Year end report 2024 CA Fastigheter AB (publ)

  • Rental income increased by 5.0% to MSEK 901 (858).
  • Net operating income increased by 7.2% to MSEK 610 (569), resulting in a surplus ratio of 67.7% (66.3%).
  • Profits from property management decreased by 8.2% to MSEK 316 (292), mainly due to higher net operating income.
  • Income from project activities amounted to MSEK 77 (74).
  • The market value of properties amounted to MSEK 14,674 (14,334). Unrealized changes in the value of properties for the year amounted to MSEK -77 (-1,027).
  • Profit after tax amounted to MSEK 218 (-695), mainly due to unrealized changes in the value of properties.

Significant events during the year:

-During the first quarter, CA Fastigheter appointed Malin Claesson Stenström as the new CEO. Malin, who is part of the fourth generation of the owner family, took up her position in connection with Andreas von Hedenberg’s resignation on April 30, 2024.

-At the end of the first quarter, CA Fastigheter issued a senior unsecured green bond of SEK 500 million with a tenor of three years and will carry a floating interest rate of STIBOR 3m plus 225 basis points per annum. In connection with the issuance of a new bond, an early redemption of the previous green bond of SEK 500 million has been made.

-CA Fastigheter already has a credit rating according to BBB-, Stable. At the annual credit assessment, which was published in April, CA Fastigheter maintains it’s credit rating.

-During the year, major refurbishments of the properties Växjö 6:69 in Växjö, consisting of 102 apartments, and the property Hermodsdal 8 in Malmö, consisting of 100 apartments, were completed. These projects are a significant investment in our long-term work to develop the investment properties and the tenant offering.

CA Fastigheter is constantly working on sustainability, and during the year, five buildings in property management operations were environmentally certified according to the Swedish Green Building Council’s Miljöbyggnad iDrift rating silver, and one building that has undergone a significant renovation according to the Swedish Green Building Council’s Miljöbyggnad Nybyggnation with silver rating.

-During the fourth quarter, BRF Kvirkelhusen 1, consisting of 42 apartments, was completed. BRF Kvirkelhusen 1 is the first phase of the Kvirkelhusen project. The Project contained three buildings close to the shore in the Strandfuret area in Lomma. Stage two of Kvirkelhusen has been projected and sales started early 2025. The buildings are environmentally certified according to the Swedish Green Building Council’s Miljöbyggnad Nybyggnation with silver rating.

 

For further information, please contact:

Malin Claesson Stenström, CEO
+4673-923 97 59, malin.claesson@cafastigheter.se

Caroline Menninge, CFO
+4670-534 25 86, caroline.menninge@cafastigheter.se

Catella Year-end Report JANUARY – DECEMBER 2024

Strengthened position in a stabilised market

In summarizing 2024, I conclude that despite another year of a weak real estate market, Catella strengthened its position as a pan-European real estate investment company with three distinct business areas. Although the Group’s total income was naturally impacted by prevailing market conditions, we successfully navigated a challenging market, increasing as-sets under management (AUM), safeguarding liquidity, and maintaining a strong operating profit over the year, despite a significant decline in variable income. We also maintained a strong balance sheet, positioning ourselves to capitalize on emerging opportunities as transaction market uncertainty diminishes. We concluded the year with a strong quarter, driven by a recovering market and implemented efficiency improvements, supporting an optimistic view for 2025.

Progress during the quarter Progress during the year
• Total income in the quarter amounted to SEK 1,045 M (540) • Total income amounted to SEK 2,307 M (2,339)
• Operating profit attributable to Catella’s shareholders was SEK 69 M (10) • Operating profit attributable to Catella’s shareholders was SEK 128 M (133)
• Non-recurring costs amounted to SEK 13 M (4) • Non-recurring costs amounted to SEK 28 M (12)
• Profit attributable to Catella’s shareholder was SEK 59 M (-75) • Profit attributable to Catella’s shareholder was SEK 30 M (-21)
• Earnings per share after dilution was SEK 0.67 (-0.85) • Earnings per share after dilution was SEK 0.34 (-0.24)
• Assets under management (AUM) amounted to SEK 155 Bn at the end of the period, an increase of SEK 4 Bn compared to the third quarter of 2024 • Assets under management (AUM) amounted to SEK 155 Bn at the end of the period, an increase of SEK 3 Bn compared to year-end.
Proposed dividend per share for the financial year is SEK 0.90 (0.90)

