The rapid pace of urbanization and demographic growth are placing new demands on cities’ urban landscapes as we know them. An uptick in population and continuous developments of new residential areas and big box retail centers have over time resulted in a reduction of warehouse facilities in close prolixity to urban areas. The scarcity and demand of this asset class is only expected to grow further as the increased shift to e-commerce calls for last mile logistics and faster shipping to end-customers.
The EQT Real Estate team in Stockholm recognized the need for urban logistics properties as particularly high in Swedish university towns due to strong tailwinds with regards to economic growth and demographic development. In July 2019, EQT Real Estate and the Swedish property company Kvalitena and Broadgate Asset Management came together and launched Svenska Verksamhetsfastigheter, a joint venture real estate company focusing on warehouses and light industry properties in city-center locations.
Since then, Svenska Verksamhetsfastigheter has executed on an ambitious buy and build strategy and after having completed six add-on acquisitions in 2020, the company today manages a portfolio comprising 174,000 sqm across 28 logistics assets in university cities across central and southern Sweden.
Henrik Orrbeck, Partner at EQT Real Estate, commented: “The demand for urban logistics properties is fueled by the exponential growth in e-commerce and we see this thematic trend impacting cities all across Sweden and in university towns in particular. Svenska Verksamhetsfastigheter’s portfolio is expected to benefit from the increased pace of urbanization to these city clusters and the company is targeting a total portfolio value of SEK 4-5 billion within the coming two or three years.”
Richard Wollter, CEO at Broadgate Asset Management, commented: ”We continue to implement the strategic business plan, which includes building an attractive last mile logistics platform and refining the portfolio through active leasing work. We are continuously reviewing the market for potential additional acquisitions in the clusters in which Svenska Verksamhetsfastigheter operates. The transactions conducted in 2020 consist of both portfolios and smaller unit transactions, majority of them sourced off-market.”
Read more about Svenska Verksamhetsfastigheter.