2019 The Finnish Property | Market

THE FINNISH PROPERTY MARKET 2019 KTI Finland in co-operation with: City Helsinki; of KIINKO Real Estate Education; Newsec; LocalTapiola; Kojamo; RAKLI; SEB Group; Sirius Capital SATO; Partners; Skanska and YIT.

The Finnish Property Market | 2019

Contents

Preface 7

1 The Finnish economy 8 1.1 The structure of the economy 8 1.2 Outlook for the Finnish economy 10 1.3 Finnish public finances 12 1.4 Demographics 14 1.5 Finland’s international competitiveness 15 1.6 Main city regions in Finland 17

2 Institutional aspects of the Finnish property market 19 2.1 Two forms of property ownership 19 2.2 Market practices of property investment and renting 20 2.3 Planning 22 2.4 Taxation in Finland 23 2.5 Legislation for indirect property investment 27

3 The Finnish property investment market: volumes, structure and players 30 3.1 Investment market in 2018 30 3.2 Ownership structure 31 3.3 Real estate service sector 42

4 Property sectors: market structure, practices and investment performance 46 4.1 The office market 46 4.2 The retail market 51 4.3 Rental residential sector 56 4.4 Public use properties 63 4.5 Industrial / logistics market 65 4.6 Hotels 67

5 Property markets in different regions 68 5.1 The Helsinki metropolitan area 68 5.1.1 Helsinki 70 5.1.2 Espoo 77 5.1.3 Vantaa 79 5.2 Other growth centres: Tampere, Oulu, Turku, Jyväskylä, Lahti and Kuopio 81

The partners of this publication 88

Preface

Positive economic development, a stable and transparent business environment and strong performance of the property market have attracted international and domestic capital to the Finnish property market in recent years. The past three years have witnessed historically high transaction volumes, and some two thirds of all transactions have been carried out by international players. Foreign interest is widespread among all property sectors, and the Helsinki metropolitan area is recognised as one of the most attractive property investment targets in Europe.

The Finnish Property Market 2019 discusses the structure, players, market practices and conditions in the Finnish property investment market. The report aims to satisfy the information needs of international investors and other players interested in the Finnish property market.

This publication is produced in partnership with 11 companies and organisations representing the Finnish property investment, development, management, finance and advisory sectors. KTI wishes to thank our sponsors: The City of Helsinki, KIINKO Real Estate Education, Kojamo, LocalTapiola, Newsec, RAKLI, SATO, SEB Group, Sirius Capital Partners, Skanska and YIT.

The report is published annually in March. The report is also available in PDF format at www.kti.fi.

KTI Finland also publishes an electronic newsletter twice a month. Finnish Property News covers the latest news from the Finnish property market. To receive this newsletter via e-mail, please subscribe to it at www.kti.fi.

We hope you find the report interesting, relevant and worthwhile reading.

Hanna Kaleva KTI Finland

KTI Finland is an independent research organisation and service company providing information and research services for the Finnish real estate industry. KTI maintains extensive databases on returns, rents, transactions, development projects, operating costs and customer satisfaction measures in the Finnish property market. Based on these databases, various kinds of benchmarking and analysis services can be provided. For more information, please call +358 20 7430 130 or visit www.kti.fi.

7 8 1 The Finnish economy Basic about Finland facts Parliament State of Head governance and History Currency industries exporting important Most capita per GDP ECONOMY cities important Other Capital city Languages Population PEOPLE Distances area Total GEOGRAPHY April 2019. April in elected be will parliament New (17). Party (19), Finns Group The Parliamentary Reform (35), Blue Party Democratic Social (38), The Party Coalition National (49 The seats), Party Center The parties: Biggest parliamentCurrent in elected 2015. 4years. for elected members, 200 chamber, One 2018) in re-elected 2012, (since Niinistö Sauli Republic, of President 1995 since Union European the of Member 1917 since democracy Independent 2002) (since Euro 11.9% goods electrotechnical and Electronics 13% equipment and Machinery 14.9%products engineering and Metal 19% products industry Chemical 2017 in exports total of 20% products industry paper and Forest (2017) €40,618 Kuopio, 118,000 Lahti, 120,000 Jyväskylä, 140,000 Turku, 190,000 202,000 Oulu, Vantaa, 224,000 Tampere, 232,000 Espoo, 280,000 biggest the being Vantaa and –Espoo municipalities neighbouring 13 and Helsinki comprising 1.5Helsinki region, million inhabitants inhabitants 645,000 Helsinki, 6.8% by spoken languages Foreign 5.2% by spoken Swedish, 88.0% by spoken Finnish, languages: Two official 2 per square kilometre Finland): (northern region Lappi 170 per square kilometre Finland): (southern region Uusimaa kilometre square per 3,012 Helsinki kilometre square per inhabitants 18 Density: million 5.53 west to east km 540 south to north 1,160 km 338,000 square kilometres to some 20%. 20%. some to GDP, Finnish of the fallen 30% had 2016,by and, share its for accounted production industrial 2000, In increased. has that of while services decreased, has production of industrial share the years, past the However, during recent years. in significantly increased also has industries of chemical importance The industries. machinery and metal well as as inFinland, sectors strong traditionally are industries paper and Forestry years. in recent declined has exports Finnish of the share its although 2000’s, of the decade first the during economy Finnish of the growth in the role important played an industries Electrotechnical decades. past the during economy Finnish of the development the on impact agreat had has production of industrial Growth 2000’s. early and late1990’s the during economies prosperous and competitive most world’s of the one into Finland transformed reforms structural and innovation growth, economic economy. Strong amarket and openness of globalization, benefits of the example a good economy, is stable which and is awell-functioning Finland 1.1 structure The of the economy economy1 TheFinnish Customs. Finnish of the statistics preliminary the to according billion, €63.8 to increased value total the 7%, and some by increased GDP. of of the goods 38.5% 2018, In exports the to amounted 7.5%, some by of GDP share its and increased 2017, In product. exports the domestic gross Finnish the 45% some of for accounted exports in 2008, highest its At development. economic on the impact a profound have in exports economy, changes and driven export is an Finland production. industrial of total 20% approximately for accounted both industries forestry and Chemical industries. technology information and industry metals industry, electrotechnical and electronics engineering, mechanical include industries metal within categories biggest The production. industrial 43% some for total of the accounted which industries, metal was sector industrial biggest year. The previous the of 11% to agrowth compared billion, representing €86.5 some to amounted production 2017,In industrial total the services. hospitality well as as transportation, trade, support, and administration communication, and information being sectors important most the services, of all cent 75 per some up make services GDP. Private Finnish of the thirds two some for economy, account and Finnish of the sector biggest the currently are Services ”Exports account for almost 40 ”Exports positively to of the the growth per centper of the Finnish GDP” economy in 2017 and 2018” ”Exports contributed contributed ”Exports Finnish machinery and equipment deliveries. equipment and machinery Finnish to related services maintenance and installation well as as services, marketing or engineering research, like services business to business include industries service exporting significant Other services. is IT in services sector exporting biggest The products. of that industrial exceeded services of in exports in 2018, and growth the exports, total of the 30% some for In 2017, accounted years. in recent services steadily increased has exports of total of services share The 21%. of some ashare with sector exports largest the were products industry vehicle and machinery In2018, the 12% for exports. of total accounted products industry electronics and 19%. to Electric industry chemical thatof and cent, per 20 to amounted industry of forest share The exports. 37% total of the some for accounted industries equipment 2017, In transport and years. machinery metal, inrecent increased has exports of Finnish diversity The Finnish foreign by trade target area 10 12 14 16 % 0 2 4 6 8

1995 1996 Russia Germany 1997 1998 1999 2000 2001 2002 2003 Public services ■Privateservices on ■Publicservices ■ManufacturingConstructi production ■ Primary Finnish economic structure 2004 USA Netherlands China Sweden 2005 2006

2007 1975 1980 1985 1990 1995 2000 2005 2010 2015 2016 2017 2008 2009

2010 0

Source: FinnishCustoms 2011

2012 10 2013 2014 20 2015 2016

2017 30 2018 40 50 of total goods exports was as high as 18%. as high as was exports goods of total in 2013, share highest At its Russia’s exports. 5% total of the some for accounted Russia to exports The of cars. exports in growth the to due mainly years, in recent significantly increased have (6%). Germany to Netherlands Exports (15%),Germany (10%), Sweden (7%), USA the the and include exports of Finnish countries target important most The exports. 8% total of the some to America North and 15% to amounted of Asia share in 2018. The countries EU other the to went exports Finnish of the 60% Some Finnish sector by industry exports 10 15 20 25 30 35 % 5 60

2000 70 2001 Other products products Chemical industry products industry Forest products industry andtransport Machinery products Metal industry products industry Electric andelectronics ”Services account for 30% of ”Services 2002 80 2003

2004 Source: StatisticsFinland the total exports” the total 90 2005

2006 100

2007 % 2008 2009 2010 2011 2012 Source: FinnishCustoms 2013 2014 2015 2016 2017 2018

9 1 The Finnish economy 10 1 The Finnish economy 3 per cent compared to the previous year. previous the to compared cent 3 per some by 1-1.5 some by in2018, cent investments per and grew consumption year. Private previous the to compared down slowed of exports growth the while sectors, domestic by more boosted 2017, to was Compared cent. growth per economic 2.5 some by grow to In 2018, continued economy Finnish the in 2019. also competitiveness the support to continue will industries exporting important in most increases wage Moderate in productivity. increase an well as as countries, competitive key that of the than development cost labour moderate more to thanks industries, exporting of the competitiveness strengthening by supported were in 2018. exports Finnish oflevel 2008 peak previous the exceeded and reached finally production in 2016 2.5% 2017.to 2.8% of and volume absolute The close up ending growth GDP with growth, healthy towards However, adirection took in 2016, economy Finnish the goods. in consumer slowly than more accelerated has in demand growth the where goods, on investment emphasis exports’ is Finnish recovery economic the down slowing challenge Another industries. exporting of Finnish competitiveness international the decreased which costs, inlabour increase the and Russia to exports inthe challenges industries, of electrotechnical competitiveness of the collapse coinciding the by boosted were downturn economic global of impacts The crisis. financial global the following decade awhole almost for sluggish remained growth GDP Finnish 1.2 Outlook for the Finnish economy ”Finnish economy by grew some cent per 2.5 in 2018” construction investments grew by some 3 per cent compared compared cent 3 per by some grew investments construction In 2018, years. in recent development economic positive of the drivers main of the one been has construction Active conditions. economic households’ Finnish the support rates low interest Also situation. economic own households’ to regard with especially strong, remained has confidence Consumer in2019 cent 2020. 1.5 per and around at only remain to forecasted moderately, it is still increase to is expected inflation Although prices. consumer than more increase to expected are earnings as consumption, private supports also rate Alow inflation earnings. increasing and employment improving by is supported 1−2 Consumption in 2019 some by both cent 2020. and per increase to is expected consumption Private investments. or of exports instead of consumption development on the dependent be will growth economic years, coming In the positively. develop to expected are of services exports the Also categories. product largest the being products pulp and paper and products industry metal other ships, cars, with based broadly be to continue will Exports 2−3 cent. some by per increase to forecasted are 2019, In outlook. exports the Finnish the deteriorates markets financial in the uncertainty increased the exports, Finnish the for goods of investment significance the to due Also, disputes. trade the by caused uncertainty the well as as economy global in the growth slowing the to due down slow to is expected in exports increase the forward, Going the volumes of new construction are expected to decrease. decrease. to expected are construction of new volumes the as construction, repair by driven more be will investments Construction is expected. collapse no but end, an to come to is expected in construction In2019, cent. per 3−4 growth the some by grew intotal year, investments while previous the to

Photo: YIT 1.5 and 2 per cent, and for 2020, between 1 and 1.5 per cent. cent. 1.5 1 and per between 2020, for cent,and 1.5 2 per and between vary forecasts 2019 growth For GDP investments. and exports in consumption, increase slowing but continuous on a based be will growth The pace. slowing but by a stable grow to is expected economy Finnish the forward, Going cent. 1per some only be to is expected growth inthe 2019,cent in others, but per 3−4 some by increase to expected are investments total forecasts positive most In significantly. vary development and inresearch well as as equipment, and in machinery of investments development onthe forecasts uncertainty, global in 2019. continue to increased to However, due is expected growth moderate sectors, investment In other ”New construction volumes construction ”New are expected to decrease” GDP in 2010GDP prices growth and GDP GDP in 2010 prices in Finland growth andGDP in the Euro area -10 100,000 120,000 140,000 160,000 180,000 200,000 220,000 240,000 EUR million -8 -6 -4 -2 % 60,000 80,000 0 2 4 6 8

1990 1991 1992 1985 1993 Finland 1987 1994 1995 1989 GDP in2010prices 1996 1991 1997

1998 (19countries) area Euro

1993 Source: Eurostat,countryeconomy.com, OECD,IMF, MinistryofFinance 1999 2000 1995 2001 1997 2002 2003 1999 2004 2005 2001 GDP growth 2006 2003 2007 challenges in matching demand and supply for the workforce workforce the for supply and demand in matching challenges structural increasing the well as as growth, economic slowing well below in2019. 7% the to However, due decrease to 7.4%, at some stood rate it is expected and unemployment of 2018, end At the the years. in recent decreased has economy, unemployment strengthening the to Thanks the Finnish industries. industries. Finnish the of competitiveness cost the deteriorate will in turn, which, wages, increasing as isresult likely to which challenges, causing is already workforce of askilled lack the industries, unlikely. some In in unemployment decrease arapid makes 2008

Source: StatisticsFinland, MinistryofFinance 2005 2009

2007 ​ 2010 2011 2009 exceeded rate ”Employment 2012 2013 2011

72 per cent per 72 in 2018” 2014 *Pr 2013 2015 eliminar 2016 **Forecast 2015 2017

y **For 2018** 2017* 2019** 2019** 2020** ecast

2021**

-10 -8 -6 -4 -2 0 2 4 6 8 % GDP growth GDP 11 1 The Finnish economy 12 1 The Finnish economy Key figures –Finnish economy benefits in order to boost employment. employment. boost to in order benefits security in social changes needed the about discussion arise is likely to This further. increase should rate employment the that agreed it is generally and society, welfare Finnish the to is crucial rate employment ahigh population, ageing the to Due years. coming in the improving continue to expected in late2018, it is and reached was cent per 72 over to rate employment increase to objective government’s current The Private consumption, % Unemployment rate, % Inflation, % Change inexports,% GDP (changeinvol), % *Estimate **Forecast Employment and unemployment in Finland inFinland unemployment and Employment Consumer confidence indicator​ confidence Consumer -25 -20 -15 -10 10 15

Employed, 1,000 persons -5 0 5 1,900 2,000 2,100 2,200 2,300 2,400 2,500 2,600 2,700 2,800

2000 2012 -1.4 1.2 2.8 0.3 Finland 7.7 1988 2001

1989 Unemployed Employed 2002 1990 1991 2003 2013 -0.5 -0.8 1992 8.2 1.5 1.1

1993 2004 Eur 1994 1995 2005 o ar 1996 1997 2006 ea (19countries) 2014 -0.6 -2.7 1.0 0.6 8.7 1998 1999 2007 2000 2001 2008 2002 2003 2009 2015 -0.2 0.8 0.5 9.4 1.7

2004 income. investment and payments pension both from revenue consistent more receive and related, pension are funds security social whereas revenues, tax fluctuating on the dependent and cyclical are finances government local and central these, Of funds. security social and government, local government, central of the consists in Finland government general in 2018. improved The also finances economy, public Finnish strengthening the to Thanks 1.3 Finnish public finances 2005 2010 2006 2011 2007 2008 2012

2016 2009 2.8* 3.5* 8.8 2.0 0.4 2010

Source: EuropeanCommission 2013 2011 2012 Source: StatisticsFinland 2014 Source: Statistics Finland, Ministry of Finance, Nordea Finance, of Ministry Finland, Statistics Source: 2013 2014 2015 2017

2.7* 2015 7.7* 1.3 8.6 0.7 2016 2016 2017 2018 2017 0 50 100 150 200 250 300 350 400 450 2018 2.8** 3.5** 2.1** 2018

1.1 7.4 Unemployed, 1,000 persons 1,000 Unemployed, 2019 2019** 1.5 6.9 1.4 1.6 3.1 2020** 1.3 1.4 1.6 2.6 6.7 also in the coming years. years. coming in the also decreasing continue to is expected rate debt in 2018. The threshold 60% below fell the and anticipated, than faster even decreased GDP of the debt government of general share relative the growth, economic the to However, thanks years. in recent increased has debt government of general amount absolute the budgets, annual negative the to Due slightlynegative. remain likelyto are budgets government general years, coming in the decreasing continue to is expected deficit the GDP. of the 0.8 some Although to decreased deficit the but negative, remained still finances 2018, In public crisis. financial global the since ever deficit on remained have finances government general Finland’s enhancing economic growth” economic enhancing ”General government”General debt decreased indecreased 2018 to due Main of components demand, 100 200 300 400 500 0

1990 1991 1992 1993 1994 Exports TotalExports demand ConsumptionInvestment 1995 1996 1997 1998 1999 2000 2001 2002 adjusted seasonally 1990=100, index Volume 2003 2004 municipal day-care provision, which is widely used in all in all used is widely which provision, day-care municipal and families all for allowances of child forms in the families for support social healthcare, and education free instance, for including, services, of public supply on acomprehensive based is largely society welfare social Finnish The reforms. structural some requires economy public the strengthening and challenges, face to continue finances public Finnish 2005 tax the years, in recent aslight decrease Despite industries. exporting of the competitiveness international the support to and markets labour in the increases wage moderate enable to in order rate, partly tax income the decrease to determined been has government current The of taxation. level onahigh based is largely society welfare of the Funding expenses. healthcare and service social well as as payments pension increases population of the ageing the as increased be will spending Public 53% production. some for of total accounts currently expenditure government a result, As society. welfare social Finnish of the cornerstones the are funding tax and responsibility public Extensive categories. income 2006 2007 2008 2009 2010 Source: StatisticsFinland 2011 2012 2013 2014 2015 2016 2017 2018

Photo: Unrealer / Kojamo 13 1 The Finnish economy 14 1 The Finnish economy healthcare service providers. providers. service healthcare for systems information improved and digitalisation well as as competition, increased management, centralised through increase to is expected services of the Productivity services. of costs increasing the over control is improved reform services social and healthcare of the objective main The in late2019. organized be should election government regional first the accepted, be will legislation the If March. in mid- ends term current the before legislation the accept to ability Parliament’s onthe is dependent schedule This of 2021. beginning the from starting phases in several force into come to planned is currently reform The processes. inlegislative law challenges constitutional and political various to due times several delayed been has reform The of regions. use of the steering and planning well as as enterprise of business promotion the to related tasks and duties development regional issues, environmental services, rescue for, instance, for responsible be will counties new the services, social and healthcare to addition In history. Finnish in restructurings administrative ever biggest of the is one reform The counties. 18 to self-governing municipalities from transferred be to is planned services social and of healthcare organisation The structure. government regional of the development profound includes also reform The services. healthcare and of social provision and management of the restructuring is the agenda government’s current in the reforms significant most of the One finances. public of Finnish sustainability the in ensuring essential are responsibilities municipalities’ in the reforms structural Therefore, services. in healthcare burden cost the increases which population, ageing an and balance migration anegative to due challenges economic biggest the facing currently typically are municipalities smallest The position. financial and structure economic size, their to regard with significantly other each from differ Municipalities 311 inFinland. currently municipalities are There services. social and healthcare education, of, instance, for majority the for responsible are Municipalities municipalities. level, in local at the out is carried welfare of social provision actual of the most whereas implementation, their monitors and welfare of social principles basic and framework the sets government central the system, Finnish Inthe services. public in role have a significant currently municipalities Finnish Sweden. and Belgium Denmark, France, by exceeded only at 43.3%, was and stood rate tax in 2018. 42% at over of In2017, GDP stood and Finnish the countries, OECD in the highest the is among in Finland rate ”The schedule of the”The reform in regional government still ”There are more are than 300 ”There municipalities in Finland” in municipalities not confirmed” not years, and several new investment companies and funds funds and companies investment new several and years, in recent markedly increased has investment property care sector of private attractiveness The federations. municipal or municipalities Finnish the by owned currently are properties of these up. Most opened be will investors property for opportunities more and properties, healthcare of public financing and ownership the impact also will reform The of years. couple next the 25% within some to increase to expected is share its and services, social and 17%some of healthcare for accounts currently sector private The fully. or partially either of services supply the privatised have municipalities many and services, healthcare sector of private supply the increased significantly already has reform planned The in 2023. force into come will of choice freedom clients’ the plan, current the to According reform. of the delay the for reasons main of the one been also has This providers. service private and public between citizens for of choice freedom is the reform the around topics discussed most of the One it is still among the lowest within the EU. EU. the within lowest the among it is still years, in recent increased has population of the of foreigners share the though Even Finnish. is ethnically population of the most where country, homogeneous ethnically is an Finland 1.4 Demographics defined. be to yet has finances municipalities’ on the impact its and space of excess However, amount the period. transition the after vacant left be would properties current of the portion some that It is expected term. longer in the provision service their for needed premises the define will counties the period, transition the After billion. €3.5 of some worth atotal with of premises sqm million 10.5 and agreements rental 18,000 some manage will company the estimates, current the to According premises. and agreements lease these all manage also will Oy Tilakeskus Maakuntien years. of three period atransition for municipalities the by operated and owned currently properties the all rent will counties force, into comes reform regional the When landlords. private from rented have municipalities that properties of the agreements lease all manage also will company The Tilakeskus. Maakuntien to transferred been already has hospitals, central large mainly comprising federations, municipal by owned currently properties the of ownership The reform. regional the by affected services the for needed buildings the manage and own to established Oy, been has Tilakeskus company, Maakuntien A separate providers. service sector private for premises the rent often most funds and companies These established. been have sector inthis specialised healthcare services willhealthcare have services a major impact on property ”The reform of social and”The investment” 2014-2065 FinnishThe population by age group competitiveness Finland’s1.5 international 48%. is currently households person of single- share the in Helsinki, smaller, and typically are households cities, largest the In is 2.01 persons. households of size average the and persons, of or two one consisted 2017, In decreasing. 75% some households of Finnish constantly been has household of aFinnish size average The 26%. some to increase to expected is share their 22%. 2030, By at some stands currently population total of the 65 years over of those share The 2030. by 66 to and 2020 by 62 to increase to expected is and 60, almost is currently ratio dependency total The population. age working to 15 65 in relation over and under of people number is,total that the ratio, dependency total the increases which now retired, are generations boom baby The 47,300 only year. births. each In 2018, were born there were babies 100,000 1945−1950 than more even or almost World Second War, the after between and born were groups age largest economy. Finnish of the The challenges biggest of the one is currently population of the Ageing 31 is the which men, for 78 years and women for years 84 is currently expectancy Life number. current the under decrease would population total the by 2050, and, decrease, will population the which 2035, after until increase to is expected population Finnish the forecasts, current the to 1.4. at only According stands currently rate fertility average the and years, in recent decreased has Fertility that of births. exceeds currently of deaths number the as of immigration, is aresult growth Population annually. cent per 0.3-0.4 some by increased has population the decade, Within past the 5.6 million. around is currently of Finland population The of the economy as well as the overall welfare of citizens. welfare overall the well as as economy of the competitiveness the regarding indicators at various look that rankings international in many position good its retains Finland 10 20 30 40 50 % 0

2014 2016 2018 65-79 0-17 2020 2022 2024 2026 2028 2030 2032 st 80- 18-29 highest in the world. in the highest 2034 2036 2038 2040 2042 2044 2046 Source: StatisticsFinland 2048 30-64 2050 2052 2054 2056 2058 2060 2062 2064 The Finnish households by size by households Finnish The Finland’s strong institutions and highly skilled workforce workforce skilled highly and institutions strong Finland’s in late 2018. “positive” as outlook the improved Fitch whereas “stable”, as outlook the consider Moody’s and & Poor’s Standard / AA1. at AA+ category, best second in the Finland rated all have Fitch also and Moody’s & Poor’s, Standard strong. remain Finland for ratings credit long-term The ranking, Denmark (7 Denmark ranking, 16 at the assessed World IMD’s In Ranking Competitiveness business. doing for factor problematic one as identified also was regulation labor Restrictive infrastructure. and size market to regard with worst performs Finland pillars, assessed the Of assessment. in this of Finland strengths other are capacity innovation and dynamism business well as as market, financial of the development The systems. training and education quality high the for appreciated highly is also Finland system. judicial and framework legal the to related mostly are Finland of Within stability. pillar, this strengths the macroeconomic its well as as framework, institutional of its functioning the to regard with high ranks Finland ranking, the In 11 in the 2018,ranked was Finland in October published World the In Economic Forum’s Global Competitiveness Report low cost. at avery funding acquire to able be to continues government Finnish the conditions, current In population. of the ageing the by caused challenges the address to in order reforms structural recommend agencies the and years, in recent deteriorate to ratings caused have finances of public indebtedness increasing and deficit the hand, other the On agencies. rating by the appreciated are evaluated countries. 140 the among Denmark, and Sweden after right position, continued to outperform Finland. Finland. outperform to continued 10 20 30 40 50 60 % 0

1985

1990 1 person ”Finland’s credit ratings credit ”Finland’s 1995

th 2000 remain strong” remain position (15 position th

), Norway (8), Norway 2005 esn 3+persons 2 persons 2010

2011 th place in2017). place this In

th 2012 ) and Sweden (9 Sweden ) and of 2018, was Finland

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15 1 The Finnish economy 16 1 The Finnish economy in 2018. In this comparison, the key assessed assessed key the in 2018. comparison, Inthis Report Happiness Index Country Good In arecent and Order Index Order and Project World the by Justice instance, for appreciated, also are safety and security Finland’s crime. organised least the Report, Competitiveness Global the to according has, also which world, in the country safest the as Finland assesses Forum Report Travel Competitiveness In its Tourism and world. in the country stable most 2018 Index State Fragile Peace’s for Fund The In countries. other from winners the differentiating factors the as of institutions transparency and systems information to access strong identified report The Zealand. New and byDenmark outperformed only was Finland ranking, this In 180 countries. among place third 2018, for retained Finland Index Perceptions Corruption Global International’s Transparency In world. inthe countries corrupt least of the one as recognised is widely Finland size. its to a lot in relation contribute to it is assessed where in world well climate,order, as as and planet equality, and of prosperity areas in the best performs Finland comparison, Inthis 153 among countries. first ranked was Finland of humanity, good greater the to of acountry contribution World World world in the its country happiest the as Finland ranked Network Solutions Development Sustainable living. of quality assessing rankings well in international performs typically countries, Nordic other with together Finland, , Police Index Police and Security World Internal competitive economies in economies the competitive the and least safest corrupt ”Finland is one of the most ”Finland remains one of countries incountries the world” . The Netherlands United Kingdom The mostThe competitive national economies in 2018 United States , Finland retained its position as the the as position its retained , Finland Switzerland Hong Kong Singapore Denmark Germany world” Sweden Finland Japan 80 , which measures the measures , which 81 , World Economic Law Law well as , as 82 83 system, environmental quality, safety and the overall life life overall the and safety quality, environmental system, education of the accessibility and quality the example, for include, of Finland strengths the comparison, this In ninth. 2018, ranked Index was Life Finland Better In OECD’s coherence. social and equality gender assessing well in comparisons ranks also Finland generosity. and trust freedom, support, social expectancy, life healthy income, include well-being citizens’ the supporting variables property market is regarded as one of the most transparent transparent most of the one as is regarded market property Finnish The markets. property in the conducted comparisons inthe reflected is also environment business overall The of Finland. weaknesses main the as regarded commonly are regulations labour restrictive and rates tax High market. the of size small the with deal mostly in particular, perspective a business from of Finland, characteristics not-so-positive The living. and business support healthcare and education high-quality and framework regulatory stability, transparent economical and political where economy welfare Nordic a respected as reputation Finland’s illustrate rankings These 3 ranked was GTCI), Helsinki Index TalentCity Competitiveness Global (The workforce talented retain and attract to ability of cities’ ranking INSEAD’s In is assessed. capital innovation global attract to ability cities’ the where future”, of the cities 6 Helsinki ranks Times Financial The instance, For entrepreneurship. for environment good a having and innovation, and of level technology high its to due talent, and companies start-up attracts also Helsinki capitals. European the among inhabitants content most the has which move and to it is easy where cities, honest and equal, most safest, of the one as It is considered conditions. living well as as environment business its to regard with well performs typically Helsinki capitals, global Among of citizens. satisfaction 84 0-100(best) Global CompetitivenessIndex4.0 ”One of the most transparent rd 85 Source: World EconomicForum among 46 cities. cities. 46 among property markets inproperty the 86 world” th in its ranking of “Global of “Global ranking in its migration. negative from suffering inregions provision service of public maintenance for, instance, for challenges the increases which population, working-age or young the towards weighted are moves Within Finland, immigration. and migration internal of both aresult be will and been has Urbanisation jobs. of 72% all and GDP Finnish the 74% some of represent currently areas city 14The biggest 70%. some by 2017, to and areas, increased has share the in urban lived population Finnish of the 60% some In 1990, years. in recent in Finland fast proceeded has Urbanisation 1.6 Main regions city in Finland area. metropolitan in the growth economy, of the population rapid bythe well as as performance strong the by things, other among is strengthened, of Helsinki position The “good”. as 13) (rank development assessed were 4) (rank and investment both for prospects The cities. European 8 ranked be to 10 leaping positions markedly position, 2019 Europe Estate Real in Trends Emerging report Institute’s Land Urban and Cooper’s Pricewaterhouse In European markets. transparent” “highly few the among of 2018 Finland ranked Index Transparency Estate Real JLL’s world. in the Global Main regions city ​ property markets inproperty Europe” among the most attractive ”Helsinki ranked was 8 in Finland , Helsinki improved its its improved , Helsinki th

th among among operation platform, the so called C21 group. The group group The C21 group. called so the platform, operation aco- formed recently have in Finland cities 21The largest 10%. some by 15% some by Turku the region and grow to is expected Tampere the region period, same the In 2040. 2017 and – between people –40,000 20% almost by grow to is expected population whose region, Oulu in the strongest the be to is expected growth region, Helsinki the Outside country. whole 1.2% only of the represents area land the as even jobs, all 32% and of GDP total 37% country’s of the population, total 27% of Finland’s some represents currently region 1.8−1.9 to Helsinki increase The to million. is forecasted population the 2050, By growth. the for driver main the being abroad from and of Finland parts other both from migration net with annum, per inhabitants 20,000 almost by increasing been has region Helsinki of the population the years, recent In area. metropolitan Helsinki the form of Kauniainen, city smaller the with Vantaa, together which, and Espoo Helsinki, include region inthe cities main the and 14 municipalities, comprises region The inhabitants. million 1.5 some accommodates currently which region, Helsinki in the fastest be to is expected and has growth Population regions. city these between growth and performance economic in the differences significant are There Hamina. Kotka- and Lappeenranta Kouvola, Hämeenlinna, include of 80,000-90,000 apopulation with regions City Vaasa. and Joensuu, Pori, Kuopio, Seinäjoki, Jyväskylä, Lahti, 7 regions: –include inhabitants 100,000 than more with –those regions of city tier second The growth. population and development economic show well strong and perform generally regions These Tampere, Helsinki, Turku Oulu. and inhabitants: 250,000 than more with regions city four are there Currently, Licensed under CC BY 4.0. BY CC under Licensed ​ data. Open Finland Statistics ​ contributors. OpenStreetMap Data: Culture. and Education of Ministry Map: services web Finland OpenStreetMap ​ KTI. by map the to Additions 17 1 The Finnish economy 18 1 The Finnish economy scenario, the increase in residential demand would be heavily heavily be would demand inresidential increase the scenario, this In annually. needed be would dwellings new 29,000 almost regions, these In 2040. by inhabitants 625,000 of some increase in an resulting accelerate, to is estimated regions 14 to city main migration scenario, “urbanisation” Inthe structure. regional on current based are estimates growth population scenario, “conservative” the In 2040. by 5.8 million to grow to is estimated population Finnish the scenarios, both In scenarios. different ontwo forecasts its based of Finland Centre Technical Research 2015, VTT the in published 2040, by demand on residential study In its regions. city in main concentrated been – has construction housing of new 90% as much –as majority vast the years, Inrecent decreased. has apartments large and houses family single- for need the whereas markets, housing rental and in owner-occupied both increased has apartments located well- small, for demand The in Finland. markets housing on impact aprofound have preferences in housing changes and development demographic urbanisation, Increasing Residential demand in main regions city budget. investment 12 years’ next in the projects these include is to aim The infrastructure. rail of the development in the investors private and cities largest the both of committing aim the with state, by the founded were projects these boosting for companies In late 2018, project cities. largest the and government current the of both agenda the is on of Helsinki northward line rail main of the development the Also government. current the by started been Turku has and Helsinki between connection train” “hour’s called so the of actively, planning the and discussed currently are cities these between connections of rail development the Therefore, development. economic and in connectivity role important an has transport public well-functioning where people, 1.5 for million area employment connected increasingly an GDP. total of the It is cent also 55.5 for per accounts and jobs, sector private of all cent 53 and per population of the cent per 49 accommodates It currently Finland. southern in area growing and TurkuTampere important and –is an of Helsinki, regions city –the triangle” “growth called so The added. of88% value some and 78% of jobs 75%some population, Finnish of the comprise cities These inhabitants. 50,000 than more with cities all and Finland, across centres regional of all consists Significance of 21 regions biggestcity in Finland, %of total Research and development expenditure (2017) (2016) GDP (2015) jobs Private-sector (2017) Jobs (2017)Population Completed dwellings (2010-2018) dwellings Completed ”Helsinki, Tampere and Turku regions make up the ’growth triangle’ of Finland” triangle’ Helsinki region 48.3 35.2 31.2 40.0 29.7 27.9 regions 2009–2018 regions Housing construction in main city Some two thirds of new housing construction is concentrated is concentrated construction housing of new thirds two Some in 2014. as much as twice is almost and years, previous the to compared growth asignificant represents which dwellings, 40,000 some to amounted starts construction residential 2017 both In 2018, and cities. largest inthe especially years, inrecent booming been has construction Residential increase. of the half almost represent would alone region Helsinki The cities. largest the towards weighted use in Helsinki metropolitan area. area. metropolitan in Helsinki use rental for 100% targeted in buildings construction under were dwellings new of 2018, 9,000 end At the almost cities. main in the housing rental of private supply increased as result will which demand, investment strong by boosted is development New buildings. in apartment apartments in small strongest been has in construction growth The higher. even were volumes in 2017, started were in 2018, dwellings and new the 14,500 some area, metropolitan Helsinki Inthe regions. city in main 10,000 15,000 20,000 25,000 30,000 35,000 dwellings 5,000 0 The regions of Tampere, Tampere, of regions The 1.6 ”Demand for”Demand rented housing 2009 Turku and Oulu Oulu Turku and increases in main cities”

