Less than 10% of Dragon Capital’s portfolio is insured against war risks — Fiala

Dragon Capital has insured less than 10% of the total value of its real estate portfolio against war risks. At the same time, insurance coverage covers about half of the company’s assets or even more, but it only covers a small part of their value.

This was reported by Dragon Capital CEO Tomasz Fiala.

Why it is impossible to insure all real estate

According to Fiala, it is currently impossible to fully insure the company’s facilities against war risks. One of the main reasons remains the high cost of such insurance.

“It is not possible to insure the entire facility, plus it is very expensive,” he explained.

Because of this, even if formally about half of Dragon Capital’s assets are insured, in monetary terms the coverage is less than 10% of the value of the company’s entire portfolio.

War risks affect new investments

Limited insurance options also directly affect Dragon Capital’s decisions regarding new real estate investments.

Currently, the company is more focused on assets located in western Ukraine. At the same time, the proximity of the object to the front line may be a reason for refusing to invest.

Another risk factor for the company is excessive concentration of the portfolio in one object.

Investments in Kyiv are treated more cautiously

Dragon Capital is also more cautious about new investments in Kyiv real estate due to the intensity of Russian shelling.

Fiala noted that the company may more actively return to investing in the capital if the effectiveness of intercepting missiles and drones increases.

Thus, military risks and limited possibilities for their insurance remain one of the key factors affecting the geography and volume of new investments in real estate.