Hepsor prepares a bond programme
Publicly listed real estate developer Hepsor, in cooperation with LHV Pank, is preparing a bond programme and plans to list the bonds on the main list of the Nasdaq Tallinn Stock Exchange in order to diversify the company’s financing structure and ensure capital for funding projects in its diversified portfolio across its home markets.
‘The planned bond programme will give us the opportunity to react quickly when market conditions offer good investment opportunities or favour the raising of additional capital. Considering the length of the real estate development cycle, it is reasonable to give projects a boost at the right moment,’ said Martti Krass, CEO at Hepsor.
Real estate development cycles are long, which is why projects often need financing at different stages. The goal of the bond programme is to ensure flexible access to capital for the company, precisely when market conditions are most supportive. The raised capital will be directed towards the implementation of ongoing and new residential and commercial development projects. Hepsor’s portfolio includes a total of 30 projects in different stages of development – 15 in Estonia, 10 in Latvia, and 5 in Canada.
‘The advantage of our bond programme, which is aimed at retail investors, is that we do not tie the raised capital to a specific project or market, but to our overall development plan. Our cash flows are stable and based on a geographically and segmentally diversified development portfolio, encompassing both residential and commercial real estate, markets in Estonia, Latvia and Canada, as well as projects in various stages of the development cycle. This provides investors with security and diversifies risk, as the investment does not depend solely on the success of a single development,’ added Krass.
As part of the planned programme, Hepsor intends to apply for the bonds to be listed for trading on the Baltic Bond List of the Nasdaq Tallinn Stock Exchange. Hepsor’s shares have been listed on the main list of the Baltic Stock Exchange since 2021.
Hepsor invites all interested parties in Estonia on 13 November and in Latvia on 14 November to the autumn-winter investor meetings, where the company’s CEO, Martti Krass, will provide an overview of the development portfolio and the situation in the home markets, as well as of the company’s planned investments and bond programme. Participation is open to all, and more detailed information will be published on Hepsor’s website.
The public offering of the bonds is subject to the approval of the prospectus by the Financial Supervision Authority. Hepsor will issue a separate notice concerning the approval of the prospectus, the start of the bond offering, and the related terms and conditions.
If you would like information about the investor event via email, please contact us at meedia@hepsor.ee
This notice is intended solely for informational purposes and refers to a potential future offering. It should not be regarded as an offer to sell bonds or investment advice. Likewise, no sale or public offering of bonds will take place in any country or jurisdiction until the relevant prospectus or other required offering document has been duly approved, registered or published in accordance with applicable law.
Why does Hepsor plan to issue bonds?
Hepsor intends to issue bonds to broaden its financing base and ensure the availability of capital for the implementation of projects within its diversified portfolio.
What is Hepsor’s previous experience with bond issuances?
Hepsor has prior experience with both domestic and international financing solutions, including a previous share issue. The forthcoming bond issuance will, however, be the company’s first.
Why has Hepsor chosen bonds instead of, for example, a bank loan?
To date, Hepsor has financed its operations through equity raised at the parent company level (including a share issue in 2021), bank loans, and project-level investor capital. By entering the bond market, the company seeks to diversify its funding structure and enhance its financial independence in development projects.
How many issuances are planned under the programme?
The exact number of issuances has not yet been determined and will depend on prevailing market conditions and the company’s project financing requirements. The purpose of the programme is to enable flexible and phased capital raising rather than securing all necessary funds at once. Through this approach, Hepsor aims to strengthen its position as a landowner in new residential real estate developments and to reduce the relative share of financial partners during the development phase.
Why might an investor prefer a Hepsor bond to a Hepsor share?
A bond is by nature a more conservative investment instrument than a share. While share investments represent participation in the company’s long-term value creation, bonds provide investors with a fixed and predictable return as well as a defined repayment schedule. Bonds are therefore suited to investors seeking stable cash flows and fixed-term investment opportunities.
How will the raised capital be used?
The proceeds from the bond issuances will be allocated to the financing of ongoing and new development projects in Estonia, Latvia, and Canada. The funds will not be dedicated to a single project but will support the company’s broader development strategy, ensuring stability and diversification of risks.
How will the programme affect the company’s profitability and financial stability?
The bond programme will provide a flexible mechanism for project financing at optimal times and will further strengthen the company’s capital structure. Thoughtful and well-timed capital raising is expected to improve project efficiency and support Hepsor’s long-term profitability and sustainable growth.
Will Hepsor’s bonds be tradable?
Hepsor intends to list its bonds on the Nasdaq Tallinn Main List, following which they will be available for trading.