2010 ■ KuopioJyväskyläLahti ■ HelsinkiTampere ■Turku ■Oulu 18.3 18.1 28.7 21.7 17.2 17.8 2011

2012

2013

2014 21 biggest city regions city biggest 21

2015 Finland Statistics Source:

Source: StatisticsFinland 2016 82.5 82.5 81.9 94.9 78.7 77.5

2017

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Photo: Skanska 19 2 Institutional aspects of the Finnish property market 20 2 Institutional aspects of the Finnish property market liberal. In principle, there are no restrictions on buying or or onbuying restrictions no are there principle, In liberal. and is simple system legal Finnish the speaking, Generally transactions Legislation concerning renting and needed. be longer no will certificates share physical and register inelectronic this registered be will of shares transfers all and ownership the both future, the In 2019. May from starting register digital this to transferred be will companies estate real of old mutual Shares Survey. Land newly maintained established shareregister by the National in a registered and form, in digital only be will companies estate real mutual of new nowshares on, all From force. into came companies estate real mutual for register share digital of 2019, concerning legislation beginning the In new law. by public not are transactions These companies. estate of real shares the by transacting made are market Finnish in the transactions property commercial of majority the practice, In of property. management and ownership the organise to way is acommon company estate real mutual the transparency, and flexibility its to Due company by-laws. in the agreed otherwise unless of ownership, share their on depends of control degree owner’s law. individual An by set requirements certain fulfil to have which articles, company’s in the defined are company estate real mutual of a procedures management and decision-making The estate. real of ownership direct to compared complicated less also are Transactions property. 4% ondirect versus company limited lower: of the is also rate 2% shares onthe tax transfer The owners. several among is divided of abuilding ownership the where in cases example for of ownership, form flexible more is a company estate real amutual through property Owning practices market on Impact ”A new digital share register for MREC shares was for MREC established in 2019” in established demand for specialist services in property transactions. in property services specialist for demand the increased also has This processes. investment property in practices innew resulted –have analysis sophisticated more and professionalism internationalisation, increased players, of new emergence the includes –which market property Finnish in the decade last the over Developments investment Property renting and investment property of practices Market 2.2 countries. other most with compared restrictions few very has legislation the there, even but tenant, the protect to exist restrictions some do market residential in the Only ifagreed. possible are clauses break and renewal, for rights automatic no are there regulated, is not indexation terms, lease maximum or minimum no are There parties. two between of agreement freedom full of idea onthe is based world and inthe liberal most the is among agreements rental regulating legislation Finnish registers. company’s in the shares of the owner the as registered be can purchaser the settled, been have taxes transfer as soon simple. As and straightforward are shares company estate real or housing with Transactions transactions. property into entering when lawyers or brokers estate real use to it is advisable provisions, certain to corporate finance expertise, and implement thorough due due thorough implement and expertise, finance corporate and advisory extensive use typically parties the transactions, portfolio large In involved. of companies type and asset the of characteristics situation, onthe depending varies process investment in the agent property or advisor of the role The process. transaction smoother and at afaster aims seller the when applied also are procedures market Off common. more are buyer potential the identify to approaches tailored conditions, market Inquieter solution. best the find to inorder processes auction extensive out carry to sellers encouraged has demand investment high years, recent In situation. market onthe depend partly out carried are processes transaction ways The selling real estate, but as real estate transactions are subject subject are transactions estate real as but estate, real selling

Photo: Kojamo metropolitan area, area, metropolitan Helsinki inthe agreements lease office of Distribution regarding the space they use. 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fixed-period in and leases indefinite in all freely indexed be can Rents parties. the between freely agreed be can refurbishments and insurances taxes, for responsibility the rents, net In costs. maintenance for is responsible tenant the where rents, net apply to common it is more buildings, single-tenant In to tenants. recharged is typically expenses shared other and marketing for charge service aseparate also where centres, shopping for typical very is also costs of maintenance recharging Separate costs. in operational increases the against landlord the hedges and oncosts save to tenants the encourages both This tenant. the to separately cost maintenance the recharges 15%, landlord remaining the in the cases many In rent. gross traditional for are database rental KTI in the agreements 85% some of office of agreements, number by Measured types. property in all buildings in multi-tenant common repairs. minor and costs operating ”Gross rentscommonly are ”Gross applied” 1 Gross rents are very very are rents Gross 21 2 Institutional aspects of the Finnish property market 22 2 Institutional aspects of the Finnish property market centres, centres, Types of lease agreements in shopping External External repairs Internal repairs Rent Indexation review Building Building insurance

Rental turnover rent for Basis payments Property Property taxes From the user’s point, the cost-of-living index is the most usable one, because index revisions do not interrupt the series and the point figures of the cost-of-living index are are index Finland) cost-of-living the of (Statistics figures index. point the price and consumer series the the as time same interrupt the not at do index. monthly revisions index published because cost-of-living one, the to tied usable most usually the are is land, index or premises cost-of-living business the point, dwellings, on user’s the From those as such its rents, and =100) Many 2000 index. index price price consumer the consumer follows (currently index therefore, price consumer development, latest the from calculated series time along is =100 1951:10 index cost-of-living The term Lease Sector Typical leasing in practices Finland in statistics. capture to difficult is very markets levels and rental overall onthe terms of these However, impact the development. economic sluggish the during markets office area metropolitan Helsinki in the instance, for seen, clearly was This things. other among tenants, new for improvements tenant and increases rent stepped periods, rent-free offer may landlords instance, For applied. be can tenants retain and attract to means various situations, over-supply In database. KTI in the space retail total of the 84% and of agreements 75% some number of the represent contracts term Fixed premises. in larger especially applied, commonly are contracts term fixed centres, shopping In turnover. tenant’s on the based is solely rent the flow. 6% agreements of all Insome cash- their for base a stable secure to wants landlord the as low, quite is typically rent of the part turnover-based the However, of turnover. share agreed an by supplemented rent base of aminimum consist database KTI in the agreements lease centre shopping of all 50% than More turnover-based. are agreements of rental majority the centres, shopping In 61%

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Landlord further notice further Cost of living of Cost Residential Residential Space area Space Landlord Until expertise. For these “key employees”, specific rules concerning work and salary levels apply. See www.vero.fi apply. 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Building and Use Land in the reforms major is preparing Environment of the Ministry The plan. regional in the included be to need units these for Possible locations regions. in different sqm 10,000 and 5,000 between set been has plan, and regional in the defined be can of “large” definition the area, coverage regional with units retail For stores. grocery of, larger example, for construction of the flexibility the increase markedly will This plan. in the reservations specific any without construction, commercial common for designated in areas built be can limit below this stores that means This area. coverage local with sqm 4,000 than larger units to refers of “large” concept the legislation, the In plan. in the designated be to have which connections, traffic public good with in locations developed be only can units retail large this, outside retail; for location the as centre city of the position the emphasises legislation current The units. retail large for permits building and plans the over coordination and control regional increasing as well as processes, complaint the up speeding plans, regional for organization the simplifying include taken of actions Examples processes. permit construction and planning the up speed thereby and planning and use land concerning regulation the simplify to is aiming government current The years. is five use of temporary kind this for period maximum The get. to easier –is usually housing temporary for building office an using for instance, –for of use change atemporary for a permit Obtaining time. along take typically processes permit and obtain, to difficult typically are these although granted, be also can property of the use the change or right building the Photo: Newsec / Maria Putaansuu and Building Actis underway” ”A reform in the Use Land made directly from taxes (eg. costs of domestic help). (eg. of domestic costs taxes from directly made are some work), whereas from and to of journeys costs and interests loan of housing (for part income example, earned from made are deductions of the Part taxation. taxpayers’ in individual allowed are deductions Some rate. tax a flat at municipalities the to and rate at aprogressive state the to is paid tax Income income. capital and income earned categories: two into is divided income taxpayer Individual in 2017.billion €27 some to amounted employees and onemployers levied payments security social and pension obligatory addition, 45%. 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The The in 2022. force into come to is planned system new the and underway, is currently taxation of property A reform rate. tax property general the than higher percentages 3.0 at least be to is set rate tax this area, metropolitan Helsinki the In 6.0%. and 2.0% between vary can rate This lots. on unbuilt levied be may rate tax A special 0.50%. is currently rate 0.41% average 1.0%. between The and vary can residences Tax permanent for at rates 1.07% onaverage. is set and annum, per value taxable of the at 2.0% 0.93% maximum and at stands currently rate tax property general minimum The 2019. slightlyfor increased were rates tax Maximum range. this within rates the decide municipalities and parliament, by the regulated are rates tax maximum and Minimum tax. property real from is exempt agriculture or in forestry used Land is situated. property real the where municipality the to goes revenue The property. of the value market below of the somewhat is generally and authorities tax by local 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are system, current in the which, building, the and land the of both value taxable of the definition the impact will reform is due to an inheritance, a donation or a division of property subject to matrimonial rights. matrimonial to transfer the if subject liability property of adivision or transfer-tax no is adonation There home. inheritance, an to due is permanent owner-occupied first her or his acquires 39 18 and between aged a person if imposed is tax 3 No properties. residential for than higher is significantly tax of property share the but income, in rental VAT the from included is deductible in expenses included VAT properties, commercial For expenses. operational total of the 30% some represent taxes annual properties, office For income. rental 10% Turku average of and the some in Tampere 9%,and some represents this InHelsinki, cities. 28% in largest some to increase properties of residential cost operational annual of the taxes of various share the account, into taken are taxes energy and tax added value When decade. past the within times several increased have been rates tax property Minimum continued. have taxes property increasing for pressures as of years, couple past the during constantly increased has share Their properties. of office 24−26%some of those and properties, of residential costs operational annual total 8−10% some of the represent typically taxes Property significantly. increased be to is estimated property of the location the of impact the Also ones. older to in relation properties new for taxes increase to likely is also system new The markedly. increased be will properties of office those while slightlydecreased, be will properties residential for taxes property estimates, preliminary the to According impacted. significantly be will properties and locations different between burden tax of the distribution is likely the that However, it increased. be to not is planned municipalities for income tax of property amount total the reform, 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dividend is levied. at source tax the requirements of the Parent-Subsidiary Directive, no fulfils company beneficiary the and investment, of direct category the into fall shares the If tax. this for percentage alower set normally which countries, several with treaties tax special has Finland countries. non-tax-treaty and non-EU to disbursement isonthe applied rate tax a30% dividends, For tax. source afinal withholds payer the Finland, from received royalties or interests dividends, Of non-residents. for also at 30% taxed is typically income Rental in Finland. gains oncapital liability tax alimited have Non-residents years. following five inyear, that possible not during or, loss, of the year in the if gains capital from deductible is oninvestment made loss Capital deductible. are income, investment the to related directly are that expenses interest as such costs, at 34%. Financial is taxed €30,000 exceeding income Capital at 30%. stands gains) currently capital and income rental net (interest, income Tax oninvestment Capital gains taxes Transfer tax is usually imposed on the purchaser. onthe imposed is usually Transfer tax tax. transfer to subject always nevertheless, are, company housing or estate in a real Shares non-residents. are seller and price, transaction total the covers base tax The price. transfer of the is 2.0% company estate real or a housing in shares buying by made transactions for Transfer tax price. Tax on real property ■ Tax property onreal € /sqmmonth Of ce property 5.07 24% 5% Source: KTI 3 comprising comprising 25 2 Institutional aspects of the Finnish property market 26 2 Institutional aspects of the Finnish property market owner-shareholder. of the income as taxable fully are profits the partnership, limited or ageneral or entrepreneur business self-employed a individual, professional of aself-employed case the In is not exceeded. 8% the limit though even income capital as taxed 85% are euros, 150,000 exceeding dividends For rate. tax income progressive the to according is taxed amount exceeding the 75% of 8% this threshold, exceed dividends the If shares. the of value mathematical onthe calculated oflevel 8% return the exceed not does of dividend amount the that provided tax-free, are 75% income. dividends of the capital as taxed company, a non-listed 25% are from dividends the Of 25.5% 28.9%. or either is thus companies listed by paid of dividends rate tax total The rate. /34% at tax a30% income capital as taxed company, 85% alisted and 15% is from is tax-free, income company. of the dividend the value Of mathematical the on dependent is also of dividends company, taxation the anon-listed In not. or listed is publicly company the whether and shareholder-beneficiary of the status tax the instance, on, for depending rules, specific by provided as taxed be will company liability of alimited shareholders dividends, of taxation the for legislation current the to According at 20%. stands currently rate tax income corporate The itself. entity the to attributable income as taxed are profits the societies, cooperative and companies of limited case the In entity. of corporate form the by determined largely are organisation or of acompany obligations Income-tax taxation Corporate Photo: Sato most commonly applied. In principle, partnership is a pass- partnership In principle, applied. commonly most are structures partnership limited investors, domestic for targeted funds estate Inreal structures. fund estate real in structuring importance of great are Taxation issues structures Taxation partnership of structure. or building of type onthe 4% 25%, to up depending from varying rate amaximum separately, with is calculated building each for Depreciation structures. other and of buildings depreciation the to applies method balance declining The in taxation. depreciation by deducted are assets fixed acquiring for Costs services. or of goods (not payment) of delivery year inthe registered are costs and income rules, accounting Finnish to According deductible. mostly limitations, certain with are, abusiness maintaining or in acquiring incurred Expenses assets. in financial investing from profits the and services or work for compensation and fees income, rental merchandise, selling from proceeds as such types, income several it covers because broad rather is taxation in corporate considered of income concept The establishment. permanent of any regardless tax, to is liable country non-tax-treaty a from company a principle, In inFinland. establishment apermanent to attributable income all and Finland from derived income ontheir taxed are companies Non-resident income. worldwide their on tax pay liable to are in Finland residing Companies been limited by the source of income regulation. of income source the by limited been previously have which losses, of potential rules deduction the simplify also will This income. business as taxed be will structures partnership and of companies income taxable all legislation, new the to According in 2020. force into come to is planned legislation new and reconsidered, being currently is of income of sources division This income. business as or rules taxation income to according either taxed be can business property by generated income partnership’s Taxation of a fund. of the of activities type the and organisation onthe depend might status tax a partnership’s of interpretation the legislation, current the to According income. investment ontheir taxes any pay not do and in taxation treatment special receive which funds, pension Finnish for instance, for important, is very This status. tax own investor’s the to according taxed are gains capital and of view, point income and a taxation from structure through sources of income is planned sources to removed be in taxation in ”The division of”The different ”Limited partnerships are are partnerships ”Limited pass-through entities in taxation” 2020” potential tax risk associated with VAT with associated fraud. risk tax potential the at reducing aimed is particularly mechanism The basis. on acontinuous services construction offering companies VAT. for is responsible is applied on mechanism This services of construction buyer the that means This applied. is being mechanism charge however,sector, areverse VAT. paying for responsible construction Inthe generally is services or of goods seller the system, Finnish the In tax. final deductible is anon- buildings of residential charges service in the VAT, include not do rents included tax the residential As sector. finance and banking in the companies and VAT-liable charities associations, include organisations of non- Examples rent. higher VAT with deductions “lost” of impact the for compensate to need VAT typically liable owner. the for Tenants not are who importance of great VAT the is tenant of the regulation, liability the to Due period. aten-year to period afive-year from extended been also has period revision The period. revision the under lapsed time the to proportionate and with in accordance amount adecreased only but revision to VAT subject be not of deducted will amount full the that means This of time. lapse the to that is proportionate revision a to lead also could use of taxable increase an circumstances, some In period. revision aset within is transferred property of the ownership ifthe or decreases adeduction to entitled property of the use ifthe revised be then will deduction This activity. of aVAT use business the for intended taxable is property relevant the that provided building, existing an of restoration the well as as building of anew construction the VAT for costs inthe deduct to included entitled is also entity VAT Finnish Under ataxable legislation, property. of the VATthe of services cost in the included deduct can owner VAT. final tenant’s the property from The VAT the is deductible rent in the cases, these In included VAT be also must tenant liable. The tenants. and premises the concerning met are requirements certain when granted is typically liability The rents. VAT collecting for liability for apply to owner aproperty for it is optional Finland, In is 10%. rate the services, VATthe certain and is 14%, medicine rate books, for and products food for services: and of goods groups specific VAT lower some are for rates There services. and goods for at 24%. charge VAT total on the stands is calculated VAT currently rate standard The investment. property for that is relevant (VAT) tax tax Value is another added Value addedtax level. investor at the taxed is income capital instance, for and, transparent, tax also are investors, at private targeted in funds used commonly currently are which structures, fund investment Special Finland. outside domiciled typically therefore, are, of funds, kinds These investors. at foreign targeted funds to applied beneficially be typically cannot structures partnership Finnish ratesCentral in tax Finland major drivers in these structures, as limited partnerships are are partnerships limited as structures, inthese drivers major are Tax issues partner. general is the company management fund the cases, in most where, partnership, is alimited investment property indirect for structure common most of view, point the investor institutional Finnish the From partnerships Limited funds Property investment 2.5 Legislation for indirect property company. of the profit total of the expenses interest of the share the instance, for on, is dependent expenses interest deduct to ability the Otherwise, loans. bank on, applied instance, for expenses interest net for threshold €3,000,000 is another there Furthermore, deductible. always are expenses interest net which under threshold, is a€500,000 there legislation, the In institutions. pension and companies insurance funds, investment alternative regulations, of MIFID by definition covered firms investment include companies Such regulation. new in the listed companies financial to applied be not will regulation limitation deduction However, interest income. business their from expenses interest deduct to ability investors’ on property impact an have thus will restrictions new the and companies, estate real including entities, corporate Finnish all to apply will in2019. regime new force into come The will in late 2018, reform the and restrictions deductibility interest new for aproposal published of Finance Ministry The taxation Deduction of interest expenses in securities Transfer tax, companies real estate of mutual tax, shares Transfer real property Transfer tax, property Tax onreal VAT tax rate Capital gains rate tax Corporate 1.6% 2% 4% property) (residential 0.41-1.0% 0.93-2.0% 24% €30,000) exceeding income (34% on 30% 20% T ax rate Source: Finnish Tax Administration, www.vero.fi Tax Administration, Finnish Source: subject totransfertax. housing company arealways are non-residents.Sharesina both thesellerandpurchaser through thestockexchangeorif exempt if the transfer takes place Transfer ofsecuritiesistax- shares. (gross) transactionpriceofthe Tax iscalculatedonthetotal company. of a(mutual)limitedrealestate outby carried sellingtheshares The majorityoftransactionsare the land. separately forthebuildingand of property. Taxable valuedefined Depends onmunicipalityandtype (0%). andperiodicals newspapers cultural events, etc.(10%);and medicine, books, transportation, (14%); and cateringservices Special ratesforfood, restaurant companies, etc. company shares, sharesinlisted securities suchashousing real property, buildings, Levied onprofitsfromselling Note 27 2 Institutional aspects of the Finnish property market 28 2 Institutional aspects of the Finnish property market only twice a year. The maximum time limit for executing executing for limit time maximum ayear. The twice only redemptions for and quarterly subscriptions for open be may afund instance, for ayear. practice, In twice at least redemptions accept and investments new take must fund the legislation, the to According assets. property underlying the of illiquidity the account into take to inorder rules fund inthe limited be −may funds the from redemptions and in investments for – provisions fund of the openness the of degree company. The management fund aseparate by managed structures open-ended are funds investment Special reporting. and valuation fund for requirements and units of fund pricing the of risks, diversification to regard with instance for funds, investment mutual normal from differs funds these for regulation The Directive. Managers Fund Investment Alternative the by stipulated are managers fund investment Special Authorities. Supervisory Financial Finnish the by regulated are and sijoitusrahastolaki) (in Act Finnish, Funds Common Finnish the by stipulated are funds investment special These inproperty. invest that (erikoissijoitusrahasto) funds investment of special establishment the enables also legislation Finnish The funds investment Special investment. property of indirect expansion the with together increased has forms legal and structures of different diversity the years, However, in recent mid-2000’s. the from starting industry, funds of property days early in the structure dominating the were partnerships limited as organised funds Property perspective. institution’s a domestic from favourable not thus and taxation, corporate to is subject in property investing companies limited from income investment Correspondingly, met. are conditions certain that provided status, tax investor’s the to according is taxed income investment and structures transparent tax ones in particular, are showing increasing interest in them. in them. interest increasing showing are in particular, ones smaller institutions, some Also, rules. investment minimum low very apply funds many therefore, and investors, private at targeted extent, alarge to are, funds These companies. management investment and banks various by launched been have strategies varying with funds more several then, Since in late 2012. launched was framework this under fund first The is recommended. advisors tax or authorities of tax consultation the investors, non-Finnish For position. tax unit-holder’s onthe depends taxation the entities, business for and income, capital as is taxed income this taxpayers, individual For income. taxable as regarded are profits sales and yield annual the taxpayers, Finnish For purposes. tax Finnish for transparent fully as considered are and entities taxable not are funds investment Special fund. of the value 5/6 total of to the up exceeded be can limit this reasons, specific For fund. of the value total of the 50% to is restricted funds of level these gearing long-term The valuers. qualified and independent by out carried be must valuations Property units. of fund value the in defining properties their of values fair use must Afund quarterly. fund of the value the publish and define to required are funds investment Special liquidation. after only defined be may units the of value the assets, fund’s the liquidating requires units the ifredeeming instance, For pricing. their and redemptions for rules limiting be might there circumstances special property investments have attracted capital to these funds. these to capital attracted have investments property of performance strong the and rates low interest as years inrecent substantially grown have funds investment Special redemptions is also rather long – six months – and under under –and months –six long rather is also redemptions

Photo: Unrealer / Kojamo ------property investor Kojamo. Kojamo. investor property largest of Finland’s offering public initial successful the to 2018 thanks onsummer significantly grew sector listed the hand, S.à.r.l.. other the On Acquisitions Nordic Kildare by company of the shares of the acquisition an to due delisted be Technopolis, soon will companies, listed largest of the One Hoivatilat. Technopolis Suomen and Kiinteistösijoitus, Kojamo,Ovaro House, Investors Citycon, include exchange Helsinki Nasdaq of the list main inthe listed currently companies Property companies. normal as taxed are and Act Companies Liability Limited the by regulated are They companies. liability of limited form in the operate companies of property majority the context, Finnish the In companies Property regime. fund investment special the under operate which of funds, funds some also are There lots. building or forestry as such assets, of real types inother investing funds investment special manage also companies management fund of these Some ------by: managed those include in property investing funds investment of special Examples

Ålandsbanken Rahastoyhtiö: Asuntorahasto A and I Properties Trevian Finland AIFM: Trevian Funds OP- and properties) commercial and residential Management: OP-VuokratuottoOP Property (both I (commercial Fennica Managment: Asset Fennia Vuokratuotto Evli Company: Management Fund Evli Asuntorahasto C (residential properties) properties) (residential C Asuntorahasto in Finland) (properties Kiinteistöt Suomi UB countries); Nordic inthe properties (commercial Fund Property Nordic UB Company: Management Fund UB properties) (commercial properties) (residential Asunto Titanium and properties) (care Hoivakiinteistö Titanium Rahastoyhtiö: Titanium Palvelukiinteistöt (public properties) sector properties) residential and (commercial Sijoituskiinteistöt LähiTapiola Management: Asset Property LocalTapiola properties) (residential Asuntotuotto FIM Management: Asset FIM properties) properties) (commercial properties) (commercial Liikekiinteistöt eQ and properties) (care properties) (residential Vuokratuotto Berg Alfred Elite Management: Fund EAB cities) Nordic in largest properties retail and (mainly office Fund Income Property Nordic CapMan Estate: Real CapMan properties) Aktia Varainhoito:Aktia Toimitilakiinteistöt Aktia (commercial eQ Fund Management Company: eQ Hoivakiinteistöt Hoivakiinteistöt eQ Company: Management Fund eQ funds have significantly grown funds ”Finnish special investment investment special ”Finnish in recent years” in recent legislation, the framework has not become very popular. very become not has framework the legislation, by the set provisions limiting the to Due foundation. its of years three within listed be to needs company The - - - - to: companies the require of companies kinds these for transparency tax for provisions The properties. residential inrental investing companies for only given been currently has structures, REIT- known internationally resembling a structure companies, property listed tax-exempt for possibility The managers. and partners investment their with together investors, institutional by established structures venture injoint common more become also has structure company liability limited the years, In recent estate. in real investing companies listed in non- used widely is also structure liability A limited strategy. investment to regard with options its expand to inorder company investment anormal into transformed company the and Kiinteistösijoitus, Ovaro to changed was name company’s the this, After shares. REIT’s Residential 25% of Orava some acquired it that had published House, company, Investors investment in 2018, property another However, framework. regulatory specific this under operated having far, company is, so only the REIT, Residential Orava comply with strict accounting rules. rules. accounting strict with comply dividends as profit of the 90% out pay sheet balance of the of 80% amaximum to capital debt its limit properties residential in rental only invest Nasdaq Helsinki main list in ”Kojamo listed was on the 2018” 29 2 Institutional aspects of the Finnish property market 30 3 The Finnish property investment market: volumes, structure and players Ilmarinen and acquired by Deka Immobilien for €189 for Immobilien million. by Deka acquired and Ilmarinen by sold property Töölönlahti the being 3office largest the in 2018, out carried were transactions office asset single large exceptionally several Technopolis the portfolio, to addition In volume. total of the cent of per 39 ashare with sector property popular most the as remained properties Office Investing. Estate Real Stanley Morgan by managed afund by centre shopping Itis of the acquisition the well as as Estate, Real Nordic Cibus established newly the by funds Sirius of two portfolios property retail of the acquisition in 2018 the included transactions large Other ever. in Finland 5 transactions top the is among which in Finland, volume total the to contribution million a €950 as resulted Partners Kildare by Technopolisof the portfolio acquisition The assets. individual and portfolios companies, of property out carried transactions large exceptionally several by boosted was volume transactions The ever. in Finland volume annual highest volume, is second this the record year’s previous the to compared decrease cent a9per in 2018. Despite billion €9.3 to amounted volume transactions Property 3.1 Investment market in 2018 players volumes, and structure investment market: property 3 TheFinnish amounted to €9.3 billion in ”Transaction volume market Transactions volume and turnover in the Finnish property ■ Transactions volume–– 10 12 2018” 0 2 4 6 8 1000 MEUR 2.0 2001 2.0 2002 2.6 2003 3.2 2004 Turnover (transactions volume / professional property investmentmarket) Turnover property (transactionsvolume/professional 2.8 2005 5.4 2006 6.3 2007 4.2 2008 1.8 2009 2.4 Foreign interest was widely spread among all property property all among spread widely was interest Foreign year. previous at inthe 70% stood having transactions, of all 66% to amounted investors of foreign share The million. €600 to amounting recorded, was ever volume annual highest the sector, property care ever. Inthe sector in this volume highest second is the This volume. 19% total of the €1.8 billion, representing to amounted properties of residential volume Transaction assets. individual and portfolios of smaller mainly Stanley, consisted Morgan and of Cibus acquisitions large the to volume, in addition which, 24% some for total of the accounted properties Retail 2010 properties. residential rental Finnish in the investments their increased BVK and NREP AXA, Also fund. residential Standard’s Aberdeen and Capital Hill Stanley, Round Morgan instance, for include, sector in this in 2018. Newcomers significantly increased investors foreign by made investments the inparticular, markets residential In regions. and sectors 1.8 2011 2.1 2012 ”Investor interest widely was spread in different property spread in different property 2.5 2013 4.3 2014 5.5 2015 7.4