 

In the CEO comments for the third quarter, I mentioned that the European real estate market was showing cautious signs of recovery alongside increased transaction activity. This was driven by improved credit terms and lower interest rates. This positive trend continued in the fourth quarter, with overall transaction volumes in the European market rising by 22% compared to the same period last year.

While uncertainty remains prevalent, the gap between buyers and sellers is narrowing, and interest in property acquisitions as part of asset allocation is increasing. The market is gradually pricing in a lower cost of capital, and the overall outlook for the European property market remains positive with yields in certain segments stabilizing or even beginning to decline. This gives us reason to believe that the negative trend of declining property values over the past two years has reached its trough. All of Catella’s business areas benefit from an active transaction market, and the improving market sentiment signals positive momentum for our operations moving forward.

Operating profit for the fourth quarter amounted to SEK 69 M (10), where the increase was driven by higher or stable income across all business areas. The results also reflect the success of our initiatives to continuously increase efficiency and reduce costs.

Full-year operating profit amounted to SEK 128 M (133). Although this represents a SEK 5 M decline from the previous year, factoring in a substantial reduction in variable fees (SEK -68 M), the underlying business delivered improved earnings and positive margin growth.

Balanced capital flows
The Investment Management business area takes pride in its continued success in balancing inflows and outflows within the core business. In a challenging market, it is impressive that AUM at the end of 2024 increased slightly compared to 2023.

Growth was primarily driven by residential property funds, and this segment also recorded the highest increase in transaction volume. It is particularly encouraging that our Article 9 fund, Catella European Residential III Fund, completed its first acquisition in Spain. The acquisition of a newly constructed residential property with 235 apartments in Madrid added nearly SEK 700 M to the fund’s AUM, bringing the total to SEK 9 Bn.

After the end of the period, we completed the merger of our two fund management companies – Catella Residential Investment Management (CRIM) and Catella Real Estate AG (CREAG) – to form Catella Investment Management GmbH (CIM). The purpose is to enhance operational efficiency and expand capacity in fund management. The merger provides our customers with access to a stronger and more efficient sales organization, managing assets worth SEK 115 Bn across 25 funds with 420 properties in 15 European countries. A unified organization under a single brand enhances resource-sharing opportunities and facilitates the development of new products.

We achieved additional milestones during the quarter, including capital investments of nearly SEK 6 Bn in Catella Logistic Deutschland Plus. In the UK, we launched Catella APAM Strategic Equities with the support of a major institutional investor, capital commitment of SEK 1.4 Bn, alongside our seed investment of SEK 25 M. We reached another milestone as Catella Aquila, in which we acquired a majority stake in 2023, assumed management of our French fund assets, previously managed by an external party.

Investment Management’s AUM totalled SEK 155 Bn at year-end, reflecting an increase of SEK 4 Bn compared to the end of the third quarter.

Continued focus on value creation
In the Principal Investments business area, the focus remains on developing and completing existing projects for divestment. During the fourth quarter, the French development project Polaxis was divested. The divestment frees up capital, further strengthening liquidity and creating opportunities for new investments that meet our return requirements.

We are actively engaged in discussions regarding the upcoming sale of the landmark project Kaktus Towers in central Copenhagen. We are in no hurry, and securing an attractive price level is crucial given the substantial capital contribution. Considering my earlier comments in this report, the timing suggests that we will successfully close a deal that satisfies all parties.

Looking ahead, we are also evaluating new potential investments, but with a more defined focus, which I outline below in my discussion on 2025 and beyond.

