Swedish real estate company, K2A Knaust & Andersson Fastigheter, has created a JV to hold all of student housing assets outside Stockholm with the proceeds used to pay down debt and strengthen the balance sheet.
The new JV holding 2,990 units will be 60:40 owned by K2A and Nordic private equity firm, Slättö.
Colliers advised K2A on the deal valued at SEK 3.1 bn (€273 mln).
The units cover approximately 72,000 m2 of rentable area, which produces SEK 188 mln (€16.4 mln) of income.
Slättö manages Alternative Investment Funds (AIFs) that invest in various property sub-segments across residential, logistics, hotel and public use properties in the Nordics.
Christian Bratt, partner and head of residential, said it was the current combination of rental growth potential and pricing that made this an attractive time to invest in housing. ‘We see great value in acquiring a purpose-built, high-quality student housing portfolio that is rarely available on the Swedish market. Students enrolled in student aid-eligible programs also have a predictable financial situation, making this a secure investment with great potential. We very much look forward to working with K2A to efficiently manage and further develop the portfolio.’
The deal frees up liquid funds of SEK 660 mln for K2A before transaction costs, and is due to complete in October.
Johan Knaust, CEO of K2A, said: ‘I am pleased with a successful deal that benefits both parties. By freeing up liquidity and thereby paying off a large part of the outstanding bonds, we strengthen our key financial ratios and the ongoing cash flow moving forward. I look forward to a good collaboration with Slättö, which will be a strong partner in the newly created company.’
André Lundberg, head of capital markets and a partner at Colliers, said: ‘This transaction confirms the value of the quality housing that K2A holds and is a very good example that demonstrates the market's continued interest in transactions in Sweden.’
