SITNO HOLDING REAL ESTATE, a.s. - SFDR FIRM-LEVEL DISCLOSURES

Regulation (EU) 2019/2088 of 27 November 2019 on sustainability‐related disclosures in the financial services sector (SFDR)

SFDR imposes new transparency obligations and periodic reporting requirements on investment management firms at both a product and firm level. SFDR forms part of the European Commission’s action plan on sustainable finance.

SITNO HOLDING REAL ESTATE, a.s. as sole shareholder of SITNO HOLDING Real Estate S.à r.l. (the AIFM) makes the following disclosures in accordance with Articles 3(1), 4(1)(a) and 5(1) of the SFDR.

Background

The AIFM, a private limited liability company (Société à responsabilité limitée) having its registered office in the Grand Duchy of Luxembourg, is the general partner and acts as a registered alternative investment manager pursuant to Article 3(2) of the Luxembourg law of 12 July 2013 on alternative investment fund managers (the AIFM Law), of SITNO REAL ESTATE SCSp, SICAV-RAIF (the Fund), a special limited partnership (société en commandite spéciale) having its registered office in the Grand Duchy of Luxembourg.

Article 3 SFDR – Sustainability risk policies statement

A sustainability risk means "an environmental, social or governance event or condition that, if it occurs, could cause a negative material impact on the value of the investment". For the AIFM, sustainability risks are risks which, if they were to crystallise, would cause a material negative impact on the value of the Fund's investment. The AIFM sets out below its policy on the integration of sustainability risks in its investment decision-making. 

Pursuant to the SFDR, the Fund is required to disclose the manner in which sustainability risks (as defined in the “General risk factors” section of the Offering Document) are integrated into the investment process and the results of the assessment of the likely impacts of such risks on the returns of the Fund.

Unless otherwise provided in the Offering Document, the Fund does not promote environmental or social characteristics and does not pursue a sustainable investment objective within the meaning of SFDR. The Fund is therefore classified under Article 6 SFDR. Nevertheless, the Fund remains exposed to a broad range of sustainability risks that are integrated into investment decision-making and risk monitoring to the extent that they may represent potential or actual material risks and/or opportunities to maximising long-term risk-adjusted returns.

The impacts following the occurrence of a sustainability risk may be numerous and vary depending on the specific risk, region, industry focus and asset class. In general, where a sustainability risk occurs in respect of an asset, there will be a negative impact on, or entire loss of, its value. Such assessment of the likely impact is conducted at portfolio level. Given the Fund’s global multi-asset investment strategy and lack of industry sector focus, the Fund is expected to maintain a highly diversified portfolio. Accordingly, it is not anticipated that a single sustainability risk will cause a material negative financial impact on the return of the Fund or on the value of its investments.

The AIFM, together with the relevant Investment Advisor, considers sustainability risks as part of the established investment and risk management processes, subject to the Fund’s investment objective, investment policy and risk profile. Reasonable efforts are made to incorporate the evaluation of sustainability factors into investment due diligence and ongoing monitoring where sufficient data is available. Such evaluation may be performed internally or via external service providers at the cost of the Fund.

Article 4 SFDR – No consideration of adverse impacts of investment decisions on sustainability factors

Article 4 of the SFDR requires fund managers to make a clear statement as to whether or not they consider the "principal adverse impacts" of investment decisions on sustainability factors.

At this stage, the AIFM does not consider such principal adverse impacts within the meaning of SFDR. The AIFM has assessed the nature and scale of its activities and concluded that it is not currently practicable to do so, as the data required for a consistent, comparable and high-quality assessment of PAIs is not yet sufficiently available across markets and asset classes.

Nevertheless, the AIFM applies established due diligence and risk management processes to all investments, which include the integration of sustainability risks as described under Article 3 SFDR. These processes focus primarily on financial, legal and operational risks, and may incorporate sustainability considerations where reliable information is available.

The AIFM manages alternative investment funds with diversified multi-asset global strategies and no specific environmental, social or governance focus. The financial products made available by the AIFM are therefore classified as Article 6 funds under the SFDR, meaning they do not promote environmental or social characteristics and do not have sustainable investment as their objective.

This approach with respect to PAIs is kept under ongoing review, taking into account regulatory developments, improvements in data availability and evolving market practices.

Article 5 SFDR – Remuneration policy 

“The AIFM has adopted a remuneration policy consistent with sound and effective risk management. Given the nature, scale and complexity of its activities, the AIFM does not operate a variable remuneration scheme; accordingly, sustainability risks are not separately taken into account in remuneration structures.”