This article was originally published on 31 October 2007

Today Guernsey-based Argyll Investment Services Limited is launching one of the first funds to invest in the Serbian and particularly Belgrade real estate market.

The appropriately named Belgrade Pioneer Fund launched on 31 October 2007 and has an opening investment period lasting until 15 November 2007. The fund, with a duration of five years, will have a minimum investment of €15,000 and is expected to raise a total of up to €10mn.

"Mentioning Serbia usually conjures up memories of civil war, hyperinflation and the regime of Slobodan Milosevic. Despite the continued uncertainty over Kosovo’s future, the reality of Serbia today is markedly different from that description. There is increasing political stability, including in external affairs, which is providing the foundation for strong economic growth," said Stuart Place, a Director of Argyll.

Argyll was again one of the first on the scene when it launched the property fund Montenegro Investments Limited in 2005.

"Interestingly, back in 2005 part of the case for Montenegro was that it was NOT Serbia. Now given the political and economic situation – with Foreign Direct Investment at its highest ever levels, labour costs half those of some of its neighbours, corporation tax at an attractive 10% and the promise of further privatisation – there is a strong case IN FAVOUR of Serbia," added Mr Place

The Belgrade Pioneer Fund, which is targeting returns of 20%+ per annum net, will have a spread of investments, although the main focus will be on residential developments in Old Belgrade.

Guernsey-based service providers to the fund include administrators Bordeaux Services, bankers Kleinwort Benson, auditors KPMG and legal advisers Carey Olsen.

Peter Niven, Chief Executive of GuernseyFinance – the promotional agency for the Island’s finance industry, said: "The launching of this fund demonstrates the high quality of investment management expertise that exists in Guernsey. This is an understated but vital element of the Island’s funds industry that certainly deserves recognition for its commitment to excellence.

"In addition, the Belgrade Pioneer Fund illustrates how the breadth and depth of services available in Guernsey means that the Island can provide a ‘one-stop shop’ for investment funds."

It is anticipated that a larger, listed Serbian property fund will be launched in Quarter 2 of 2008.

Belgrade Pioneer Fund

Launch date: Opening period, 31 October 2007 – 15 November 2007

Expected fund size: Up to €10mn

Minimum investment: €15,000

Legal structure: Guernsey company, regulated as a Registered Fund

Front-end fee: Up to 3%

Management fee: 2.0% per annum

Performance fee: 20% of all profit over 8% per annum

Fund duration: 5 years

Manager: Argyll Investment Services Limited

Property adviser: Perella Investments Ltd (via its Ultimate Assets Serbian team)

Service providers:

  • Administrator – Bordeaux Services
  • Bankers – Kleinwort Benson
  • Property Valuers – Deloitte
  • Serbian Tax and Auditors – KPMG
  • Guernsey Auditors – KPMG
  • Legal Advisors – Guernsey: Carey Olsen; Serbian: Karanovic & Nikolic

Guernsey’s funds industry

The value of funds under management and administration in Guernsey reached a record high of £155.6bn at the end of June 2007, an increase of £15.2bn (10.8%) from the £140.4bn recorded at the end of March 2007 – the previous high – and a rise of £40.8bn (34.8%) year on year.

The number of funds approved by the GFSC reached a new high of 1,024 by the end of June 2007, an increase of 43 (4.4%) from the 981 at the end of March 2007 – the previous high – and a rise of 179 (21.2%) from the same time in 2006.

There has been significant interest from fund promoters and sponsors in the Island’s new registered closed-ended funds regime. In the period between its introduction on 1 February 2007 and the end of June 2007, 37 such funds have been given consent by the GFSC.

For more information about Guernsey's finance industry please visit

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