Starwood Capital, Scius to Sell 51 Swedish Properties for $413M
The portfolio Sweden-based Hemfosa will acquire includes office, warehouse and logistic assets and totals approximately 460,000 square meters or nearly 5 million square feet.
MIAMI—Locally-based Starwood Capital Group and local operating partner Scius Partners have agreed to sell a 51-property portfolio in Sweden to Hemfosa for SEK 3.6 billion or more than $413 million (US).
The portfolio Sweden-based Hemfosa will acquire includes office, warehouse and logistic assets and totals approximately 460,000 square meters or nearly 5 million square feet.
Starwood Capital Group, via a controlled affiliate of Starwood Global Opportunity Fund X acquired the assets as part of the SveaReal portfolio in Sweden and DNB NOR Eiendomsinvest I ASA in Norway, which was the largest transaction in the Nordics in 2015. Scius Partners is acting as the local operating partner for Starwood Capital Group for the SveaReal portfolio.
“We are pleased that we have succeeded in repositioning this diverse portfolio, which at acquisition consisted of office, hotel, retail and warehouse/logistics assets into a well-managed and well-performing warehouse/logistics portfolio for which Hemfosa, as an institutional buyer, is the most natural long-term owner,” says Richard Vaaje, SVP at Starwood Capital Group.
He adds that Sweden and the Nordic region remain a “core focus area” for Starwood. Mikael Freudmann, CEO of Scius, says that during the venture’s ownership it has actively invested in the portfolio and increased occupancy, lettable area, lease terms, rental levels and has initiated plans for more than 200,000 square meters (approximately 2.2 million square feet) of residential building rights in Västerås, Stockholm and Lund.
The properties are located in 17 towns and cities, mainly in central and southern Sweden, including Stockholm, Malmö, Västerås, Borås and Lund. Tenants include Speed Logistics, DHL Nordic, Haldex Brake Products and PostNord Sverige and the average remaining lease term is 3.4 years.
Hemfosa reports the expected date of transfer for the properties is Sept. 13, 2018. The acquisition is subject to the condition that the Swedish Competition Authority (Sw. Konkurrensverket) decides to approve or leave the acquisition without action.
“This is a portfolio that generates high earnings and is an ideal fit with the strong portfolio of commercial properties we own, in addition to our community service properties, and that we have gathered together in the subsidiary Nyfosa ahead of the intended division of the group,” says Jens Engwall, CEO of Hemfosa. “The properties are a good geographical complement to the commercial portfolio and also in the offices and warehouse/logistics property categories. The transaction also provides us with an opportunity to resell certain properties in combination with the existing portfolio.”
Pangea Property Partners KB is acting as financial and M&A advisor to Starwood in connection with the transaction.