Platzer Fastigheter Holding AB (publ)

Welcome to Platser's Q1 report. My name is Johanna Hult-Rentsch, CEO. And I'm here with me.

Fredrik Sjölin, CFO.

We'll start by summarizing this quarter. Our strategic investment a few years ago on logistics and industry gives us a change, and it's a great contribution to our business this quarter. We've made a big investment in Volvo Cars, on 15,000 square meters, which is the majority of the 22,000 that we have rented out. Industrial logistics also contributes strongly to our net sales, which we will come back to a little later. We have a positive net sales of 3,000. This quarter is also the 14th quarter in a row. And we have also secured nice project opportunities in our current portfolio and been able to make them a little more concrete, which we will also come back to in industrial logistics. If we look at the business as a whole, we deliver a nice income increase of 15%. It is an increase of about 47 million per quarter compared to the quarter last year at this time. We also have an increased turnover of 18%. It is, of course, the result of a solid and sustainable work from our organisation and we are very proud of this. We also have a higher administrative result despite a higher debt volume and higher interest rates, so we are in favor of this in a good way. Then the capital market has climbed up for us and also reached our segment BBB- and we took the opportunity to take advantage of that situation and have emitted 350 million SEK in a green obligation during the quarter. A little bit about the market situation in Gothenburg. We are, as you know, in a low-income situation as the rest of Sweden. Our region has held up quite well in this low-income situation. And a little better, I would say, than the rest of Sweden. The purchase manager index is now showing a little more positive and it feels good for the future. We are of course humble because there are industries that are struggling. Construction and trade are some of them, but there are also industries that are doing very well. We are a city of knowledge and an industrial city and the manufacturing industry has gone well. Sweden's export capital, with the US as the largest export country, was 23 times better than the rest of Sweden. Container volumes in Gothenburg's port increased by 3%, for example. And the city is growing. It is growing regardless of how the economy looks. We are now over one million people in Greater Gothenburg. Arbetslösheten när vi gick ut 23 låg på 5,7 men nu ligger den på 5,8 så den har stigit något. Den ligger en dryg procentenhet bättre än landet i övrigt dock. Sysselsättningsgraden den är också svagare än vad den har varit tidigare men den är fortsatt positiv. I Göteborg så kan man säga som så att You expect 24% to become 1.4% when you look at the most important markets when it comes to the regional BNP growth. And 25% you expect from the Konjunkturinstitutet that this will increase to 1.9%. So a little weaker, but still better than many other parts of the country. In the last ten years, we have had a very strong regional growth in the region. We have been at 72 percent. It is almost the level of China. The EU is at 17 percent. So we have a fairly high, we come from a fairly high level. But with that said, we should be humble in that the longer a low-income community remains in itself, the more it affects our tenants. We are hopeful, but also because it varies quite a lot between the industries. But what is it that makes Gothenburg stand up to a little better than many other parts of Sweden? Well, something fundamental is happening here right now. We have very large investments coming in. We have taken an example here, which is the Novo battery factory at 30 billion, where the stoma is being moved right now. And this factory is right up to our stock in Arendal, Torslanda. We have also been assigned to the most attractive city for future workers through the Talent City Index, which is held every year. And it is quite unusual that another city, so to speak, takes over the capital, but it is obviously the case that many opportunities are created here in our city. We have a lot of research resources, 34% is the highest in the country, that goes to the Göteborgsregion. And that of course helps in this innovative environment. And we also have a lot of focus on cluster building, where we connect some of the 750 companies that are represented in the city. And it becomes magic. And I think this is the background to why we stand strong. I will now go into the industry logistics segment. Vårt affärsområde som har bidragit väldigt fint till vårt resultat under det här första kvartalet som jag var inne på. Göteborgsregionen toppar ju listan 22 år utav 23 om man tittar sedan mätningen startade här 2001 när det gäller Sveriges bästa logistiklägen. Och det är klart att med hamnen, tåganslutningen och flygplats så är det svårt att slå det här läget. Och vårt bestånd ligger i det allra bästa läget inom Sverige. with connection to the port. Here we have a map of where it is located. For those of you who want a little insight into Gothenburg, it is the grey dots here that are our assets. We have both existing administrative facilities and a lot of projects. If we look at the Gothenburg market and industrial logistics, we have very low vacancy rates. They are below 3% today on the entire market. This is a strong demand. This demand has never really gone out of the market. And now we see that e-commerce has picked up a little more. The transaction market has actually been the one that has worked in the real estate industry all the way. It exceeded about 25% in the last measurement we got here at Transaktion from JLL. And it is actually the largest volume of transactions during the quarter. There is a lack of demand on the market, or rather there is a lack on the market, but there is a strong demand, I would say. And that is what we are aware of and can benefit from. In Gothenburg, the industry and the logistics market is very logical. how that market completes our office stock. Today we have 402,000 sqm out of our 960,000 sqm which is actually industrial logistics. That's about 25% of our total value. And in this quarter, industrial logistics contributed with 60% of the operating net increase, which is exciting. I was talking about this with our development opportunities. We have 100,000 square meters that are ready to be built. And of course, these are fast projects that quickly generate a cash flow and a low risk of failure when we start them. So we are happy to see that we are growing in this segment. If we look at our largest segment and business area, which is offices, which is 75% of our value, we can summarize that with the fact that Gothenburg's office market shows a stabilization. We have had quite high volumes of newly produced offices that have come out in recent years and we are at a vacancy rate just under 11% now. It has dropped somewhat in the last quarter. It has not been made any transactions at the office since the spring of 2022, and of course we are all waiting for that to happen. The rents are unchanged or weakly increasing. This is the picture I have shown a few times before, but here you can see the office volumes that came out in 2021-2022. And we can see that not much has come out in 2023-2024, not even in 2025-2026, especially not in the rest of the city and in CBD. But of course, we have had a flight to quality, as we usually say, where we have moved to the new stock. The good news is that in 2023, when we went through that, we see that the issuance in the B segment actually goes around the A segment. So now we're starting to see that we get a positive net issuance in total in the market, even when it comes to our existing stock. And here we see the vacancy rates. Out of seven sub-markets, there are six sub-markets on a downward vacancy trend, which is exciting. And of course, it is a city that is growing. As I said, we grow with about 11,000 jobs here per year. Let's take a closer look at the net sales. Last quarter, most of our sales almost ended up in the office. This quarter, we mainly receive our net sales from industrial logistics. And here you can see very clearly how they complement each other, these two legs. This, I should say, despite the fact that we have had a large supply from Volvo Sveafjord of almost 12 million, which has been known to us for a long time since we actually bought this stock in 2016 and that it would happen then. But we have a positive net supply in total of 3 million kronor and out of that, industrial logistics stands for 11. Vi har också gjort fina omförhandlingar i kvartalet, framförallt en del större kontrakt. Omförhandlat värde är 39 miljoner. Det innebär att vi också har kunnat förlänga vår återstående kontraktstid från 51 månader till 53, vilket är ett sätt att minska risk för oss. Let's see what I mention. We have gone from 51 months to 54. With that, I'll hand it over to you, Fredrik. You'll talk a bit about the turnover.

