The Finnish Property Market 2009 - KTI

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Throughout the recent years, the vacancy rate of offices has remained at a very low level but has, however, now increased to ca. 4.5%, according to Catella – thanks to new supply. In the retail market, there is practically no vacant space at the moment. However, there are abundant plans for new retail development both in the city centre and in the neighbouring municipalities. These plans are likely to only come true when the economic activity peaks up again. The rents of modern premises have remained stable or increased in prime locations. Jyväskylä Location: 270 km north of Helsinki, in the centre of Finland Population: Jyväskylä: 127,000 Jyväskylä region in total: 142,000 Prime office yields in major Finnish cities Helsinki Espoo Tampere Turku % 10 9 8 7 6 5 50 The Finnish Property Market 2009 Jyväskylä is a dynamic university town that has a strong emphasis on both traditional industries and new technology. The Jyväskylä region’s most prominent business areas cover paper manufacturing as well as information, energy, health and environmental technology. The population of the City of Jyväskylä increased markedly in the beginning of 2009, when two neighbouring municipalities (Korpilahti and Jyväskylän maalaiskunta) were merged with Jyväskylä. The Jyväskylä area municipalities’ joint development company Jykes-Kiinteistöt is one of the most active players in the commercial property market. It also co-operates with property investors in order to ensure the supply of suitable company premises. Currently, Jykes-Kiinteistöt is redeveloping the old Kivääritehdas (Rifle Mill) property into office use. Other ongoing office development projects include those carried out by Technopolis south of the city centre. The retail property market in Jyväskylä is concentrated in the city centre. The major players include local retailers as well as some national investors. Also, new retail space is currently being developed in the centre by S-Group and Anttila department store, among others. North of the city centre, the Seppälänportti shopping centre is due for completion in late 2009. Vacancy rates for both offices and retail space are at a low level. The outlook for the market is also relatively good. Office rents in the Tourula / Seppälä areas are close to the ones in the city centre. Retail rents are the highest in the pedestrian shopping district in the city centre. Lahti Location: 104 km north-east of Helsinki Population: Lahti: 99,000 Lahti region in total: 157,000 Lahti is a traditional industrial city with a strong background in furniture and the food industry. Recently, the emphasis on jobs has transferred to professional services. Because of structural changes in the economy, Lahti has suffered from relatively high unemployment compared to the rest of the country. 4 05-1995 09-1995 05-1996 09-1996 05-1997 09-1997 05-1998 09-1998 05-1999 09-1999 05-2000 09-2000 05-2001 09-2001 05-2002 09-2002 05-2003 09-2003 05-2004 09-2004 05-2005 09-2005 05-2006 09-2006 05-2007 09-2007 05-2008 09-2008 (09-2009) Retail space occupancy rates have improved rapidly in Lahti. Also, office vacancy rate has decreased and is now around 6%. Retail construction is active also in Lahti, with new projects carried out outside the city centre. The extension of Trio shopping centre in the city centre was completed in 2008 by Citycon. Also, new office projects are planned or are developed both in the city centre and in old industrial buildings. Rents for both office and retail premises have remained relatively stable. Kuopio Source: Kauppalehti-KTI barometre survey Location: 400 km north-east of Helsinki Population: Kuopio: 92,000 Kuopio region in total: 118,000 Kuopio, the capital of the province of Savo, is situated in eastern Finland. Kuopio is a university city that places emphasis on the research and development of information and welfare technologies. Traditional industry areas are mostly related to wood. As in most major cities at the moment, the service sector is the biggest employer in the area. The property investor base in the Kuopio property market is dominated by domestic players, consisting of both national and local investors. The retail market of Kuopio is concentrated in the city centre around the main market place. New development in the region is concentrated in the retail space, new projects including a new shopping centre in Haapaniemi, a Citymarket hypermarket property in Päivärinta, and a retail park in Leväinen. Also, IKEA has confirmed the opening of a new store in the region. New supply has not affected vacancy rates so far. In the office market, vacancy rate remains at a low level of 3.3%, according to Catella. Due to limited supply, rents have increased steadily, but moderately.