2016 sectors” 10.2 2017 Source: KTI 9.3 2018 0 3 6 9 12 15 18 % 2009-2018 Transactions sector volume by property property investment market amounted to some €69.5 billion. billion. €69.5 some to amounted market investment property professional Finnish of the of 2018, size end At the total the structure Ownership 3.2 million. of €20 size average an with annum, per 2018 and 214 are 2009 transactions between figures average The million. €29 to amounted transactions of these size €1 of over average the million, and aworth with transactions 320 follow-up, were Transactions there KTI the to According of transactions. size average and number increasing the both by boosted was volume transaction The 1000 MEUR 10 12 0 2 4 6 8 1.6 0.6 0.4

”Finnish residential property 2009 investments foreign attract 2.3 0.6 0.7 0.3

2010 ■Other property ■ ResidentialMixedCare ■IndustrialHotel ■ RetailOffice 1.1 0.9 0.3 0.6

2009-2018 Number and average transactions size of property 2011 Average size, MEUR 0.6 1.0

investors” 2012 10 15 20 25 30 35 40 0 5

2013 0.5 0.8 2009 2014 1.1 1.0 1.3

2015 2010 1.7 1.3 1.3 2016 1.7 1.7 2.8 ■

2011 Average size,MEUR 2017 2.7 4.1 1.5 1.0 Source: KTI 2018 0.6 2012 2.2 3.6 0.5 1.8

2013 –– Number oftransactions

2014 €5.8 billion or 9.1%. or billion €5.8 by increased year, market the previous the to Compared their domestic portfolios and increasing their international international their increasing and portfolios domestic their in restructuring active however, been have they years, recent In market. investment property in the role dominating a had traditionally have investors institutional Finnish billion. €3.7 to amounted market transactions Finnish in the investments net in 2018. investors In2018, foreign (€18.429% billion) of 2017 atend the 32% to (€22.3) billion from increased share Their market. property Finnish in the group investor largest the currently are investors Foreign Direct property investments in Finland 2011-2018, EUR billion EUR 2011-2018, Finland in investments property Direct investment market by investor group structureThe of Finnish property ■ RealestatefundsCharities,endowmentsandother companies companies■Non-listedproperty ■ Listedproperty investors ■ InstitutionalinvestorsInternational 10 20 30 40 50 60 70 80 0 01 21 21 21 21 21 21 2018 2017 2016 2015 2014 2013 2012 2011 42.9 15.4 5.2 6.5 5.7 2015 9.0 investment market by grew Source: KTI(queryforinvestors,annualreports,estimates) 45.7 16.2 5.4 6.3 9.0 7.6 2016 Finnish ”The property 47.8 16.2 5.6 9.3 8.4 7.1

2017 9% in 2018” 50.1 16.0 5.6 9.9 9.8 7.5

Source: KTI 2018 15.6 11.9 54.5

11.1 5.8

9.1 0 50 100 150 200 250 300 350 400 Number of transactions of Number 15.7 12.3 12.7 58.2 6.9 9.6 16.2 18.4 13.7 11.4 63.7 3.0 16.4 22.3 11.7 69.5 9.9 8.2 31 3 The Finnish property investment market: volumes, structure and players 32 3 The Finnish property investment market: volumes, structure and players €480 million in 2017. million €480 at stood million, having €600 over to amounted place 30th onthe in 2018, and portfolio the increased, has portfolios of investment size average The years. past in the markedly changed has investors property biggest of the list The respectively. increase will investors of foreign share the million, and €900 than by more decrease will of Technopolis, amount delisting the the After of 12% market. ashare total of the billion, representing €8.2 to amounted companies property Finnish companies’ listed of 2018, of end At the value exchange. the stock the from shares company’s the delist shares, of minority redemption the Technopolis, after will, company and listed of the shares of the majority the S.à.r.l. acquired Acquisitions Nordic level.However, in2018, Kildare previous their to back investments property companies’ listed the 2018 increased of summer in the 2017, of Kojamo offering public initial the in of Sponda delisting the Following achange. undergoing is companies property of listed importance and role The portfolios. property their to positively contributed growth capital also and development, property in in 2018. investing also However, continued sellers they net be to continued investors institutional market, transactions 24%. at the some In ended and decrease to continued market investment total of slightly,the share their grew but Finland in investments In2018, absolute their investments. property Property assets under management at the end of 2018, EUR billion EUR 2018, of end the at management under assets Property holdings investorsDirect of property in 30 biggestproperty Finland OP Insuranceandpensioncompaniesfunds Ilmarinen MutualPensionInsuranceCompany Bank ofÅlandRealEstateInvestmentFunds LocalTapiola andLocalTapiola’s Group funds Varma MutualPensionInsuranceCompany ”The listed property sector listed is property ”The Morgan StanleyRealEstateInvesting*** Morgan AXA InvestmentManagers-RealAssets Elo MutualPensionInsuranceCompany *** KTIestimate * Q2/2018**Q3/2018 undergoing a change” a undergoing Nordea LifeAssuranceFinlandLtd Nordea Aberdeen Standard Investments Standard Aberdeen Cibus Nordic RealEstateAB Cibus Nordic Deka ImmobilienGmbH*** Sponda Plc(PolarBidco)* Redito Property Investors Redito Property Fennia Group andFunds Fennia Group eQ RealEstateFunds Hemsö FastighetsAB CapMan RealEstate SATO Corporation** Nordisk Renting*** Nordisk Technopolis Plc** Antilooppi Ky Mercada Oy Mercada Logicor*** Kojamo Plc Citycon Plc AB Sagax Avara Ltd NREP Keva 0 Non-listed property companies/funds ■ Non-listedproperty ■ Institutionalinvestors 1 2 value of the investments of pension insurance companies companies insurance of pension investments of the value total the TELA, Pension Alliance Finnish the to According companies. insurance other and funds life include markets institutional in the participants Other universe. investment institutional Finnish of the majority the form schemes pension other and companies Pension insurance investors Institutional players. non-Finnish by held were oflist 2018, end the 30 top onthe 12 positions At ownership. foreign to portfolios domestic previously transferred have transactions portfolio or company large some markedly. Also, portfolios their increased have investors many years, However, list. in recent 30 top on the found were investors foreign few only years, recent the Until ranking. in the positions top earlier their from fallen thus have and holdings, domestic direct their divested have institutions many years, in recent However, investors. of largest list on the position second the to rose Ilmarinen Etera, with merger recent 2018, the to due In portfolios. their restructured have companies insurance pension time, same At the Fennia. and Ålandsbanken eQ, LocalTapiola, Group, OP of, instance, for positions rising the to contributes which portfolios, their increasing continued have funds property domestic largest The years. in recent list onthe positions top in the positions their established SATO and both have Kojamo companies residential Large International investors ■ International companies ■ Listedproperty Source: KTI(queryforinvestors,pressreleases,annualreports) ”Foreign investors”Foreign increase 3 their portfolios actively” 4 5 6 and prepares to finance future pensions. In addition, there there addition, In pensions. future finance to prepares and expenditure pension state balances state the which through is afund /VER) (Valtion Eläkerahasto Pension Fund State the and Kela employees, and Church Lutheran Evangelical State, government, of local pensions the administers Keva institutions: pension major two are there sector, public In the Veritas. and Elo Varma, Ilmarinen, companies: major four currently are There players. biggest the are companies insurance pension sector, pension private the In investments. on equity returns healthy the to thanks annum, higher, 5.8% per some clearly been has return the years, ten past the During years. 20 past in the onaverage annum 4.3% per to amounted has investments institutions’ pension sector onprivate return real the TELA, to According 3.5%. of level original its to back increased be will expectation return the which 2025, after until on investments return real annual cent of a 3 per assumption on the based are flows money pension long-term on the Calculations investments. onexisting onreturns based currently thus is assets investment funds’ in pension increase The billion. €1.8 was payments pension cover to in order of funds out 2017, In taken contributions. sum net the of annual amount the than is now larger out paid being of pensions amount the generations, 1940s the from of people numbers of large retirement the to Due assets. investment institutional Finnish of the basis the form past inthe collected reserves The system. pension Finnish inthe role asignificant have not do insurance, pension individual or agreements market onlabour based systems, pension Supplementary employees. and employers both by paid are Pension contributions employers. by organised foundations and funds pension companies, insurance by pension is administered and contributions pension annual of the bulk the receives scheme pension occupational The insurance. pension employment-based and regime pension public of a basic is a mixture system pension Finnish The 2018. of quarters three first the during cent per 2.5 to amounted investments institutions’ onpension return nominal The of 2018 (€199.9 quarter of 2017).third end at billion the of the end at billion the €204.7 some to amounted schemes pension occupational statutory the administering funds and Investment of pension portfolios insurance companies, Q3/2018 100 20 40 60 80 % 0 Shares ■RealestateinvestmentsOther ■ Shares anddeposits ■BondsOthermoneymarketinstruments ■ Loansreceivables Elo 29 40 13 8 Ilmarinen 32 43 13 6 Varma 20 24 41 9 share of property investments amounted to 9.5%, to in while amounted investments of property share the companies, insurance pension sector of 2018. private For quarter third of the end at 8.2% the to amounted portfolios investment in the investments of property share The 37.7%. to amounted instruments market money and loan other and of bonds share The investments. 8.1%some equity in other and shares, in listed invested were assets schemes’ pension all of 2018, 37.5% quarter of third of the atend the average, On of 2018. 41% to quarter amounted third of the end at the schemes 35%, sector is some of that public while equities of listed share the portfolios, companies’ insurance pension sector private the In returns. investment higher slightly in resulting exposure, equity alarger have typically They allocations. and strategies investment havedifferent thus and institutions, sector private than framework solvency different a under operate institutions pension sector public Finnish funds. pension specific industry or company smaller several are foreign, in many cases Swedish investment partner. These These partner. investment Swedish cases in many foreign, have a often they where companies, or funds established newly to held investments directly formerly their sold also have institutions many years recent In companies. and funds property domestic in many investors major are Institutions years. in recent increased has investments of indirect share The of 69%. share the with portfolios property domestic institutions’ the dominate investments domestic Direct investments. domestic of all cent 24 per some represent thus investments of 2017). end the Property (€13.1 in Finland invested €12.6 are billion assets, at billion €16.8to (€16.6 billion of 2017). end at billion the these Of amounted schemes pension of all investments of property of 2018, amount total the quarter third of the end At the at 5.2%. stood share their schemes pension sector public the Source: TheFinnishPension AllianceTELA ”Properties represent 8.2%”Properties of the Finnish pension schemes’ Veritas 28 36 16 9 investment portfolios” investment Keva 33 46 6 7 33 3 The Finnish property investment market: volumes, structure and players 34 3 The Finnish property investment market: volumes, structure and players major office property in Paris. In Finland, Varma is expanding Varma is expanding InFinland, in Paris. property office major in a 2018, co-invested Varma in summer and investments, property foreign its increase to aiming been has Varma in2018. inFinland transactions inmajor enter not did Varma restructuring, portfolio property of active years several After Ilmarinen. to transferred were Pension Fund Group’s of OP of 2019, beginning the In pensions the in Finland. investor property largest of 2018,end second it the made which atbillion the €4.2 some to amounted investments property domestic direct of Ilmarinen’s value The centres. shopping Tripla and Redi inboth investor an is also company the years, in recent properties residential of rental development active to in addition and, projects, development property in invests also Ilmarinen Germany. and Netherlands the US, inthe properties office acquired and internationally, portfolio property the diversify to strategy its pursue to continued company The properties. smaller some as well in Vantaa as property warehouse large one sold also Ilmarinen year the During Etera. by owned formerly were properties Both CBD. Helsinki in the Töölönlahtithe area in investors foreign to properties office large two selling by portfolio domestic direct its restructured 2018,In Ilmarinen portfolio. total of 8.2% the billion, representing €3.9 was portfolio of Varma’s property value of 2018. The beginning in the Etera with merger the through markedly increased portfolio property Ilmarinen’s portfolio. total the 12.8% of of 2018, representing quarter third of the end the at billion €6 to amounted value fair portfolio’s property its and in property, more invested has Ilmarinen billion. €46.9 €47.0 totaled of that Varmatotaled billion, and portfolio investment of Ilmarinen’s of 2018, value market the quarter third of the end At the in Finland. companies insurance pension sector private largest the are Varma and Ilmarinen managers. and partners investment their with together structures in jointventure often assets, single in large typically investments, direct some made have Elo and Varma, Keva Ilmarinen, as such institutions, largest the years Inrecent vehicles. in indirect invested are investments of 2018 of (€3.8 foreign billion in 2017). majority The quarter third of the billionend at the €4.2 to amounted investments property foreign investors’ Institutional Kiinteistöt). (Agore Elo and (Antilooppi) Ilmarinen by, established instance, for been have of structures kinds Real estate exposure of the Finnish institutions 10.7% 5.9% total valueEUR23.6bn 2018 14.0% 69.4% Source: KTI(queryforinvestors,annualreports,estimates) ■ ■ ■ domesticinvestments Indirect ■ The third largest private sector pension insurance company company insurance pension sector private largest third The use. educational to another and residential to property old one office converting currently is Varma also airport. of the vicinity in the hotel Flamingo of the expansion the well as as in Kalasatama, property office K-Kampus the include projects ongoing largest The area. metropolitan Helsinki inthe underway projects development large several has company the and development, property through portfolio property its them from making direct property investments. property direct making from them prevent statutes fund’s The funds. hedge and infrastructure estate, real comprises category This investments. total 9.2% of VER’s, represented investments” “other category of 2018, investment the quarter third of the end At the investments. property on indirect solely focuses 2018. VER of of €19.7 quarter portfolio third of the end at billion the investment an managing was VER Pension Fund State The in late2019. completion for due in Tampere, is which development property hotel Marriott is the in Finland investment recent largest The investments. property foreign its onincreasing concentrated has Keva also years, of 2018. end at the and recent In in property, 6.1% portfolio, is invested of 2018. investment Keva’s Of quarter third of the end at billion the €52.6 to amounted portfolio investment its sector; pension Finnish in the player biggest is the Keva institution pension sector public The properties. centre shopping two buying by portfolio its increased Kiinteistöt In 2018, Agore Management. Trevian Asset and fund AP1 Swedish the with together Kiinteistöt, company, Agore investment In 2017, property retail a new established Elo Helsinki-Vantaa of the airport. vicinity in the property 2018, In logistics major one sold Elo portfolio. total the 12.7% of billion, representing €3 to amounted portfolio of property Elo’s of value 2018. The quarter third of the end at billion the of €23.7 portfolio investment atotal is Elo, with Indirect foreign investments foreign Indirect investments foreign Direct domesticinvestments Direct ”Pension institutions diversify diversify institutions ”Pension their property portfolios portfolios property their internationally” Market values at the end of year of end the at values Market companies property Market values of the Finnish listed insurance. Life Aktia and Group Fennia include in property investing insurers Other Group. LocalTapiola and Group Sampo Nordea, Group, OP institutions financial large the by managed are companies insurance and insurance life biggest The agreements. capitalisation called so through clients their to opportunities investment offer also They corporations. and individuals private both to insurances pension voluntary well as as insurances life offer companies insurance Life Authority. Supervisory Financial the of FSA, statistics the to billion, according €3.8 some to amounted investments €13to Total billion. property companies €21.7 to of that insurance and billion amounted companies insurance of life of investments amount total the of 2018, quarter third of the end At the institutions. pension of those than smaller however, are, markedly portfolios investment Their companies. insurance and insurance life include in Finland investors property institutional Other development. residential in investments their increased have and opportunity this used have institutions of the Many cities. main in the property residential of rental supply the enhance is to legislation of this purpose The 2022. until 50% to up investments property residential their leverage can companies insurance pension whereby introduced, was legislation temporary In2014, however, investments. anew in their leverage use to allowed typically not are funds pension Finnish interface. tenant of their control retain to want they as teams, management property and asset in-house have also institutions Many kept in-house. are functions management portfolio thus and themselves, by institutions made are decisions investment that requires legislation Finnish in property. invest also these All Pension Fund. Seafarer’s the and Pension Fund Pharmacy Valio include Fund, Pension of players kind of this Examples sector. industry one or company of one matters pension the inmanaging specialising providers pension smaller some are there players, major these to addition In 1,000 1,500 2,000 2,500 EUR million 500 0 ■ 20142015201620172018 oaoPc iyo l ehooi l Soe vr Investors Ovaro Suomen Technopolis CityconPlc Plc Kojamo Plc

ovtlt Kitit- House Kiinteistö- Hoivatilat Source: NASDAQOMX Helsinki sijoitusOyj regions in Finland. The company increases its property property its increases company The in Finland. regions city largest seven in the located mainly dwellings residential 34,000 some owns company The billion. €5 exceeded portfolio property residential of Kojamo’s of 2018,end value market the At the exchange. stock Helsinki Nasdaq in the listed was Plc Kojamo company property largest 2018, Finland’s summer In in 2019. delisted of Technopolis be will shares the billion when €0.9 some by reduced be will holdings property total The billion. at €4.7 stood companies of these value market total The billion. €8.2 to amounted exchange stock Helsinki Nasdaq in the listed companies property six of the holdings of 2018, end At the property Finnish the sector Listed property investors. private and institutional both to targeted funds, property unlisted launched also have companies These portfolios. investment property their manage to companies management separate have founded groups, Fennia LocalTapiola and OP, instance for institutions, financial main of the Some Hoivatilat, Ovaro Kiinteistösijoitus and Investors House. House. Investors and Kiinteistösijoitus Ovaro Hoivatilat, Suomen include companies property listed smaller The Tampere campuses. and Kuopio existing in its million €39 some and campus, Otaniemi of the expansion the in million €94 some invest it that will announced company the 2018, In future. near inthe delisted be will Technopolis’ shares S.à.r.l. in late2018, Acquisitions Nordic Kildare by company of the shares of the acquisition of the a result As in Finland. located are million €900 €1.6 than ofmore this, billion, and to amounted portfolio of Technopolis’ property value fair of 2018, the quarter third of the end At the in Copenhagen. one and in Stockholm one in Helsinki, one spaces, working co- UMA three operates It also in Finland. 12 campuses and in 6 cities operates currently company The regions. Baltic and Nordic in the countries in seven campuses park of business achain manages and Technopolis develops owns, apartments. 550 well residential as as space, leasable of sqm 42,000 some comprise to in Espoo centre Lippulaiva the extending and reconstructing is currently Citycon sqm. of 101,000 area leasable agross with centres, shopping company’s of the largest is the in Espoo Omena Iso centre shopping The in Finland. located 10 of which are centres, shopping 50 manages and owns currently company the total, of 2018. In quarter third of the atend billion the €4.2 to close was portfolio property of Citycon’s value The countries. Baltic and Nordic in the management and development investment, centre in shopping specialising company is a property Citycon Investing. Estate Real Stanley Morgan by managed afund to dwellings 2018, 1,600 some sold Kojamo in and focus, investment its outside assets divesting continues also company level. The same at the was development own their through completed of apartments number the and funds Group’s OP from dwellings 980 some 2018, bought Kojamo In acquisitions. and development own both through portfolio ”The Finnish”The listed property through the initial public sector increased in 2018 offering of Kojamo” of offering 35 3 The Finnish property investment market: volumes, structure and players 36 3 The Finnish property investment market: volumes, structure and players Index (index 7/2000=100) OM companies property of FinnishShare performance listed company’s strategy and management team was changed, and and changed, was team management and strategy company’s the acquisition, the Following shares. company’s of the cent per 25 some acquired House, company, Investors investment However, in 2017, properties. property another residential in rental investing companies investment estate real listed for transparency tax provides which legislation, fund property Finnish the under it operated and Trust, Investment Estate Real Residential Orava called previously was company The €179 worth of 2018. at million end the portfolio aproperty had and properties in residential invests Kiinteistösijoitus Ovaro in Finland. only operated previously having in Sweden, office anew 2018, established company the In operators. service sector private and municipalities both include tenants company’s of 2018. end atmillion the The €350 of some portfolio aproperty had and properties sector public other and properties in care invests Hoivatilat Suomen 100 200 300 400 500 600