Absolutely, there are a couple of ways there. Through our rental revenues and property costs. We increase our rental revenues by 54 million compared to the same quarter last year. Then we have some major contributions to that within industrial logistics. As Johanna mentioned, about 60% of the turnover increase comes from that business area. Then there is the acquisition of finished buildings in Sörre Logistikpark, three of them, which we did in the half-year shift in 2023. And then there is the participation in Bulicke Logistikpark, where we have completed a project and where our tenants have moved in successfully. And then of course we have a big difference and contributes to the index increase that we have in 2023 compared to 2024. On the cost side, we only increase by SEK 7 million, approximately 8%. This also means that our turnover increases by 18% when the revenues increase by only 15%. And the big cost drivers are the ones that are the heaviest, so to speak. There is overdrift linked to snow and hail protection, and then there is real estate tax that has gone up somewhat compared to the same quarter the previous year. We come out with an excess rate of 77%, which is a strong excess rate. This shows that we are working to maintain our cash flow in the company. We will continue with that and to make it easier, we have an income capacity. This is the turnover in the income capacity. And then we have the high light pink stacks, that is the output. And then, evenly the output, you have the previous year's forward-looking income capacity. Hence, it is 2024, it is the income capacity that We have in the books now contracted agreements with interest within six months. It lands on about 1.4 billion in the next four quarters, given the prophecy. Much of this is due to what did not enter in the next four quarters, so there is still a successive effect in the quarter and also an increase in the index that contributes to it in the future. But there are almost 200 million in increase in turnover in the next four quarters. There is a lot of focus on key numbers, financial key numbers and property values. It has been generally for a while now in the industry. During the first quarter, the industry tends to be somewhat watchful. We make a very big breakthrough during the fourth quarter where we do our big benchmark for the year and take in A large proportion of external valuations. We always make sure to keep in touch with the market and have relevant input to our internal valuation. And in our books, the internal valuation is stated. We landed at 28.4 billion when we left last March. And then we have 200 million coming from investments. And then we have negative unrealized value changes that are summed up to 38 million minus. If you separate the components, there are of course several factors, and in these factors there are several variables, so it is a semi-scientific value, which is to be taken into account when reading newspaper articles and other things, that it requires a nuanced picture. Our nuanced picture right now is that we have 100 million positive from our project development. 100 million negative related to vacancies, vacancy rents that affect the cash flow in the valuation model negatively about 100 million. And then we have yield changes that negatively affect with about 40 million kronor in the quarter. Financing. Here we have, if we are to mention primarily two key figures that have been very much in focus, it is interest rate and reward rate. We have stabilized ourselves now at an interest rate where we are at 2.1 times the financial net, and that is then above our financial goal, which is 2.0 times. The isolated quarter is 2.1 and the rolling quarter of 4 is 2.1. Another key focus driven by the value of the properties and the rate of investment is the degree of reward. where we have had a debt increase during the period and then a property value that has had a downward trend related to GILD and then of course we work in our business, we advise over with project development and make sure to get good rental revenues in the future. That's what we can affect, but we end up at 50. And it is also in line with our financial goal where we will not exceed 50% over time. This also means that we can temporarily climb over, but our goal is not to be above 50% over time. During the quarter, we have increased our sustainable financing. We have issued a new green obligation in our own MTN program, as Jan-Olof mentioned, and it is linked to the fact that the market has returned, the prices have become more attractive. We are a long-term player in the capital market and the MTN market and we made sure that Given the obligation, we continue to see positive results on that market and hope that the margins will come together even more in the future. Our loan transfer structure, the majority of our financing is from the bank market and the balance is about 80-20 distribution between the bank and the capital market. This is something we see will be maintained over time. Our upcoming declines are under good control. We have credit facilities of about 2.3 billion to handle upcoming declines if any market would deviate negatively. But right now we have received positive signals from both banks and the capital market. With that said, we can link the financing to sustainability work.

