Office rents continue to climb
High demand for office premises combined with low vacancies in central locations push rents higher. Net operating income rose 6% for comparable property holdings and profit after tax was SEK 8,902 million.
- Rental revenue increased to a total of SEK 5,006 million (4,836). For comparable property holdings, the increase was 5% and was mainly attributable to positive effects from new lettings and renegotiated leases.
- The occupancy rate was 92.8% (92.7) at the end of the period.
- Property expenses totalled SEK 1,390 million (expense: 1,337). For comparable property holdings, the increase was 5% and was mainly due to higher costs for electricity and district cooling.
- Net operating income increased in total to SEK 3,616 million (3,499). For comparable property holdings, the increase was 6% and was due to higher rental revenue.
- Profit before value changes and tax rose to SEK 2,731 million (2,554), up 7%.
- The change in the property value amounted to SEK 6,692 million (5,662), which corresponded to a 5.4% (4.9) increase in value due to rising market rents in Stockholm. At the end of the period, the portfolio amounted to SEK 134,303 million (122,999).
- Profit after tax was SEK 8,902 million (6,833).
- The share of environmentally certified buildings rose to 85% (83) at the end of the period.
- The energy intensity was 104 kWh/m2 (103).
During the quarter, new lettings corresponding to 26,000 sq. m. (27,000) and an annual rent of SEK 69 million (105) were signed. Moreover, renegotiations and lease extensions corresponded to 68,000 sq. m. (49,000) and annual rent of SEK 214 million (187), resulting in an increase on the previous rent payable of 11.9% (11.5).
During the period, Vasakronan was first in the world to issue green commercial paper, which has been listed on Nasdaq Stockholm’s new green commercial paper list. At the same time, the company was ranked as the most sustainable property company in Europe in the office segment and the ninth most sustainable property company in the world across all segments in the annual Global Real Estate Sustainability Benchmark (GRESB).
“The GRESB result spotlights the strength of our sustainability efforts from an international perspective. We have also noted a general increase in demand for green funding alternatives and have, therefore, followed up with green commercial paper that has been very positively received by the market,” says Fredrik Wirdenius, CEO of Vasakronan.
After the end of the period, Vasakronan established a Euro Medium Term Note programme (EMTN programme). The EUR 6 billion programme enables Vasakronan to issue bonds in several markets and currencies, thereby further broadening the funding base.
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