0 Photo: Skanska Helsinki Index and OM and Index X Helsinki 2000 OMX HelsinkiRealEstateIndex 2001

2002 OMX HelsinkiIndex 2003 2004 2005 2006 2007 2008 2009 Helsinki Real Estate Estate Real X Helsinki 2010 2011 2012 2013 Source: NasdaqOMX 2014 2015 2016 2017 2018 properties in the Helsinki metropolitan area. area. metropolitan Helsinki in the properties in office specializes which is Antilooppi, properties in commercial investing company largest The properties. in residential specialize both SATOwho Avara, and include companies property non-listed Finnish largest The companies property Non-listed in7% 2018. of some showed adecrease index price CAP Helsinki OMX The performance. overall exchange’s stock the than worse was performance companies’ 15%of some in 2018. Property showed adecrease index price Sector Estate Real OMX The management. and investment property to related services provides also company The area. metropolitan Helsinki the outside mainly properties commercial and in residential invests House Investors listed company. anormal as relisted and aREIT as delisted was company the Property assets under management, EUR billion EUR management, under assets Property Finland in investors property holdingsDirect of property 10 biggest Varma MutualPensionInsurance Elo MutualPensionInsurance OP Insuranceandpension Sponda Plc(PolarBidco)* Ilmarinen MutualPension companies andOPfunds LocalTapiola and Group eQ RealEstateFunds LocalTapiola’s funds SATO Corporation** Insurance Company **Q3/2018 *Q2/2018 Kojamo Plc Company Company Keva 0 ■ 20182017 Source: KTI(queryforinvestors),annualreports 1 2 3 4 EUR billion 5 6 with its foreign and local investment partners. partners. investment local and foreign its with divestments and acquisitions in several involved been has in 2016, then since and founded was company The investors. international mainly for partner jointventure and operator alocal as is onacting of which focus company, primary the management asset and investment is an Partners Capital Avant Advisers. Estate Real Barings by managed a fund –from in Lappeenranta one and in Rovaniemi –one centres shopping two acquiring by portfolio its increased company 2018, In the area. Helsinki the outside primarily cities in major properties office and retail centre oncity focuses company The Management. Trevian Asset and AP1 insurer pension Swedish Elo, the company insurance pension by company, owned joint venture is another Kiinteistöt Agore premises. in the tenant main is the Kesko Sweden. and in Finland properties 37 retail and centres shopping three comprises company the of portfolio property company. of the third The one owns company. the to Kesko portfolio property retail amajor sold Kesko in2015, retailer Finnish the established when also was Oy, which in Mercada owners also are AMF and Ilmarinen properties. existing of its redeveloper active an is Antilooppi million. €800 over to amounts value portfolio company’s The in Vantaa. property one sold also company in Vallila, The Helsinki. property office one 2018, it acquired in and acquisitions, several through grown has company in2015, the foundation its Since Pensionförsäkring. AMF Swedish the and Ilmarinen insurer pension Finnish the by is owned company The area. metropolitan Helsinki in the properties in office Ky invests Antilooppi projects. development new in some invested and NREP, by managed afund to dwellings 465 comprising In 2018, a portfolio sold Avara properties. residential state-subsidised manages and owns also Avara companies, residential sector private large other the Unlike services. management investment well as as joint ventures and co-investments funds, equity private through growth pursue also they strategy, current company’s the to According company. in the shareholder biggest the being Elo company insurance pension the with institutions, Finnish major are shareholders Avara’s cities. larger in the located mainly are €1.2 of some properties Avara’s billion. worth atotal with apartments rental 8,000 some manages and owns currently company, Oy, Avara investment residential other The in 2018. transactions major in any enter not did company The development. own through portfolio its grow to SATO continues shareholders. main other as Elo Finnish the and APG fund pension of SATO, Dutch the with shares of the majority the owns Balder Swedish The market. Russian in the investments new any from retain being, time the for it that will, announced has company The portfolio. total of the cent 3 per some represent currently they and Russia, Petersburg, in Saint investments some SATO has also in Finland. 17% and cities major in other area, metropolitan Helsinki in the is located portfolio of the 2018. 80% Some of quarter third of the end at billion the €3.8 of some value portfolio property total the with in Finland investors property SATO largest of the is one apartments. 26,000 some comprises portfolio property SATO’s residential specialised property investment companies. Renor owns owns Renor companies. investment property specialised domestic of other examples are Estate Real HYY and Renor company. in the shareholder amajor become and in Turku Properties Technology invest also will Hemsö ofdeal, this part As Fastighets. Hemsö €130 some Swedish the worth to million portfolio property 2019, of In early Turku a healthcare sold City the investors. of local a group with of Turku together City the include company of the shareholders The AB. Kielo Swedish the to centre city in the properties office two sold company the 2018, In Sciences. of Applied University the for premises new developing it is currently and in Kupittaa, properties sports and educational in some invested also has Properties Turku Technology area. in the properties of office majority the owns company The area. Kupittaa inthe located in Turku, mainly premises business manages and owns that company estate is areal Turku Properties Technology assets. existing of its redevelopment in the invested Onvest in 2018, and acquisitions in several portfolio its expanded Conficap inproperty. investing continue both will Oy Conficap and Oy in 2018. Onvest companies separate two into Oy, divided Onvest was corporation, Finnish traditional of a arm investment Another portfolios. investment property their expanding currently also are they but corporations, of the holdings the inredeveloping arole have They corporations. Finnish of traditional arms investment the of examples are Invest Lindström and Capital Ahlström these funds. Some funds have also attracted foreign capital. foreign attracted also have funds Some funds. these in invest also in particular, ones smaller the institutions, Some companies. management wealth and banks through distributed and investors, at private targeted mainly are funds of these markedly. Many increased have funds mutual semi-open-ended of the size and number the years, recent In institutions. domestic for structure is afavourable of view point taxation a from which partnerships, limited as structured typically are at institutions targeted funds property non-listed Finnish years. in recent increased also has services management of investment supply the preferences, and strategies of investor development the Together with groups. investor various to offered products of kinds of different spectrum awide covers currently funds of property supply The years. past the during significantly increased has funds property of non-listed supply The companies management investment and Real fund estate in 2020. commence to is planned properties existing of the demolition The in Helsinki. area Kallio the in properties residential and hotel, office develop will and of Helsinki, City bythe organised competition planning the won It also use. hotel into property the redevelop will and CBD Helsinki in the holdings current of their vicinity in the property hotel and office atraditional acquired Estate Real 2018, In CBD. HYY Helsinki inthe is concentrated portfolio property company’s The of Helsinki. University of the union student the by owned company investment is an Estate Real HYY Ilmarinen. with together it owns which Puuvilla, Porin centre is shopping asset largest company’s The uses. new into it develops which properties, old industrial mainly 37 3 The Finnish property investment market: volumes, structure and players 38 3 The Finnish property investment market: volumes, structure and players which is invested in hotel properties. CapMan also manages manages also CapMan properties. in hotel is invested which of of 2018, end at billion the €0.9 majority to the amounted holdings Finnish of CapMan’s value total The Fund. Income Property Nordic CapMan fund investment special one manages also CapMan areas. business of the is one investment property whom for company equity private of aFinnish part is inproperty, investing structures partnership limited Finnish three and Nordic one manages which Estate, Real CapMan properties. in residential invests fund investment special in late20182019. early and FIM’s investments first its made and properties in commercial invests fund Aktia’s transactions. smaller in three portfolio its expanded then and Capital, Horizon Northern from a€140 portfolio million acquired first I,which Healthcare Evli partnership, limited as structured afund established also Evli funds. in these investments first their made in2018 and structures fund investment special first their established Aktia and Evli Both FIM. and Aktia Evli, include companies management fund estate real bank-related Smaller year. previous the to compared billion of €0.5 increase an €1.8 to billion, showing amounted value portfolio property of 2018, end At the total their properties. commercial in invests other the and properties in care is specialised funds of the One funds. investment estate real special two manages Bank, of eQ asubsidiary Management, Fund eQ Tontit lots. Fennica in building and properties Toimitilat incommercial Fennica Iinvests funds: investment special two well as as partnerships, limited two manages Fennia portfolios. direct client’s group of that their exceed currently of funds values portfolio the companies, both For funds. property and clients internal their for managed portfolios direct the of 2018, both at end billion the including €2.4 to of that LocalTapiola billion, and €2.5 to amounted of OP management under assets property of Finnish value total The market. property Finnish in the directly investing funds investment special open-end and partnerships limited both manage all They clients. other to opportunities investment fund offer also but investments property direct groups’ their manage who institutions, Finnish traditional are OP, Fennia and managers, LocalTapiola fund largest the Of Investments. Standard Aberdeen and Ålandsbanken Estate, Real CapMan Management, Asset Company, Fennia Management Fund eQ Management, Asset Property LocalTapiola Management, Property OP Group’s OP are companies management fund largest the management, under assets property by Finnish Measured strategies. their affects significantly also which backgrounds, diverse have companies management fund property Finnish ”New fund managers enter managers fund ”New ”The supply of”The semi-open- ended mutual funds has has funds mutual ended increased markedly” increased the market” estate investment and asset management company, which management asset and investment estate is areal company, Management, sister Trevian Asset Their area. metropolitan Helsinki the outside mainly properties in commercial invests fund The I. Properties Trevian Finland structure, fund mutual special one manages currently company, which management is afund AIFM Trevian Funds Nordics. in the manages CapMan mandate (BVK), whose Versorgungskammer Bayerische to dwellings 1,700 over and 37 assets comprising III, Fund Housing of ICECAPITAL late2018, portfolio In the sold company the phases. lifecycle indifferent funds property residential several manages Management Asset Estate Real ICECAPITAL Titanium. and Management, Trevian Asset ICECAPITAL, instance for include, companies management property Finnish Specialised of 2018. end atmillion the €750 some to amounted management under assets property Finnish Investments’ Standard Aberdeen Intotal, clients. of its onbehalf strategies investment alternative executes Investments Standard Aberdeen addition, In dwellings. 800 of aportfolio acquiring by in Finland investment first its made Fund Property Residential Pan-European Standard 2018, In Aberdeen funds. property European its through in Finland invests also and fund property Finnish one manages currently which companies, investment largest world’s of the is one Investments Standard Aberdeen portfolios in Finland. in Finland. portfolios investors’ domestic and international some manages that company management asset and investment estate real is a Group, of Catella part Management, Asset Catella Evli. by managed afund it to selling by fund II Healthcare its exited company 2018, Inearly the properties. in care predominantly invest funds estate real Their in Berlin. well as as countries Baltic and in Nordic offices has company The mandates. separate and funds property both manages Horizon Northern class. asset alternative an as clients their for funds property offer also that companies investment and management wealth Finnish of examples other are Bankers United and Taaleri Auratum, list. North First Helsinki’s in Nasdaq is listed Titanium properties. in care other the and in residential, investing funds the of one inproperty, investing funds investment special two managing company management is a fund Titanium in Stockholm. North First onNasdaq is listed Cibus transaction. million in a€767 AB Estate Real Nordic Cibus a newly-established to funds property grocery two of their portfolios the sold 2018, early In Sirius basis. onadeal-by-deal investments co- makes and funds property manages that company management investment and is afund Partners Capital Sirius structures. in jointventure manager or partner investment as acts and clients its for investments estate real structures also company The years. in recent structures partnership limited several exited and founded has portfolio of more than 1,700 apartments in late2018. apartments 1,700 than of more portfolio a buying by portfolio Finnish its increased which mandate, investment property residential Nordic BVK’s German the shopping centre Ratina in Tampere. Ratina centre shopping sqm 53,000 the in Tampere. and opened In 2018, Sponda area metropolitan Helsinki in the areas prime in the mainly cities, Finnish largest in the properties centre shopping and office owns company The billion. €4 almost to amounted value portfolio 2018, property of June end the Sponda’s At Sponda. company property listed formerly the owns 2017, who, since Areim, and Blackstone by owned Bidco, is Polar inFinland investor property foreign largest The year. previous the to compared 20% than of more agrowth billion, representing €22.3 some to amounted investors of foreign holdings year, total the in 2018. of the end At the markedly increase to continued market property Finnish in the role investors’ International partners. operating local their with structures co-investment through market Finnish the entered have investors of foreign amount increasing an of years, couple past In the managers. asset local /or and offices Nordic their through operate others while in Finland, offices own their established have of them Many practices. management and strategies varying with of players group adiversified form investors Foreign International investors cities. Finnish largest in the properties in commercial invests fund Tradeka. The and Pension Fund of State Varma, the is a joint venture VVT properties. hotel and retail office, comprising million €500 of some a portfolio manages and owns company the and investors, institutional Finnish of four is ajointventure Exilion VVT. and Exilion include of arrangements kinds of these Examples purposes. specific for fund a property establish to forces join investors of number alimited where arrangements jointventure like or club-deal- as considered be can funds Finnish of the Many Photo: SATO property investment market” investment property ”Foreign investors”Foreign represent 32 cent per of the total portfolio value has increased to almost €900 million. million. €900 almost to increased has value portfolio whose is NREP, portfolio Finnish its increasing actively investor Nordic Another million. €700 than more worth portfolio aFinnish has in 2018, currently and transactions significant several entered and grow to continued company The properties. sector public other and properties in care specializes who is Hemsö, in Finland investor originated Swedish- significant Another million. €800 than more worth portfolio property retail aFinnish holds currently AB Estate Real Nordic Cibus in Finland. active be to continue investors Swedish other many Sagax, to In addition market. Finnish the entered Japan and Korea South from 2017 In investors 2018, inFinland. and limited first the rather is currently capital of Asian amount the Logicor, from Aside Corporation. Investment China by owned currently is company The in Finland. located –are properties 77 – of these majority The Nordics. in1.3 the sqm million comprising properties 86 owns company The Finland. in player foreign significant is another platform, property warehouse and logistics of aEuropean is part which Logicor, assets. in single and portfolios small in 2018, in both investments new ten than more made and properties logistics and in industrial mainly invests company €1 in 2018. billion exceeded The investments total whose and years, in recent in Finland portfolio its increased steadily has who Sagax, held Swedish by the is currently place Porperties and one in Lahti from Royal House. House. Royal from in Lahti one and Porperties Turku Technology from two Niam, from properties office three in 20182017, buying by portfolio its expanded also in established AB, Kielo Brunswick’s transactions. separate in three area metropolitan Helsinki in the properties office eight disposed also Niam million. of €54 worth combined a with centres retail two in 2018 acquiring by portfolio its expanded who is Niam, investor active Swedish-originated Another million. €600 than more worth portfolio Finnish a has currently in Finland, portfolios property retail two manages who Redito, Swedish-originated the Also, In the list of largest foreign investors in Finland, the second second the in Finland, investors foreign of largest list the In 39 3 The Finnish property investment market: volumes, structure and players 40 3 The Finnish property investment market: volumes, structure and players exceptionally large single-asset transactions in 2018. Early in 2018. Early transactions single-asset large exceptionally through portfolios their increase to continued Deka and Investment Union in Pasila. construction under properties Tripla two the office Workery YIT from acquiring by market Finnish the to returned who Real, Commerz by out carried was transaction 2018, In market. largest Finnish in the the role important play an to continue investors German Many in Finland. dwellings 11,000 residential than more own already investors foreign Altogether, sector. property residential rental Finnish in the further invest to continued (BVK) Versorgungskammer Bayerische and NREP Assets, –Real Managers Investment AXA in Finland, active already investors the Of inFinland. investment first its made Fund Property Residential Pan-European Investments’ Standard Aberdeen Capital, Hill Round and Investing Estate Real Stanley Morgan to in 2018. Inaddition investors foreign attract to continued properties residential Finnish dwellings. residential 3,200 than of more a portfolio by buying market Finnish the entered Capital Hill Round UK The in Helsinki. property office developed in anewly invested Managers, Asset Life Swiss 2019. in early one Also athird and in Helsinki, properties office two acquired funds whose Assets, Real BlackRock in 2018 instance, for include, newcomers significant Other Wereldhave €516 for million. from Itis centre shopping the acquired Investing Estate Real Stanley Morgan by advised in 2018, fund Late another dwellings. 1,600 comprising portfolio residential million €100 almost an acquiring by Nordics in the investment first their made funds whose Investing, Estate Real Stanley is Morgan players new of these largest The market. Finnish the entered investors foreign new In 2018, several Trevian. and AP1 Elo, between is ajointventure Kiinteistöt Agore whereas Mercada, and in Antilooppi investor is an Fastigheter AMF funds: pension Finnish with structures jointventure into entered also have investors institutional Swedish Several Serena. company property SATO, retail inthe well as as company residential in the shareholder is amajority Balder companies. in several ownership share significant through market Finnish the to channeled is also capital Swedish Helsinki. in Tampere and properties care acquired who AB, Norden i SBB and inHelsinki, property office alarge purchased who Castellum, company property 2018 listed the included in in Finland investors Swedish new Cibus, to addition In Hemfosa. and Properties Alma AREIM, Genesta, instance, for include, in Finland investors Swedish-originated Other ”Swedish investors continue continue investors ”Swedish ”German investors entered”German to active be in Finland” transactions in 2018” in transactions several large office AXA InvestmentManagers-RealAssets of companies. kinds of these examples are Trevian and Partners Capital Avant years. inrecent increased also have services management investment offering companies and players foreign with co-investors as acting companies market, Finnish the into capital international channel to serve that companies these with Along €165 for Helsinki million. of City the – from construction under – also in Kalasatama House Environment Urban the bought Investment Union autumn, in the and Ilmarinen, from CBD Helsinki the in property a€190 office million in 2018, bought Deka * Q2/2018**KTIestimate investors inFinland foreign Biggest third company, University Properties of Finland Ltd, has has Ltd, of Finland Properties company,third University The tenants. other by used be also will of premises amount increasing an where in Otaniemi, area campus in its project development amajor out carried recently has Properties University Aalto themselves. universities the by owned are companies these and Properties), University Aalto and Properties University (Helsinki area metropolitan Helsinki in the buildings university manage and own Two companies of the buildings. university manage and own is to purpose sole whose companies, limited three by owned are properties university of Finnish majority The term. long in the agencies state by needed not are that of properties dispose and/or develop is to purpose sole whose unit abusiness has Properties Senate Properties. Senate by sold be to of space amounts significant free thus would which efficiency, in space increase ambitious at an aim that will strategy workplace anew pursue to started has state The of Finance. Ministry of the control the under operates Properties Senate Army. Finnish the by used properties as well as buildings cultural and prisons ministries, and agencies state by used of offices consist holdings Senate’s sqm. 6.1 some million billion, comprising €4.3 of some portfolio a property had of 2018, end At the Properties Senate investors. property sector private and agencies state between agreements in lease intermediator an as acts also and holdings, property state’s the lets and manages develops, Properties Senate agencies. state the among of working ways new promotes and environments working provides who Properties, Senate called enterprise onagovernment-owned holdings property of its most concentrated has state Finnish The market. property Finnish in the players important are entities sector Public Public sector Aberdeen Standard Investments Standard Aberdeen Cibus Nordic RealEstateAB Cibus Nordic Deka ImmobilienGmbH** Sponda Plc(PolarBidco)* Hemsö FastighetsAB Nordisk Renting** Nordisk Source: KTI(queryforinvestors,pressreleases,annualreports) Logicor** AB Sagax NREP 0.0 0.5 1.0 1.5 2.0 2.5 3.0 EUR billion 3.5 4.0 Maakuntien Tilakeskus Oy (the Counties’ Service Centre Centre Service (the Oy Counties’ Tilakeskus Maakuntien issues. ownership on property impact asignificant have will services healthcare and in social reform planned The companies. property sector private the from bought be might they or companies, limited city-owned or units by municipal provided be can Services structure. company limited normal a as or structure enterprise public aspecific as organized or directly city the by owned be can Properties services. management and ownership of property organization inthe of structures kinds different apply Municipalities Helsinki. of City the by Investment Union to House Environment Urban of the sale is the of arrangement kind of this example recent most The investors. sector private with agreements rental long-term enter also cities cases, some In ownership. and usage in space practices new towards municipalities the drive also aservice” as “school like concepts New Hemsö. Swedish the to million €130 some worth portfolio property hospital and care health existing an sold of Turku also City The municipalities. to services their sell who providers service sector private to premises the rent they and investors, private by developed have been care elderly for needed properties of new proportion abig instance, For ownership. property impacts also which provision, service in their strategies varying more apply to started have municipalities years, In recent provision. service municipal for used properties are rest the and properties €13 some these, residential Of larger. are billion much be to estimated was value technical current their €32 billion, and some to amounted municipalities Finnish of the holdings property of the value book current study, the In a recent at low-income households. targeted mainly therefore and state by subsidized are of which majority the properties, of residential amount asignificant own also municipalities the subsidiaries, their Through buildings. cultural well as as centres healthcare and nurseries schools, offices, as such provision, service and administration public for required of properties majority the own typically municipalities Finnish campuses. onits organisations education other and corporations private to increasingly premises offers also of Finland Properties University company. in this shareholder aminority is also state Finnish The Finland. throughout 12 and cities 9universities across spread ownership its with base, shareholder a broader varying strategies in property strategies in property varying investment and management” and investment ”Finnish municipalities apply ”The reform in healthcare”The major impact on property service provisionservice has a management” than 80%, is still owned by Finnish industrial corporations. industrial Finnish by owned is still 80%, than more stock, total of the majority vast the sector, industrial inthe Only investors. professional by owned often very also are properties retail Large investors. by owned currently is stock property office Finnish of the 80% than More inparticular. markets inoffice common less is becoming Owner-occupation years. past the during markedly changed has markets property in the occupiers of property role The Corporations dwellings. state-subsidised 50,000 almost owns which Heka, company property residential its through in Finland landlord single largest is the instance, for of Helsinki, €13 some to City The billion. amounts which of value estimated the stock, state-subsidised own mainly companies These companies. separate through portfolios property residential significant own also municipalities Most Tilakeskus. Maakuntien by managed and counties the by rented be will municipalities individual by owned those whereas of municipalities, federations by owned currently properties the own will company The billion. €3.4 worth portfolio aproperty have will and agreements, rental 18,000 and of premises sqm million 10.5 some manage will company the at that stage, that in 2021. It is estimated counties the to transferred be to state, the by established is a company Management) Estate Real and Facilities for been active in selling its properties to investors in recent years. years. inrecent investors to properties its inselling active been has inparticular HOK-Elanto SGroup, within operatives co- the Of years. in recent project development significant most group’s is the in Sipoo centre logistics sqm 200,000 nearly SGroup’s strategies. different apply also increasingly they although properties, hotel and centre shopping of retail, owners major are co-operatives its and S Group Varma. by developed being currently is which in Kalasatama, property office anew move to to is going and use, hotel and residential to redeveloped be will which headquarters, former its divested also Kesko investment. and development property retail in the player amajor remains it still but deals, sale-and-leaseback major through holdings its decreased has Kesko years, recent In market. property in the players active been traditionally have chains, retail Finnish major two Kesko, the and S Group long leases. relatively through buildings in these tenants as remained companies the cases, of these in many and, holdings property existing their sold also have corporations Finnish major several of years, couple past the During developers. or investors professional by developed −are in particular properties – office properties new of the Most strategies. management and ownership property evolving corporations’ of execution the enabled has market finance and investment property of the development and broadening The property stock is ownedproperty by ”An increasing amount of the Finnish commercial professional investors” professional 41 3 The Finnish property investment market: volumes, structure and players 42 3 The Finnish property investment market: volumes, structure and players corporations. and investors property international and domestic both for services valuation and advisory management, estate of real spectrum awide offers Newsec sector. management property and asset inthe player major is another group, Stronghold- Swedish-originated of the part Newsec, firms. management domestic of smaller acquisitions several through expanded has Management Realia years, recent In services. advisory well as as valuation management, property commercial for services management offers also and portfolios, residential investors’ major some manages Group, of the company affiliate another Management, Altor. Realia firm equity private Nordic by the owned is currently group The markets. management and brokerage property residential in the player amajor companies, daughter its is, through Group Realia Finland. International Colliers and Newsec Management, Realia are investors foreign and institutional large the servicing companies largest The companies. Nordic and domestic by dominated is market services management property and asset The services management property and Asset 3.3 Real sector estate service premises. new move to companies when reduced is typically usage space and efficiency, space emphasise also companies Most premises. their rent typically and strategies, workplace sophisticated increasingly pursuing are space office using Companies premises. office other and headquarters their renting are they even cases inmost currently but properties, production their own typically still companies Industrial in Järvenpää. centre logistics newly-developed its extending is currently Lidl centres. city and centres in shopping located of stores exception the with in Finland, properties its owns typically Lidl chain retail German The Photo: Stailia / Kojamo they currently also manage several property funds. property several manage also currently they but portfolios, property shareholders’ of the management property and of asset care take to founded originally were companies The investors. institutional domestic by founded companies of management examples are Management Property OP and Management Asset Property LocalTapiola services. management centre shopping well as as corporations, to services management facility and property offers also CBRE in Finland. investors for services management property and asset offers also CBRE firms, service estate real global the Of services. development property retail its for well known is also and in Finland, providers service management centre shopping leading of the is one Oy Realprojekti company affiliate Finland’s International Colliers corporations. well as as investors international and Finnish major include clients management property and asset property commercial company’s The properties. centre shopping and residential commercial, for development and management property for services offers Finland International Colliers property valuation and transaction advisory service markets. markets. service advisory transaction and valuation property Finnish in the player major is another Catella services. transaction and advisory valuation, offer also Management Realia and Newsec companies, management major the Of companies. global big and firms entrepreneurial domestic of small amixture includes market service advisory The services valuation and transaction Advisory, SOL. and &Tikanoja Lassila ISS, include services management offer currently also who maintenance) and catering cleaning, (such as provision service traditional in backgrounds with companies service largest The chain. service whole the offer to expanded that have companies service traditional and companies management specialist both by offered are occupiers to services management Facilities management. services onproperty solely concentrating of acompany example is another Management Service Coor market. service management technical and property in the player is asignificant Oyj Caverion properties. residential and commercial both for services management project and development property offers also company The portfolio. of the manager local is the Premico apartments. rental 1,600 of anearly acquisition the for RIM Swedish the and Investing Estate Real Stanley Morgan with ajointventure in 2018, established but company the funds, property domestic mainly with active been previously has company The is Premico. management property in residential company, specialized mainly management domestic Another companies. management asset and property domestic established of smaller, recently Team examples are Property Avanto and Management Niemco investors. domestic for working mainly company service management property Finnish of atraditional example is an Management Asset Juhola by both local and international ”Management services offered ”Management offered services players” either senior or mezzanine debt for property investments. investments. property for debt mezzanine or senior either provide which funds, is debt capital of debt source Another of finance. sources other or banks to compared competitive not are requirements yield their low, rather as remained has institutions by provided of debt however, volume the circumstances, market current In deals. in financing banks with in co-operation act or clients their to directly debt property provide either can funds insurance life Pension and investments. property for financing debt provide also funds, life instance for investors, Institutional clients. international major their with together Finland to come typically They in Finland. transactions major some have financed Stanley Morgan and America of Bank Lynch, Merrill as such banks, international Large market. Finnish in the active most the currently is Hessen-Thüringen) (Landesbank Helaba German the banks, finance property specialised international the Of Group. OP and Bank Danske Bank, Nordea SEB, including banks, Nordic and local major the by provided is financing estate of real part major The well available. is typically finance property conditions, market current In financing Property well. as in Finland services specific estate real offer PwC, and EY KPMG, as such firms, consultancy business Global inFinland. unit estate a real has also Finance Corporate Enskilda SEB Nordanö. and Aventum Finance, Corporate Advium including companies, Nordic and domestic some by offered are services finance corporate firms, services transaction actual the to In addition investors. international and Finnish both with working companies of domestic examples are Ecorum and Oy mrec Partners, Property Finnish sector, services transactions the In firm. advisory and valuation property of aFinnish example newer is a Property GEM investors. major some Peltola serves &Co Kiinteistötaito firms, valuation traditional local the Of players. domestic mainly servicing firms service valuation and transactions local of smaller acouple also are There in Finland. transactions major in many advisor as acts also Leimdörfer, formerly Nordanö, Swedish-originated The years. in recent rapidly in Finland operations its increased has CBRE Also agreement. apartnership through Finland in &Wakefield is represented Cushman services. brokerage and consultancy leasing valuation, in transactions, players major of the is one JLL inFinland. well represented currently are firms service property international Major providers of debt financing” advisory service sector has service advisory expanded in recent years” in recent expanded ”Nordic banks are major banks”Nordic are ”Property transaction ”Property is the first green bond in the Finnish property sector. sector. property Finnish in the bond green first is the in late2018 of Finland Properties University the by issued €100 bond million The of Finland. Properties University and Regenero company development the Mercada, investor centre shopping include of companies kind these of Examples instruments. financing of different use the balance to in order bonds issued have companies property mid-sized some also players, largest the to addition In recently. issued been have bonds unsecured and secured Both financing. of bond terms and availability the improve to in order ratings credit SATO acquired and also have Citycon of bonds. issuer SATO active is an company also Residential sheets. balance their finance to bonds use Kojamo and Citycon companies Listed sheets. balance their financing for bonds corporate use currently companies property Finnish biggest the of many equity, to access good relatively to Inaddition finance. of sources several to access have investors property biggest The Finland. in insignificant is, however, volume currently sector’s This currently stands as the largest Finnish and significant North North significant and Finnish largest the as stands currently 2018, in early YIT Lemminkäinen with merger its After investors. international and domestic both with cooperated have and years in recent field in this active been have all companies SRV, Peab. NCC, These and Skanska, Hartela YIT, include development property in commercial involved companies construction Nordic and Finnish largest The them. redevelop to in order properties buy who companies specialized by or owners, their by handled is mostly properties of existing Redevelopment development. in new players active most the are units These development. property incommercial specialises that arm have a separate typically companies construction Finnish The development Property obligations. its fulfill to able is not borrower original the if properties of the management the over take to able be typically would investors These return. ahigher for inreturn risk higher accept to able sometimes also are investors institutional and investors equity private Some Bank. is Collector of player kind of this example One risk. more accept to willing are that institutions financing or banks smaller some for opportunities new up opened has This transactions. complicated more or riskier for financing get to difficult more it is sometimes Therefore, clients. known with low-risk investments large, rather in financing interested typically are banks Major of Tripla Mall the for project. financing provided also banks, commercial some and NIB with together has, EIB buildings. energy zero nearly of new development the for Bank Investment European the from financing received have SATO both Kojamo example, and For financing. institutions’ special to access have also investors property Some companies of active are users ”Large property investment property ”Large bond financing” bond

43 3 The Finnish property investment market: volumes, structure and players 44 3 The Finnish property investment market: volumes, structure and players residential, sports and culture arena project in 2019. project arena culture and sports residential, Arena and Tampere the Deck start to planning SRV is also in 2018. Tallberg-Kiinteistöt Julius to sold was phase first of SRV, project is another the and in Vantaankoski project Premises Smart Pressi user. main the be will and investor is an Supercell company game mobile where inJätkäsaari, project Woodcity the developing is also company The area. in the buildings residential high-rise develop to 2018, continues and in in Kalasatama centre shopping REDI the SRV completed underway. currently are phases third and second the in 2018, Life Swiss to sold and and completed was phase first The Development. Property NCC by developed currently project in Vallila park largest is the business Fredriksberg The Skanska. by 2018, owned is still in late completed phase, second The Niam. to project office Aviabulevardi of the phase first the sold also 2018. Skanska in Properties Senate to sold was project K6 The in Helsinki. area in Telakkaranta ECHA Agency Chemicals European to leased building office an and inSörnäinen property office K6 include projects ongoing major CDF’s Skanska it develops. buildings in the investor an as remain also can which Nordic, Development Property Commercial Skanska through Nordics inthe operations development its organised has Skanska in Pasila. Tripla is the unit project in this underway project largest The properties. developed and of plots realisation subsequent and ownership the and projects development major financing for is responsible unit Properties Partnerships the and management, project and construction property commercial for is responsible segment Premises Business Its properties. commercial and residential both builds and develops YIT InFinland, in 11 countries. operations has company company. The construction European Bonds issued investors by the Finnish property Citycon Regenero Kojamo) (now VVO Citycon Mercada Citycon Finland of Properties University Kojamo Kojamo SATO Citycon SATO Citycon Citycon ISSUED BY ISSUED have specialized property ”Construction companies companies ”Construction development units” development ISSUE DATE ISSUE 24.10.2017 17.10.2016 22.8.2018 31.5.2018 2.11.2018 16.9.2015 24.3.2016 10.9.2015 22.9.2017 19.6.2017 1.9.2015 1.9.2015 8.9.2016 7.3.2018 MATURITY DATE MATURITY 24.10.2022 17.10.2023 2.11.2023 16.9.2022 15.1.2027 31.5.2021 24.3.2021 22.9.2025 10.9.2020 19.6.2024 1.3.2021 8.9.2026 1.9.2025 7.3.2025 YEARS over 8 over 5.5 10 10 3 7 5 5 8 5 5 7 7 7 EUR MILLION 1.25 bn NOK bn 1.25 and typically buy and hold a significant amount of plots. In In of plots. amount hold asignificant and buy typically and properties residential develop also companies of these Most of 2019. quarter first in the completion for is due which in Pitäjänmäki, Garden Business Ultimes of its phase second the develops Peab Invest Herttoniemi. in Hertsi centre commercial local sqm 25,000 the jointly develop YIT 2019. and in early Hartela completion for use in the Helsinki metropolitan area Helsinki metropolitan the in use stock reduction through change ofOffice sector, development property residential the In properties. residential of rental supply increasing an and uncertainty increased to due down slowing be now to however, seems activity, This funds. property often most investors, to sell they which projects, development in housing active been also have companies construction in particular, of years couple past the 2018, and Ramboll’s new head office in Leppävaara is due is due in Leppävaara office head new 2018, Ramboll’s and in in Pasila project Asema Ilmalan the completed Hartela 1.4 bn NOK bn 1.4 1.0 bn NOK bn 1.0 100,000 120,000 sqm 20,000 40,000 60,000 80,000 300 300 300 500 300 500 200 350 100 100 175 0 office use; ie. when the new plan is confirmed / conversion project hasbeenstarted /conversion project use;ie.whenthenewplanisconfirmed office for notoffered tothepointoftimewhentheyare allocatedbetweenyearsaccording are ** Projects information. area gross hasbeenestimatedbasedon area hasn’tbeenavailable,rentable area onrentable * Ifinformation 2006

2007 ■ ResidentialHotelOther 3 m NIBOR + 1.55 % +1.55 3 mNIBOR 2008 ANNUAL INTEREST

2009 1.625 % 1.625 1.625 % 1.625 1.875 % 2.375 % 2.375 2.375 % 2.375 2.375 % 2.375 1.80 % 1.50 % 1.50 3.90 % 3.90 1.25 % 1.25 4.00 % 4.00 2.25 % 2.25 2.75 % 2.75 2010

2011

2012

Source: KTI,RPTDocu Oy 2013

2014 Source: Press releases Press Source:

2015 INFORMATION Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Unsecured Secured Secured Secured Secured 2016 OTHER

2017

2018 markets. One example is Renor, which concentrates on is Renor, concentrates which example One markets. niche in their development in property active funds and companies property non-listed smaller some also are There developers. property active also are SATO and Kojamo in particular, companies, residential Large Oulu. Vantaa and in Espoo, buildings new with campuses its in Tampere,expanding it is also and projects development office ongoing some Technopolis has also vicinity. in the property retail and office an developing inTampere in2018, is currently and project centre shopping Ratina the completed Sponda strategies. in their included countries in well other as as in Finland both areas core own in their development in property players active are Technopolis and Citycon Sponda, portfolios. own in their assets develop actively also companies investment Property development. residential in financing debt use to allowed temporarily are funds pension and regulators, by encouraged been also has development Residential portfolio. in their plots appropriate have they where in cases especially development, property commercial than risky less is considered which development, residential in strategies active more pursue typically Institutions in Tampere. Marriott for property a hotel is developing Keva of Espoo. City the to rented a school into in Espoo building office an converting and airport, of the vicinity in the property hotel Flamingo its to extension amajor out carrying is Varma also tenants. other by rented be to available also of premises plenty with Kesko, but to rented be will building sqm 35,000 of the majority The by Varma in Kalasatama. developed being project is, however, office amajor there moment At the solutions. new for look to investors is pressuring which area, metropolitan Helsinki in the premises of office oversupply the to due conditions market in current is emphasised This properties. vacant for uses new for look instance, for can, they where portfolios, in their assets of existing redevelopment the emphasise strategies development Institutions’ projects. in development occupiers with directly together work also may Institutions developer. main the with risk development the share company, thus they and developing in the shareholders as investors institutional are there example, for project, multipurpose Arena and Deck Tampereen in the well as as Tripla centres shopping and REDI the both In pre-let. are premises of the majority the when aproject enter only typically institutions companies, construction by led in projects instance, For development. property commercial concerning strategies conservative quite have traditionally investors Institutional use. own its for properties develop to continues also Lidl country. of the parts various in underway projects renovation and development property hotel and retail haveseveral also co-operatives local its and SGroup phase. sqm 19,000 another by extended being is currently and phases inseveral developed been has which in Sipoo, centre logistics Freeway sqm 193,000 is the project development largest S Group’s developers. property professional and significant –are in particular Kesko, and SGroup retailers –large owner-occupiers Some buyers. home for apartments develop mostly who players, local smaller typically numerous, also are there property development and investment. Also Exilion’s fund fund Exilion’s Also investment. and development property in active also that are arms investment corporations’ Finnish of traditional examples are Capital Ahlström and Invest Lindström use. residential into often properties, existing redevelops that fund of aproperty example is an Auratum in late2018. fund eQ’s to sold was and of Espoo City the to is rented building The district. Otaniemi in the use office and educational into building office of an redevelopment the is of Regenero project Another Accountor. firm accounting to rented been has building of the majority plot. The the on right building unused the exploit also and use, in office remain will which property, landmark this redevelop will Regenero Espoo. in Keilaniemi, property office head former is Fortum’s far so project largest Regenero’s locations. good in projects property large redevelop and invest is to which Oy, of aim the Regenero company development property YIT, a company construction with together founded, also has HGR use. other some for redeveloped be to buildings in existing investing mainly development, estate on real focusing company investment estate real is another Partners Property HGR premises. of old industrial redevelopment development risk. development risk. the carry to willing more developers or investors to sold however, are, projects these Sometimes developer. the as acts typically owner former the projects, these In use. educational other, some into example for converted also are buildings office cases, some In use. hotel into converted being are and been have offices many in Helsinki, locations central most the In use. residential into converted be will premises office old of the majority The market. the from removed was space of office sqm in 2018, and 100,000 than significantly, more increased have volumes however, conversion the years, recent In processes. planning by slowed down been often have, however, projects These years. in recent projects redevelopment and of conversion lots generated has area metropolitan Helsinki in the of offices oversupply An use. ithotel into redevelop will and CBD Helsinki in property office an acquired Advisers Estate Real Barings use. hotel and residential for redeveloped be will which of Kesko, office head former in the invested NREP and Assets Real Managers, Investment AXA example, For use. anew into redeveloped be to planned are that in properties invested have investors international some years, recent In use. hotel into station railway main Helsinki at the premises old of the office conversion the started just company The projects. redevelopment in some invested has redevelopment projects in the converted into residential or Helsinki metropolitan area” metropolitan Helsinki ”Old being are offices ”Plenty of”Plenty office hotel use” 45 3 The Finnish property investment market: volumes, structure and players 46 4 Property sectors: market structure, practices and investment performance Helsinki, Espoo and Vantaa. The office stock in Tampere stock office The Vantaa. and Espoo Helsinki, in is located sqm, million 8.8 some cent, per 44 stock, total of the and market, Finnish the within position a dominating has area metropolitan Helsinki The metres. square million 19.8 is some in Finland space of office stock total The Stock market 4.1 office The regions. and sectors property between differences significant again, were, of 5.3%. There income of 1.3% anet and growth in 2017), of acapital consisting in2018 at 6.6% (6.6% stable remained market property Finnish onthe return total the Index, KTI the to According at 4%. only remains still stock property invested total of the share their but years, in recent rapidly increased has properties of care stock invested The market. 5% total of the some of 2018, end at the and represented they years, recent in market investment in the attractiveness their increased also have properties Hotel market. total of the respectively, cent, 23 per of and 28 shares with sectors, largest the are properties retail and offices properties, commercial the Of market. investment property total the of cent 29 per represented properties year,the residential of end at the and, values, in asset growth and development new both through increase to continued market property In 2018, residential market. invested the property Finnish in the sector largest the currently are properties Residential market. investment in the classes asset property recognised as attractiveness their increased also have properties, educational and healthcare instance for properties, use public of years, couple Within past the capital. of investment supply increasing an and dwellings residential rental for demand strong to due strengthened has inparticular properties of residential position the time, same At the decreased. has of offices share the sectors, in other base investor of the expansion and of offices performance investment weak to due years, recent In investors. by favoured most one the and market investment in the sector largest the clearly were properties office ago, A decade years. in recent markedly changed has market investment property Finnish the structure, sector of property terms In investment performance practices and market structure, sectors: 4 Property as theas largest sector in the strengthen their position position their strengthen ”Residential properties properties ”Residential investment market” investment 228,000 sqm was under construction, of which the vast vast the of which construction, under was sqm 228,000 However, year, of the atend the some area. metropolitan Helsinki in the completed were of space, sqm 38,000 some totalling projects, development office 2018,In four only started. were space of office sqm 100,000 than of more In2018, conversions years. in recent speed accelerating with sqm, 57,000 some been has conversions through reduction stock of office volume average annual the period, same the During area. metropolitan Helsinki in the annually completed been has space office new of sqm 76,000 some decade, past the within and, area, New development is also concentrated in the metropolitan metropolitan in the concentrated is also development New million sqm. 1.1 some to that of Turku 0.8 and to sqm, million amounts sqm Distribution stock by location, of office Total 69.5 EUR size bn investment market by sector structureThe of Finnish property 37% 19% 29%