What we want to highlight in sustainability in this quarter is how we have started our recycling hub. We are of course looking for CO2 improvements all the time and this is one way to do that. Where we have gone together with other real estate owners to create a recycling hub. and be able to reuse our materials. We now have 20 solar facilities and 21 solar facilities. We have added one in operation during this quarter. And on social sustainability, we have created a development council with the other property owners at Medicinärberget to develop the area in a good and inclusive way. And we have also It started at the end of the installation of this public art, which we can see here in the picture, in our school, the International English School, which we are at the end of the installation here in Södra Engården. So it is incredibly nice to have an artist who can help us with this public art. If we take a look at our focused areas, our area development, I would like to mention Gårda. Here we see our closest icon, Kineum, which was completed about a year ago. In this area, we continue to activate our street plans. We have signed an agreement with Din Veterinär, among other things, and we have also initiated the work of developing the offer for Gårdatorget, which is located right here, where Nordic Wellness opens in the fall, among other things. Gamlestaden, this is the director that we see in this picture. Gamlestaden is one of our most exciting development areas. We both run an area that includes offices, shops and apartments. And right now, the development of the apartments is underway with the help of JM. And we have started the first phase with the director that we can see here in the picture. It is also a part of creating the food and cultural destination that we want to do here. We have opened the pizzeria Dubbelhaken in the quarter and soon we will open Ego Gin Distillery and a cocktail bar. And then these forum design market companies create the flow in this part of the city. Lilla Bommen is another such area where we have ARI that we see in front of us in the picture. And the same thing there, we work very closely with other property owners in this area. We have Capio that moves in shortly and also Rangsells. I would also like to mention Arendal and Torslanda, since that is our highlight for this report. We have received an OK from the county board for additional building rights of 45,000 square meters, so that we can enter the building law. And we have also made a climb out of our largest property. on 1.6 million square meters and then divided it into 13 different facilities. This is to create additional value and to be able to work closer to our customers and of course to develop each and every one of these facilities in a good way. Here we can probably see a lot of possible buildings here in the future. Another area that is prioritized for us when it comes to area development is Möndal. Möndal is a very nice municipality. For the second year in a row, under the age of 23, it has won the prize as the year's growing municipality and has also reached the top several times as the year's super municipality and won the last 21, I think. It is a growing municipality with a very strong labor market and a good economy. It has a strategic position, our MIMO here, which we will take over from NCC, preliminary in Q4 this year. It is a condition that we reach an 80% exit rate and right now we are at a little over 60%. In summary, Fredrik, we want to summarize what we think are our strengths. We are experts in Gothenburg. This is where we work, and this is the market we really know. We focus on the customer, and it is very pleasing when we see that this work shows in our figures, as it does this quarter. We have a profitable growth plan. which is really about strategic transactions, our project development and our cash flow focus, which is incredibly important for us in the business. We have a diversified portfolio in these two branches, which are industrial logistics and our largest segment, office. We have a very nice group of committed employees who make sure that these deliveries are possible and we have a stable financing. And with that, we will open up for questions.

