Pilevin will not pull out PNK
The closure of PNK-Rental may be a harbinger of the bankruptcy of one of the leading companies in the commercial real estate market.
The PNK-Rental real estate closed-end investment fund (ZPIF) is being liquidated, which, according to financial market participants, was created in 2020 for the “gray” capital of some large figure due to the limited availability of foreign REIT instruments (trust investment management of real estate, Real Estate Investment Trust).
Real investors call stock real estate, the companies that manage it, which often own this property, as well as developers (almost always included in the structure of the UK) “legitimate swindlers” and “legal pyramid schemes.”
An investor who has invested in such a fund cannot influence the management company, but can only hope for income. At the same time, in most cases, the commission for real estate management that makes up such mutual funds is almost zero, and the main income was from secondary benefits due to an increase in the turnover of development projects of the management company and the developer.
In principle, the same is happening with PNK-Rental, which is managed by A Class Capital. The co-founder of this company is Dmitry Pilevinwho has been working at PNK group in various management positions since 2011.
Bringing Down the House”
By the way, he got into the register of the Federal Tax Service of disqualified persons under part 5 of article 14.25 of the Code of Administrative Offenses of the Russian Federation – the repeated submission of false information to the inspection authorities.
In addition, the company “A Class Capital” is engaged in the investment strategy of the fund and is part of the structure of “PNK-Rental” together with the management company “Industrial Real Estate”, which directly manages the real estate objects of the fund, and finances their construction fund “PNK-Development”, also under management “A Class Capital”.
This “distribution of duties” allows “PNK-Rental” to sell shares of the investment fund without violating the law and to receive income from these investments.
Investors themselves received income from the rent for real estate and price changes after its revaluation or sale. But, given that the rent was fixed for a long time unchanged, and there were more and more investors, the PNK-Rental fund seemed somehow confusing.
So, for most mutual funds, the value of a share is calculated from the value of the net assets of the fund divided by the number of shares, and the investor’s income in this case is the sum of the difference in the value of the share upon acquisition and upon redemption. And in the case of a real estate fund, the shares constitute a share in the objects included in the fund.
In general, real estate mutual funds in the REIT market work differently: investors invest certain amounts in a commercial real estate fund, which builds or buys objects for the total amount and rents them out. That is, this property belongs to the fund, and investors receive income from rental payments. Investors, buying a share, acquire a share in the property under the management of the company.
In addition, management companies place their shares on the stock exchange, as, for example, in the United States, which gives investors additional leverage to influence their activities.
But in PNK-Rental, investors did not receive a share in any real estate object, but had a corresponding share in all objects at once, which reduces the share of each shareholder with an increase in their number. That is, investors gave their money to the trust management of A Class Capital, which transferred it to Industrial Real Estate Management Company, which, in turn, through PNK-Rental, sent them to the objects of the PNK group.
At the same time, the income of the fund itself consisted of a commission from the management of real estate objects in the amount of 20% when the investor’s income exceeded by more than 13%, that is, with an income of 15%, the commission was deducted from the difference of 2%.
In addition, no one was able to find a depository who should store information about the shares, which indicates the impossibility of controlling the return of money from the PNK-Rental fund in the event of the bankruptcy of its management companies.
Reputational costs
And here we remember the co-founder and former director of the fund of the management company A Class Capital Pilevina, who is the founder and director of 28 loss-making companies (most of them have been liquidated today), including Project Development LLC, Logopark Yug-2 LLC, Nedvizhimost PRO LLC and Logopark Yug LLC, which are affiliated with the fund “PNK-Rental” and PNK group.
By the way, through his company Central Park, he is associated with the British companies Lixton Entertainment Limited and River Entertainment Limited. Offshore, as a rule, are used to withdraw funds abroad.
In addition, according to the authors of the TLTgorod.ru website, allegedly Dmitry Pilevin as a director of the Aldis-Lada company (dealer of AvtoVAZ and BMW) has already appeared in one of the court cases on counterfeit bills. Then, in 2002, he allegedly issued promissory notes for 3 million rubles to a front company, the actual owner of which he himself was.
This, again, only has a negative impact on the image of the mutual fund. Also disqualification. Pilevinbut for deceiving government agencies. That is, he can be compared with the notorious Sergey Mavrodi, which increases reputational risks and alarms investors, who, in the absence of actual income, according to the rules of the fund, must now pay a commission to the management company.
In general, the prospects of “PNK Group”, which works with the largest banks in the country, taking into account the above, become more and more cloudy. And taking into account that the company has a significant weight in the commercial real estate market, the closure of the PNK-Rental fund may be the first call to much more unpleasant events, for example, the bankruptcy of one of the leading companies in the market. Which cannot but affect the banking system.
