Nordic property shares continue to power on in the stock market, and over the past year the sector has risen by 32 per cent, excluding dividends, compared with 3 per cent for the stock market in general. Above all, Swedish property shares have performed well and are now on average valued 14 per cent above their net asset values, motivating new companies to go public, according to the latest edition of Pangea Listed Overview, produced by Pangea Property Partners.
“Real estate has throughout the 21st century been one of the absolutely strongest sectors of the Nordic stock market, driven by low interest costs and rising rental incomes. In recent years, international capital has also flowed into the Nordic real estate market and contributed to record low property yields in several segments. 2019 is the eight year in a row with increasing prices for Nordic property shares,” said Mikael Söderlundh, Head of Research and Partner at Pangea Property Partners.
According to the report, listed real estate companies focusing on logistics and residentals were the strongest, with an average uplift of 70 per cent and 33 per cent on average over the past year. Companies focusing on shopping centers, on the other hand, are still lagging and increased by only 5 per cent. In terms of geography, Swedish real estate companies have been the strongest and increased by 35 per cent, while real estate companies in the other Nordic countries have increased by 14 per cent.
Record number of listed real estate companies
The positive development means that Swedish listed real estate companies are now valued 14 per cent above their underlying net asset values on average. Many real estate companies in the other Nordic countries, on the other hand, typically trade at a discount of 20-25 per cent, according to the report.
“As Swedish real estate companies continue to boom in the market, more companies are led to consider a stock exchange listing. There are now more listed real estate companies than ever before, with John Mattson and K2A being the most recent examples, and more companies are standing in line,” said André Lundberg, Director and Partner at Pangea Property Partners.
Today, 34 real estate companies are listed on the Nordic main list and another 16 real estate companies are listed on First North, with a total market capitalization of €63 billion. In addition, there are about ten property developers with a market capitalization of another €4 billion, according to the report.
“Real estate now accounts for approximately five per cent of the total market capitalization in the Nordic region, and nine per cent in Sweden, which is the highest level we have seen since the early 1990s,” continued Mr. Lundberg.
Report with key figures for all Nordic property shares
Pangea Listed Overview is a report covering all Nordic property shares listed on the Nordic main list and First North. The report is published twice a year by the Nordic property adviser Pangea Property Partners.
The report can be downloaded here: Link
Key facts about the Nordic listed property sector:*
Nordic property shares – main list
- 34 listed property shares with a total market cap of €57.6bn (+€11.1bn latest 12 months)
- Market cap by country: Sweden (80%), Norway (8%), Finland (9%) and Denmark (3%)
- New listings (latest 12 months): John Mattson, K2A, Nyfosa
- Share price performance (latest 12 months): +32%
- Top performing property shares (latest 12 months): Corem (+82%), Sagax (+71%) and FastPartner (+66%)
Nordic property shares – First North
- 16 listed property shares and property developers with a total market of €4.4bn (+€0.7bn latest 12 months)
- Market cap by country: Sweden (52%) and Norway (48%)
- New listings (latest 12 months): Brinova
- Share price performance (latest 12 months): +16%
- Top performing property shares (latest 12 months): Amasten (+70%), Fastator (+65%) and SBB i Norden (+44%)
* Nasdaq OMX, Nasdaq First North, Oslo Børs (including Eiendomsspar)
- Chart: Nordic property shares performance by sector (latest 12 months)
- Chart: Nordic property shares performance by geography (latest 12 months)
- Chart: Current PRICE/NAV by company
About Pangea Property Partners
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 in Finland. Since 2010, Pangea Property Partners has advised on more than 400 transactions and advisory mandates with an underlying property value above €33 billion. The mandates include property divestments and acquisitions as well as large corporate transactions, capital raisings and debt financing. For access to our free premium market research, please register at www.pangeapartners.co.uk/research.