Recovery in the transaction market
As previously mentioned, in Corporate Finance, we are seeing an improvement in the transaction market, albeit to varying degrees across different markets. In the fourth quarter, we acted as advisers in a growing number of transactions and observed a general increase in market activity. During the period of reduced activity, we demonstrated resilience and adaptability, seizing the opportunity to strengthen the organization and refine our operations. We are now well-positioned for a transaction market with higher activity and reduced uncertainty.

Outlook
For 2025 and beyond, we have refined and clarified our strategy, which is centred around three key strategic focus areas moving forward:

Diversify and sharpen the investment focus of Principal Investments. Our financial position has allowed us to continue investing in existing development projects despite the weakest transaction market since the global financial crisis. This has enabled us to preserve value in a cautious property market. Looking ahead, our key focus is to diversify the investment portfolio. As divestments progress, new investments will be guided by the strategic use of equity, with the aim of growing AUM in Investment Management and establishing a strong foundation for recurring revenue. This will take the form of seed investments for the establishment of new funds, co-investments with external capital partners to secure long-term asset management mandates, and investments in development projects alongside majority-owning capital partners. By leveraging our balance sheet to drive growth in AUM and recurring revenue, we steadily enhance stability and generate greater shareholder value over time.

Enhanced profitability and harmonized offering in Corporate Finance. The Corporate Finance business area was reinforced during the weaker market of recent years, while we simultaneously implemented cost-saving measures. Looking ahead, we are well-positioned for growth in line with the market turnaround, while further optimizing the strengths of our platforms to create value for our customers.

Focus on AUM growth in Investment Management. Thanks to the trust placed in us by our investors, we have built operations over the past 10 years that now manage SEK 155 Bn. Despite the stagnation of the past two years, our business model continued to deliver growth, driven by a balanced approach between fund investments and our expertise to manage and develop properties through mandates. By continuing to expand existing funds and launch new strategies, we cultivate growing, stable, and value-creating cash flows.

The refinement of our strategy aligns closely with our focus on property and reflects our ambition to leverage existing strengths. By further optimizing our core assets – capital and expertise – we aim to drive sustainable and profitable growth. By continuously assessing promising investment opportunities and regularly reviewing our capital structure, we aim to enhance shareholder value.

Catella presents the Interim Report and answers questions today at 10 a.m. CET.
To participate, go to https://financialhearings.com/event/48743

Daniel Gorosch, interim CEO and President
Stockholm, Sweden, 12 February 2025

For further information, please contact:

Michel Fischier
CFO
+46-8-463 33 86
michel.fischier@catella.se

CA Fastigheter acquires Lidingö Centrum

CA Fastigheter Aktiebolag (publ) acquires Lidingö Centrum indirectly through a company acquisition from Grosvenor, a global privately owned organization. The acquisition is based on an underlying property value of SEK 811 million before deduction of deferred tax. The purchase price is SEK 786 million, financing is provided through own equity and traditional bank financing. The shopping centre contains a total lettable area of just over 20,000 sqm with a rental value of approximately SEK 78.5 million per year. Closing will take place at the end of February. The acquisition is conditional on approval by the Inspectorate of Strategic Products (ISP).

Lidingö Centrum is a well-established local shopping centre on Lidingö consisting of the properties Lidingö Oden 20 and Lidingö Oden 21 and has so far been managed by Areim on behalf of Grosvenor. The shopping centre currently has approximately 50 tenants, mainly in retail, restaurants and public operations. Coop and Systembolaget are the largest tenants. The shopping centre is strategically located on Lidingö and has around 3.1 million visitors per year.

”We believe in Lidingö, which is a strong market in direct proximity to central Stockholm. We know that the residents of Lidingö are loyal to both their local community and the shopping centre, and our ambition is to make the place even more attractive for both the residents of Lidingö and all other visitors,” says Charlotte Claesson Ripoll, Regional Manager at CA Fastigheter in Stockholm.

