Vasakronan’s vacancy rate has increased by two percentage points in one year, from 8.3 to 9.9 percent. In one quarter, the vacancy rate has increased by 0.8 percentage points. Net letting amounted to -25 (-46).
– We continue to maintain a stable rental rate and do many good deals, but despite that, I can state that the rental rate is going down, says CEO Johanna Skogestig.
The vacancy rate has mainly increased in Malmö, from 7 to 10 percent, over a one-year period. In Stockholm, it has risen from 9 to 11 percent (which hits the total hard when a large part of the surface is in the capital). In Gothenburg, the vacancy rate has fallen from 8 to 6 percent. In Uppsala, the level of vacant premises is unchanged at 6 percent.
Vasakronan’s key figures for the first quarter:
- Rental income increased by 5 percent to a total of SEK 2,338m (2,221). The increase is mainly explained by the increase in the index. In a comparable portfolio, rental income increased by 5 percent.
- New lettings have been made of 28,000 square meters (23,000) with an annual rent of 180 (121). The net letting amounted to -25 (-46).
- The occupancy rate was 90.1 percent compared to 90.9 at the end of 2023.
- The operating surplus increased by 8 percent to a total of SEK 1,751m (1,620). In a comparable stock, the increase was 7 percent.
- The financial net amounted to SEK -468m (-409). The increase is explained by higher short-term market interest rates during the quarter.
- The interest coverage ratio for the last twelve-month period deteriorated to 3.7 times (4.4), explained by higher interest costs.
- The management result amounted to SEK 1,200m (1,147), an increase of 5 percent. The increase is explained by the higher operating surplus.
- The change in value of comparable properties for the period amounted to SEK -458m (-5,048), corresponding to -0.3 percent.
The occupancy rate for offices amounted to 88.8 percent and for trade to 95.2 percent at the end of the period, to be compared with 90.1 and 95.6 percent respectively at the end of 2023.
Comment Johanna Skogestig, CEO of Vasakronan:
– Despite a challenging rental market, our income is increasing and we are delivering an improved management result compared to the same period last year
– We did the biggest deal of the quarter together with Nasdaq, which rents 8,300 square meters in Klara Zenit in Stockholm. Nasdaq is a good example of what we see in the market, that is to say that the situation has always been important, but today it is central. You also want premises of high quality and to be in a larger context, preferably in city locations. It benefits a company like Vasakronan.
Regarding the rental market in general, Skogestig writes in the CEO’s speech:
– We continue to maintain a stable rental rate and do many good deals, but despite that, I can state that the rental rate is going down. It is primarily a consequence of previously known departures, primarily in Stockholm. Among other things, NetEnt is leaving a larger premises in the Klara C property on Vasagatan and Nordanö has moved from its office on Jakobsgatan in Stockholm. The number of renegotiations is also at a high level and we notice that some customers want to reduce their areas – often in favor of better quality and location.
The change in value for the management portfolio amounted to SEK -500m (-4,850), which corresponds to a change in value of -0.3 percent (-2.7). The percentage reduction in value is greatest for office properties in Malmö, while office properties in Stockholm CBD developed best with a positive change in value. The value change for project and development properties amounted to SEK 93m (-175), a value change of 1.5 percent (-2.0), Vasakronan states in the report.
Average direct yield requirement used in the valuation of the stock amounted to 4.54 percent, to be compared with 4.51 at the end of 2023 for the corresponding properties.
Of the contracts that have been subject to renegotiation in the past 12 months, including those that have moved within the stock, nearly 75 percent (70) have chosen to remain tenants with Vasakronan, the company states.
