Investors’ Club Starting at EUR 125,000 – Yet Even Half a Million May Not Be Enough

In theory, having EUR 125,000 is enough to invest in funds that acquire or develop real estate (RE). However, in Lithuania, the collective investment market is structured in such a way that real estate funds are often less accessible to smaller investors and resemble an exclusive investors’ club. Nevertheless, industry experts agree that interest in such investments is gradually spreading to a wider audience.

Retail investors have already had some exposure to fund-related investments and their operating principles, particularly when changes in the real estate sector prompted fund managers to issue bonds to finance certain development projects. However, the returns generated by such bonds are likely to be significantly lower than those earned by investors holding fund units, largely due to the different levels of risk involved.

Currently, more than 100 real estate investment funds operate in Lithuania, making the collective investment sector relatively mature. Typically, investment managers pool capital from investors and either acquire properties for rental income or undertake development projects. In the first case, investors earn returns from rental income, while at the end of the fund’s lifecycle, the properties are expected to be sold at a profit.

In development projects, investor returns are generated through the sale of completed real estate. Residential developments tend to move relatively quickly, whereas commercial real estate projects may remain in a fund’s portfolio for years before being sold.

Expectations of Broader Interest

Arvydas Avulis, Chairman of the Board of real estate development company Hanner, stated at the Baltic Real Estate Investment Forum that, in his opinion, real estate and real estate funds are among the easiest ways to invest.

“People hold billions in bank accounts, and if inflation remains high—around 5% as it is today—there will be strong pressure to put that money to work because simply keeping it in a bank account means losing value. Wealthy individuals with substantial cash reserves will increasingly feel compelled to invest. The easiest ways to do so are through real estate or investment funds. Lithuania has large funds managing not hundreds of millions but billions of euros. This is a strong market with strong players,” he said.

However, Andrius Stonkus, co-owner of Lords LB Asset Management, one of Lithuania’s largest investment management companies, pointed out that commercial real estate investors currently face liquidity challenges. He believes local businesses could help improve the situation.

Simply put, after the outbreak of the war in Ukraine, some international investors withdrew from Lithuania and other countries neighboring Russia. At the same time, rising interest rates made it harder for buyers and sellers of commercial real estate to agree on asset valuations. As a result, the number of transactions that would return capital to fund investors fell sharply. Without wealthy international buyers, selling premium, high-value properties became especially difficult. Still, expectations are growing that 2026 will bring several transactions worth hundreds of millions of euros.

“Today, local fund managers and private investors are active. Lithuania has many businesses generating substantial profits, and they could become buyers of larger assets over the next 12–24 months. They should help improve market liquidity. If you want foreign capital to come in, you need liquidity. Every investor says that if they are to invest, there must be an opportunity to sell at a fair price whenever necessary. We are moving in that direction, but there is still some way to go,” said A. Stonkus.

He added that some major investors currently want to withdraw capital and pursue other opportunities, but he believes there is potential to attract additional investors with lower risk tolerance into funds.

How Much Money Is Needed?

When Verslo Žinios asked how much capital is required to invest in a real estate fund, responses from fund managers and investors varied widely—from a few thousand euros to EUR 500,000.

Collective investment schemes in Lithuania are supervised by the Bank of Lithuania, whose approval is required for every fund and investment company. Investors must also meet specific requirements.

According to Mindaugas Liaudanskas, CEO of Demus Asset Management:

“For traditional real estate funds in Lithuania, the minimum investment amount is usually EUR 125,000. This is due to the prevailing definition of an informed investor, one of whose simplest qualifying criteria is an investment of that size. Theoretically, a person who is properly assessed and recognized as an informed investor could invest much smaller amounts. In practice, some funds allow investments starting from EUR 25,000–30,000 after assessing an investor’s knowledge and experience.”

Andrius Uždavinys, CEO of Eika Asset Management, shares a similar view. Since most Lithuanian funds are designed for informed investors, the minimum investment threshold is often EUR 125,000.

“These funds are intended for investors with more investment experience, who better understand investment risk, can tolerate it, and are capable of selecting instruments that best meet their needs. The EUR 125,000 minimum does not apply to professional investors, and after an additional suitability assessment considering risk tolerance and loss-bearing capacity, the fund manager may allow investments from EUR 30,000,” he explained.