”For CA Fastigheter, it is important to be local and to know the market. We already own the Gasverket area in Stockholm Royal Seaport, which is now being developed from an industrial area into a vibrant district. It was therefore a short step across the bridge to Lidingö Centrum and we also see possible synergies between an established retail business and a district under development,” Charlotte continues.

CA Fastigheter owns properties with a lettable area of approximately 650,000 sqm spread over six regions in Sweden with the headquarter in Kalmar. The acquisition of Lidingö Centrum strengthens its presence in Stockholm, which today includes Veddesta Handelsplats in Järfälla in addition to Gasverket.

”We are a curious and long-term real estate company that invests where we see potential. Now we had an opportunity to grow in this part of the Stockholm region, and we took it,” says Malin Claesson Stenström, CEO of CA Fastigheter.

 

For more information, please contact

Malin Claesson Stenström, CEO of CA Fastigheter

malin.claesson@cafastigheter.se
+46 (0)73 923 97 59

Charlotte Claesson Ripoll, Regional Manager in Stockholm
charlotte.claesson@cafastigheter.se
Tel: +46 (0)73-923 97 51

Increased efficiency in a recovering market

The European property market is showing signs of cautious recovery and a slight increase of transaction market activity due to improved credit terms and lower interest rates. Macroeconomic conditions are also improving with inflation now under control and lower interest rates. During the quarter, Investment Management generated balanced in and out-flows, along with new asset management mandates, which is encouraging in a relatively subdued transaction market. Our stable liquidity and capital position, coupled with strategic organisational adaptations, enhance our preparedness as the market rebounds.

The outlook on the transaction market improved slightly in the third quarter, although completed transactions did not increase notably on the European markets. The underlying sentiment is positive and there are indications that the gap between buyers and sellers’ expectations is closing, supporting increased transaction volumes going forward.

The main reason behind a brighter outlook is improved financing conditions and lower capital costs. Although transactions still take a long time to complete, market sentiment suggests that we can expect more and larger transactions looking ahead, as the market slowly but surely prices in lower capital costs.

At macro level, the outlook is also brightening with inflation under control in Europe and the US, and with key central banks in the midst of interest rate cuts. However, the outlook is not as bright in all markets, where some economies, such as Germany, continue to face challenges. In addition, the continued political uncertainty and ongoing conflicts that, besides human suffering, could lead to new inflationary pressure, increased oil prices and disruptions in logistics.

The European property market is showing signs of recovery, with some segments experiencing stabilization or even decreases in yields. This indicates that the negative trend observed over the past two years and the decline in property values may be near a turning point. Given the positive impact of increased transaction market activity across all Catella’s business areas, we are encouraged by indications from current dialogues we have across our European markets that a recovery is underway, with sellers’ and buyers’ price expectations increasingly aligning.

I recently had the opportunity to attend the property fair Expo Real in Munich with other colleagues. In comparison to just six months ago, the sentiment within the sector is markedly more positive, with a notable increase in discussing transactions based on well-founded and genuine interest.

Operating profit for the quarter amounted to SEK 19 M (32), the decrease attributable to non-recurring costs of SEK 13 M. Adjusted for this, profit was in line with the previous year, despite decreased revenue excluding commissions, assignment and production costs of almost SEK 10 M. The outcome is the result of our initiatives aimed at increasing efficiency and digitalising operations, thus reducing costs.

Balanced capital flows
The Investment Management business area takes pride in having successfully balanced in- and outflows in the core business during challenging times. The majority of capital inflows were generated in Asset Management through the growth of new mandates, where investors appoint us to manage and develop property portfolios and to reposition them in the current and future market. This demonstrates that our business model continues to generate growth opportunities even in a weaker and more hesitant market. The work associated with new investment products continued successfully in the quarter, and we are now moving out of the product development phase and towards actively seeking investments alongside new and high-profile investment partners.

During the quarter, the initiative to merge our two fund management companies – Catella Residential Investment Management (CRIM) and Catella Real Estate AG (CREAG) continued. The ultimate goal is to create a stronger, more efficient and larger fund platform in Investment Management. The merger will result in a more efficient capital raising function, improved coordination of investor relations, and stronger management and analysis capabilities.