Other Residential Of ce 5% 4% 8% 44%

Retail 1 The Finnish economy 3% Hotel ■ RestofFinland ■ Othermajorcities area ■ Helsinkimetropolitan Industrial 23% Care 28% 7% Source: StatisticsFinland Source: KTI 9% 11% significant investments in Finnish office properties. properties. office in Finnish investments significant have also Investment, Union and Immobilien Deka Niam, instance for investors, Foreign Technopolis Antilooppi. and Sponda, as such companies investment specialised well as as Keva, and Varma, Ilmarinen as such institutions Finnish large include sector office in the investors biggest The area. metropolitan Helsinki in the mainly connections, traffic good near located properties is business-park-type category office third The area. metropolitan Helsinki inthe areas other in some and CBD Helsinki in the both found be can These headquarters. company as typically used buildings is single-tenant category second The areas. office recognised and centres in city located typically buildings, office tenant is multi- stock office of investable proportion largest The sectors. of other growth the to due years in recent rapidly decreased has share their although portfolios, property institutional in Finnish role played a significant havetraditionally Offices Players Tamperein the region. is located of which half about construction, under was sqm however, 60,000 in some 2018.completed year-end, At the was space office of new sqm 13,000 some only regions, Lahti and Kuopio Jyväskylä, Tampere,in the Turku, Oulu, area, metropolitan Helsinki the outside cities main the In areas. Kalasatama and Pasila in the located are in Helsinki projects ongoing largest The is in Helsinki. sqm, majority, 180,000 ”Offices accounted”Offices for 39 per cent of the total transaction 2009-2018 in area Helsinki metropolitan the in offices of Completions volume in 2018” 100,000 150,000 200,000 250,000 sqm 50,000 0 estimated basedongrossareainformation. onrentableareahasn’tIf information beenavailable, rentableareahasbeen 09 00 21 02 21 04 05 21 07 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 ■ RevelopmentNew activity was concentrated in the Helsinki metropolitan area. area. metropolitan Helsinki in the concentrated was activity transactions of the majority vast The volume. total of the cent of per 39 ashare with year consequent asecond for market transactions in the sector largest the were 2018,In offices Swedish Kielo AB, which entered in several transactions transactions in several entered which AB, Kielo Swedish the in 2018 instance for markets include, office Finnish the in investments their increased who investors foreign Other in Töölönlahti €116 for property million. office an acquired Fund Property European M&G in December, and in Kalasatama, construction is under which Helsinki, of City of the House €165 Environment Urban in the invested Investment Union autumn, Inthe Sponda. from million €200 for space, office includes also premises, court to in addition which, House, Court Helsinki the acquired Hemsö €190 InDecember, million. of almost aprice for Immobilien Deka to CBD in Töölönlahti Helsinki in the property office an sold year, in the Ilmarinen when early published was transaction office asset single ever largest The investors. in 2018, by foreign out mostly carried were transactions office asset single large exceptionally Several Sachs. Goldman and Cromwell between ajoint venture by well as as REIT Cromwell’s by out carried acquisitions instance, for €100 included, million exceeding transactions portfolio property office Other YIT. by in Pasila developed being offices Workery Tripla the acquired Real Commerz when in December, out in 2018 carried was transaction office largest second The million. €950 to amounted portfolio property office Finnish sqm of Technopolis’s value 430,000 the transaction, of the S.à.r.l. time At the Acquisitions Nordic Kildare by shares of Technopolis acquisition the was transaction largest The single asset transactions office ”Several exceptionally”Several large Source: KTI,RPTDocuOy took place in 2018” 47 4 Property sectors: market structure, practices and investment performance 48 4 Property sectors: market structure, practices and investment performance Rental practices Rental Castellum. and Management Asset Life Swiss Assets, Real BlackRock instance, for included, in 2018 market investment office Finnish in the Newcomers Varma. and Partners Capital Avant Partners, Capital Tristan between venture ajoint from properties office of eight portfolio a acquired who year, the AREIM, well as as throughout also typically applied in sale-and-leaseback deals. in sale-and-leaseback applied typically also are of agreements kinds These applied. commonly are rents net agreements, these In years. twenty and ten – between long quite usually are terms the buildings, single-tenant In units. office in applied larger commonly are terms lease Fixed period. notice agreed the with term indefinite an for continues contract the which after years, five or of three period fixed ona agree to common It is also landlord. and tenant the both for applies period same the and months, twelve or six three, are periods Typical notice buildings. office tenant inmulti- applied commonly are terms lease Indefinite building. of the characteristics and location the on month, depending per metre square per €5.50 and €4.50 between vary properties office for costs Typical operating tenants. to separately charged be also can costs Operating costs. operational include which rents, gross often most are rents buildings, office multi-tenant In sub-categories. office different between significantly differ agreements of rental terms The varied. are market office in the practices Rental Photo: SATO investment market attracted new investors in 2018” ”The Finnish”The office instance, start-up companies in the technology sector. sector. technology inthe companies start-up instance, to, for offered concepts targeted some also are There in Helsinki. location first their opened just has Epicenter Swedish the and market, in the represented are Spaces and Regus brands IWG’s players, international the Of Antilooppi. Varma and Teknologiakiinteistöt, Turun Technopolis, by, Sponda, instance, offered for currently are concepts of space kinds These contracts. flexible very with use temporary and short-term for services business acquire and space rent can occupiers where concepts, space flexible or of co-working kinds new through need this to responded have owners supply. Property space office flexible more for need the up brought has demands flexibility occupiers’ in office increase the years, recent In Index. of Living Cost the to linked typically are rents Office charge. service separate a plus rent of afixed consist typically rents park Business facilities. meeting and services postal catering, cleaning, security, reception, supply, as such service extensive an and agreements flexible offering by compete parks Business major impact on rental levels and vacancy rates. rates. vacancy levels and onrental impact major a has space of office quality the Also, distinctive. remained have areas office secondary and of prime performance rental in the differences the years, past the During offices – market Rental of 2018. end at the area metropolitan Helsinki inthe concept space office flexible by occupied was space of office sqm 100,000 some total In CBD. Helsinki 01 in the Maria well as as in Espoo campus University Aalto in the AGrid include of concepts kinds of these Examples ”The supply of”The flexible office concepts increased to some 100,000 sqm in the HMA” 100,000 rates vary between 8.5 and 9.5 per cent. cent. per 9.5 and 8.5 between vary rates vacancy office Jyväskylä, and Lahti Oulu, In years. in recent construction of new low volumes and demand space strong both to due in Turku, is lowest 6.8, rate vacancy cities, main 11%. at almost stands in the Tampere in 2018, Of still but markedly decreased rate vacancy the cities, main other the Of 2012. autumn since level highest is the which 2018, 83% to in September increased portfolios investors’ in large of offices rate occupancy the database, rental KTI Inthe Catella. 13%, at to over remained according rate vacancy the development, economic strong the despite already. In2018, decade past the for area metropolitan Helsinki inthe high remained has of offices rate vacancy The Aviapolisin Vantaa. and in Espoo Keilaniemi in Helsinki, Kalasatama and Ruoholahti instance, for include, years recent in development rental positive with areas best The question. in asset individual of the characteristics and location micro onthe is dependent performance areas, office most In 2012. since figure 2018, highest is the which in September at 90% stood and CBD, in the improved also has rate occupancy the demand, With increased the €30/sqm/month. some to increased rents average and Median in 2018 CBD. Helsinki in the at €33/sqm/month stood agreements rental new for quartile upper the database, rental KTI in the and years, recent in increased have in particular premises best in the Rents Index. Rental KTI the to according cent, per 6-7 some to accelerated growth rental in 2018,and annual the immediately, almost positively reacted CBD inthe rents the in 2016, positive more turned economy the When Finland. in area office appreciated most is the CBD Helsinki The per centper in the Helsinki CBD ”Office rents increased”Office by 6 and whole Finland whole and occupancy rates in the HelsinkiOffice metropolitan area 100 70 75 80 85 90 95 %

2005 in 2018” in

2006 HMA

2007

2008 Whole Finland

2009

2010

2011

2012 area Helsinki metropolitan take-up, net Office CBD Helsinki rent index office and occupancyKTI rate, -150,000 -100,000 100,000 150,000 200,000 250,000 100 110 120 130 140 150 160 -50,000 50,000 60 70 80 90 ■ Occupancyrate––

2013 sqm

0 1995 1996 period betweenSeptemberandAugust. each12-month calculatedfrom are Annual figures 2014 2006 1997 1998 2007 1999 2015 2000 2008 2001 2002 2009 Rentalindex(HelsinkiCBD2000=100) Source: KTIRentaldatabase 2016 2003 2004 2010 2005 2006 2017 2011 2007 2008 2012 2009 2018 2013 2010 2011 2014 2012 2013 2015 2014 2015 2016 2016 2017 Source: KTI Source: KTI 2017 2018 80 82 84 86 88 90 92 94 96 98 100

2018 % 49 4 Property sectors: market structure, practices and investment performance 50 4 Property sectors: market structure, practices and investment performance produced a total return of 6.7% (7.7% of 6.7% in 2017). return atotal produced properties In2018, office returns. income pressured have properties quality best in the investments of institutional concentration the and values increasing time, same at the However, of offices. growth capital the have supported values rental increasing and yields 2018, decreasing both 2017 In and returns. of weak years many after years recent in improved has of offices performance investment The sqm. 355,000 some to amounted and increased also take-up Gross decade. past the within take-up net annual highest is the This sqm. 83,000 some to in 2018, amounting increased offices of economy, take-up net strengthening the by Supported exceeded 80,000 sqm in exceeded 80,000 ”Net take-up”Net of offices Total investments, returns on office 2000-2018 10 12 -6 -4 -2 0 2 4 6 8 %

2000

2018” 2001

2002

2003 Capital growth ––– ■Capitalgrowth ■ Incomereturn 2004

2005

2006

2007

2008

2009

2010

2011 to zero, and income return continued to decrease, which which decrease, to continued return income and zero, to close slowed down 2018, In growth however,areas. capital other inmost decline 2013 continuous the since despite year every positive remained has growth capital and yields, decreasing and values rental increasing both by supported been has growth Capital inFinland. sub-markets office other all outperformed have offices CBD Helsinki years, In recent capitals European other in Helsinki yields and rents and Office rates and strong investment demand. In the latest RAKLI- latest the In demand. investment strong and rates low by interest supported decade, past the during steadily decreased have CBD Helsinki in the yields office Prime offices. Helsinki of central performance investment the deteriorated

2012 Total return

2013

2014 ”Yield compression slowing

down in Helsinki CBD” 2015

2016

2017 Source: KTIIndex 2018

Photo: Sato the outlook for rental growth is negative. growth rental for outlook the cities, major the outside whereas stable, mostly remain to expected are rents office cities, largest other the In area. the in increasing continue to rents office expected respondents of the majority the Barometer, Property RAKLI-KTI in the and market, the within position hold a unique to continues CBD Helsinki in 2018. The positive slightly less turned offices for outlook economy, in the rental the uncertainty increasing the with However, together years. in recent growth rental supported has economy strengthening The 2018. levels in spring lowest their from a slight growth representing both at 6.8%, of that Turku and at 6.5%, 2018, Tampere for stood yield the in October out carried Barometer, Property RAKLI-KTI the in instance, For wide. remained has cities Finnish main other and Helsinki between gap yield the and in Helsinki than later years several decrease to started yields cities, major other In well level. below this been have properties best the for yields (4.2% in 2017).average transactions, recent the In at 4.1% stood yield prime on and slowed had down, CBD Helsinki in the buildings office prime for for compression 2018, yield inOctober out carried Barometer, Property KTI Q4/2018 cities, European other Helsinki in and yields office Prime Q4/2018 rents in HelsinkiPrime office and other European cities, Copenhagen* Copenhagen* Amsterdam Stockholm Amsterdam Budapest Stockholm Brussels Budapest Moscow Helsinki Brussels Warsaw London Moscow Helsinki Madrid Warsaw Dublin London Madrid Berlin Milan Dublin Paris Berlin Oslo Milan Paris Oslo 0 0 *Forecast *Forecast 1 200 2 400 3 600 4 5 transactions. At the end of 2018, the total amount of retail of retail of 2018, end amount At the total the transactions. sale-and-leaseback major some and development new to due mostly years, inrecent steadily grown has investors professional by owned stock property retail The in Helsinki. REDI in Tampere and centre shopping Ratina of the in 2018 those include openings new significant most of 2017. end at the in Finland sqm million 2.2 of some The area retail leasable atotal with 101were centres shopping there Centers, of Shopping Council Finnish the to According cities. major in other 5.7 and million area, metropolitan Helsinki in the located is stock space retail of the sqm 4million About properties. hotel includes also this data, Finland’s InStatistics Finland. in space of retail sqm million 30 some are there Altogether, Stock market retail The 4.2 800 6 1000 7 continues to increase ” ”Retail property stock stock property ”Retail 1200 8 Source: JLL,KTI(Helsinki) Source: JLL,KTI(Helsinki) 9 1400 /sqm/year 10 1600 11 % 51 4 Property sectors: market structure, practices and investment performance 52 4 Property sectors: market structure, practices and investment performance across Finland, with Iso Omena being the portfolio’s largest largest portfolio’s the being Omena Iso with Finland, across 12 centres shopping operates and owns currently Citycon centres. onshopping concentrates currently which Citycon, is in Finland investor centre shopping specialised largest The retailers. main and investors international funds, and companies investment retail specialised institutions, domestic including is diverse, properties retail for base investor The Players border. Russian the to in Vaalimaa, Village close Outlet Zsar of the phase first sqm 12,000 the and in Lempäälä centre shopping Ideapark of the extension the included projects completed largest the Ratina, to 2018, in addition During in late 2019. completion for scheduled in Seinäjoki, centre shopping Ideapark sqm 66,000 is the underway project centre shopping largest the region, Helsinki the Outside is underway. Hertsi centre service local of the construction the InHerttoniemi, space. of retail sqm 20,000 another by Tapiola extended is being in Ainoa centre Shopping respectively. sqm, 44,000 and of 85,000 areas leasable with in Espoo, Lippulaiva and Pasila of Tripla Mall the in include projects ongoing largest The area. metropolitan Helsinki in the construction under was space of retail sqm 203,000 some year-end, At the on average. sqm 50,000 some to amounted have completions annual the decade, past the During stock. total the for of 2.6% a growth representing completed, was space retail of new sqm 104,000 2018, In some decade. past the during markedly increased has area metropolitan Helsinki in the stock property Retail market. total of the cent 23 to per corresponding €16 to amounted billion, market investment in the properties Photo: Skanska is located in Jyväskylä. is located which one and area metropolitan Helsinki in the located are of which three centres, smaller four owns Partners Capital Cerberus and properties, centre shopping inFinnish invested also have Assets –Real Management Investment AXA and Barings Investors, Global CBRE by managed Funds CBD. Helsinki in the centre shopping Kamppi the own jointly who Estate, Real Nuveen €516and for Allianz million, and Wereldhave in 2018 from centre shopping Itis the acquired who Investing, Estate Real Stanley Morgan include owners foreign largest The funds. and companies property foreign attracted also has market centre shopping Finnish The Tapiola, Espoo. in centre Ainoa the owns LocalTapiola’s fund YIT, and and SRV developers the of with Tripla, Mall the and together REDI in both invested havealso institutions Domestic Pori. in Puuvilla inRenor’s well as as inLappeenranta, centre IsoKristiina in Citycon’s is aco-investor Ilmarinen Group. S and Kesko of Elo, Unibail-Rodamco, consisting group a by in Vantaa is owned centre shopping Jumbo the while – Ilmarinen and Elo –Keva, institutions pension three by jointly is owned in Espoo centre shopping Sello the example, For investors. other with jointinvestments into enter often also they centres, Inlarger Finland. across centres shopping whole own Keva, Varma, and LocalTapiola Ilmarinen, instance, for including, investors, institutional Finnish Many properties. centre shopping some own also SGroup, and Kesko chains, retail large Both Group. Kesko to leased are properties Mercada’s of majority The inFinland. assets 31 and retail other centres shopping three owns which is Mercada, investor retail large Another region. Oulu in the Zeppelin wellTampere as as near Elo in Tampere centre, Ratina CBD, Helsinki the in Citycenter and Forum include centres biggest whose asset. Another major shopping centre investor is Sponda, is Sponda, investor centre shopping major Another asset. Major retail development projects in the Helsinki Metropolitan Area OpenStreetMap Finland web services, licensed under CC BY 4.0. Map: Ministry of Education and Culture. Data: OpenStreetMap contributors. OpenStreetMap Data: Culture. and Education of Ministry Map: 4.0. BY CC under licensed services, web Finland OpenStreetMap KTI. by map the to Additions transaction was the largest single asset deal in Finland ”The Itis shopping”The centre 2009-2018 Completed retail space in the Helsinki metropolitan area in 120,000 150,000 sqm 30,000 60,000 90,000 ever” 0 estimated basedongrossareainformation. onrentableareahasn’tIf information beenavailable, rentableareahasbeen 09 00 21 02 21 04 05 21 07 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 ■ RevelopmentNew fund invested in some smaller centres across Finland. Agore Agore Finland. across centres smaller in some invested fund I In 2018, Properties Trevian VVT. Finland and also Fennia OP, by, eQ, managed instance, for those include properties retail other and centre in shopping investing funds Domestic located in Lappeenranta and one in Rovaniemi. in Rovaniemi. one and in Lappeenranta located one centres, more two in 2018,and acquired company the centres, shopping some includes also portfolio Kiinteistöt’s Source: KTI,RPTDocuOy 53 4 Property sectors: market structure, practices and investment performance 54 4 Property sectors: market structure, practices and investment performance Top 10 Shopping centres in Finland CENTER Mylly R Matkus Omena Iso Itis Jumbo Ideapark Sello Veturi Hansa Willa hypermarkets, supermarkets and smaller stores – under –under stores smaller and supermarkets hypermarkets, – categories store inall 2017, operate They respectively. in sales 36% of total and of 46% shares Kesko, with and SGroup by is dominated market goods daily Finnish The retailers. international attracted have centres shopping in large and CBD Helsinki in the locations best the particular, In cities. main Finland’s in supply space modern and population increasing the both by attracted market, Finnish the entered have chains retail international new several years, few past the During Finland. across assets retail 100 than more comprises portfolio whose Redito, by managed is Trophi Fastighets, segment in this player significant Another transactions. smaller in two properties more nine with portfolio the expanded later who and Finland, across properties 123 retail comprising portfolio million a€767 year,in the acquired who, early Estate, Real Nordic Cibus Swedish the was sector in this newcomer 2018, In largest the investors. foreign and funds, and institutions domestic retailers, large instance, for including, of investors, group adiverse by owned are centres, retail smaller well as as properties supermarket and hypermarket as such properties, retail Other centres. shopping out-of-town with consumers for compete typically shops street high centre city cities, regional In many in Helsinki. areas retail prime in owners retail significant also are Ilmarinen and Keva as such investors office major a result, as and, buildings, office CBD inHelsinki located typically are shops street High edi

retail investors in Finland” in investors retail ”Cibus Nordic Real Estate became onebecame of the largest NLA RETAIL 58,334 Mercada 48,500 85,000 65,000 78,559 58,149 53,415 49,121 84,700 97,900 91,712 LocalTapiola ja Group OP SRV, Ilmarinen, Kuopio Centres Ingka Finland Citycon Investing Estate Real Stanley Morgan by advised Fund Kesko HOK-Elanto, Elo, Unibail-Rodamco, investors Private Elo Ilmarinen, Keva, OWNERS MAIN Ky, Nurmi-yhtiöt Keva, Hansa Kauppakeskus HOK-Elanto Partners, Estate Real Nordic Estate, Real CapMan Varma, Mylly Kauppakeskus relatively long-term contracts with net rent. rent. net with contracts long-term relatively typically are agreements and driven, cash-flow increasingly are investors properties, supermarket and hypermarket In shops. street in high especially applied typically are of terms kinds These period. time infinite an for continued then are and period afixed for made first are agreements cases, many In years. is three space retail for term fixed minimum typical The agreements. with business their of continuity the ensure to want tenants as market, retail the in applied commonly more are terms Fixed market. office the in than retail in the longer normally are agreements Rental tenants. and investors of the preferences the to and unit of retail type the to both according significantly vary market retail inthe practices Rental practices Rental of low-volume drinks. alcoholic sales of the liberation the well as as units, retail of all hours of opening deregulation total the include of this markedly. Examples business retail of regulation the liberated has government current The year. previous the to compared cent of 1per €17.6 agrowth billion, representing some to amounted 2017,In goods of daily sales total the 9%. of some ashare with market goods daily in the player largest third is the Lidl chain German The brands. different for a rent partly or totally based on the tenant’s turnover. turnover. tenant’s onthe based totally or partly arent for is leased centres of shopping space retail total 64% of the database, rental KTI the to According centres. in shopping is increasing leases of turnover use The leases. shorter have typically tenants Other leases. in applied shorter sometimes options renewal with years, fifteen even and ten to five of leases have often tenants anchor centres, shopping In Source: Finnish Council of Shopping Centres Shopping of Council Finnish Source: Helsinki KUOPIO ESPOO HELSINKI VANTAA LEMPÄÄLÄ ESPOO LOCATION T KOUVOLA HYVINKÄÄ RAISIO urku retail area in Finland. The CBD’s main shopping streets streets shopping main CBD’s The in Finland. area retail prime the as position undisputed an has CBD Helsinki The at 17%. stands currently sales total of the share their and years, in recent steadily decreased has accessories and of fashion sales the hand, other the On goods. leisure well as as beauty and health supplies, and décor home furnishing, are development positive showing categories retailer Other cent. 2per at only stand still sales of total 19% markedly, share in 2018, almost by their but increased services entertainment and of leisure sales in 2018. The sales total of 9% the some 3%, represented by some and increased centres in shopping restaurants and of cafes sales the example, For increase. to continues centres shopping of area space and sales total of the of services share The area. metropolitan Helsinki in the more decreased of visitors However, number the pronounced. more even in sales increase the makes area metropolitan Helsinki inthe stock centre inshopping growth The Finland. of parts other inthe than area metropolitan Helsinki the in stronger was insales growth The Centers. Shopping of Council Finnish the and KTI by produced indices the to 1.6%, by according decreased of visitors number The like-for-like stock. in 2018,of Finland comparing when 1% by whole in the increased Total centres in shopping sales slightly. accelerate to is expected in consumption 1.3% some by in 2018, in 2019, and increased growth the consumption Private unemployment. decreasing and slow inflation confidence, consumer strong by supported was growth The Finland. Statistics to in 2018, according 1.7% some by increased sales of retail volume total The retailThe market in 2019 centres increasedcentres by 1per ”Total sales in shopping shopping in sales ”Total cent in 2018” Sales and visitors in the Finnish shopping centres 100 105 110 115 85 90 95 12-month moving average, 2012=100 10/2012

01/2013 Rest ofFinland(visitors) Other majorcityregions(visitors) HMA (visitors) 04/2013 07/2013 10/2013 01/2014 04/2014 07/2014 10/2014 01/2015 04/2015

Source: KTIandFinnish CouncilofShoppingCenters 07/2015

10/2015 Rest ofFinland(totalsales) Other majorcityregions(totalsales) HMA (totalsales) However, during the year, the outlook of the retail markets markets retail of the year, the outlook the However, during country. in the slightly elsewhere lower year, were of the end at the but area metropolitan at 95.7% Helsinki in the stood premises retail of rates occupancy the database, centre Shopping KTI the In Catella. to according Turku,in Tampere respectively, and cent per 4.0 and at 4.5 in 2018, 2.8% to stood and decreased rate vacancy area metropolitan Helsinki the In cities. major low in all remain premises of retail rate vacancy The year. previous the to of 8% compared increase an shows which onaverage, month €123 at per some sqm stood per CBD Helsinki inthe rents prime inOctober, out carried Barometer Property RAKLI-KTI the to 2018. According in increase to continued rents retail of prime development the centres, shopping best in the and CBD Helsinki the In Citycenter. and Kamppi Forum, Kluuvi, Galleria, Kämp including centres, shopping several accommodates also centre city The streets. two these interconnecting streets as well as Esplanade Northern and Aleksanterinkatu include 01/2016 and area metropolitan Helsinki in the Elsewhere Barometer. Property RAKLI-KTI the to according CBD, Helsinki in the especially positive, remain markets retail inthe growth rental for expectations forward, going growth economic for driver main the be to is expected consumption However, private as market. rental in the uncertainty the increased stock property in retail increase an well as as ine-commerce, increase an and behaviour inconsumer change The of retailers. kinds different by replaced being of these many CBD, Helsinki in the closed stores, chain international newer some with together stores, In2018, traditional some uncertain. more turned 04/2016 07/2016

10/2016 remains low in the Helsinki 01/2017 ”Retail vacancy rate vacancy ”Retail

04/2017 area” metropolitan 07/2017 10/2017 01/2018

04/2018 ​ 07/2018 10/2018 55 4 Property sectors: market structure, practices and investment performance 56 4 Property sectors: market structure, practices and investment performance remain the most positive for large shopping centres in the in the centres shopping large for positive most the remain year. Expectations previous the to 2018 compared during uncertain more clearly turned also had centres shopping for outlook the Centers, of Shopping Council Finnish the and by KTI out carried Barometer Centre Shopping In the is negative. growth rental for outlook the country, in the elsewhere whereas stable, remain to expected are Turku,in Tampere rents and contributed to the total volume. volume. total the to contributed transactions small of relatively number alarge Otherwise, in Finland. transactions of largest list all-time in the high rank Investing Estate Real Stanley Morgan and Estate Real Nordic Cibus by out carried transactions The volume. total of the cent 24 per billion, representing in 2018,high at €2.2. remained transactions property of retail volume total The area. metropolitan Helsinki in the also negative turned centres shopping for 2018, In growth capital properties. retail of that other than weaker even was performance investment 2.1%. to centres’ Shopping decreased properties 2011, retail onall since year in 2018, return and total the every negative been has properties retail for growth capital Index, KTI In the market. in the uncertainty increasing the reflects properties of retail performance Investment is negative. rates occupancy and rents both for outlook the areas, other and centres smaller for whereas area, metropolitan Helsinki ”Increasing uncertainty in the the in uncertainty ”Increasing retail property markets” property retail Total return on retail investments, 2000-2018 10 15 20 -5 % 0 5

2000 2001

2002 ––– ■Capitalgrowth ■ Incomereturn 2003 2004 2005 2006 2007 2008 2009 2010 Finnish households by size by households Finnish Finland, and of these, about 40% are single-family homes. homes. single-family are 40% about of these, and Finland, in units housing occupied million 2.68 some are There Stock sector residential Rental 4.3 terraced houses and single-family houses. single-family and houses terraced and detached well as as apartments including of housing, forms in all is widespread ownership Home homes. occupied 2017,In inowner- live households of 64% Finnish about in particular. cities largest in the is increasing dwellings smaller for demand the households, of size average decreasing of the higher, Because 7%. is even share their Helsinki, In persons. two or one of only steadily, in 2017, and consisted 76% some households of all decreasing been has household of aFinnish size average The at 45%. currently stands buildings inapartment of dwellings share The 1,000,000 1,200,000 No. ofhouseholds 2011 200,000 400,000 600,000 800,000

2012 Total return

0 2013

1985 2014 1987 2015

1989 Source: KTIIndex 2016

1991 3+ persons 2 persons 1 person 2017 1993 2018 1995 1997 1999 2001 2003 2005

Source: StatisticsFinland 2007 2009 2011 2013 2015 2016 2017 Owner-occupied andOwner-occupied rented dwellings in the Helsinki metropolitan area income and size, as well as the dwelling’s location. dwelling’s the well as as size, and income household’s onthe depends of subsidy amount The dwellings. non-subsidised and subsidised in both living tenants for granted be may subsidy This support. housing public through subsidised be Tenants also may low income with in 2018. construction housing total of the 20% some represented dwellings subsidised total, In framework. this within started was dwellings of 730 2018, In price. construction the market at let freely be can dwellings the period, this After levels. rental at moderate low-income to tenants rented be to have dwellings the period which during guarantee, state and subsidy interest ona10-year in 2016, based introduced was framework recent most The cities. inmajor of housing supply the boost to in order players sector private for frameworks of subsidy kinds different offer also may government The subsidy. interest a40-year with provided types both groups, at special targeted 3,300 and dwellings, rental normal so-called were 2,400 in 2018. some these, Of started was dwellings subsidised 8,600 of some construction the In total, cost-based. are rents stock, subsidised of the majority inthe and, selection tenant for rules specific have Some forms. different between significantly vary supply housing for subsidy of public types different of regulation and terms the markets, subsidised In the portfolios. in their dwellings subsidised of share the reducing currently all are they and businesses, of their part alimited to applies currently This housing. subsidised offer to them enabling status non-profit hold this also SATO Kojamo, Avara and of players. kinds of these examples are foundations housing student numerous well as as Asunnot, KAS and TA-Yhtymä Y-Foundation, disabled. the or people elderly students, as such groups specific for housing rental offering organisations non-profit include housing of subsidised providers major Other companies. daughter municipalities’ Finnish the by owned are dwellings of subsidised majority The decade. past the during steadily decreased has dwellings rented of all dwellings subsidised of share The subsidy. interest an or loan state-guaranteed a commonly subsidy, most of public kind some with provided 36% been have some dwellings, rented all Of dwellings. owner-occupied than rented more currently are there and is 49%, dwellings of rented share the Helsinki, In rented. are dwellings of all 44% some area, metropolitan Helsinki In the on average. country whole in the than in cities major common is more housing Rented dwellings. rented are stock, 32% some total of the representing dwellings 877,000 Some unknown tenure status tenure unknown or other and dwellings occupancy of Right dwellings rented All dwellings All owner-occupied status Tenure unit household-dwelling of Size 1 person 40% 54% 6% 2 persons 39% 55% 5% construction of some 17,300 new dwellings was started in the in the 17,300 started of some was dwellings new construction 2018, In the inparticular. area metropolitan Helsinki the in cities, largest in the is weighted activity Construction year. the during started was dwellings new 45,000 some of RT, construction the Industries Construction Finnish of ofConfederation the estimates the to According in 2018. high remained activity construction Residential investors. private other or households Finnish by is owned dwellings, 320,000 some stock, non-subsidised of the majority the and years, in recent dwellings in rental investments their of 2017. end at the increased also have households Finnish dwellings rental 190,000 some owned investors Professional investments. residential their increased have investors foreign well as as funds and companies property institutions, groups, investor all investors, professional Of stock. of subsidised restrictions of the termination the through extent, a lesser to and, construction, new through increase to continues stock year. The previous the to compared dwellings of 2017,end 30,000 of some increase an showing at the dwellings 510,000 some to amounted stock housing rental non-subsidised estimations, KTI to According than 50% and lowest in Helsinki, at some 30% of all permits. permits. of all 30% at some in Helsinki, lowest and 50% than more in Oulu, is largest of studios share the cities, major the Of strategy. housing their to according municipalities between varies construction of all of studios share The moderate. more is much development the area, space by measured but of dwellings, of number in terms significant is volumes in construction increase the Therefore, flats. one-bedroom or in 2018, 75% studios for some were permits construction the Of apartments. insmaller and buildings onapartment is concentrated construction housing New volume. average long-term the exceed clearly still would which dwellings, 39,000 some to decrease to expected are starts construction 2019, In in Helsinki. located residential were 8,200 some of these, and, area, metropolitan Helsinki 3 persons 37% 57% 6% demographics for drivers as housing construction” housing continues to increase” to continues ”Rental housing”Rental stock ”Urbanisation and 4+ persons 4+ 30% 65% 6% 280,634 250,020 31,363 Total 57 4 Property sectors: market structure, practices and investment performance 58 4 Property sectors: market structure, practices and investment performance drivers of the increase in construction volumes. According According volumes. in construction increase of the drivers of the one been has housing of rental construction Active *Estimate the by Oy, owned Heka acompany municipalities. Finnish the by is owned stock housing of subsidised majority The Players area. metropolitan Helsinki in the are 9,000 almost construction, under dwellings rental the Of use. in rental cent per 100 be will which buildings, apartment comprises only figure This of 2018. at end the in cities major construction under were dwellings rental new 12,000 almost statistics, KTI the to Residential construction activity construction Residential Subsidised Non-subsidised Total Non-subsidised homes Single-family Subsidised Non-subsidised buildingsApartment Started residential dwellings dwellings Residential in the Helsinki construction activity metropolitan area 10,000 15,000 20,000 367,000; 42% Total 877,000 apartments rental Ownership structure of in rental Finland, apartments in 2017 5,000 0

