KDD carries USD 700mn of property on its balance sheet so is one way to get Ukrainian real estate exposure, albeit with development risk. Real estate consultants in the country estimate that supply will not equal demand until 2010-2011. This explains why the market is 'hot'. Office rent rates grew 40 per cent in 2006 and 35 per cent in 2007.
Results just out include a USD 145mn property revaluation gain. Unfortunately, some of this is accounting manipulation including a reclassification of the PecherSKY project into inventory from investment property.
KDD holds a diversified portfolio of real estate projects comprising offices, residential complexes, retail centres and mixed-use projects. KDD currently has eight projects, of which three are in the groundwork construction phase and five are at various stages of design and development. The company is listed on AIM having having been bought too the market by ING and Renaissance Capital .