Investment Management’s assets under management totalled SEK 151 Bn in the quarter, which represents a decrease of SEK 1 Bn compared to the end of the second quarter, primarily driven by exchange rate differences.

Planned divestments
In Principal Investments, the focus continues to be on developing and completing existing projects for divestment. In the fourth quarter, we expect to divest the French development project Polaxis. The divestments will further strengthen our liquidity and open up for new investment opportunities that meet our return requirements.

At the end of September, Kaktus Towers was awarded the prize “Europe’s Best Tall Building” by an international jury of architects at CTBUH’s (Council on Tall Buildings and Urban Habitat) conference in London. The award recognises both the building’s innovative architecture and its contribution to modern and sustainable residential concepts that satisfy the needs of today and tomorrow. We continue active dialogues with potential investors of a sale of this landmark in central Copenhagen.

Looking ahead, we are evaluating potential investments in both development projects and several European aggregation mandates with capital partners. With valuations stabilizing, we see attractive investment opportunities.

Signs of transaction market recovery
As previously mentioned above, we are beginning to see a brighter transaction market in Corporate Finance, although this has not yet translated into a notable increase in the number of transactions.

While transaction volumes in Europe were up slightly year-on-year, they remain well below the levels seen two years ago, when the downturn began. We are optimistic that the number of transactions will pick up on several markets in the fourth quarter, as this is the most transaction-heavy quarter in historical terms.

Green investments
In support of future green investments in the real estate industry, we established a Medium Term Note-program (MTN) in the quarter. In September, we issued new senior unsecured green bonds at a total amount of SEK 600 M, which attracted significant interest. The new green bonds are listed on Nasdaq Stockholm’s list for sustainable bonds. The issue is the first under our green bond framework.

In the quarter, we also continued the process associated with the implementation of CSRD (Corporate Sustainability Reporting Directive) – a new EU Directive aimed at increasing transparency and responsibility relating to corporate sustainability reporting.

Outlook
I am humbled by the confidence the Board has placed in me to lead Catella into the future during the recruitment of a permanent CEO. As indicated above, I am optimistic about the near future after more than two challenging years.

We have done and continue to do the right things. During the period of reduced activity, we have worked diligently to improve efficiency and adapt the organization. We have maintained a strong liquidity and a strong capital position and are now well-positioned to take advantage of the upturn. Our upcoming divestments will further strengthen our position. As the market improves, Catella is in a strong position to capture and capitalize on the opportunities arising, and continue to create value for our customers and shareholders in the future.

Catella presents the Interim Report and answers questions today at 10 a.m. CET.
To participate, go to https://financialhearings.com/event/48742

Daniel Gorosch, interim CEO and President
Stockholm, Sweden, 07 November 2024

For further information, please contact:

Michel Fischier
CFO
+46-8-463 33 86
michel.fischier@catella.se

Nomination committee before the annual general meeting 2025

The nomination committee before the annual general meeting 2025 in Catella AB has been appointed in accordance with the current instruction for the nomination committee.

The nomination committee before the annual general meeting 2025 comprises Eje Wictorson, appointed by Claesson & Anderzén, Ruben Visser, appointed by Gran Fondo Capital, and Oscar Karlsson, appointed by Alcur Fonder. Eje Wictorson has been appointed as chairman of the nomination committee.

Information about the work of the nomination committee can be found on the company’s website, www.catella.com. Shareholders who wish to submit proposals to the nomination committee may do so in writing via e-mail to valberedning@catella.se or by post to Catella AB, Att: Nomination Committee, P.O. Box 5894, SE-102 40 Stockholm, Sweden.

The annual general meeting in Catella AB will be held on Tuesday, 20 May 2025 in Stockholm.

For more information, please contact:

Eje Wictorson
Chairman of the nomination committee
+46 70 600 19 58
eje.wictorson@claessonanderzen.com