1995

1996

1997 34,500 11,200 23,300 12,500 12,500 11,200 21,000 9,800 2010 1998

1999 11,000 25,200 11,600 21,200 33,700 12,700 8,500 8,500

2011 2000

2001

2002 Permits 13,900 24,800 31,000 20,100 6,200 6,200 9,800 9,800 2012 2003 190,000; 22% Source: ARA,StatisticsFinland,SuomenVuokranantajat,KTI 2004 320,000; 36% 13,200 21,500

19,600 2005 27,900 6,400 6,400 8,100 8,100 2013 Starts 2006 (subsidised) ■ (non-subsidised) ■ Households /privateinvestors (non-subsidised) ■ with 34,000, 26,000 and 8,000 dwellings, respectively. respectively. dwellings, 8,000 and 26,000 34,000, with players biggest the Kojamo, SATO are Avara and companies investment residential specialised segment, this In dwellings. 190,000 some comprising currently years, in recent rapidly holdings their increased have investors professional called so- the market, residential rental non-subsidised In the of Turku, Tampere. Vantaa and those include dwellings 9,000-11,000 with companies municipal large other the and dwellings, 15,000 some owns company housing of Espoo’s city The apartments. 48,000 around city of Helsinki, is the biggest player in this segment with with segment in this player biggest is the of Helsinki, city 2007 Municipalities andotherowners investors Professional 18,400 11,000 25,300 17,900 7,400 6,700 7,400 6,700 2014 2008

2009 Completions

2010 13,600 32,500 24,000 22,100 8,500 8,500 6,500 6,500 2015 2011

2012 18,600 26,500 29,400 37,300 7,900

7,900 2013 6,700 6,700 2016

2014 Source: StatisticsFinland

2015 Source: Statistics Finland, ARA, RT ARA, Finland, Statistics Source: 44,200 23,900 35,600 32,500 8,600 8,600 7,300 7,300 2017 2016

2017

1–9/2018 44,000 35,500 32,600 24,100 2018* 8,500 8,500 7,500 7,500 30,500 39,000 19,000 27,500 2019* 8,500 8,500 7,500 7,500 to its residential property fund. fund. property residential its to construction under properties five purchasing by and NREP to dwellings 465 some selling by transactions portfolio residential into entered also Avara activities. development own onits in2018, concentrated but transactions major any in SATO enter not did funds. Group’s OP from apartments 1,000 almost acquired and Investing, Estate Real Stanley Morgan to apartments of 1,600 aportfolio sold Kojamo 2018, In acquisitions. and development property both through portfolios their increasing and in restructuring active been have companies both years, recent In Finland. in investors property largest of the ranking in the four and one hold positions SATO and Kojamo currently and Varma, Ilmarinen, Keva and Elo, for instance, all all Elo, instance, for and Keva Varma, Ilmarinen, and market, investment institutional in the sector recognised a are properties Residential market. residential rental the in players significant also are funds pension largest The projects completed during 2013–2018 Residential building (rental apartments) 10,000 pieces Photo: Newsec / Maria Putaansuu 2,000 4,000 6,000 8,000 0 estimate of50sqmperdwellingisused isunknown, *if numberofapartments only) number ofdwellings(newprojects 2013 2014

2015 ■ HMA Completed 2016 2017 2018

2019 ■ Under construction Under construction Tampere, Turku, Oulu,Jyväskylä,Lahtiand

Other majorcities: 2013 Source: KTI,RPTDocuOy 2014 Kuopio regions 2015 2016 2017 2018 2019 past 2-3 years has this interest materialized as significant significant as materialized interest this has 2-3 years past in the only but years, several for investments residential rental Finnish in the interested been have investors Foreign private investors. to distribution for platform agood create networks branch whose Ålandsbanken, and Management Property OP by managed are investors at private targeted are and properties in residential thatinvest funds largest The investors. attracted have these and established, been have investors at private targeted funds investment mutual special open-ended new some years, two past Inthe institutions. at domestic targeted are Estate Real LocalTapiola and ICECAPITAL instance by for managed Funds investment. property in residential specialising funds property non-listed several also are There development. housing in new leverage use to possibility temporary the by boosted currently also are investments residential investors’ Institutional funds. and companies property specialised through investment residential to exposure indirect significant have also institutions Many portfolios. in their dwellings rental thousand several have increases the supply in the transactions market. market. transactions in the supply the increases of funds terminations as activity, market boosted also has sector fund residential of the growth The portfolios. their restructure to willingness increased investors’ domestic the by enabled been has investors of foreign entry market The estimates. KTI to according ofat 2018, the in Finland dwellings 11,000 rental some owned investors in 2018. foreign total, In investments their increased (BVK) Versorgungskammer Bayerische well as as Assets, – Real Managers Investment by AXA managed a fund NREP, market, in the present already investors the Of fund. Investments’ Standard Aberdeen and Capital Hill Round the included market investment residential in the players foreign new other fund, Stanley’s Morgan to In addition transactions. ”Foreign investor interest interest investor ”Foreign rental residential market” residential rental increasing in the Finnish Finnish the in increasing 59 4 Property sectors: market structure, practices and investment performance 60 4 Property sectors: market structure, practices and investment performance agreed notice period, typically one month. The landlord landlord The month. one typically period, notice agreed an after contract the terminate to right the has tenant The notice. further until afterwards continuing ayear, agreement as the with such period, fixed onacertain agree to possible It is also period. indefinite an for made typically are agreements Rental levels. rental or periods rental for restrictions no are there Currently, 1990s. the during deregulated gradually were dwellings rental market free for Rents practices Rental investors. foreign by acquired were of shares proportion 2018, alarge in summer IPO in Kojamo’s Also, APG. fund pension Dutch the by is owned 23% company of the another of SATO, majority and the owns currently Balder company property listed Swedish the instance, for market: residential Finnish in the indirectly invested is also capital Foreign residential property market property residential foreignBiggest investors in the Finnish Estate Advisers Fund managedby BaringsReal Property Pan-European Residential Aberdeen Standard Funds managedby AXAIM NREP Stanley Real Estate Investing Fund managedby Morgan (BVK) Bayerische Versorgungskammer Round HillCapital INVESTOR ”Regulation of the residential rental market is liberal” index (2000=100) Residential and price rent indexes, Helsinki metropolitan area, 100 120 140 160 180 200 80

2001

2002 APARTMENTS IN FINLAND FINLAND IN APARTMENTS

2003 RENTAL OF NUMBER

2004 1,200 1,400 3,500 1,600 2,100 (ca.) 800 2005 300

2006 Source: KTI 2007 –– Rents––

2008

2009 Prices 2010 investor, as well as for the amount collected and reserved for for reserved and collected amount investor, the for well as as the to paid of dividend amount the increases, rental annual for restrictions are there model, subsidy 10-year current the In market-oriented. typically are rents but buildings, of period holding the or selection tenant for conditions varying be might there dwellings, subsidy interest some In ARA. by supervised and is controlled of costs calculation the and cost-based, are rents used, are subsidies or loans housing state long-term where stock, ARA-housing so-called In housing. priced moderately for need onthe consideration with approach holistic on a more is now based selection and rules, selection tenant from removed were criteria income However, in 2018, selection. strict tenant levels and rental both to related restrictions mightbe –there of subsidy form on the – depending stock housing subsidised In the buildings. and areas in different conditions market prevailing to increases rental adjust to landlord the allows and inparticular, investors by professional is used of indexation kind This cent. per of 5 3or aminimum instance for increases, oflevel rental onahigher agree to common It is also used. most the being index of living cost the with indexed, typically are Rents period. rental the of length onthe depends also period the but months, three is minimum period notice the landlord, the For conditions. specific certain under contract the terminate only can 2011 in demand. growth rapid most and volumes larger its to due out stands area metropolitan Helsinki the cities, large the Among demand. the exceeds dwellings of rental supply cases, insome and decreased, have prices the municipalities, in smaller steadily, whereas increased have rents and prices housing cities, largest the In country. of the parts various the between differentiated has markets housing of the development the years, recent In residentialThe market in 2019 market. non-subsidised in the than lower but stock, subsidised in traditional than higher be to expected are rents apartments, these In refurbishments. and repairs

2012 Source: KTIandStatistics Finland 2013

2014

2015

2016

2017

2018 new agreements showed an annual increase of 2.5% for the the for of 2.5% increase annual showed an agreements new for index 2018, rental In in rents. KTI visible clearly also is regions different between differentiation increasing The size. household average in adecrease and urbanisation continuing by strengthened is demand The cities. major inthe apartments small for especially strong, remains housing rental for Demand investors. foreign by out carried typically were acquisitions largest the sector, property residential Inthe sector. in this ever volume highest second is the €1.8 to billion, which amounted volume annual total the and in 2018, accelerated activity transaction portfolio property residential market, investment property professional the In pronounced. more even be will country of the rest the and cities largest the between differentiation the forecast, this to However, according in2019. also pace same at the increasing continue will prices housing that forecasts PTT Research Economic Pellervo 4.6%. by in Turku in Tampere 4.9%, and by increased prices housing area, Helsinki the Outside 0.6%. by decreased they country in the elsewhere whereas onaverage, 2.2% by increased prices area, metropolitan in 2018. Helsinki the In average on country whole in the 0.8% by some increased dwellings old for residential prices Finland, Statistics to According Prices of old residential dwellings, index (1983=100) 100 200 300 400 500 differentiating between between differentiating large cities and smaller ”Housing markets are ”Residential property property ”Residential accelerated in 2018” transaction activity activity transaction

municipalities” 1988 1989 1990 1991 1992 1993

1994 area Helsinki metropolitan 1995 1996 1997 1998 1999 2000 2001

2002 Rest ofFinland 2003 2004 transactions portfolio Volume residential of for rental development remained positive, and the majority majority the and positive, remained development rental for expectations the Barometer, Residential RAKLI in the Also supply. narrow more the to due apartments, in larger stronger been has in rents increase year, past the the During TurkuTampere regions. and in strongest been has growth rental area, metropolitan Helsinki the outside cities large the Among on average. city, due to the rapid increase in supply in the area. area. in the in supply increase rapid the city, to due large other in any than positive less clearly are development rental for expectations the Lahti, In apartments. large for stable but apartments, small for positive were expectations growth rental Kuopio, and Jyväskylä Oulu, In increasing. continue to expected were apartments larger and small inboth rents Vantaa, Turku, Tampere where and Espoo, Helsinki, for positive most were expectations The continue. to in rents increase the expected respondents of the Helsinki metropolitan area and 0.6% for other main cities cities main other for 0.6% and area metropolitan Helsinki 1000 MEUR 2005

0.0 0.5 1.0 1.5 2.0 2.5 3.0 2006

0.16 2007 2005 Whole Finland 2008 0.12 2006 2009 0.14 2007 2010 0.13 2008 2011 0.26 2009 2012 0.17 2010 2013 Source: StatisticsFinland 0.27 2011 2014 0.26 2012 2015

0.66 2016 2013

0.70 2017 2014

1.25 2018 2015 2.80 2016 1.04 Source: KTI 2017 1.79 2018 61 4 Property sectors: market structure, practices and investment performance 62 4 Property sectors: market structure, practices and investment performance rents. In the RAKLI-KTI Property Barometer, the yield yield the Barometer, Property RAKLI-KTI the In rents. increasing and yields decreasing both by supported strong, Residential properties’ investment performance has remained database. Index KTI in the sector largest the is also in2018. cent Residential 29 per to increased share its and market, investment property professional in the sector property largest the is currently Residential Photo: Kojamo ”Rents continue”Rents to increase in Helsinki metropolitan area and other major cities major other and area Helsinki metropolitan Residential index, rent KTI 10 12 -4 -2 % 0 2 4 6 8 largest cities” New agreements Annual change 2001

2002

2003

2004

2005

2006 Helsinki metropolitan area Helsinki metropolitan 2007

2008

2009

2010

next year. next the within properties residential in rental investments their increase to expected were of investors types all Barometer, Residential in 2018, 3.7% to RAKLI in the and decreased in Helsinki location in acentral property aresidential for 2011

2012 Other majorcities

continue strongly to perform 2013 in the investment market” **Forecast

”Residential properties properties ”Residential 2014

2015

2016

2017

2018 Source: KTI 2019**

2020** facilities, medical facilities and even hospital properties. In In properties. hospital even and facilities medical facilities, care people), day disabled well as as children’s patients mental (e.g. and people elderly groups target different for homes nursing and facilities living of assisted consisting segment market a diversified are properties Healthcare provision. service for needed premises the and services the both providing for opportunities alternative inconsidering interested increasingly also are operators sector public time, same At the investors. private attract to started has market the of years, couple past in the Only properties. of these owners predominant the still are state Finnish the and Municipalities groups. target specific for offered housing serviced and buildings hospital large specialised highly to properties office normal from ranging segment market diversified a are services of public provision the for used Properties investors. attract to started also have buildings educational as such properties of public kinds other years, past the during but properties, at healthcare targeted mainly first was interest Investor years. in recent market investment in the attractiveness their increased have services of public kinds of different supply the for used Properties Stock 4.4 Public use properties 5%. than at more healthy remained return income rents, increasing to Due of 8.8%. return total the with Index, KTI in the sector performing best the as position its back took 2018, In residential 2000. in start index’s the since year every positive remained has growth capital properties’ residential Index, KTI the In continues to increase in public properties” use ”Investment potential potential ”Investment 2000-2018 investments, property Total residential on return 10 12 14 % 0 2 4 6 8

2000 2001

2002 ––– ■Capitalgrowth ■ Incomereturn 2003 2004 2005 2006 2007 2008 2009 2010 have operated the facilities. the operated have and services social provided also have which organisations, sector public other and municipalities by owned been traditionally have facilities of these most context, Finnish the years and the market value of its property portfolio exceeded exceeded portfolio property of its value market the and years in recent markedly increased has Hoivakiinteistöt eQ fund mutual special Company. eQ’s Management Fund Evli and Rahastoyhtiö Titanium Bank, eQ by managed are properties in healthcare investing funds property domestic largest The people. elderly for facilities living at assisted targeted been typically have sector in healthcare investments Pension funds’ investors. foreign specialised some and companies and funds property domestic investors, institutional include sector investment property healthcare inthe players sector Private investors. property and operators service healthcare both for opportunities new up opening is also reform approaching the by caused provision service social and healthcare in the change structural The population. of the ageing the with is increasing properties sector social other and healthcare for demand The Players investors. sector private from premises office normal rent to organisations sector public for common increasingly It is also portfolios. in investors’ assets individual represent typically these but facilities, sports as well as buildings cultural and educational various instance, for own, investors sector Private properties. of these supply total the to in relation small rather is still investments private of amount the segments, property use public In other year. previous the to compared cent per 40 of almost of 2018, end at billion the €3 increase to an close showing to amounted investors professional by owned properties healthcare of the value market the estimates, KTI to according and, years, inrecent rapidly increased has market investment in the properties 2017. of healthcare amount The of 12.9 end at the some sqm million to amounted facilities of healthcare stock total the Finland, Statistics to According 2011 2012 Total return 2013 2014 2015 Source: KTIIndex 2016 2017 2018 63 4 Property sectors: market structure, practices and investment performance 64 4 Property sectors: market structure, practices and investment performance a health and well-being centre that was recently completed completed recently was that centre well-being and a health in invested has Deka German The agencies. public by used properties in office invested mainly has which is Hemfosa, market Finnish in the active Yet investor Swedish another iNorden. SBB was market in this newcomer Swedish Another fund. Titanium’s from portfolio million a€48 acquiring in 2018 market by property care Finnish the entered Management, Business Pareto by managed AB, Care Origa properties. use of public kinds other and educational in healthcare, invests Hemsö million. €724 some to amounted properties of its year, of the end value the in 2018, at the and, portfolio property Finnish its expand to continued company The sector. property use public Finnish in the investor foreign largest is the Hemsö Swedish The million. €350 worth portfolio of 2018, aproperty end had At the company the properties. daycare children’s and educational in healthcare, invests that company property is alisted Hoivatilat Suomen €140 some to million. amounted size in late 2017,launched of 2018, end the by and fund’s the was fund The properties. service of public kinds various in investing fund investment aspecial has also Group OP region. Nordic the across properties in healthcare invests Care, Aged Nordic fund, newest Its properties. healthcare in investing funds manages also Horizon Northern million. €480 to amounted fund property healthcare of Titanium’s 2018, size total the January In million. €78 some totalling acquisitions more three with portfolio its expanded fund the year, in the Later fund. Capital’s Horizon Northern from portfolio property a€140 care 2018 million it acquired when in early launched Iwas €1 in 2018. billion Healthcare Evli Finnish market” property care ”New players”New enter the property tax and insurances, and, in many cases, even for for even cases, in many and, insurances, and tax property maintenance, for is responsible tenant the where leases, net commonly most are agreements 10−15 Lease instance years. long, for typically are properties of healthcare Leases operator. aprivate to premises the leases further or itself services the provides either which municipality, a to rented directly be can properties cases, some In investors. and developers property the for demands certain set also requirements These property. the of use specific onthe depending vary which requirements, technical strict fulfil to and authorities the by approved be to need facilities the Even companies. solid financially be to need operators thatthe means also which authorities, from a licence for apply have to operators the sectors, service most In municipalities. the to services their provide typically who operators, private to rented are investors by private owned properties care of health majority The applied. be can practices market office normal users, various to adaptable premises in long, whereas rather typically are agreements rental properties, use special In in question. of property type the on depend sector property use public in the practices Market practices Market Assets. –Real IM AXA and Group Property Pioneer include market property care Finnish in the players foreign Other Helsinki. in Kalasatama, new development. development. new in investing continued investors many year. Inaddition, previous the from 50% than of more agrowth represents This million. €620 to in level 2018, amounting record new a reached properties of healthcare volume transaction The 2019 in Market by net income. driven strongly are investments sense, this In refurbishments.

Photo: YIT outsourced their services. their services. outsourced who municipality, the typically most was seller the cases, year, the in these and throughout properties several bought also Attendo operator service The Hoivatilat. Suomen as well as funds, OP’s and eQ’s included market transaction inthe players active year. of the Other quarter first the in fund by Evli’s out carried €140of the portfolio million acquisition the was transaction largest The phase. selling the to maturing are portfolios more market, property care in the that also place,indicates which took transactions portfolio property care significant In 2018, several rapidly in recent years as a result of both changes in space in space changes of both aresult as years in recent rapidly developed has in particular properties of logistics stock the these, Of sub-categories. main the are properties logistics and warehousing modern and properties manufacturing light market, investment Inthe owner-occupied. typically are properties manufacturing corporations’ industrial Large basis. customer and investor well a heterogeneous as as practices, and structures market varying with sub-categories various into divided be can market property industrial The 12%. some for accounts area metropolitan Helsinki the this, Of Finland. Statistics to according sqm, 73 million some to amounts stock property logistics and industrial Finnish The Stock 4.5 Industrial /logistics market million. €200 for Sponda from House Court Helsinki the acquired late2018, In Turku. also Hemsö of City the from properties hospital and of care portfolio a€130 2019, million inearly acquired and company the market, in the players active most of the one been has Hemsö volume reached anew record ”Care property transaction property ”Care in 2018” in 2000-2018 Total return investments, on industrial property 10 12 14 -6 -4 -2 % 0 2 4 6 8

2000 2001

2002 ––– ■Capitalgrowth ■ Incomereturn 2003 2004 2005 2006 2007 2008 2009 2010 to increase its Finnish portfolio in 2018, company the and portfolio Finnish its increase to continued Sagax AB company property listed Swedish The properties. own their own and develop sometimes operators logistics international Also corporations. retail and industrial large instance, for include, owner-occupiers Big owner-occupied. be to is estimated properties warehouse and of industrial stock 85% some total of the value, capital by Measured sector. in this assets their sold have investors domestic many while years, recent in investments their increased have in particular investors Foreign players. foreign and funds property institutions, domestic including players main the with investors, attracting are properties light manufacturing and Logistics Players systems. logistics and chains of supply reorganisations by well as as e-commerce, and trade foreign increasing by is supported properties of kinds these for demand The years. in recent investors have attracted properties logistics efficient Modern, owner-occupied. typically are properties strategic These systems. logistics and warehousing in-house centralised pursued traditionally have chains retail major the context, Finnish In the area. metropolitan Helsinki the surrounding and connections traffic good with in municipalities increased has supply the particular, In connections. traffic new and demand in Finland. in Finland. located are properties of these 77 1.3 sqm. some million and properties 86 comprise holdings Nordic company’s The sector. property /industrial logistics Finnish in the investor significant is another partners, investment its with together Corporation, Investment China by owned Logicor, €1.1to of 2018. end at billion the amounted portfolio Finnish Its properties. warehouse and in industrial specialising investor largest the is currently 2011 2012 Total return 2013 2014

Source: KTIIndex 2015 2016 2017 2018 65 4 Property sectors: market structure, practices and investment performance 66 4 Property sectors: market structure, practices and investment performance and manufacturing property development and investment. and development property manufacturing and in logistics players smaller numerous are there addition, company. In service e-commerce and logistics postal, Finnish of the arm property the Kiinteistöt, is Posti market property logistics in the player domestic significant Another properties. logistics and in industrial invest Trevian, example, and for OP, by Fennia managed those eQ, funds, domestic the Of Investments. Standard Aberdeen and NREP by managed those include properties in logistics investing investors foreign Other Elo. insurer pension inVantaa from property logistics sqm a 42,000 in 2018 market acquiring by property logistics Finnish the client, entered institutional of aGerman DWS, onbehalf relatively high, partly explained by high construction costs. costs. construction high by explained partly high, relatively are premises logistics modern levels for rental comparison, However, by international years. in recent stable fairly remained have rents property logistics and Industrial year-end. at the at 4.6% in 2018, stood and decrease to continued rate vacancy the Catella, to According area. metropolitan Helsinki in the years low in recent rather remained has space industrial and logistics of vacant amount The industrialThe /logistics market in 2019 rating. tenant’s the by determined partly levels are rental of leases, kinds Inthese years. fifteen or ten is typically period the contracts, fixed-term In buildings. in multi-tenant premises smaller for used only are leases gross Finnish Traditional rents. triple-net or net typically are Rents markets. logistics and industrial inthe vary practices rental needs, user and stock available of both heterogeneity of the Because practices Market Photo: Kojamo in total, the centre will comprise more than 200,000 sqm sqm 200,000 than more comprise will centre the in total, and underway, is currently extension in late2018. Another completed was of which largest the phases, in several built is being of Helsinki, north in Sipoo, centre logistics S Group’s construction. under were projects property logistics significant Turku Tampere the In and regions, underway. were ones smaller several and airport, of the vicinity in the completed were properties /terminal logistics significant In2018, three areas. harbour Vuosaari the and airport in the concentrated been recently has area metropolitan Helsinki in the properties industrial and of logistics development New area. metropolitan Helsinki in the located sqm of 48,000 area atotal with properties logistics in three invested who Conficap, Finnish the was in 2018 market the entered who player new Another client. German of its DWS, by onbehalf out carried was transaction asset single largest The transactions. in several portfolio its increased and market in the player active most the was Sagax place. took transactions large year, several when previous the from decrease clear a billion in 2018, represents which €0.5 to amounted properties logistics and of industrial volume transaction The €13-14 month. per typically sqm are per rents logistics in Vantaa, prime the area airport the In month. per €10-11 at some stand sqm per municipalities surrounding and area metropolitan Helsinki in the areas logistics best the levels for rental quartile upper the database, KTI the In for the 11th the for year. consecutive decrease to continued values healthy, capital but remained of in2018 7% (5.4% in2017). return a total income Net produced sector property /warehouse industrial Finnish The sqm. 12,000 another by centre the extending currently inlate2018, use is own and its for facility logistics sqm a60,000 completed Lidl of Helsinki, north also Järvenpää, In premises. logistics automated highly and of modern number of hotel nights increased by 3% by in 2018 compared increased ofnights hotel number 2017. to compared 0.7% the some by Lapland, In increased region Uusimaa in the tourists by foreign spent of nights 2018, In number the Lapland. and area metropolitan Helsinki the include inFinland tourism for areas growth main two The in 2018. in Finland group tourist 2017; to biggest 6%by compared fourth the were they decreased tourists Swedish by hotels inFinnish spent nights of number The travellers. Chinese and British German, included groups tourist increasing Other in Finland. spent of nights number in the slight the decrease despite group tourist largest the remained Russians tourists. foreign and domestic splitbetween evenly was growth year. The previous the to of 1.4% compared agrowth in 2018, representing million 22 over to grow to continued hotels Finnish in the spent of nights number the Finland, Statistics to According 69.1%. to increasing higher, clearly was rate occupancy the region, Uusimaa the in 2018. In on average 55.3% was country whole in the rooms of hotel rate occupancy the Finland, Statistics to According 2019 in Hotels market in Finland. common not are management, involved in property is closely and risk business hotel’s of the part carries investor the where agreements, Management differently. allocated might be tenant and landlord the between responsibilities use, retail in example for space, of other amount is asignificant there where centres in city properties some In costs. operational and maintenance all for is responsible operator The years. of 15-25 length a lease with agreements rental net triple long, favour typically investors property hotel Finnish CBD. Helsinki in the located are of which majority 10 hotels, the operates which Collection, is Kämp operator expanding Another cities. largest the into expanding also now but in Lapland 17 located hotels, mostly operates who Hotels, Lapland include operators concentrated more but expanding Other country. the 14 across hotels, also operates Hotels Finlandia country. whole the across located both 53 hotels, SGroup hotels, and 69 operates currently Scandic SGroup. and Scandic include operators hotel largest The properties. hotel some own also in particular, SGroup operators, hotel Some Balder. and Corum Immobilien, Deka include market property hotel Finnish in the investors Foreign properties. in hotel invested have example, for Fennia, and eQ Exilion, by managed those funds, domestic the Of portfolios. their in properties hotel hold some institutions biggest the of Most Pandox. Swedish the and hotelfund CapMan’s are in Finland owners hotelproperty biggest two The Players of 2018. end at billion the €3.5 some at stood investors professional by owned properties hotel of value market the estimates, KTI to According region. Uusimaa in the located are rooms 15,600 some with hotels 127 these, Of rooms. 53,000 some comprising Finland, in hotels 628 are there Finland, Statistics to According Stock Hotels 4.6 430 rooms. rooms. 430 comprising in Pasila, Tripla project new development hotel the acquired also fund The project. in the invested has fund Exilion’s Scandic. by operated be will hotel, which room a500- into redeveloped being currently are station railway main of the premises office the centre, city Helsinki the In projects. in both investor is the NREP redevelopment. is under property old office another where in Hakaniemi, well as as use, hotel into converted partly is being Kesko of office head former the where in Katajanokka, underway are conversions significant Other completed. was CBD Helsinki in the Hotels of that Lapland conversion, another 2019, In early properties. old office from redevelopments are of these Both Airport. Helsinki Scandic well as as CBD, Helsinki in the George St. Hotel included area metropolitan Helsinki in the In 2018, completions hotel main the use. hotel into converted being are or been have buildings old office several CBD, Helsinki In the market. the to come will rooms hotel of new thousands several years, of couple next in the and in particular, area metropolitan Helsinki inthe markedly is increasing supply Hotel 5%. than more by increased spent of nights number year. The previous the to in the country for the past two years. years. two past the for country in the elsewhere negative been has but area, metropolitan Helsinki in the positive 2018 remained (8.7% in 2017). growth Capital of 8.4% in return atotal delivered and performance strong their continued properties hotel Index, KTI the to According future. near in the in Hakaniemi premises hotel develop to plans also company The Sponda. from CBD Helsinki in the property office and ahotel acquiring by sector hotel the into expanded Group in HYY 2018. Also properties in hotel invested instance, for Fennia, and eQ by managed those funds, domestic the Of fund. hotel CapMan’s from properties hotel six acquired which Management, Asset Corum French bythe out carried was transaction portfolio property hotel largest The deals. asset single mostly were transactions The million. €240 to amounted of hotel properties volume In 2018, transaction total the building. hotel anew, by larger replaced and demolished be to is planned Börs Hamburger hotel Turku, traditional the in Also in Kakolanmäki. area old in the prison another and inTurku, inKupittaa, one projects hotel two well as inTampere, hotel as Marriott new the include underway projects largest the area, metropolitan Helsinki the Outside in 2019. started be to planned are projects hotel Several refurbished. is being CBD Helsinki in the Marski Hotel and project, extension major a is undergoing Hotel Vantaa,In Flamingo the in Helsinki. Ruskeasuo and in Espoo Matinkylä in, instance, for underway currently are projects development hotel new Other ”Hotel is construction active in the Helsinki metropolitan area” 67 4 Property sectors: market structure, practices and investment performance 68 5 Property markets in different regions some 37% of the Finnish GDP. 37%Finnish of the some delivers 32% and jobs of all about for accounts population, 27% Finnish of the it accommodates but country, entire of the 1.2% for area of the accounts area land region’s The 1.5 inhabitants. million some has and of 14 municipalities consists region Helsinki entire The of 1.2 people. million apopulation has Kauniainen, Vantaa and Espoo, Helsinki, of cities of the consisting area, metropolitan Helsinki The area 5.1 Helsinki metropolitan The portfolios. residential and in retail especially cities, in smaller invest also companies, and funds international and domestic both investors, larger Some owner-occupiers. and investors local by dominated traditionally are regions city insmaller markets Property area. metropolitan Helsinki the to compared offer they gap yield positive the by strengthened been has cities of these attractiveness the years, recent In segments. market selected in their cities in these invest also investors international Some areas. market in these only operate who players local are there cities, these all In sectors. selected in their cities in these invest investors domestic large Many Kuopio. and Lahti Turku, Jyväskylä, of Tampere, Oulu, centres growth regional the include markets second-tier The region. capital in the invest only players global large many and investors, foreign among is well recognised area The area. metropolitan Helsinki in the concentrated is also market investment property institutional The stock. office total of the 60% than more accommodates area metropolitan Helsinki the value, by measured markets: office in the prominent most is the dominance Its market. property Finnish in the region dominant is the area metropolitan Helsinki The different regions marketsin 5 Property Percentage of jobs, 2017 jobs, of Percentage structureThe of the economy 16.3% HELSINKI REGION 13.4% 24.8% 0.3% 45.3% andforestry ■ Agriculture ■ Trade ■ Manufacturing ■ Publicservices ■ Privateservices of Commerce. Chamber Region Helsinki by the review, published industry region Helsinki the to according on average, country (25%) entire inthe than lower clearly are services public (16%) inmanufacturing and of occupations proportions the hand, other the On country. entire the across – than –59% higher is significantly sectors trade retail and service private in the of jobs proportion the region, Helsinki the In base: Economic Vantaa: Espoo: Population: cities. in these concentrated are region Helsinki of the population of the majority the and activities, administration Jobs, area. metropolitan Helsinki inthe located are agencies government well as as headquarters company major Most of jobs. structure and profile knowledge the impacts also of Finland centre administrative the as position region’s The country. whole in the than region Helsinki in the role have astronger businesses logistics and trade wholesale industries, high-tech well as as development and research services, financial and professional Specialist cities. main other of the those from significantly differ region Helsinki of the areas specialist The 22.0% WHOLE FINLAND region exceeds clearly that of 11.5% ”Growth in”Growth the Helsinki 4.0% 28.5% the whole country” Source: HelsinkiRegionChamberofCommerce

research and development occupations development and research industries, high-tech logistics, trade, wholesale services, financial and professional industries, Information 1,491,000 region: Helsinki Helsinki: 33.9%

