Vasakronan’s Interim Report January–March 2023

• Rental revenue increased 17% (5) to a total of SEK 2,221 million (1,902). In comparable property holdings, the increase in rental revenue was 14% (3). The increase was primarily due to completed projects and indexing.
• New lettings were contracted corresponding to 23,000 square metres (44,000) and an annual rent of SEK 121 million (260). Net lettings amounted to a negative SEK 46 million (positive: 125) for the quarter and SEK 99 million (230) for the rolling 12-month period.
• The price change after renegotiations averaged 5% above index (7). Renegotiations were completed in the quarter corresponding to an annual rent of SEK 354 million (285).
• The occupancy rate was 91.7% (91.2) at the end of the period. Of total vacancies, 1 percentage point (1.2) was attributable to ongoing project developments and development properties.
• Operating surplus increased 16% (5) to a total of SEK 1,620 million (1,400). For comparable property holdings, the increase was 12% (3).
• Net financial items deteriorated to an expense of SEK 409 million (expense: 243), due to increased interest-bearing liabilities and higher interest expenses during the period.
• The LTM interest coverage ratio increased to a multiple of 4.4 (5.4), primarily due to lower net financial items.
• Income from property management amounted to SEK 1,147 million (1,088), up 5% (3).
• The change in the property value amounted to a decrease of SEK 5,048 million (increase: 2,922) for the quarter, corresponding to a decrease of 2.7% (increase: 1.6). The change in value was primarily due to higher assessed yield requirements. The property portfolio value at the end of the period thus amounted to SEK 184 billion (185).
• The value change in financial instruments amounted to a decrease of SEK 229 million (increase: 901).
• Profit after tax amounted to a loss of SEK 3,309 million (profit: 3,895).

“We reported increased income from property management for the first quarter of the year,” says Johanna Skogestig, CEO of Vasakronan. “There is a great deal of activity in the market but demand for high-quality products in our locations remains strong. The greatest pressure remains on the best premises in Central Stockholm.

The macroeconomic signals are difficult to interpret, but it is clear that we are heading towards more uncertainty in the market. Nonetheless, I remain confident. We have excellent properties in prime locations and strong financial metrics. Moody’s also confirmed this and we have retained our high rating of A3, stable outlook.”

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