Sweden’s Folksam has bought an office property from Zurich Insurance in the middle of its core market of Stockholm.

The insurance and pensions group said its general insurance division, Folksam Sak, is buying the asset at Rotundan 1, for SEK565.5m (€50.7m).

Lars Johnsson, Folksam’s real estate director, said: “We are continuing our strategic and profitable expansion of the property portfolio through another acquisition in the middle of our core market Stockholm.”

The firm’s was maintaining a firm focus on high-quality office properties in attractive locations, he said. “The Folksam group aims to further increase its property portfolio in the future,” said Johnsson.

The 4,100sqm office property serves as the Swiss insurance group’s office in the Swedish capital, and is located in the Stockholm district of Östermalm.

Folksam said it had bought just over SEK27bn of properties for its directly-owned portfolio as a group in recent years, and that in total, it now had almost SEK62bn of direct real estate assets.

A well-risk-diversified investment portfolio ensured a stable return even in times of economic uncertainty, Folksam said in its statement today, adding that real estate had “over time had a very favourable risk-adjusted return”.

According to Folksam’s annual report released on Friday, at the end of 2022, real estate accounted for 11% of the group’s overall investment portfolio, which was worth SEK526.8bn at that point.

To read the latest edition of the latest IPE Real Assets magazine click here.