According to Uždavinys, Lithuania also has several funds intended for non-professional investors, with minimum investment amounts determined by the fund manager.

For example, Demus has established a residential rental portfolio fund with a minimum investment of EUR 100,000. However, Liaudanskas has previously stated that the company plans to lower this threshold in the future, possibly to EUR 20,000–30,000.

Meanwhile, investor and Profitus founder Viktorija Čijunskytė, who previously worked in fund management, believes that investors should ideally have at least EUR 500,000 available for such investments.

“Most funds are intended for informed investors and have investment horizons of 3–7 years. Investors need sufficient capital to diversify, ensuring that a single real estate fund accounts for no more than one-fifth of their portfolio,” she explained.

Doors Are Not Always Open

Even if an investor has EUR 125,000—or even the EUR 500,000 mentioned by Čijunskytė—it does not necessarily guarantee access to a fund. Although fund managers strive to expand their investor networks, several factors create this seemingly paradoxical situation.

Uždavinys notes that one reason is that fund managers prefer working with fewer investors.

“All clients are effectively equal from an operational perspective. The procedures required when onboarding investors and administering their investments are largely the same, regardless of investment size. Therefore, managers naturally prefer larger investments from fewer investors. Serving less experienced investors with smaller amounts would require working with thousands of individuals to raise sufficient capital. This creates challenges in process automation, digitalization, staffing, and ultimately increases operating costs.”

Liaudanskas adds that most funds are designed for informed investors, and the main challenge is not administration but assessing whether investors truly understand the risks associated with their investments.

“Funds would like to have smaller investors, but legislation strictly protects retail investors from being persuaded into investments they may not fully understand,” he summarized.

Čijunskytė adds that it is easier and more cost-effective to serve a few large investors than 100 smaller ones.

“There is interest in creating funds for retail investors, but because real estate is relatively illiquid, managing the interests of a large investor base is very difficult. That is why retail investors often choose real estate crowdfunding platforms instead.”

Key Differences

Nevertheless, the capital potential is significant. According to Čijunskytė, Lithuanian real estate crowdfunding platforms raised more than EUR 200 million during the first five months of 2026, compared to approximately EUR 360 million throughout all of 2025.

Asked about the differences between funds and other investment instruments, she explained that funds generally have longer investment horizons—typically 3–10 years. By comparison, crowdfunding investments usually last 4–24 months, while bonds often have terms of 2–3 years.

“In terms of returns, funds offer the highest expected return—around 15%. Bonds may generate 6–12%, while crowdfunding platforms average around 9%. However, higher returns come with higher risk. By investing in funds, investors become equity partners, meaning that if a project fails, they may bear the full risk. In my view, this is the greatest risk. Bond investors, although bonds are often described as ‘secured,’ are usually secured by company shares, meaning that in the event of failure they stand behind mortgage creditors in the repayment hierarchy.”

She noted that loans funded through crowdfunding platforms are typically secured by a first-ranking mortgage on real estate.

“Therefore, they carry the lowest probability of a total loss. But all investing involves risk, which is why diversification is so important.”

Uždavinys argues that real estate funds are not the most suitable instrument for small investors due to their long-term nature and the relatively low liquidity of real estate itself.

“For example, if a bond issue is listed, it has immediate liquidity and can be sold at any time. Funds generally cannot offer this. Most lock investors’ capital for at least five years, and fund units can rarely be redeemed before the end of the fund’s term.”

However, he believes that a secondary market for fund units may gradually emerge over time.

According to Uždavinys, crowdfunding and bond products usually offer fixed returns, whereas funds generally provide target returns.

“Managers are motivated to outperform because their compensation often includes a performance fee. The more investors earn, the more the manager earns. Crowdfunding and bond products are often more specific—there is a clear business plan and assumptions, making risk assessment easier. Funds, particularly at the beginning of their lifecycle, may not yet have identified specific assets.”

Another important difference, according to Liaudanskas, is the overall investment size. A crowdfunding project, for example, may borrow no more than EUR 5 million, whereas fund sizes typically start at EUR 5–10 million and increase from there.

“Funds also benefit from a corporate tax exemption—they are not subject to corporate income tax. Investors, however, pay personal income tax and dividend tax depending on whether they are individuals or legal entities,” he added.

Nevertheless, Uždavinys observes increasing attention from investment managers toward retail investors and predicts that more funds tailored to this segment will emerge in the future.