reports
- Simen Mortensen
Sector optimism
In the past week, Citycon divested a retail asset in Norway, Logistea updated its financial targets following the merger with KMC Properties, Cibus carried out a rights issue as it is targeting M&A in the daily-goods property sector, and we saw sector optimism at DNB’s Nordic Real Estate & Construction Conference. The weighted-average implied EBITDA yields on the stocks we cover are 4.21% for 2024e and 4.65% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
PUBLI PUBLIC PROPERTY INVEST
- Simen Mortensen
Bonds, market data and investments
This week, Castellum issued a EUR500m bond loan, and according to Bloomberg, Catena is contemplating launching 1–2 green bonds next week. Pandox acquired another UK asset, Logista and Public Property Invest look set to join the FTSE EPRA index, and finally, August data for Swedish and Norwegian house prices and commercial transaction volumes was published. The weighted-average implied EBITDA yields on the stocks we cover are 4.26% for 2024e and 4.70% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
PUBLI PUBLIC PROPERTY INVEST
- Simen Mortensen
Hufvudstaden up to HOLD, layoffs in construction sector and rate cut
This week we upgraded Hufuvdstaden to HOLD following its Q2 results, JM is laying off 145 employees, and the Riksbank cut the policy rate by 25bp to 3.50%. While we retain our neutral stance on the Swedish real estate sector, we have turned slightly more positive since last month’s reduction in long-term market interest rates. The weighted-average implied EBITDA yields on the stocks we cover are 4.27% for 2024e and 4.71% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
PUBLI PUBLIC PROPERTY INVEST
- Simen Mortensen
Aurora Eiendom (Buy, TP: NOK110.00) - Vacancy rate up on terminations
With two lease terminations by a retailer in a bankruptcy protection restructuring in Q2, rental income and FFO disappointed. However, with one of the vacated stores already re-let from Q4, we believe the negative effects will be short-term. We reiterate our BUY and NOK110 target price.
- Simen Mortensen
More Q2 results and other news
The Q2 reporting season is again underway, following the summer break, with results from Olav Thon and Kojamo. In other news, Pandox announced it is considering a large UK investment, Norges Bank signalled the policy rate will not be cut near-term, and in Sweden, CPI has increased on an expected cut. The weighted-average implied EBITDA yields on the stocks we cover are 4.29% for 2024e and 4.74% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
PUBLI PUBLIC PROPERTY INVEST
- Simen Mortensen
More Q2 results, a profit warning and an equity raise
This week, Kojamo issued a profit warning for Q2 and the full year. Balder, Castellum, Citycon and Sagax reported Q2 figures. Corem issued new shares. The weighted-average implied EBITDA yields on the stocks we cover are 4.26% for 2024e and 4.69% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
PUBLI PUBLIC PROPERTY INVEST
- Simen Mortensen
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
PUBLI PUBLIC PROPERTY INVEST
- Simen Mortensen
Q2 starts and transaction updates
The slow market recovery in Nordic CRE transactions continued in June. Moreover, a large transaction in Stockholm, Sweden, supports commercial brokers’ estimated current CBD yields. The Q2 reporting season has started, with continued indications of a weakening office rental market in Sweden. The weighted-average implied EBITDA yields on the stocks we cover are 4.34% for 2024e and 4.74% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Strong divestment, flat Swedish policy rate and tenant bankruptcies
This week, the Swedish Riksbank kept the policy rate unchanged at 3.75%, but the market is factoring in an 85% likelihood of a cut in August. Stenhus Fastigheter has seen two key tenants apply for bankruptcy within a week, and Entra divested a hotel at a 28% premium to book value. Finally, we maintained a neutral view in our Nordic real estate sector update last week. The weighted-average implied EBITDA yields on the stocks we cover are 4.45% for 2024e and 4.86% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Improved sentiment, but unattractive sector valuation
On the positive side, sentiment has improved on peaked interest rates and tightening credit spreads. However, we consider the sector fully valued and maintain our neutral view, given our expectation of muted NAV/share and FFOps growth. Our key focus is on rising vacancy rates, particularly in the office segment. Our top sector picks are Wihlborgs, Catena and PPI.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
A merger, a bond exchange offer and other news
