Experienced management organization
The experienced and decentralized property management organization with a local presence enables active and value-creating property management with short decision paths. The management organization consists of local property managers in each region to ensure a close dialogue between Sveafastigheter and its tenants. Sveafastigheter has a successful organization in place and thus continue to conduct active and value-creating property management with good conditions for managing the portfolio.
Strong financial position and stable capital structure
Sveafastigheter has a strong financial position with an LTV of 431 percent and a stable capital structure that gives the Group a good ability to implement its growth strategy and manage any market changes. By having a simple and transparent financing structure, Sveafastigheter can strengthen its position in the residential market.
Stable cash flow
Sveafastigheter has a long-term strategy that provides good opportunities for stable revenue over time. The majority of Sveafastigheter’s rental income comes from rent-regulated income. This means that Sveafastigheter has a low exposure to market rents and economic fluctuations. By combining value-of-use rents and presumption rents, Sveafastigheter has created a balanced and sustainable rental strategy, which provides the Group with stable and growing cash flows.
High sustainability ambitions
Sustainability is a central part of Sveafastigheter’s operations, and the Group works actively with social, economic and environmental sustainability. A growing focus on sustainability among all stakeholder groups has contributed to an increased demand for both climate-smart and safe housing. Sveafastigheter has high ambitions to improve the sustainability of its property portfolio and works actively to reduce its climate footprint by implementing energy-saving projects. The Group also works to enhance social security in its residential areas to create value for its tenants and contribute to positive social development.
Increased demand for rental apartments
In recent years, the residential market in Sweden has been characterized by high demand, low supply and that prices of condominiums have risen by approximately 500 percent during 2002-20222. This has according to the Company led to many households finding it difficult to finance a home purchase, either because of high down payments, debt-to-income limits or amortization requirements. At the same time, interest rates have started to rise from historically low levels, which has increased the cost of borrowing for housing. These factors have contributed to the increasing attractiveness of rental apartments, as these offer greater flexibility, lower risk and lower capital commitment. The share of rental apartments among residential housing has increased from 29 percent in 2013 to 33 percent in 2023, which indicates a long-term trend that benefits Sveafastigheter’s rental market.3
Housing shortage and population growth in Sveafastigheter’s markets
Sveafastigheter manages and develops properties in regions that, over time, have demonstrated a long-term demand for housing. Sveafastigheter has significant exposure to regions where the housing shortage is widespread and population growth is high compared to the national average, factors that drive demand for the Group’s residential properties. Sveafastigheter operates in municipalities where approximately 80 percent have a pronounced housing shortage and 13 percent have reported a balance in the residential market. In addition, the population in Sveafastigheter’s regions has increased by 11.6 percent between years 2013-2023, which is higher than the national average of 9.6 percent during the same period. This gives Sveafastigheter good opportunities to achieve a high occupancy rate as well as stable and increasing rental income over time.
1) As of the first day of trading.
2) Statistics Sweden, statistical database.
3) Based on data from the Council for Municipal Analysis.