Next question comes from Marcus Henriksson from ABG Sandakarjur. Welcome.

Thank you very much. Good afternoon. I have five questions. You raised a little bit about Can we get some help on a possible initial yield? Why is the property value going up? And then you mentioned 80% exposure. How long has the NCC been on from preliminary access in Q4? Is it half a year after? Do you have one year after? What does that timeline look like when you can potentially withdraw? Thank you.

A part of the increase in the value of the purchase difference is of course that we have received an index in the signed rental contracts that NCC has signed. So that's a big part of it, which explains that the purchase difference also follows along. And as I said, there are several conditions in a purchase agreement and an equity agreement. And what I think is worth mentioning is that we apply when the property is 80% sold out. And yes, it works out in the right direction, one might say. So it is difficult to make a prognosis exactly when it happens, but it is preliminary at the end of the year.

Thank you for the follow-up. The price was up 20% and the index was 6.5%. Do we have any additional points on the delta there? And if it would not be sold out in 24 months, are you out of this business? Without saying exactly how long this will last, but after 24 months from today.

The first question, Marcus, if I may take it. The 1500 has been flat for quite some time. It has not taken into account the previous index, not the 10.85 man either. So it has been still and not updated. Now we did an update when we looked at it. We do not have access to it. It is NCC that does the education work. So now we have... We have taken forward more corrective figures to present in the report. So that is the question.

The expiry date and the horizon. I think we should be realistic here. I think that this volume of expiry will be able to handle this within a fairly short time. With the pace that we have gone forward with, We will buy this when it is 80% sold out. That is how the business looks.

Alright, I will move on to vacancies. You mentioned that they are decreasing, even Citymark, which you referred to. Last week, we noted rising vacancies from Åtri Björnberg on the other side of the river. And further, Eriksson is looking for new locations in Gothenburg. I think you highlight several positive things about why Gothenburg's vacancy is going to decrease in the long run. But you highlight that the vacancies will decrease over the coming years, is your assessment. What is it that you see that strengthens that statement?

Let me first comment on this increase in vacancies at Lindholmen, which you refer to. It is that part of the vacancy, so to speak, when you look at in Gothenburg includes CBD and the rest of the city and Lindholmen. So it is Lindholmen that has a vacancy rate that goes up a little compared to how you look at all these three together. That makes the analysts a little different, how you package these different share markets together. What other questions did you have?

The question is actually that you write under your market view, so you refer to Citymark. But then you also write that Platser estimates that the vacancies will decrease over the coming years. And I see several positive signs of why the vacancy may decrease over the next 10 years. So I just want to see what you see in the market that makes you write it that way.

But yes, my assessment is that when we are a growing city and when we have smaller projects that come out, it makes it so that as long as our entire market grows, it becomes mathematics as such that there are also more questions on I'm a bit cautious when I say this, because it's also a balance. We can't be in a low position for three more years, then it's not a good growth. But we have a lot of positive signs that we're on our way out of it. My assessment is that when we look at analyses and see what's in the pipeline, Den här tillfälliga höga vakansen som vi har i beståndet, den är ju historiskt hög i Göteborg. Den har ju inte legat där tidigare. Och med den tillväxttakt som vi har då i marknaden så tror jag att den kommer liksom tugga ner de kommande åren.

Tack för det. Vidare på nettuttidning. Den är plus 3 miljoner men den är ju minus 21 miljoner i förvaltningsvastigheterna. And you are a little out of my knowledge, many of you are moving in and moving out in the future. And now you have 5.2 million in upcoming vacancies from April 1st. Can you list the larger moves and a little closer in time as these moves happen? Of course not all, but if you can list the larger pieces around this.

The largest one is the Volvo Svea Fjord that we were talking about. It is 12 million of this, so it is the largest of those that will move. So it has been known to us for a long time.

Precisely, and they are listed year by year according to the agreement. And then we don't have, it's not per April 1st that these transfers happen, but you know that too, it happens successively over time, but we don't have that data specifically, but we can take it in another forum if necessary.

Alright, two more questions. Very strong drift and the margin is up 1.5% compared to last year's QED. And you have also improved the margin in your income up to 40 points. Do you think this is a pretty clean quarter considering the costs? Or is it a historically low quarter considering the costs? Underhåll, reparationer, är det något som sticker ut? Och sen följdfrågan då, tror ni att ni ska kunna förbättra er marginal i år jämfört med förra året om vi justerar för det här elstödet som ni fick förra året?

