Progressive operations and strategic acquisitions have helped Kungsleden achieve 26% growth in Q3 2015 profits worth €29 mln (SEK 274 mln).
A key feature of Kungsleden’s strategy is to increase property holdings in Swedish cities and regions where there is growth potential and local demand. In Q3 Kungsleden’s expansion continued by way of acquisitions that totalled €79.56 mln (SEK 750 mln). Further to this rental revenue increased by 3.2% to €60 mln (SEK 570 mln) and operating net fell to €43 mln (SEK 409 mln).
Biljana Pehrsson, CEO of Kungsleden, said: “During the first nine months of the year, we optimised and expanded our property portfolio. We’ve fortified out existing cluster areas and have moved forward on the prioritised property development projects.
“We have also implemented a new, flatter organisation for the entire company and reinforced our management team with the addition of new market area managers, property managers and rental providers. New leasing is going well and several major new leases have been signed, such as the latest, with Regus, at our Kista One property. Operating net and profits from property management have also improved.”
Kungsleden has focused particularly on strengthening its position in Stockholm on the basis of the city’s economic growth and position as a leading capital city in Europe when it comes to innovation. Work is now being undertaken to supplement clusters in Kista and Danderyd with a cluster inside the city boundaries.
As reported by Europe Real Estate, Kungsleden made one of their largest acquisitions ever in expansive Gärdet-Frihamnen. According to the CEO: “The Gärdet-Frihamnen holding is a perfect example of what Kungsleden strives to achieve with its clusters: a collection of properties with good accessibility in an area where the underlying demand is strong. This is one of the main urban development areas of Stockholm, where 12,000 new residences and 35,000 new offices are being produced within an entirely new infrastructure.”
Last year Kungsleden stated its goal to build up a property portfolio worth €2.6 bln (SEK 25 bln) by 2017. Now, a year ahead of schedule, it has achieved a property value of €2.86 bln (SEK 27 bln) with 76% of the holdings located in four major city areas. The CEO commented: “We have the size that’s needed, and the right kind of properties in areas that are currently in demand, and will remain so in the future.”
Source: Kungsleden
