Maintaining Balance: Why Max Krippa Bought BC “Parus”
Posted on August 19, 2024 By: Tamerlan Boris
Analyzing the behavior and actions of experienced investors can sometimes be as interesting as reading a detective novel. The intrigue is heightened by the fact that investors' actions are never spontaneous, and no investor reveals all their cards. In this sense, Ukrainian entrepreneur and investor Max Krippa is a canonical example: experienced, visionary, and quite secretive. Let's understand what lies behind Max Krippa's purchase of BC “Parus”.
About the Asset: What is BC “Parus”
The first Ukrainian skyscraper has 34 floors and 75,000 square meters of total area. The commercial area of the building is 50,000 square meters. There are several conference halls and a private parking lot. The location of the building is more than successful — the center of Kyiv, the elite Pechersk district, good transport links.
The transaction amount for the purchase of BC “Parus” is naturally not disclosed. But experts are allowed to speculate and estimate. They tend to believe that the amount is 100 million dollars or more. The parties to the transaction were Max Krippa, Vadym Stolar, and his ex-wife Inna Maystruk (she owned 20%).
Who is Max Krippa?
Max Krippa is a businessman, entrepreneur, and venture investor who primarily works with Ukrainian assets. He was one of the first Ukrainian investors who paid attention to the esports industry and made several investments even before it was recognized at the state level.
Max Krippa first step towards esports was the acquisition of a stake in an unknown startup at the time. At the time of the offer review, the company had only been in existence for 4 months and planned to engage in unclear activities — broadcasting and commenting on esports matches. Despite the high-risk investment, it paid off. Today, the Maincast studio is a market leader, concentrating about 65% of the market. According to unconfirmed information, Max Krippa owns 25% of Maincast.
Max Krippa's investment portfolio also includes the esports organization NAVI and the game development company GSC Game World, known for products like S.T.A.L.K.E.R. and Cossacks.
Goals of Buying BC “Parus”
After the news about the change of ownership of BC “Parus” emerged, expert opinions were divided. Some believe that buying commercial real estate aims to diversify the portfolio. Others insist that Max Krippa is consistently implementing a strategy of segmental investment and plans to use BC “Parus” in the context of esports. Both versions have their evidence, and they do not contradict each other.
If seriously considering the purchase of BC “Parus” as a way to diversify the portfolio, it is necessary to note the successful and elegant solution. The skyscraper belongs to the top class of commercial real estate, making the asset quite liquid compared to lower-class real estate.
Investing in commercial real estate objects allows not only increasing capitalization but also receiving stable rental income. What the potential income of BC “Parus” is today is hard to say, but it is known that in 2008 it was 50 million dollars a year.
Finally, purchasing an asset in the form of commercial real estate allows you to obtain a physical asset with low correlation to other portfolio assets and good growth potential.
All the above makes BC “Parus” a truly attractive object, naturally with an adjustment for the overall economic situation in the country. But apparently, these risks do not frighten Max Krippa — his portfolio mainly consists of Ukrainian assets.
If we consider the second hypothetical goal of buying BC “Parus”, it is worth noting that Ukraine has good potential for growth and development of the esports industry. Even considering the initial technical lag at the start of forming the global esports industry, Ukrainian companies and teams have already achieved significant results and bright global victories.
One of the key problems of global esports is the lack of sufficient training bases and infrastructure facilities. Analysts already note this problem and indicate that it will become increasingly acute as the esports audience grows. In this light, the idea that Max Krippa decided to create a multifunctional and modern esports hub at BC “Parus” seems quite plausible.
This theory is also supported by the fact that technological issues are resolved quite quickly in the esports organization NAVI. Upon becoming a full-fledged owner, Max Krippa initiated the creation of two new modern bases: in Berlin and Kyiv.
It seems that Max Krippa is interested both in diversifying his portfolio and developing the esports industry. Whether he will combine the two tasks within a single object is an open question. But technically, implementing this idea is entirely possible — funds and desire are all that are needed.
