Coimbra City Council capitalizes fund to create student residence

Coimbra City Council signed a capital increase operation for the Coimbra Viva real estate fund, worth 2.8 million euros, now allowing that entity to move forward with the construction of a student residence in Baixa.

“Coimbra City Council subscribed, last Thursday, to a capital increase operation in the special real estate investment fund closed for urban rehabilitation Coimbra Viva, with subscription in kind by the municipality in the amount of 2,829,000 euros, to finance the construction of the student residence project in the Nogueira block”, in downtown, announced the councilor responsible for housing and urbanism, Ana Bastos, who was speaking during this Monday’s Executive meeting.

The capital increase was essential to move forward with that student residence, whose costs amount to around 4.2 million euros, “which cannot be fully supported, not even with the current equity capital [do fundo]nor by resorting to debt”, he clarified.

The capitalization process allows “to move forward with the student residence project, contributing to the rehabilitation, dynamization and vivification of Baixa and, simultaneously, increasing the fund’s debt capacity”, highlighted Ana Bastos.

According to the councilor, this capitalization will also support the cost of completing other rehabilitation projects in Baixa by Coimbra Viva.

Questioned by the Lusa agency on the sidelines of the meeting, Ana Bastos clarified that the Housing and Urban Rehabilitation Institute (IHRU) did not subscribe to the capital increase and, with this operation, the Municipality now holds 72.58% of the real estate fund, instead from the previous 56% before capitalization.

The capital increase was released after, in January, the Municipality made it possible to take out a loan in order to capitalize Coimbra Viva.

In June 2023, the fund’s management company, the private FundBox, had stated that the fund has 27 properties in its portfolio, of which nine were already rehabilitated at that time and another nine licensed or under licensing.

The fund, created in 2011 to operate in a delimited area of ​​the city’s downtown, has as institutional participants the City Council of Coimbra and the Institute of Housing and Urban Rehabilitation (IHRU) and is managed by the private company FundBox, also allowing the participation of investors private individuals and property owners.

After having started its activity with 17 properties, the fund has 27 properties in its portfolio, spread across the streets of Moeda, Direita, João Cabreira, Nogueira and Pedro Olaio, which are valued at 4.5 million euros.