280,000 224,000 645,000

construction volumes going forward. forward. going volumes construction in aslight decrease indicates which dwellings, 18,500 some to decreased permits of construction However, number the 2000s. in the volume highest is the which dwellings, 22,000 almost to amounted starts construction new period, same the During construction. total 75% than region’s of the more for accounted area metropolitan Helsinki the altogether, Vantaa, and in Helsinki fastest was growth The region. Helsinki inthe completed 2018, were 15,700 dwellings some 2017 September and September in2018: between continued construction of residential growth The area. metropolitan Helsinki in the construction fuels also growth region’s The growth. population natural onpositive also 2030s, until and, migration internal and immigration onboth is based growth population The 2050. by 860,000 some to increase to and 2025, by 700,000 exceed to is expected population year. The per inhabitants 7-8,000 some to amounted and expectations, exceeded has of Helsinki growth the years, In recent 1.9 some to million. 2050, by and 1.7 inhabitants, million to grow to is expected region in the population the 2030, by and, region, Helsinki in the is fast growth Population cent. 2 per at some was country whole in the growth the while region, Helsinki in the cent 3 per by some increased production 2018, In total region. Helsinki in the more significantly increased also has of jobs number The onaverage. country whole in the cent 6per by only but region, Helsinki in the 12 by cent per increased 2013 2018, and production total Between onaverage. country whole inthe than region Helsinki in the positively more developed have of jobs number the and of production amount the years, recent In investments in infrastructure” in investments ”Growth in”Growth the Helsinki region requires majorregion requires Commercial property stock by region and property sector stock by region and property Commercial property Warehouse/logistics, area Helsinkimetropolitan * Turku, Tampere, Oulu,Lahti,Jyväskylä andKuopio Retail&hotels, Helsinki metropolitan area Retail&hotels, Helsinkimetropolitan Warehouse/logistics, othermajorcities* Warehouse/logistics, ofFinland rest Office, Helsinki metropolitan area Helsinkimetropolitan Office, Retail&hotels, othermajorcities* Retail&hotels, rest ofFinland Retail&hotels, rest Office, othermajorcities* Office, Office, rest ofFinland rest Office, 0 5 Kalasatama, Laajasalo and Korkeasaari. with city inner the connecting bridge tram and light traffic a of Kruunusillat, construction the well as as Pasila, and Kalasatama between and Hernesaari Jätkäsaari, example for to, lines, tram developing several include planned being currently projects development transport public Other cities. major other and Helsinki between investments rail major other to related it is also made, and be to is still rail Pisara of the construction the about decision final city. The inner in the transportation public ease would which Hakaniemi, Töölö, Station, and Pasila Central between planned is being connection rail Pisara called so the Furthermore, 2019. spring the during made be will Espoo and of Helsinki councils city in the decisions needed that the 2019 provided in 2024, completed and summer in started be to is planned of Helsinki, parts northern the through go would which in Helsinki, Itäkeskus to in Espoo Keilaniemi from connection tram Joker, afast Rail called so of the construction The Kivenlahti. to extended is now being in late 2017 and operating started in Espoo Matinkylä to line Metro in 2015. Western completed The was centre, city the with areas residential significant several and airport Helsinki the connects which Road, Rail Ring The area. metropolitan Helsinki in the construction and growth the support network transportation public in the investments major Current project is planned to be financed by private sources. sources. private by financed be to is planned project the plans, current the to According project. the around initiatives independent several are there moment, At the Helsinki-Vantaa the airport. with Tallinn the airport connect also It would traffic. passenger and freight for both used be Gateway, would and aEuropean form and Baltica Rail to Finland €15-16 connect at some would tunnel The billion. is estimated tunnel of the cost total The inhabitants. million 3 some with city atwin form to Tallinn in order in Estonia and Helsinki between tunnel railway 90-100-kilometer is a inplanning project infrastructure major Another 10 15 Source: StatisticsFinland2017 20 million sqm 25 69 5 Property markets in different regions 70 5 Property markets in different regions in Helsinki. is 2.1 located sqm million about this, Of sqm. 4.1 million about to amounts area metropolitan Helsinki the of stock space Retail of offices. sqm 1million Vantaa about 1.9 and sqm million about accommodates Espoo in Helsinki. is located sqm 6million some area, metropolitan Helsinki in the of offices stock total sqm million 8.8 around Of of Tripla). (Mall in Pasila developed being is currently centre shopping major Another Kluuvi). and Citycenter Galleria, Kämp Forum, (Kamppi, CBD Helsinki Omena),Tapiola (Iso in well the as as Matinkylä (Ainoa) and (Sello), Aviapolis (Jumbo), Leppävaara (Kaari), Kannelmäki (Redi), (Itis), Kalasatama in Itäkeskus located are centres shopping in Vantaa.Main Tikkurila and in Espoo Matinkylä Tapiola and of Leppävaara, centres regional the include areas important the CBD, the to in addition markets, retail the In in Vantaa. area airport the and in Espoo Leppävaara and Keilaniemi in Helsinki, Pasila−Vallila−Kalasatama the areas and Ruoholahti include locations office prime other CBD, the Outside location. market retail prime and office prime the both as position indisputable an (CBD) has district business central Helsinki the markets, property area metropolitan Within Helsinki the area Helsinki metropolitan the in areas office Main Source: StatisticsFinland Espoo centre Lauttasaari Olari &Matinkylä Töölö Myyrmäki &Martinlaakso Kallio Tikkurila area Vallila Sörnäinen &Kalasatama Pitäjänmäki Kilo &Mankkaa Otaniemi &Keilaniemi Leppävaara Tapiola &Niittykumpu Aviapolis Ruoholahti Pasila Helsinki citycentre Area OpenStreetMap Finland web services, licensed under CC BY 4.0. Map: Ministry of Education and Culture. Data: OpenStreetMap contributors. OpenStreetMap Data: Culture. and Education of Ministry Map: 4.0. BY CC under licensed services, web Finland OpenStreetMap KTI. by map the to Additions buildings No. of 253 26 30 32 30 22 45 25 30 53 58 29 56 18 37 41 71 71 area (sqm) Gross floor 1,781,954 220,985 239,023 362,282 146,236 167,723 275,565 337,520 296,311 700,146 413,235 405,712 127,979 347,587 397,112 175,010 318,371 96,396 together with some company headquarters and ministries’ ministries’ and headquarters company some with together – firms service financial and law firms consultancies, business as – such services business-to-business offering companies mostly are centre city in the users Office buildings. cultural several well as as functions administrative sector public important most the accommodates also area small geographically This markets. property retail and office in the both in Finland, submarket property single important most is the CBD Helsinki The HelsinkiThe CentralBusiness District Herttoniemi. and Pitäjänmäki areas industrial and office traditional the well as as axis, Vallila−Kalasatama Pasila− extending the instance for include, supply property commercial increasing with Areas in 2050. in Helsinki jobs 560,000 be will there that predicts plan master The possibilities. cycling and in pedestrian improvements well as as hubs rail important most the emphasises plan the connections, of traffic terms In use. residential –into park central of the parts and area airport Malmi the instance –for areas of new zoning well as city, inner as inthe density building increased of the a vision on is plan based master The people. 860,000 some to grow will in Helsinki population the that, by 2050, prediction on a is based planof Helsinki master city current The Helsinki 5.1.1 Fund. Fund. Property European M&G to area in the property office sqm 12,000 another sold Ilmarinen InDecember, property. in the tenant main is the €190 for KPMG million. Ilmarinen from property office sqm 16,000 almost an acquired Immobilien Deka when Töölönlahti in the place area, took in Finland ever transaction office single year, in the largest the Early investors. foreign large by mostly CBD, Helsinki in the place took transactions property major In 2018, several late 2018. in completed was which library, central new the well as as Hall, Finlandia and Hall Music City the as such buildings cultural major also are there area, Inthe station. railway main of the vicinity in the Töölönlahti the area towards extended been recently has area office CBD Helsinki The refurbished. and well maintained it is mostly but 1900s, early and late1800s in the built was CBD Helsinki in the stock office of the majority The offices. Helsinki rental index area) CBD (KTI Office Maanmittauslaitos & ESRI Finland LITE open data, licensed under CC BY 4.0. BY CC under licensed data, open LITE Finland &ESRI Maanmittauslaitos KTI. by map the to Additions ”Foreign investors out ”Foreign carried several major transactions in the Helsinki in 2018” CBD month, and the average rent at some €30/sqm/month. €30/sqm/month. at some rent average the month, and €33/sqm/ at some stood agreements rental office of new quartile upper The context. Finnish in the rate growth high 6% in 2018, some by exceptionally is an which increased offices CBD Helsinki for agreements rental new for index Rental KTI The growth. rental positive by supported also is offices CBD of Helsinki performance investment The onlevels well below this. closed been have properties best at 4.1% very of the Transactions on average. stood CBD inthe property office an for 2018, yield prime the inOctober out carried Barometer Property RAKLI-KTI the In decrease. to continued have CBD in the properties prime for yields the Therefore, demand. rental secure and liquidity its by investors attracts CBD Helsinki The in 2018. CBD in the property office hotel in a invested Group HYY and properties office acquired Conficap and Fund Nordic CapMan’s investors, local the Of property. office House Custom called so in the invested fund BlackRock’s and centre, shopping Kluuvi the acquired fund AXA’s Fund. Retail City Europe AEW by property retail and office House Book called so of the acquisition the was transaction major Another 71 5 Property markets in different regions 72 5 Property markets in different regions hotel use are also underway in Katajanokka and Hakaniemi. and in Katajanokka underway also are use hotel to office from projects conversion centre, city of the vicinity the In projects. extension and redevelopment undergoing currently are CBD in hotels the in 2021. two addition, In hotel modern a240-room open and project extension an out carry to is planning and station, railway main the to opposite in Kaivokatu, building hotel and office an acquired Group HYY project. conversion another start to is planning Barings in hotel,Unioninkatu, and a500-room into premises office is converting fund Exilion’s station, railway main At the 2019. in early opened in Bulevardi Hotel Lapland the and completed, was in Kamppi George 2018, In St. Hotel years. in recent use hotel to converted been have CBD in the buildings office several space, of office oversupply an well as hotels, as for demand increasing to Due remained below Index database KTI 90%. in the rate, which, low occupancy and costs increasing by pressured be to continued in 2018. return cent Income per 1 under to slowed down growth capital the expenditure, capital for need in 2018. increasing the to However, due increase to continued offices CBD in Helsinki values capital rents, increasing and yields decreasing of both aresult As Helsinki. in areas central inthe at 6.7% stood rate vacancy office Catella, to According CBD. Helsinki in the rates in vacancy adecrease as resulted also has demand space Strengthening 100 120 140 160 180 200 220 offices RentalKTI index, Helsinki CBD 80

1995 ”Rental growth accelerated growth ”Rental in

”Hotel supply is increasing in 1996

the Helsinki in 2018” CBD 1997 1998 1999 Rental index(HelsinkiCBD1993=100) the Helsinki CBD” Helsinki the 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: KTI 2015 2016 2017 2018 Median office rents, all rents, agreements office Median The main shopping streets include Aleksanterinkatu and and Aleksanterinkatu include streets shopping main The station. railway main the to next Citycenter and area, Kluuvi inthe Kluuvi and Esplanad) Galleria (formerly Galleria Kämp area, Kamppi in the Forum and Kamppi include CBD Helsinki inthe centres shopping Main affordability issues. affordability cost occupancy and behavior consumer changing the to due locations central most in the shops their closed retailers local and brands fashion In2018,shops. international some goods electric and decoration likehome premises, of large users some attracted recently also have CBD in the centres Shopping users. space of retail examples as restaurants and of cafes number increasing an and entrepreneurs, local stores, brand luxury international with is mixed CBD Helsinki inthe premises of retail base tenant The decrease. to even or stable remain to expected were rents areas, other in all whereas increase, to rents expected still of respondents majority the but positive, less turned rents retail CBD’s the for outlook the Barometer, Property RAKLI-KTI the In this. than higher significantly are rents locations best in the and premises small For month. €110 at some stood per sqm per agreements rental retail new of quartile 95% above inupper 2018. The remained CBD the in space of retail rate occupancy the database, rental KTI the In premises. best the for tenants find to easy it is very and low CBD, in the remains space retail of vacant amount The locations. shopping important most the around developed been have areas pedestrian extensive years, recent In streets. two these between is located store department Stockmann traditional The streets. two these connecting streets the well as as Esplanade Northern the month €/sqm/ 10 15 20 25 30 5

1996

positive in the Helsinki CBD” 1997 ”Outlook for retail rents is 1998 Leppävaara 1999 2000 2001 2002 2003 Helsinki CBD 2004 2005 2006 2007 2008

2009 Pitäjänmäki 2010 2011 2012 2013 2014 Ruoholahti

Source: KTI 2015 2016 2017 2018 Maanmittauslaitos & ESRI Finland LITE opendata,Maanmittauslaitos & ESRIFinland licencedunderCCBY4.0. ofEducationandCulture, web services, licencedunderCCBY4.0.Map:Ministry Data:OpenStreetMap contributors. OpenStreetMap Finland Additions tothemapby KTI. Prime retail area in Helsinki CBD eQ. by managed afund to area inthe property office an 2019,sold inearly and Patrizia million, €200 for Sponda from in Salmisaari, located House, Court Helsinki the investor. late2018, In acquired Hemsö aforeign also was seller the transactions, these in all and space, of rentable sqm 12,000-15,000 comprising large, were properties these All building. the refurbishing is currently and investment, BlackRock’s to next property office another acquired Genesta in Ruoholahti. properties office acquiring by investments property Finnish first their made BlackRock and Castellum Both investors. by foreign out carried were area in Ruoholahti transactions In 2018, largest the Group. Kesko by operated and rented and bySponda owned centre, shopping Ruoholahti in the is concentrated in Ruoholahti space Retail funds. international some well as as companies property and institutions domestic include area in the Investors database. rental low at 84% KTI in the quite remains rate occupancy the but tenants, attract area of the premises office efficient and Modern onaverage. month per sqm per €23-24 at some stand currently in Ruoholahti rents Office companies. insurance and banks consultancies, business companies, industrial and high-tech as such of businesses, avariety accommodate area Salmisaari adjacent the and Ruoholahti route. radial of western amajor point starting the at CBD Helsinki the near area office is a modern Ruoholahti Salmisaari – Ruoholahti and one office building being under construction. The block block The construction. under being building office one and completed be to about just buildings residential two with is underway block Wood of SRV’s City development The 2030. by jobs 6,000 and inhabitants 18,000 some accommodate to is planned area The construction. under were 600 some end, year at the and, area, in the completed were dwellings residential rental 2018, In 300 some projects. wellowner-occupied as as housing, rental subsidised non- and subsidised both accommodates area The area. Jätkäsaari in the active remains development Residential Jätkäsaari. in located is still Tallinn to Petersburg, Saint and ferries to Vuosaari. West The Harbour, which passenger serves operations its moved harbour the after development for freed was which area, Jätkäsaari growing is the Ruoholahti to Next in Ruoholahti. underway projects development major no are there 2018. Otherwise, of half latter in the in Salmisaari Campus Ruoholahti of its phase third of the construction Technopolis the completed planned in the area. area. in the planned being buildings hotel other four also are in 2019. There started be to planned building, ahotel comprise also will Ruoholahti attracted foreign foreign Ruoholahti attracted ”Large office properties in properties office ”Large investors in 2018” in investors 73 5 Property markets in different regions 74 5 Property markets in different regions Workery Offices. Offices. Workery Tripla the acquired Real Commerz by managed 2018, afund in late and Tripla in the invested property, hotel has fund Exilion’s project. centre shopping in the co-investors YIT’s are Conficap company investment and Fennia company insurance Ilmarinen, company Pension insurance in 2020. completed be will buildings 2019, office and hotel the and inlate of Tripla opened Mall be will The construction. under is also cars 2,300 for facility A parking dwellings. residential 400 some well as as rooms, 430 with a hotel sqm, 50,000 some totaling buildings office Tripla three centre, shopping of Mall sqm 85,000 the comprises project The YIT. by out carried being is currently Tripla project three-block the station, railway current of the surroundings in the area, Pasila Central Inthe redevelopment. major under is currently Pasila year. per 47 passengers million some with in Finland hub railway busiest the become to is expected station Pasila residents. 30,000 to triple almost of inhabitants number and 50,000 to double will of jobs number the plans, long-term city’s the In significantly. increase to planned are in Pasila stock property residential and commercial Both companies. media and service business and companies insurance agencies, city and government including users, of office mixture a colourful accommodates currently Pasila station. of the south area machinery old railroad the and Pasila Northern Ilmala, developing the Pasila, Western and of Eastern submarkets traditional the including areas of several consists Pasila centre. city of the north area market property multifaceted and hub railway important is an Pasila line. tram high-speed Kruunusillat new the and metro rail, connect would which Kalasatama, to Pasila from planned is being connection tram Anew strategy. growth of Helsinki City in the of growth” “axis an as is named area Pasila−Vallila−Kalasatama The Vuosaari. to operations its moved harbour the when development for released was land where area, Kalasatama developing is the there Sörnäinen, supply. to Adjacent office amultifaceted by characterised are areas Vallila. and These Sörnäinen Pasila, include centre city of the out somewhat situated areas office traditional Other Pasila –Vallila –Kalasatama restaurants. and cafes with seashore the along a promenade well as as buildings, residential accommodate also will area The project. in the investor as remain also will and area, the in plots the owns Skanska Agency. Chemicals European the to is rented which property, of a17,500 office sqm construction the with is underway Jätkäsaari, to next area, land Telakkaranta industrial and old of the dock development The ”The Mall of Tripla”The shopping centre willcentre opened be in late the Telakkaranta is area ”The construction of construction ”The underway” 2019” are currently being converted into hotel use. hotel into converted being currently are station railway main at the offices former Group’s VR Yle. company broadcasting Finnish the by refurbished premises the into Ilmala, to moved recently has Group VR company railway state’s Finnish of the office head The projects. onresidential is concentrated construction new current and properties, office and residential both accommodate will areas These station. railway of the north areas Pasila Northern and Ilmala the develop to plans major also are There area. in the buildings high-rise nine comprises 2021. or project the in2020 total, In started be to is estimated construction the and premises, retail and office hotel, residential, comprise will and area, planning of the part western in the located are buildings The million. €500 some of worth a total with buildings high-rise two comprising 2019, in early YIT and Properties Senate of Helsinki, City the by signed was project of the phase first onthe agreement Trigoni. The called proposal their with project, High-Rise” “Helsinki of the competition construction and design the won also YIT area, Pasila Tripla, to Central in the Next to Swiss Life Asset Managers. Of the domestic investors, investors, domestic the Of Managers. Asset Life Swiss to in 2018 completed sold and was phase first The sqm. 18,600 of some area gross atotal comprising project, Fredriksberg of their phases third and second the developing is currently NCC companies. telecommunications and of banks offices head example, for accommodating, currently Pasila, to next area light industrial and office Vallila is a traditional 94%. was rate in 2018,sqm occupancy the and €19−22 at some stood per agreements in new rents average the database, rental KTI’s In area. in the stock modern and older between significantly levels vary in 2018.Pasila Rental in decrease to continued space office of vacant amount The 100 110 120 130 Prime retail rent in the Helsinki CBD 50 60 70 80 90 €/sqm/month

2000 2001 2002 jobs accommodate 50,000

2003 residents” 30,000 and ”Pasila is planned to 2004 2005 2006 2007 2008 Source: RAKLI-KTIProperty Barometer 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (autumn 2019) dwellings were under construction in the area. area. in the construction under were dwellings new 2,400 than more end, year At the inhabitants. 3,000 some accommodates currently area The dwellings. occupied owner- and rental both comprises stock Residential projects. residential with started in Kalasatama work Construction jobs. 10,000 and people 25,000 some accommodate to is planned area the 2040, inabout completed When development. property new extensive and infrastructure in investments significant requires development where and combined, be will services private and public and working living, where area is another Kalasatama area. Kalasatama developing is the Sörnäinen to Adjacent stock. modern and traditional the between significantly vary also areas however, which, in2018. inthese improved rates, Rents low occupancy rather from suffered also have areas the and is varied, in Vallila Sörnäinen stock and of office quality The agencies. state by accommodated be will premises in 2018. The Properties Senate to sold was 2019, insummer and completion for is due project The area. in the sqm of 18,500 area agross with project office K6 the is developing Skanska buildings. office refurbished many accommodates currently which area, harbour and industrial a traditional Vallila to is Sörnäinen, Next premises. canteen and office old in the ahotel is developing fund OP’s and property, hall painting and old in the assembly premises office and restaurant event, exhibition, develop to plans project Factory in 2018 sold were 2019. and Train station of Pasila The south in Vallila, located properties, workshop machine old VR The in Vallila in 2018. properties in office invested funds UB’s and eQ’s well as as Antilooppi, Photo: Kojamo ”REDI shopping”REDI was centre opened in 2018”opened use building with residential, office and hotel premises. hotel and office residential, with building use mixed- one and towers residential seven comprise to planned is centre the Altogether, started. been just has second the 2019, in summer and completion for is due of which first the centre, in the towers residential constructing currently SRV is developer centre’s in late 2018. The Kalasatama in opened was centre shopping REDI sqm 60,000 The would transform the current Käpylä railway station into an an into station railway Käpylä current the transform would plans These area. in the accommodated be will residents new 20,000 some and boulevard, acity as developed be to is planned motorway Tuusulanväylä of Helsinki, City of the plans the In located. are headquarters of company couple a where stock office modern a relatively accommodate station railway Käpylä of the surroundings The Käpylä. area residential traditional is the Pasila of eastern North fund. OP’s by owned is currently Park Business Aitio AM. Corum to headquarter, Skanska’s as used Kathy-building, Rasti Manskun the sold 2018, In Investment Park. Union Business Aitio NCC’s of buildings two the well as as project, Rasti Manskun of Skanska’s phases two first the example, for accommodates, currently area supply. space The modern mostly with area office Ruskeasuo is the Mannerheimintie, by Pasila, to Next Ruskeasuo million. in 2018 €165 for Estate Real Investment Union to sold was building The sqm. of 40,000 area agross comprising House, Environment Urban the is developing of Helsinki City the of 2019. half vicinity, in the Also first in the completion for due are and station metro Kalasatama of the vicinity in the located are projects Both area. in the project Park Business of Rantatie phase third the is developing Invest Lindström and tenant, main the be will Kesko where property, office K-Kampus sqm 35,000 the Varma is developing in Kalasatama. active be to continues construction Office ”Office construction remains construction ”Office active in Kalasatama” 75 5 Property markets in different regions 76 5 Property markets in different regions OpenStreetMap Finland web services, licenced under CC BY 4.0. Map: Ministry ofEducationandCulture, web services, licencedunderCCBY4.0.Map:Ministry Data:OpenStreetMap contributors. OpenStreetMap Finland Divisionopendata,Helsinki CitySurvey licenced underCCBY4.0. Additions tothemapby KTI. projects under construction inNew Helsinki office metropolitan area base investor The 1990–2000s. inthe use office mainly into converted was that area old isindustrial an centre, city Helsinki of the north kilometres seven situated Pitäjänmäki, Pitäjänmäki connections. light rail and bus train, for hub transportation important and Vantaaand rents in Helsinki,Prime office Espoo 10 15 20 25 30 35 40 €/sqm/month 5

1995 1996 1997 1998 1999 2000 2001

2002 Helsinki 2003 2004 2005 Source: RAKLI-KTIPropertyBarometer

2006 Espoo 2007 2008 2009

2010 Vantaa 2011 2012 2013 2014 2015 2016 2017 2018 (autumn 2019) area’s occupancy rate improved in 2018, but only stood in2018, stood only improved rate but occupancy area’s the database, rental KTI’s In years. several for Pitäjänmäki in high remained has space office of vacant amount The corporations. and investors foreign funds, and companies property institutions, comprises and is varied area in the looking for opportunities for changes of use in the area. area. in the of use changes for opportunities for looking actively are investors low to demand, Due 68%. at some Espoo and Vantaa and Espoo occupancy rates in Helsinki,Office 100 70 75 80 85 90 95 %

2007

2008

2009

2010 Helsinki

2011

2012 Espoo

2013 Vantaa Source: KTIRentaldatabase 2014

2015

2016

2017

2018 area Helsinki metropolitan the in industrial Occupancy rates retail of offices, and stock. residential extensive is also supply. There retail and office with area diversified a more into transformed gradually has that area old is warehousing an line. Herttoniemi metro the and route radial eastern the both to adjacent CBD, Helsinki of the east kilometres five area is an Herttoniemi –ItäkeskusHerttoniemi −Vuosaari Investment. Standard Aberdeen by managed afund from area inthe located properties office three acquired 2018, In Conficap area. inthe Garden Business Ultimes of the phase second the complete to Peab is about month. per sqm 13 per 17 and between euros vary rents office database, rental KTI In the companies. service professional and IT example, for among, attractiveness their retained have station railway the to closer buildings modern the whereas low rents, relatively through tenants attract to forced been have investors in particular, buildings older In Pitäjänmäki. in buildings and areas different the between markedly vary levels supply, space rental heterogeneous of the Because companies and Yleisradio Pension Fund are investors in the in the investors are Pension Fund Yleisradio and companies insurance life Aktia and Fennia centre. Megahertsi existing the with connected be will which station, metro bythe centre Hertsi sqm 20,000 the constructing currently are Hartela and YIT area. inthe small is rather of offices stock total The Marimekko located in Herttoniemi. in Herttoniemi. located Marimekko of property office head the acquired Finland Fund Estate Real 2018,In OP’s centre. Hertsi on the constructed be to building residential 18-store in an invested has fund OP’s part. existing in the investor is the fund eQ’s and centre, new 100 70 75 80 85 90 95 %

2003

property stock is increasingproperty 2004 2005 ”Retail and residential residential and ”Retail 2006 in Herttoniemi” in

