.real-vita.cz

ASPELL a.s., company ID: 28381955, Another company wholly owned by the Salutem Fund is ASPELL. It provides comprehensive services in the field of real estate, in particular the rental and management of real estate, real estate transactions and revitalization of owned real estate for the purpose of capital appreciation. One of the latest acquisitions of ASPELL is a recreational and residential complex in the picturesque valley in Jeseníky, which is awaiting complete revitalization and transformation in order to harness its full potential. The first project is Mountain Apartments in Loučná with 26 housing units. More information with the portfolio on the map can be found at www.aspell.cz

Salutem Services, s.r.o., company ID: 09411330, The company’s portfolio has, for example, residential properties in the centre of the capital, which are intended for long-term lease, occupied by stable and reliable tenants for an indefinite period. The portfolio includes the Flats in Šumperk project with 12 flats as well. You can find out more on the company’s website www.salutemservices.cz

Salutem – Realitní I s.r.o., company ID: 09914790, founded in 2021, focuses on profitable real estate with long-term tenants. In addition to the care and management of real estate, he is also engaged in regular publishing activities related to the development of the domestic real estate market. It monitors trends that affect investment real estate. Once again, you can find out more on the company’s website www.salutem-jedna.cz

How do you select real estate for your portfolio?

The selection of real estate for the portfolio is done by our analytical team led by the fund’s founder Jaroslav Ton. The real estate selection process is as follows:

  • We primarily focus on regions outside large cities. The reason for that is that it is in the regions where we can find higher yields. We have a network of cooperating entities which give us tips on interesting investment opportunities. 
  • Thanks to the experience of our team, we can appreciate a large number of opportunities per month and thus select those with the highest revenue potential. We then select both residential and commercial properties from the package of opportunities, where we predict synergies with our other business activities.
  • The next step is to assess the investment by a certified investment company. An analysis of economic profitability is prepared for each investment plan, the investment is further assessed by the investment committee and the final decision is made by the executive director. 
  • Last but not least, we also finance real estate with bank capital, so transactions are assessed by strict risk management of banks. 

The investment process has a number of rounds and evaluators, including the most stringent one, the fund’s founder himself, as the minimum return for our investors is covered by equity (see the explanation of the guarantee in the form of redistribution of fund capital).

How is the real estate management in the Salutem Fund portfolio taking place?

Our properties are managed by our internal real estate team, and we have several experts who take care of technical matters. For example, in the Vitareal Prostějov complex, we have a full-time administrator, Leona Lanžová, who is responsible for its technical administration in cooperation with suppliers. She can, in fact, personally show you the entire complex and the quality of our facility management. Our entire team, including cooperating entities, is comprised of over 40 people throughout the Czech Republic.

Topic No. 2: Assurance and guarantee

How does the Salutem Fund guarantee mechanism work?

We guarantee investors a minimum yield of 6% p. a., even in the event of a lower profit or even a loss of the fund. The guarantee is a form of redistribution of fund capital from holders of performance investment shares (fund founders) in favour of holders of priority investment shares (you, external investors), up to the amount of this fund capital, which falls on performance investment shares. In practical terms, this means that we cover your appreciation with our own capital. We are happy to explain the details to you. The maximum appreciation is 6.3% p.a.

Return on investment mechanism:

  • If the appreciation of the fund’s assets as of the given date is higher or equal to 6.3%, the PIA is entitled to a return of 6.3%.
  • If the appreciation of the fund’s assets on a given date is in the 6.0-6.3% range, the PIA is entitled to the return corresponding to this particular appreciation.
  • If the appreciation of the fund’s assets on a given date is less than 6%, the PIA is entitled to a return of 6%, in which case the difference is offset by the funds invested by the fund owner (VIA).

Example: In the case of an investment in the amount of CZK 2,000,000 to the investor, in the form of the above-mentioned redistribution of fund capital, we guarantee a minimum return on investment of CZK 382,032 after 3 years. In addition, the income is exempt from income tax after 3 years, so it is already a net income.