I would say it's a relatively clean quarter, especially now that we have Q3 and Q4 behind us, where we had imbalances between the two quarters. We have a little higher snow and hail pollution compared to what we usually have, while we have other positive effects. So I would say it's a nice, clean quarter to look at in the future.

Yes, thank you. Last question. Your recognition for many interest companies is still unchanged financially, but the management result came in at 10 million and it was 5 million in Q4. How do you think we should think about this post in the future?

It is not always easy to judge, I would say. With caution we should judge this post.

We haven't received any income during this quarter. It's a fluctuation. It's not an income.

I think we usually have 7 million in some form of internal guidance and so on. Thanks for that.

Those were my questions.

The next question is from Emil Ekholm from Pareto Securities.

Welcome. Hi, I'm Emil Ekholm from Pareto Securities. Hi, I'm Emil Ekholm from Pareto Securities. Hi, I'm Emil Ekholm from Pareto Securities.

It has been the intention that we will buy these projects when they are finished. So that is the intention in the long run.

Perfect, thank you. And how do you see the start of new projects? Maybe mainly in logistics, there seems to be a very high demand for this project.

It's a bit confusing, Julien, but I don't understand the beginning of the question. Can you ask it again?

Absolutely, absolutely. How do you see starting new projects? In France, the risk seems to be very high for the question.

What is very positive in the industrial logistics community is that it is a project that is... There is a small risk of failure when you start them, because they are often very well maintained. And it is also fast construction time, so it is fast to get a cash flow in these projects. So we are happy that we have the opportunity to make use of demand in this market. Everything depends on how the payments go. But I can see that we have the opportunity to continue to work in this segment. And that we get a good quality time.

Of course, it will be a profitable project we do.

Of course, but do you expect to start something in 2024?

Jag får passa på den.

Det får jag göra. Jag hoppas det. Vi har gjort en affär här under kvartalet mellan Baring, som källningstid på Kappahl i Arendal, i ert område. Där visar vi att fastighetsvärdet har ökat ungefär 30% sedan den förvärvades under våren 2022. Skulle ni säga att det kommer att ha någon positiv påverkan på era interna värderingar under det andra kvartalet?

Industry and logistics, as I mentioned, has been a market of transactions that has been running all the time. Transactions are happening all the time in that market, which is very positive. It was also a very quick yield adjustment. in the industrial logistics market. We are happy that this type of business is being done, of course, and it is clear that all points affect our values as well. Then you have to get out of our own stock. And I think that what is important for us is this type of strategic work that we work with. Yes, thank you. One last question.

You have entered new markets with about 400 million, as well as about 250 million have ended or fallen. Can you say something about the difference in margin between those who entered and those who ended?

Nej, jag har inte den datan. Sen för att komplettera på den fastighetsvärderingsfrågan. Det är två och en halv månad kvar innan vi levererar nästa fastighetsvärde så mycket hinner hända. Dock så mår ju all fastighetsvärdering bra av att ha evidens i marknaden när det sker transaktioner som vi verkligen kan benchmarka emot. Så det är bra industrilogistik tuffar på. Vi ser gärna att transaktionsmarknaden inom kontor också kommer att bär evidens vart det står någonstans.

Okay, that's all from me.

Thank you very much.

Thank you Emil.

Thank you Emil. The next question comes from Albin Sandberg from Kepler Kevra.

Please go ahead. Hi, I actually had a question for you. I would like to conclude with the fact that the evaluation and maybe the office, as you rightly said, is not as important. I mean, if you want another quarter without any bigger business, where there is a given lock on this Iran, or you experience that there is something that remains to be scrapped, scrapped that might require an upgrade, or maybe there is a camera, or... We have successfully changed the yield throughout the quarter.

The pressure of change decreases the more we are in the FAT market. One reason we have a very small margin difference now is that we indicate that we are somewhere in the right level. But then, as I mentioned to Emil earlier, transactions in the market, when they show and bear evidence, that's when we actually know. Dessförinnan så är det en bedömning med ett antal variabler som leder ut till ett fastighetsvärde.

Jättebra. Det var det. Tack så mycket.

Tack, Albin.

Det finns inga fler frågor på telefon just nu, så jag lämnar över ordet till talarna för eventuella skriftliga frågor och avslutande kommentarer.

Då har vi inga inkomna skriftliga frågor så vi får tacka tittarna som har följt oss till denna rapportpresentation så ses vi igen i juli månad.

Tack så mycket!