Driven by a very strong Norwegian and Finnish market, volumes in the Nordic property markets reached a new record in the first half of 2017. Private investors and property funds were particularly active on the buy side and the share of foreign buyers increased significantly.
Transaction volumes in the Nordic property market were €22.3 billion in the first half of 2017, according to new figures from Pangea Property Partners. This is an increase of 14 percent from same period last year and a new record for the first half of the year. Foreign buyers accounted for 53 percent of the volume, which is the highest level ever recorded.
“The interest for the Nordic region as a whole is very strong at the moment, both from international and pan-Nordic investors”, says Mikael Söderlundh, Head of Research and Partner at Pangea Property Partners.
Growth was partly driven by the Norwegian market with a transaction volume of €4.2 billion in the first half of 2017, which is 58 percent higher than last year. The Finnish market also contributed with a transaction volume increasing by 80 percent, mainly because of the acquisition of listed property company Sponda.
The largest sector in the first half of 2017 was office accounting for 38 percent of the Nordic transaction volume, followed by residential accounting for 22 percent and retail accounting for 15 percent. The average transaction size amounted to €49 million, which is slightly higher than last year.
“Private investors and property funds were particularly active on the buy side, while listed property companies were large net sellers,” added Mr. Söderlundh.
|Transaction volume H1 2017||Sweden||Norway||Finland*||Denmark||Nordics|
|Number of deals H1 2017||215||130||60||55||460|
|Number of deals H1 2016||204||103||61||51||419|
|Transaction volume H1 2017 (EURbn)||7.9||4.2||6.8||3.4||22.3|
|Change compared to H1 2016 (%)||-18%||+58%||+80%||+7%||+14%|
|Foreign buyers H1 2017 (%)||24%||32%||86%||80%||53%|
|Average deal size H1 2017 (EURm)||37||33||114||61||49|
|Average deal size H1 2016 (Eurm)||49||26||62||62||47|
*Based on transactions above EU5m *Figures include Blacstons's pending offer for 100% of Sponda (EUR 3.8 bn)
The largest property transactions in the Nordic region in the first half of 2016 were:
1. Blackstone/Areim acquiring Finnish listed company Sponda (EUR 3.8bn)*
2. Heimstaden Bostad acquiring several residential portfolios in Sweden, Norway and Denmark (EUR 0.8bn)**
3. Samhällsbyggnadsbolaget acquiring DNB’s head quarter in Oslo from Meteva (NOK 4.3bn)
4. Niam acquiring 2,000 apartments in Denmark from HD Ejendomme (DKK 4.2bn)
5. DCC Energy acquiring 142 assets in Norway from ExxonMobil (NOK 2.4bn)
6. CBRE GI acquiring retail park Bromma Blocks in Stockholm from Starwood (SEK 2.3bn)
Source: Pangea Property Research, deal values partly based on estimates
* Offer for entire company still pending, expected closing July 2017
** Adjusted for ownership change before and after the deal
During the first half of 2017, Pangea Property Partners executed more than 30 transactions and other advisory mandates in the Nordics with an underlying property value above €1.1 billion. For example, the company advised Nordic Choice/Strawberry Fields in the large hotel establishment on Copenhagen Airport, Skanska in the sale of Flemingsbergdalen in Stockholm and Fem Hjärtan in the sale of 10 properties in Halmstad, the largest transaction ever done in this Swedish town.
“With our pan-Nordic reach and local market knowledge combined with our presence in London, our ambition is to offer the very best transaction services to national and international property investors in the Nordic region. We are extremely proud of the trust given to us by leading clients over the past years,” said Bård Bjølgerud, CEO and Partner at Pangea Property Partners.
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Pangea Property Partners is an independent Nordic corporate finance and advisory firm focusing on the real estate sector. The company has offices in Stockholm, Oslo and London with more than 30 employees. We also have a strategic cooperation with Mrec in Finland. Since 2010, Pangea Property Partners has advised on more than 300 transactions with an underlying property value above €26 billion. The mandates include property divestments and acquisitions as well as large corporate transactions, capital raisings and debt financing.