The guarantee of the minimum return on the Fund’s preferred investment shares was also assessed by the renowned consulting company Ernst & Young, its opinion can be found HERE

How is the Salutem Fund secured? 

  • The fund is managed by TILLER investiční společnost, a.s.
  • Company ID: 086 08 733, a company with CZK 8 billion in assets, more on www.tillerfunds.cz
  • The activity is supervised by the Czech National Bank, which requires regular reports on our finances. 
  • The fund’s depositary is the Československá obchodní banka, a.s. bank, which continuously controls the management of the fund’s assets; the purpose of each item in the fund’s account must be documented by the depositary. 
  • The auditor of the fund, who controls bookkeeping and compliance with the rules of asset management, is the renowned company NEXIA AP a.s.
  • The administrator is Avant investiční společnost, a.s.
  • In 2021, we were also listed on the Prague Stock Exchange (www.pse.cz), which means there is even higher level of control and regulation of the fund. For example, we have translated our accounting into International Financial Reporting Standards (IFRS). In addition to this, the listing establishes the obligation of regular reporting to the Exchange, half-yearly reports and a more detailed annual report. 

Where can I find more information about the Fund and its parameters?

More information can be found at the following links:

Important information can also be found in other materials that are available on our website. 

How often are the Fund’s assets revalued and its management controlled?

Our manager values the fund’s assets once a year in the form of independent expert opinions. The role of an investment company is, however, to regularly control the management of our real estate companies as well. Due to our listing on the Prague Stock Exchange in 2021, we will simultaneously publish not only an audited annual but also a biannual report with a summary of the management.

Topic No. 3: Investment in the fund

I’m considering investing in real estate. What are the benefits of investing with the Salutem Fund?

With us, the investor diversifies their investment into dozens of carefully selected properties throughout the Czech Republic, without worrying about their operation and occupancy. The fund therefore represents an attractive investment opportunity, for example, compared to investing in a rental apartment. You can easily calculate your yield HERE

What are the costs associated with investing in the Fund?

The entry fee is 3% of the investment. You do not pay any fees during the investment, so the additional costs are CZK 0. In addition, the income is exempt from income tax after 3 years.

What is the minimum investment period?

The minimum investment period is 3 years. In case you want to withdraw earlier, the exit fee is 5%. The reason for this is that we buy investment real estate for your funds and in an extreme case, we would have to sell them before it would be economically advantageous. In this way, we protect the shareholders of our fund.

Note, that the minimum annual guaranteed return by the redistribution of fund capital described above is 6% p.a., which is therefore significantly higher than the exit fee.

How quickly will I get my money back from the Fund, if necessary?

The deadline varies according to the amount of redemption, with redemption up to CZK 10 million, the maximum deadline is 120 days from the date of receipt of the redemption request for preference investment shares. In order to maintain reasonably high liquidity, which allows us to satisfy investors in the event of their redemption, in our portfolio there are investments of long-term held income assets with lower liquidity generating the required return (such as industrial sites, apartment buildings) and liquid assets that we do not hold for a long time.

Liquid assets are mainly:

  • smaller residential properties that we can acquire very conveniently (like all our assets). Subsequently, we reconstruct them or just revitalize them and basically offer them for sale immediately.
  • Call loans provided to verified business partners that are repayable at any time.
  • Short-term investments with a maximum maturity of six months in a financial institution providing operational financing to transport companies.

How is the preferred shareholder protected against loss? 

The preferred shareholder (PIA type shares) is protected primarily by the fact that the fund is obliged to hold VIA (its own funds) / PIA (investors’ funds) type investments at least in a ratio of 1 to 4. Should a situation arise where, on the part of the fund owner (VIA), the amount of investment is insufficient, the fund cannot accept further investments from external investors (PIAs) because it must protect existing PIA investors.  At present, the vast majority of invested funds are the funds’ own resources, i.e. VIA shares.

Should you have any other questions, contact us at +420 778 112 978, or via email at info@salutemfund.cz.