Fastator: ABGSC Investor Days feedback - ABG

Coming expansion of existing areas in Företagsparken

Growth prospects remain high ahead for Nordic PM

Mid-sized city centres bring positive chain effects

Insightful details provided on Företagsparken
At today’s Investor Days presentation, Fastator confirmed that its fastest growing holding, Företagsparken (SEK 900m in property value by the end of Q2 to SEK 3.6bn today), has bought properties at a 6% net initial yield or more. With the recent transaction, a majority of the portfolio has come to be concentrated around Stockholm and Mälardalen. Nevertheless, Företagsparken’s strategy of owning properties in smaller municipalities at higher yields (i.e. 7-8%) but with lower prospects for rental growth, remains. Properties in the industrial areas that Företagsparken targets (in the outskirts of small- and mid-sized Swedish cities) typically have many individual owners and Företagsparken has so far acquired a few properties per area that it has entered. The next phase is to expand within existing areas and gain a larger local presence and market share. Today’s presentation is available on introduce.se.

Volume-driven business and fragmented market in Nord. PM
Nordic PM has historically grown largely due to acquisitions. As limited information about the business is provided, we asked the company today if more muted growth should be expected going forward. In contrast to our fears, Fastator’s CEO and CFO meant that a high growth rate is more likely since a distinct share of the business – besides the property management - stems from property lettings and transactions. These income streams tend to grow in a hot real estate market, like we currently have. Management also emphasised that a certain business volume is needed to satisfy a relevant amount of customers, and Nordic PM has reached that level. It is now widely present throughout Sweden, serving customers both within Fastator and outside (i.e. Nyfosa and Veidekke). A second argument for stro
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