Review of 2010 – USD version - Skanska

In Ellös on the isle of Orust along Sweden’s west coast are these
low-energy “passive houses” containing 19 cooperative apartments
that were sold directly to customers and six rental apartments
bought by the Municipality of Orust before groundbreaking.
Such external factors as interest rates and customer
demand are of crucial importance to all decisions in the
process. In case of sharp economic fluctuations or collapsing
demand, the development of new projects may
be stopped completely, as occurred during the financial
crisis which began in the autumn of 2008.
Sales and pre-bookings are followed up monthly.
Projects are usually divided up in phases. To avoid
building up an inventory of unsold homes, sale of
homes in a new phase begins only when the preceding
one is nearly sold out or pre-booked.
Ownership mechanisms vary in different markets
In Sweden and Finland, sales occur largely in the form
of cooperative housing associations or ownership rights
in the respective housing corporation. Skanska acquires
land, which is then sold, usually to a cooperative housing
association formed by Skanska. Construction does not
normally begin before contracts have been signed for
about half the homes in a project phase, but this pre-sales
level may vary depending on project conditions and is
thus not a fixed minimum for all projects. The cooperative
housing association buys the building right and construction
services from Skanska, which then invoices the
customer − the cooperative housing association or housing
corporation − regularly as the phases are completed.
In the Czech Republic and Norway, development
occurs mainly for Skanska’s own account. The homes
are sold individually as ownership homes. Here, too,
Skanska requires a minimum percentage of pre-booked
sales before making a decision to start construction.
Skanska Review of 2010 – USD version
Markets Jämförelse nordiska bostadsutvecklare
development in Skanska’s Nordic markets
Residential
and Startade the Czech bostäder Republic 1) takes advantage of synergies
and 5 economies 000 of scale, while adapting products to
customers in local markets. Investments in new projects
4 000
will increase in all markets during 2011. Room for this
is created by utilizing financial synergies in the Group.
3 000
Sweden and Norway
2 000
The housing market in the Nordic countries developed
favorably 1 000 in places where customer optimism and
confidence in the housing market strengthened. Supply
shrank 0 because few projects had been started up
JM NCC Peab Skanska
in 2009, while demand intensified. Favorable interest
rates Sålda also bostäder benefited sales, which meant that Skanska
1)
started up and sold more homes than the year before.
4 000
Meanwhile the number of completed unsold homes fell
significantly.
3 000
Due to good demand, shortages of homes for sale
arose in certain markets, for example in Stockholm,
Oslo 2 and 000 Stavanger. This is why operations are now
focusing on purchasing suitable land and starting up
new 1 projects. 000 To some extent, land with completed local
development plans has been acquired from competing
developers.
0
In 2011 JMthe demand NCC Peabfor Skanska housing in attractive locations
is expected to continue. The underlying need
remains large throughout the Nordic countries and is
1) Totalt i respektive koncern.
driven, among other things, by continued urbanization.
Källa: Respektive bolags
Interest Bokslutskommuniké.
rates and general expectations about the
future are always important parameters that affect the
Comparison of Nordic
residential developers
Homes started 1
5,000
4,000
3,000
2,000
1,000
• 2009 • 2010 • 2009 • 2010
0
Homes sold 1
4,000
3,000
2,000
1,000
0
JM NCC Peab Skanska
JM NCC Peab Skanska
1 Group total.
Source: Year-end report of each
respective company.
Residential Development 39