The sponsors of this publication Aberdeen Property Investors is the dedicated property division of Aberdeen Asset Management PLC, a global investment management group listed on the London Stock Exchange which manages over €114 billion of assets in equities, fixed income and property. Aberdeen Property Investors manages €28 billion of property assets in Europe, Asia and North America through property funds and separate account mandates making it one of the top 10 global property investment managers. Our mission is to facilitate international investment exposure to property by offering a wide range of investment products and services, all supported by a rigorous investment processes, independent in-house research and local active management. Our investment vehicles include national, regional and sector funds as well as fund-of-funds products. In Finland, Aberdeen manages some €2 billion of property assets. Our clients are both domestic and international institutions. In addition, we manage six different Aberdeen funds with total property asset value about 1.5 billion euros in Finland. www.aberdeenpropertyinvestors.com Citycon is an active owner and longterm developer of shopping centres, laying the foundation for a successful retail business. Citycon’s retail properties serve both consumers and retailers. The company takes account of environmental aspects and wellbeing in the areas surrounding its retail properties. Citycon is the market leader in the Finnish shopping centre business and holds a strong position in Sweden and a firm foothold in the Baltic Countries. Citycon combines property investment with shopping centre business. This differentiates Citycon from many other real estate investment companies which principally focus on buying, selling and owning properties. At the end of 2008, Citycon owned a total of 33 shopping centres and 50 other retail properties. The fair value of the company’s property portfolio totalled approximately two billion euros. Citycon’s shares are listed on Helsinki stock exchange. www.citycon.com Eurohypo is a global specialist bank for commercial real estate and public finance in the Commerzbank Group. In 2008, Eurohypo was once again awarded the Best Global Commercial Bank in Real Estate by Euromoney.The awarded passion for solutions is for the future focused in the slogan: “What moves you drives us”. In Finland Eurohypo financed among others the Forum deal in Helsinki CBD. www.eurohypo.com Greater Helsinki Promotion Ltd (GHP) is the international business promotion agency for the Greater Helsinki area. GHP receives its funding from public sources – from the cities of Helsinki, Espoo, Vantaa and Kauniainen as well as the Uusimaa Regional Council. Helsinki is a dynamic hub for international business. At the heart of the Baltic Sea Region and strategically located in the crossroads of East and West, Helsinki offers businesses Europe’s most highly educated workforce supported by advanced infrastructure in a green and stable environment. www.helsinkibusinesshub.fi Invest in Finland - Business opportunities and professional consulting services for international companies Invest in Finland assists foreign companies in finding business opportunities in Finland. The organisation provides information on Finland as an investment location, and develops and coordinates the Foreign Direct Investment (FDI) attraction on a national level through active networking with regional and international partners. Services for international companies: • Data collection • Information services • Opportunity analysis • Entry alternatives • Networking • Location management • Setting up a business www.investinfinland.fi IVG Polar Ltd., founded in 1952, is a real estate investment company concentrating on owning, leasing and developing office premises. IVG Polar also manages properties owned by IVG Funds. The main thrust of its operations is in the Helsinki metropolitan area. The balance sheet value of IVG Polar’s real estate portfolio totals €250 million, while its leasable facilities in investment properties amount to 165,000 square metres, with ca. 500 customers operating in them. The company is a member of the German IVG group (IVG Immobilien AG), which is one of Europe’s largest real estate companies. IVG group manages assets of more than €20 billion in its Investment, Funds, Development and Caverns divisions. www.ivgpolar.fi NCC is one of the leading housing and development companies in the Nordic region. In 2008, annual sales totalled €6 billion. The Group employs 20,000 persons. NCC develops residential and commercial property projects and builds offices, industrial 51 The Finnish Property Market 2009
Page 1: The Finnish Property Market 2009 1
Page 5: Contents Preface 7 1. Basic facts a
Page 8 and 9: 1. Basic facts about Finland 2. The
Page 10 and 11: subordinated loans or state guarant
Page 12 and 13: Key Figures - Finnish Economy 2001
Page 14 and 15: 14 The Finnish Property Market 2009
Page 16 and 17: The indefinite leases often last lo
Page 22 and 23: Real estate investments’ proporti
Page 26 and 27: The Finnish fund managers concentra
Page 32 and 33: 5. Property sectors - market struct
Page 34 and 35: The office market in 2009 The deman
Page 36 and 37: Prime office yields in Finnish citi
Page 38 and 39: Rental practices Rental practices i
Page 42 and 43: 5.4 Logistics market - a developing
Page 44 and 45: The Helsinki Central Business Distr
Page 46 and 47: Preferred office locations in Helsi
Page 48 and 49: 6.2 Other growth centres: Tampere,
Page 54 and 55: Key terminology Property Kiinteist
Page 56: 56 The Finnish Property Market 2009

The Finnish Property Market 2009 - KTI

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