US-headquartered logistics property specialist Prologis is believed to be the front runner to buy a portfolio of modern logistics buildings in Sweden thought likely to change hands at around €350 mln.
Competition for the portfolio, which has been dubbed Project Ostium, is thought to have been fierce and information in the market suggests that the price will reflect a yield well below 5%.
The portfolio consists of 11 properties with the most northerly in Vasteras and the most southerly in the Helsingborg area. There are clusters in the Stockholm and Gothenburg regions.
Project Ostium, which has been on the market through Cushman & Wakefield, is 100% occupied and has a total lettable area of 294,500 m2. There are 12 lease contracts across the portfolio which produces an annual rent of €16.6 mln and has a weighted annual unexpired lease term of eight years.
The portfolio is being sold by Logistikfastigheter Sverige, a company established by Swedish occupational pension fund manager Alecta and Bockasjö, a logistics property developer, investor and manager based outside Gothenburg.
Alecta and Bockasjö formed Logistikfastigheter Sverige in 2016 with the aim of building a significant portfolio of logistics property in Sweden and Scandinavia within five years.
Logistikfastigheter Sverige has had, from the outset, an option to acquire all new logistics facilities that Bockasjö develops.
The deal was seeded with three properties transferred from Bockasjö totalling 116,000 m2 and comprising schemes at Landvetter Airport and along the E6 in Helsingborg, and at Arlandastad by Arlanda Airport.
Sweden is attractive for overseas investors but competition from local investors makes market entry challenging.
According to Pangea Property Partners, Nordic deal volumes topped €42 bn in 2018, which was virtually unchanged from 2017 and close to the 2016 record.
The volume in Sweden increased in local currency terms to SEK156 bn (€15 bn), with Vonovia’s acquisition of Swedish residential property company Victoria Park the largest deal of the year across the whole of the Nordics.
This article first appeared in EuroProperty, PropertyEU's sister publication.