KMC (No rec) and Logistea (No rec) plan to combine, with Logisea acquiring all of KMC Properties’ group operations. SBB Norden announced a bond exchange offer. Dios named David Carlsson new CEO. Corem divested SEK107m of properties. Citycon announced the result of a bond hybrid exchange offer. The weighted-average implied EBITDA yields on the stocks we cover are 4.43% for 2024e and 4.83% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Initiating with a BUY, office-space reduction, and personnel changes
This week, we initiated coverage with a BUY on Public Property Invest, a key tenant for Fabege reduced its office space, Hufvudstaden made management changes, we updated our estimates for Besqab following the merger with Aros Bostad, and transaction volumes in May rose from low levels. The weighted-average implied EBITDA yields on the stocks we cover are 4.38% for 2024e and 4.78% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
A bit of everything
This week, Wihlborgs bought new assets, Citycon sought the conversion of its 2025 hybrid bond, SBB announced a new JV, dismantled an old one, and set a record date for the remaining 2023 dividends, Balder issued four bonds, while Prisma Properties is aiming for an IPO. The weighted-average implied EBITDA yields on the stocks we cover are 4.42% for 2024e and 4.82% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Bond margin improvement and other news
This week, Sagax issued a 6-year EUR500m fixed bond – the first ‘large and longer-duration’ EUR bond issue by a listed Swedish real estate company in around two years. Also, Fitch warned about the liquidity situation in SBB Norden, Emilshus raised equity, and K2A initiated a written procedure to extend its bonds. The weighted-average implied EBITDA yields on the stocks we cover are 4.38% for 2024e and 4.78% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Equity raise, two more Q1 reports
This week, Nyfosa raised SEK1.7bn in equity, and Citycon and Olav Thon reported their Q1 results. Real estate stocks have performed well globally since the latest US CPI print. The weighted-average implied EBITDA yields on the stocks we cover are 4.32% for 2024e and 4.71% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Aurora Eiendom (Buy, TP: NOK110.00) - Stable operations, but higher fi...
The Q1 operating results were broadly in line with our expectations (EBIT 1% above our forecast). However, higher credit margins on one bank loan and new swap derivatives resulted in FFO falling 11% shy of our forecast. Still, the valuation remains attractive in our view, given the large discount to NAV. We reiterate our BUY and NOK110 target price.
- Simen Mortensen
Swedish policy rate cut, an upgrade and a downgrade
Sweden’s Riksbank cut the policy rate this week to 3.75% (4.0%); our estimates are based on another four cuts by end-2025. During the week we upgraded Veidekke to BUY, downgraded Castellum to HOLD, and reiterated our HOLD on Kojamo and SELL on Hufvudstaden and Sagax. The average implied EBITDA yields on the stocks we cover are 4.40% for 2024e and 4.79% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Q1 reporting continues
This week, Castellum and Balder reported Q1 results, Wihlborgs announced a new lease, and SBB corrected 2023 profits and dissolved Unobo. Norges Bank has signalled interest rates might stay higher for longer. K2A has halted preference dividend payments. The weighted-average implied EBITDA yields on the stocks we cover are 4.69% for 2024e and 4.97% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
Q1 reporting season kicks off
Q1 reporting season kicked off this week, with results from Nyfosa, Entra, Wallenstam, Fabege, KMC Properties, Pandox, and Catena. In other news, Public Property Invest is to be listed on the Oslo stock exchange on 29 April. The weighted-average implied EBITDA yields on the stocks we cover are 4.75% for 2024e and 5.04% for 2025e.
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
- Simen Mortensen
EPBD the big story this week
The Energy Performance of Buildings Directive (EPBD) was approved on 12 April, requiring the modernisation of existing real estate in the EU, and will soon enter the Official Journal of the EU. In other news, KMC Properties bought a new asset and appointed an interim CEO, JM got a new CEO, while Castellum announced a divestment and new leases, and Atrium Ljungberg kicked off Q1 reporting season. The weighted-average implied EBITDA yields on the stocks we cover are 4.74% for 2024e and 5.01% for 2...
OLT OLAV THON EIENDOMSSELSKAP ASA
BALD B FASTIGHETS AB BALDER CLASS B
CAST CASTELLUM AB
CATE CATENA AB
WALL B WALLENSTAM AB CLASS B
ATRLJ B ATRIUM LJUNGBERG AB CLASS B
KMCP KMC PROPERTIES
ENTRA ENTRA ASA
POX PANDOX AB CLASS B
SBB B SAMHALLSBYGGNADSBOLAGET I NORDEN AB CLASS B
FABG FABEGE AB
WIHL WIHLBORGS FASTIGHETER AB
CORE B COREM PROPERTY GROUP (B)
KOJAMO KOJAMO OYJ
CTY1S CITYCON OYJ
NYF NYFOSA AB
SAGAB SAGAX
AURA AURORA EIENDOM
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