2007 Office 2008 2009

2010 Retail 2011 2012 Industrial Source: KTIRentaldatabase 2013 2014 2015 2016 2017 2018 Espoo, Finland’s second biggest city, has property stock stock city, property has biggest second Finland’s Espoo, 5.1.2 Espoo area. in the space logistics of the owners main of the is one Logicor stock. property logistics extensive an with harbour, of Helsinki City the accommodates Vuosaari supply. retail area’s of the centre is the which Columbus, centre shopping sqm 21,000 is the station metro Vuosaari the to Next in Helsinki. areas growing fastest of the is one and residents 38,000 some accommodates currently Vuosaari Sciences. of Applied University Metropolia the for building campus new extensive an completed just has of Helsinki City the where area, residential is Myllypuro Itäkeskus to Next in late2017. vicinity in the completed was centre shopping Easton sqm 20,000 Kesko’s million. €500 over for Investing Estate Real Stanley Morgan by managed 2018 afund to in Wereldhavecentre the sold Dutch The metres. square 100,000 than of more area leasable agross with Europe in northern centres shopping largest of isthe one centre shopping Itis line.The Rail Light Jokeri new of the end eastern the It is also living. and retail both for area attractive an as development its line, supports metro eastern the by as well as route, radial eastern the Iand Road of Ring junction at the location area’s The area. Itäkeskus is the east Further property. in the invested has in 2018. Niam opened was Saari centre retail sqm 8,500 the where area, residential Laajasalo is the of Herttoniemi South park concepts. Prime rental levels are at the same level than than level same at the levels are rental Prime concepts. park business modern some well as as properties office head major several accommodating area office is a modern Keilaniemi areas. station new inthe is active construction residential and Retail modern. is mainly areas in these stock Office stations. metro new accommodate − all Matinkylä and Niittykumpu Tapiola, Otaniemi, − Keilaniemi, Espoo in southern submarkets property commercial established five The Matinkylä TapiolaKeilaniemi – Otaniemi – – constructed. being is currently Kivenlahti to line metro of the extension The inEspoo. stations new of the vicinity inthe markets property the boosting been has line metro western new of the construction The database. rental KTI the to 2018, according in September rented were investors by large owned premises office all 78% however, of some only Espoo, whole markedly. Inthe increased has rate occupancy the and years two past the in increased has demand railway, office western the and Turku I,the motorway Road Ring the by located Leppävaara, line.In Tapiola and metro Keilaniemi new the by include rates occupancy healthier with Areas areas. Olari-Niittykumpu and Kilo-Mankkaa the instance, for include, vacancies high from suffering Areas years. few past the for in Espoo areas many for aproblem been have rates vacancy office High properties. and areas in different rates vacancy levels and of rental development diverse in the seen be also can which is multifaceted, stock property commercial Espoo’s plans. current to in 2023, according is completed extension the when metro the by served be also will Espoonlahti, centre, fifth line. The metro western by the are Matinkylä-Olari railway, Tapiola and western the by and are centre Espoo and Leppävaara centres: regional five within scattered 77 5 Property markets in different regions 78 5 Property markets in different regions one of the most significant retail centres in Espoo, which also also which in Espoo, centres retail significant most of the one is project, line metro current of the stop final the Matinkylä, areas. station these in all active remains development Residential Niittykumpu. and Tapiola Urheilupuisto after are stations two next The Keilaniemi. in lower than 2-3 some euros in TapiolaRents typically are redeveloped. been has properties of older part alarge where stock, office adiversified Tapiola accommodates also area The space. of retail sqm 50,000 some comprise will centre in late2019, in Tapiola. completed the When construction is under centre shopping Ainoa of the phase third The stock. property new and existing and infrastructure transportation in both investments major includes project The redevelopment. major undergoing is currently which area, residential and office retail, Tapiola is atraditional of Helsinki. Union Parish the and Pension Foundation YLE Varma, Ilmarinen, between ajointventure to building Kvartti Spektri the sold in 2018, completed Keva when was park business of the ownership of the centralisation The Park. Business Spektri sqm 50,000 I,is the Road Ring the by Otaniemi, to Next in late2018. fund eQ’s to sold it was and of Espoo, City the to is rented property The use. educational into it partly converting and property office sqm a26,000 is redeveloping vicinity,the Regenero in Also phase. fourth the by extended is now being campus Technopolis’s Innopoli companies. at high-tech targeted parks business several accommodates also area Otaniemi of The 47,500 sqm. area agross with building campus a new and station, metro atOtaniemi the located centre shopping ABloc sqm 6,000 the completed Properties University Aalto In2018, premises. of new development and buildings existing of redevelopment major through area in the campus main its it is centralising and in Otaniemi, is located University Aalto Keilaniemi. to next is located area Otaniemi The 2019. in spring opened be to is planned project tunnel metre 440 The development. residential for opportunities the improve and area of the attractiveness the increase both Tapiola, and to Keilaniemi in order between atunnel into I Road Ring the moving is currently of Espoo City The Sirius. by in Keilaranta buildings office of two acquisition in 2018 the area in the was transaction largest The building. in the tenant main the be will Accountor firm Accounting of Fortum. office head former the is redeveloping Regenero where Tower is underway, Accountor project called so the moment, At the use. centre congress and residential office, combining projects hybrid well as as buildings residential high-rise some including area, in the planned being projects development property major several are There Catella. to at 10.4%, according stands currently area in the rate vacancy The month. per sqm €22-24 at some per in Ruoholahti, ”Otaniemi and Tapiola areas are developing” are Espoonlahti area. Citycon is carrying out a major project a project major out is carrying Citycon area. Espoonlahti line, is the metro of the extension the along west, Further centres. shopping Liila and Merituuli the well as as properties retail bigbox mainly accommodates currently area The of Suomenoja. area manufacturing light and retail traditional is the West of Matinkylä project. the to connected hall a swimming construct will Espoo of in late 2019. City completion for due The properties, hotel two inits invested has Veritas company insurance pension the and project, in the developer is the Lujatalo underway. is currently facilities parking and hotel, residential comprising project development ahybrid Omena, Iso to Next space. of lettable sqm 100,000 over comprises currently centre shopping The station. metro Matinkylä the accommodates it also and extension, and redevelopment amajor undergone has centre shopping Omena Iso Citycon’s of Espoo. areas southern and western the from connections traffic public the for ahub is also station Matinkylä buildings. office modern some accommodates remains high in Leppävaara and in the adjacent Perkkaa area. area. Perkkaa adjacent in the and in Leppävaara high remains activity construction Residential project. in the invested has Keva and property, the 2019. is developing in early Hartela completion for is scheduled Finland Ramboll firm consultancy and planning technical of the building office new The park. business Stella the of buildings of the one acquired vicinity, the In Antilooppi in 2018. Yield OP-Rental fund to sold was building the and in late2017, Park Business Alberga of the phase final and fifth the completed NCC parks. business in these projects extension ongoing no are there moment, At the in phases. built have been which buildings, several with complexes park by business is characterised area Leppävaara The supply. residential modern some and premises retail older some centre, shopping Sello sqm 100,000 the stock, office adiversified comprising area, Leppävaara is the railroad western the by also and motorway Turku the Iand Road Ring along of Otaniemi, North Leppävaara apartments. 550 residential some and terminal bus station, ametro comprises also in late2021. project The completion for scheduled and construction under currently is centre Lippulaiva sqm 42,000 Anew centre. Pikkulaiva sqm 10,000 atemporary by replaced and demolished was centre shopping Lippulaiva the where area, in the ”Vacancy rate in decreased ”Residential construction construction ”Residential activity remainsactivity high in Leppävaara” Espoo” Group and Wihuri in Viinikkala. Aberdeen Standard Standard Aberdeen in Viinikkala. Wihuri and Group Posti for completed were properties 2018,In logistics new investors. attracted also has segment this and years, in recent area in the active been has development property Logistics supply. space modern rather with hub logistics important an form also areas Viinikkala supply. adjacent the and Aviapolis retail abundant and stock hotel increasing an premises, office modern includes Aviapolis area in the stock property Commercial connections. railway main and centre city the with area the linking in Aviapolis, well thus as as airport the at stations has Line Rail Ring The is estimated. jobs 15,000 additional of some growth further and jobs, 35,000 about accommodates area The growth. significant for plans further and area in the inhabitants 18,000 some currently are There development. area’s the boost to and base financial the expand to order in Pontos Oy and NREP to company of the shares of the 2018, 51% sold inearly Finavia but of Finavia, company daughter is aformer Estate Real LAK companies. property several and developers property major all Estate, Real LAK of Vantaa, Finavia, City the include area in the players main The years. few past the during rapidly developed has Helsinki-Vantaa the Airport around Aviapolis area The Aviapolis properties. service and retail several and projects residential abundant including areas, station the around development property boosted has Line Rail Ring of the development The city. of the administration the accommodates also which centre, Tikkurila traditional in the well as as surroundings, its and airport the around concentrated are areas market property commercial important Vantaa,In most the 5.1.3 Vantaa centre. in Espoo is high activity construction Residential property. retail sqm 10,000 another is planning in late2017. confirmed vicinity, the In YIT finally was plan the but issues, planning to due years several for postponed been has project The area. in the center shopping a major planning are HOK-Elanto and Kesko units. retail large other and stores electronics car, furniture, mainly comprises space retail III, Road Ring and Turku of the motorway junction at the centre Espoo to next situated area, Lommila the In centre. inEspoo located are Entresse and Espoontori centres shopping The route. railway western the alongside and Turku the motorway to close of Leppävaara, west situated is buildings, retail various well as as city of the buildings administrative the accommodating area an centre, Espoo Espoo centre month. per sqm per €20 at some stand Leppävaara in offices for rents Prime Catella. to at below 10%, according stands recently, currently and leases significant some to due markedly decreased has inLeppävaara rate vacancy office The Aviapolis attract investors” attract Aviapolis ”Logistics properties in properties ”Logistics prime rents stand at above €20 per sqm per month. month. per sqm per €20 at above stand rents prime healthy, remains and demand Rental Catella. to according 13%, at some stands in Aviapolis in 2018, currently and increased rate vacancy supply, office increasing to Due project. industrial Pressi STC in the invested fund in 2018, OP’s and Kiinteistöt Tallberg- Julius to sold was project office Smart of Pressi phase first The project. Pressi the SRV is developing Rail, Ring the by and Hämeenlinnanväylä and III Road of Ring junction in the located area vicinity, In the in Vantaankoski NREP. by fund eQ’s to sold was building in 2018, Plaza another and Investment Union from III Road Ring the by Plaza park business of the buildings office two acquired Partners Capital Tristan by managed Afund area. inthe property office sqm a10,000 developing is currently NREP Also building. another with Campus Helsinki-Vantaa the late 2018, Technopolis and extended in project Aviabulevardi of the phase second the completed CDF Skanska located. are complexes park business several where III, Road Ring by and itself area airport in the both area, in the is abundant supply space office Modern DHL. to rented is predominantly property in 2018.Elo The from property logistics sqm a42,000 investor, acquired of aGerman vicinity, DWS, the In onbehalf property. Logistics Wihuri in the invested has fund Investments’ sqm logistics centre and head office property in late2018. property office head and centre logistics sqm a64,000 completed DSV inPäiväkumpu, north-east, Further in late2019. completion for due and AS, Fortus Norwegian the by construction is under Outlet of Helsinki phase first the III, Road Ring the by in Porttipuisto, airport, of the East gardening. and furniture vehicles, motor for outlets as such units big-box retail and park retail by favoured areas retail important also are Tammisto areas and Pakkala the Aviapolisarea, of the part southern the In inKoivuhaka. property hotel of a200-room construction the start to is planning Marriott area. residential expanding an also is and properties, office and logistics some units, retail large of Aviapolis, accommodates east just area, Koivuhaka The rooms. 540 with in Finland hotel 2019, largest the it became in February opening its by and rooms, new 230 by hotel the extended Varma has owner centre’s The premises. leisure and hotel, office comprising centre leisure Flamingo is the of Jumbo neighbourhood immediate Inthe area. in the centre retail major is the centre shopping Jumbo sqm 85,000 The terminal. airport the from metres 100 some just building, old office an from converted was hotel The opened. was Hotel Airport Helsinki 2018, Scandic the early In area. Aviapolis inthe is increasing supply Hotel ”Hotel supply increasing in the the in increasing supply ”Hotel airport area” airport 79 5 Property markets in different regions 80 5 Property markets in different regions all property Total returns in Finnish cities 2018, redevelopment. major under is currently area the and Line, Rail Ring the by markedly enhanced were centre Helsinki and trains long-distance airport, the between connections for ahub as position Tikkurila’s buildings. administration city’s of the most accommodates also Tikkurila Vantaa. in area retail and office important most –the area airport the –alongside and centre urban main is the Tikkurila Tikkurila warehouse properties in Hakkila. in Hakkila. properties warehouse and in logistics invested instance, for Sagax, and Conficap 2018, In is underway. project development property logistics smallish another and area, in the warehouse Ruokakesko the of extension another out is carrying Logicor area. warehouse and logistics established an is Hakkila, of Tikkurila East area. in Tikkurila active is also development Residential buildings. administrative inits projects redevelopment extensive out carrying of Vantaa is also City The premises. service and restaurant instance, for accommodate, also will property multi-use the phases, latter the In built. were facility aparking and space office of new sqm 5,000 some whereby Silkki, in Tikkurilan project conversion property old ofindustrial an phase first the completed 2019, later. early In phase larger, another, with even Renor continued be to is planned project The Väritehtaankatu. in premises hotel and retail office, comprising property multi-use sqm a10,000 completed In 2018, Sponda terminal. bus and station train Tikkurila the accommodates investors, are Ilmarinen and fund NREP’s where Dixi, centre office and retail The area. in the investments new out carrying are investors property several and infrastructure, its of Vantaa is developing City The Whole Finland,6.6% Other Finland,3.8% Jyväskylä, 6.7% Tampere, 5.8% Helsinki, 8.0% Vantaa, 8.1% Espoo, 5.5% Turku, 6.5% Lahti, 2.5% Oulu, 5.0% ”Office, residential and retail development is active in -5 Income return, % %■Incomereturn, ■ Capitalgrowth, -4 -3 Tikkurila” -2 -1 0 1 2 3 4 Source: KTIIndex 5 6 7 % 8 Prime office yieldsPrime in major office Finnish cities Road III and the Hämeenlinna motorway alongside the Ring Ring the alongside motorway Hämeenlinna the and III Road Ring to close is inKivistö, area development Vantaa’s biggest Kivistö facilities. facilities. working and lounge well as as aspa, accommodation, term longer- and rooms hotel normal both comprising Myyrmäki, in hotel of a322-room construction the start to is about NREP Virtatalo. as rebranded been has which property, office sqm a44,000 refurbishing is currently Elo company Pension insurance stock. office older some accommodates also area The of Myyrmanni. slightly north in Myyrmäki, located is also Isomyyri, sqm 15,000 the centre, shopping other Citycon’s station. the to next centre, in Myyrmäki is located centre shopping Myyrmanni sqm 40,000 The instance. for Vapaala Kaivoksela, and Martinlaakso, of areas neighbouring in the and in Myyrmäki high remains activity construction Residential people. 53,000 as much as region Myyrmäki greater the and inhabitants, 15,000 some accommodates currently area growing The Line. Rail Ring Vantaa the by inwestern centre is aregional Myyrmäki Myyrmäki in 2019. space of retail sqm 15,000 first of the construction the start is to objective current developers’ The made. be isto yet decision investment final the and postponed, been has project of the start The in phases. constructed be will which sqm, 100,000 some comprise to is planned centre the In total, Kesko. and HOK-Elanto NCC, Skanska, between is ajoint effort project The planned. is being centre service and shopping service afull station, Kivistö At the years. in recent area in the abundant been has development Residential jobs. many as nearly and inhabitants 50,000 some accommodate to planned are areas surrounding its and Kivistö Line. Rail 10 % 4 5 6 7 8 9

1995 1996 Jyväskylä Turku Oulu Vantaa Tampere Espoo Helsinki 1997 1998 1999 2000 2001 2002 2003 2004 2005

Source: RAKLI-KTIPropertyBarometer 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

2017 2018 (autumn 2019) the city centre with Pyynikintori. In the city centre, new new centre, city the In Pyynikintori. with centre city the of side eastern in the area hospital university the and south in the Hervanta combine lines in 2021. two completed The be to scheduled construction, under is currently tramway Anew centre. city of the side northern onthe opened recently −was kilometres 2.3 tunnel− road longest Finland’s in Tampere. is developing network transportation The at 9.5%in 2018,year. of the end at the stood and Tampere in the region markedly decreased Unemployment centre. city the to lake, close Pyhäjärvi by the area Viinikanlahti as well as area, Hiedanranta old the industrial campus, sports Hakametsä include of areas kinds of these Examples use. anew into areas of old industrial redevelopment and areas of new development the requires city of the growth The employees. 4,000 than more and students 30,000 has Community The community. education Tampere higher new the constitute Sciences, of Applied Tampere the University of 2019, with beginning together and in the merged were Tampere Technicaland University Tampere the University city, where Tampere is auniversity inhabitants. 250,000 than more accommodate to is expected city the 2030, of Tampere. By City inthe concentrating growth of the in 2018, people majority the with 4,500 by some grew region of the population The area. in the environment business the in developing cooperation active pursuing municipalities of eight consists Tampere region technology. healthcare and automation and machinery technology, information include Tampere in the region areas expertise Technology companies. service well as as businesses technology high attracted recently has that city Tampere old isindustrial an countries. Nordic in the city inland Tampere largest is the Population: Location: Tampere Oulu, Turku, and Lahti Kuopio Jyväskylä, centres:5.2 growth Other Tampere,

Tampere region in total: 390,000 390,000 in total: Tampere region Tampere: 232,000 countries Nordic in the city inland biggest the of Helsinki; 170 north km Helsinki metropolitan area area Helsinki metropolitan Transaction volume in cities outside the MEUR 100 200 300 400 500 600 700 800 900 0 uk Tmee uu yäkl Koi Lahti Kuopio Jyväskylä Oulu Tampere Turku region region region region region region ■ 20142015201620172018

10.8% at the year end, according to Catella. Catella. to according end, 10.8% year at the in Tampere at in 2018, stood and decreased rate vacancy Office month. €15 per at some sqm are per typically rents the stock in older month, whereas per sqm per €20 around levels are rental buildings, in modern locations office best the In Technical the University. alongside in Hervanta as well as hospital University the near in Kauppi centre the to Tulli, close and in areas of Hatanpää areas in the centre, city in the is found space of 2017. end the office Modern 1.1 some to at sqm million amounted stock Tampere office 2023. by in 2021, completion for project whole the and is scheduled of which first the in phases, built be will project The project. Arena multi-use in the involved Tampere is also of City The facilities. parking well as as premises retail and office ahotel, some towers, residential five people, 13,000 for arena amulti-use comprise will complex sqm 120,000 The project. in the invested have companies insurance Group’s OP and LocalTapiola SRV developer, and is the is underway. project Arena) and (Deck Kansi of Tampereen construction the station, railway the to next centre, city In the investors. estate real international and domestic both attracted has region The region. Helsinki the outside in Finland area market property active most is the Tampere region The discussion. active is under area metropolitan Helsinki the to connection rail fast the Also, areas. pedestrian and light transportation mainly into turned be will itself centre the and planned, being are facilities parking underground area of 27,000 sqm. area agross comprise to planned are project Kansi Tampereen of towers office The property. retail and office 13,700 sqm a is developing Sponda Ratina, In sqm. 34,000 of almost space gross a combined with buildings office two developing Technopolis is currently project, Kansi Tampereen the of vicinity Inthe projects. development planned and ongoing through of Tampere is increasing stock office The 530 ”Tampere stock office is Source: KTI increasing” 81 5 Property markets in different regions 82 5 Property markets in different regions cities, autumn 2018 autumn cities, Prevailing rents in major office Finnish comprising 285 rooms and planned to be completed in 2021. completed be to planned and 285 rooms comprising project, Kansi Tampereen of the hotel inthe operator the be in late2019. will Hotels completion for Lapland scheduled Tampere Hall, to next hotel Marriott a229-room developing is in Tampere. Keva increase to continues stock hotel The construction. under projects logistics two currently are There airport. the to close of Tampere and south inPirkkala, mostly concentrated been has construction property industrial years, recent In area. in the underway projects retail major no are there moment, At the sqm. 15,000 another by extended was centre shopping Ideapark sqm of Tampere, 100,000 the south 2018. Lempäälä, In inspring centre shopping Ratina sqm 53,000 the completed vicinity. Sponda in the centres shopping Ratina and Koskikeskus the and Hämeenkatu, street, main the include in Tampere locations retail prime The Catella. to according low in Tampere, 4.5%, at some remained has rate vacancy retail years, in recent construction new of active Despite 10 15 20 25 30 /sqm/month 0 5

Photo: YIT inKTIdatabase. Based onleaseagreements Lower quartile Upper quartile

Helsinki Median

Espoo

Vantaa

Tampere

Turku

Oulu

Jyväskylä

Kuopio Source: KTI

Lahti index spring 2000 =100 2000 spring index Turku, and Oulu, Lahti Jyväskylä Residential indexes rent inTampere, 100 110 120 130 140 150 160 170 180 boosted by the developing transportation infrastructure. infrastructure. transportation developing the by boosted partly ongoing, projects development numerous are There in Finland. regions city growing fastest of the is one which in Tampere, high is also activity development Residential were carried out in 2018. out carried were transactions asset single major no and portfolios, of larger part as exchanged in Tampere were properties cases, many In sectors. property all among spread widely was interest Investor region. in the active being investors foreign and funds domestic both million, with €560 to amounted volume In2018, transactions total area. metropolitan Helsinki the after area market active most second of the position the holds Tampere typically market, transactions In the in Tampere. steadily increase to continued have rents Residential Tampere. in projects residential the in investors are companies property and funds Domestic 90

2000 apr Turku OuluJyväskyläLahti Tampere 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: KTI 2016 2017 2018 in Oulu, supported by the increase in employment, and the the and in employment, increase the by supported in Oulu, strengthened has demand office cities, major in other Like University. Oulu and companies high-tech several accommodates which centre, city of the north area Linnanmaa the and centre city of the east Peltola just centre, city the to in addition include, areas office important most The sqm. 670,000 some to amounts of Oulu stock office total The market. office in the player important is an inOulu, founded originally Technopolis, company property listed The strong. quite remained has market in the position whose funds, pension domestic attract to enough is large market estate real Oulu’s at 11.6% year, of been the end at the having before. ayear at 9.5% stood in 2018. Unemployment region Oulu in the positively developed employment cities, major in most Like markedly. economy region’s the impact and employment the boost would project The planned. plant is being power nuclear billion a€6-7 in Pyhäjoki, of Oulu, vicinity the In services. information and software engineering, example, it: for supporting services the and manufacturing, electrotechnical in is specialised Oulu region. of the specialisations of the examples are services science life well as as sectors technology other services, technology Information is onservices. structure economic region’s Oulu of the emphasis The network. Europe Arctic of the is part city The country. entire of the area of the one-half –about Finland of northern all covers influence whose city technology and science is auniversity, Oulu municipalities. neighbouring of merger the to due recently more and jobs, new created which sector, high-tech in the growth rapid the to due first mid-1990s, the since markedly evolved has of Oulu City The Population: Location: Oulu Value added by employee (€) parenthesis in employee by Value added Value addedby sector and region 2016 Jyväskylä region (70,285€) Jyväskylä region Tampere (73,759€) region Helsinki region (84,485€) Helsinki region Whole Finland(73,937€) Oulu region in total: 247,000 in total: region Oulu 202,000 Oulu: of Helsinki north km 600 Kuopio region (71,763€) Kuopio region Turku (75,294€) region Lahti region (68,191€) Lahti region Oulu region (75,538€) Oulu region 80 40 60 20 100 0 % Private services ■Publicservices trade■Privateservices ■ Wholesaleandretail andfishery forestry ■ Agriculture, In 2018, Technopolis started the construction of a 8,400 sqm sqm of a8,400 construction the 2018,In Technopolis started €15 sqm. per at some stand rents office average, On month. per sqm per €20 slightlyabove at even or are rents office locations, best 2018. the In during markedly decreased rate vacancy office 2017, and some 2,000 by the end of the third quarter in 2018. quarter 2017, third of the end by the 2,000 some and in started being dwellings 4,000 almost with years recent in markedly increased has activity construction Residential out. rented be to premises include that will building by a new replaced and demolished be to is planned Hall City The station. railway at the project office and retail residential, amulti-use well as as planned, being are facilities prison and station police anew Also, buildings. hospital University inthe started be to about are renovations major and is underway, project hospital construction new sqm 24,000 The in Oulu. active remains also properties sector of public construction The centre. city the outside projects supermarket some include only projects ongoing and recent The on rents. pressure downward is some there Turku,Tampere but and in as level same at the stand rents retail Prime Catella. to according at end, 4.4% at year the stood rate vacancy the and up, picked recently also has premises retail for demand The project. property office and retail sqm a7,000 start to is about Movitek company service technical building local the Limingantulli, In centre. city the to close also property, office and residential sqm 5,000 is a mixed-use underway project Another centre. city in the building office Construction ■ ManufacturingConstruction ”Residential rents increased decreased in indecreased Oulu 2018” by 2.6% in in Oulu 2018” ”Office vacancy rate vacancy ”Office Source: StatisticsFinland 83 5 Property markets in different regions 84 5 Property markets in different regions of the construction is expected to be made by the next next the by made be to is expected construction of the decision final The 1.5 for people. million area commuting a unified create and hour one to time travel the decrease would which Turku Helsinki, and between connection train fast of the in Turku development is the planned being project development infrastructure important most The needs. businesses’ to respond better to in order area in the developed being are possibilities education instance, for therefore, and, personnel, of skilled lack the from suffering currently are sectors industry growing in2018. The Turkuthe region 74% to close in increased rate employment the sectors, industry in several development positive the to Thanks people. 6,000 some employs company The Turku region. in the development economic strong the to contributes of Turku, north kilometres 60 some in Uusikaupunki, growth Valmet Also, Automotive’s area. in the people 4,000 some employ bioindustries and health and Turkuin the area, is accommodated industry medical Finnish of the Half region. inthe people 6,000-7,000 some to increases number the Togethercontractors, its more. with is recruiting and people, 2,000 some employs currently itself company The facilities. in its investments significant made also has Werft Meyer mid-2020s. the until is secured shipyard Werft Meyer inthe employment the orders, major several to due and, strongly developing is currently industry shipbuilding The of view. point development economic region’s the from importance of great been traditionally has which business, shipbuilding extensive an by supported are region in the industries Metal biotechnology. and cluster sea the around businesses include areas competence current region’s The in Finland. university Swedish-language main the example, for city, accommodating, university traditional Turku is astrong of Finland. corner south-western in the municipalities of eleven consists Turku region The Population: Location: Turku deals. smallish mainly included and investors, local and funds of domestic activity onthe based was volume the Otherwise, Partners. Kildare by of Technopolis acquired being shares the to thanks million, mainly €380 some to amounted and in2018, inOulu increased volume transaction Property country. whole in the average ofthat the exceeded markets residential onOulu 2018, return total the in Index KTI In the cities. major in other growth the exceeds which 2.6% by increased agreements in new rents residential demand, increasing the by 2018, In supported cities. major in other than lower in Oulu is, however, significantly owners professional by developed residential of rental share The showing in the growth strong ”Sea and health”Sea are clusters Turku region” Turku region in total: 330,000 in total: Turku region 191,000 Turku: of Finland corner south-western in of Helsinki; west 160 km The largest local player is Turku player Properties. Technology local largest The in Turku. invested also have players European and Nordic Several area. in the holdings their increased recently have funds in Turku, property and have investments typically institutions Domestic players. local and domestic of foreign, amixture are market investment Turku in the property Players building. hotel 300-room new a by replaced and demolished be to is planned Hotel Börs Hamburger place, traditional the market the By in late2020. completion for is scheduled project The cars. 600 for facility of aparking construction the including is underway, area marketplace main of the reconstruction the centre, city In the north. in the Raisio to and east in the Varissuo to centre city the from connections of tram development the explore to decided council city the and discussed, being is also connections transport public local of the development The mid 2020s. in the started be to work construction the and parliament Rausanne is developing a nearly 200-room hotel property. property. hotel 200-room anearly is developing Rausanne investor alocal in Kupittaa, Also in late2020. property the to headquarter move its to and area in the property office of an construction the start to is about Veritas company insurance pension The completed. were building hospital Pohjola Group’s OP well as as building school medical of anew in2018 and projects is underway, the building hospital University of a new vicinity,In the construction the investors. other and institutional local of Turku and City the include owners other company. in the The a shareholder became Hemsö 2019, early In Swedish the Sciences. of Applied University Turku the for building campus sqm 28,000 anew developing is currently company The development. new and acquisitions through both portfolio its increased has years in recent and in Kupittaa, owner major is the Turku Properties Technology unit. development business local the Park, Turku the Science accommodates also area The space. manufacturing high-quality and of office consists and companies, service business-to-business and biotechnology at high-tech, targeted is mainly area This Turkuin the area. market office active most is the station, railway the to next and area University the near located area, Kupittaa The city centre and centre city Kakola areas” population in Turku” growth ”Active development in the development is supporting supporting is development ”Kupittaa area continues continues area ”Kupittaa to grow through newto grow ”Strong economic economic ”Strong construction” a multi-purpose arena, sports facilities and ahotel. and facilities sports arena, a multi-purpose comprising planned, is being centre event and entertainment sqm million, 200,000 a€450 station, railway the to Next area. in the construction is under 155-room property hotel a also but properties, residential mostly accommodate will area The centre. city the to close area prison Kakola former of the development the include underway currently projects development property major Other 2019 2030. and between developed be to is planned which centre, the for area land 55 the hectare acquired has city The shipyard. the of vicinity in the centre innovation and manufacturing Park Industry Blue extensive an planning of Turku is currently City the of addition, In Turku. north-east in Lieto, centre logistics sqm 20,000 anearly developing is currently Schenker up. DB pick to is starting but years low in recent been also has sector in this development of new volume The recently. sector in this decreased also have rates Vacancy sector. shipbuilding of the situation good the by supported is currently premises manufacturing and logistics for Demand building. hypermarket anew is building operative co- SGroup’s local the of Turku, where east Piispanristi, in is underway project property retail new ongoing only the Otherwise, redevelopment. under is currently centre shopping Hansa The vicinity. in its and Hansa centre shopping in the found be can space retail expensive most the centre, city the In units. retail large other well as as Skanssi centre shopping sqm 38,000 the accommodates area Skanssi The area. in the located is also Mylly centre shopping sqm 58,000 The retailers. car and furniture by, is occupied instance, for units of large supply abundant the Hauninen, In centre. city of the east area Skanssi the as well as in Raisio area Hauninen the centre, city the include Turku in the area submarkets space retail important most The this. than higher even are rents premises, smallest the for month, and per sqm per €20 exceed centre city the and in Kupittaa premises high-quality the for rents Office years. in recent development office of new low the by amount supported is rate occupancy healthy The below 7%. stands currently and decrease to continued rate vacancy of Turku, office the whole the In zero. to close fallen has rate vacancy the where in particular, area Kupittaa in the is strong demand Office companies. at creative targeted centre office and centre conference arena, event is an which Centre, Logomo in the well as as areas, Port and Pitkämäki in the found be can supply office modern Kupittaa, to addition In construction activity picking picking activity construction ”In the”In residential markets, Turku other outperformed ”Commercial property ”Commercial property major cities in 2018” up in Turku” of atjunction the located town is auniversity Jyväskylä Population: Location: Jyväskylä fund. Aktia’s to sold were centre of Logomo 2019, premises early In office the OP. Trevian by and managed funds well as as Assurance, Life in Turku in 2018 Nordea include investments making investors of domestic Examples deal. portfolio of alarger in Turku part as aproperty hotel acquired Corum Properties. Turku Technology from centre city in the properties office two €130 acquired Kielo, who Swedish the well million, as as in 20182019,€12 to early and and amounting transactions inTurku intwo expanded who Hemsö, included market in the active investors in 2018. million Foreign €290 some to in Turku amounted volume transaction property The growth. capital ahealthy to thanks cities, major other all outperformed properties on Turku residential 2018, In returns total increased. also has in Turku residential interest Investor increase. to continue rents residential and is healthy, demand level. Rental 2018 same at the is almost in volume the in 2017, of permits, number onthe based and, started being dwellings new 2,800 some with years, recent in Turku in increased has activity construction Residential building Valtiontalo (State House) is underway. is underway. House) Valtiontalo (State building heritage of the renovation the centre, city in the Also 2020. in completed be also will Reimari property office and retail the centre, city Inthe area. in the project Arkki Kankaan the start to is about Jykia local The project. in the invested has fund Fennica and area, Kangas in the property office sqm a10,600 Peab is developing in Jyväskylä. also development new boosted has demand in space development Positive Turku. in Tampere and as level same at the levels are rental premises, and locations best very the In tenants. attracting have continued in particular, offices, Modern Catella. to according 9%, at some stands of offices rate vacancy The construction. office and residential for area is adeveloping Tourula, to next Kangas, area mill old paper The centre. city the to next area, Lutakko in the found be also can supply office modern Some use. office into redeveloped been have properties old industrial side, where northern in the Tourula and centre, city of the south area Mattilanniemi/Ylästönniemi the include supply modern with areas office Other locations. central most the in developed been recently has stock new no but region, the in area market office important most is the centre city The 12% in 2018. 14% some in 2017 from to decreased rate unemployment average the Employment, and Affairs of Economic Ministry the to in 2018, according and, in Jyväskylä significantly improved also markets Labor workforce. of the 80% some employ services while industries, manufacturing the in 17.5% are Some region inthe jobs of the industries. healthcare and ICT materials, construction and wood cover areas industry region’s Jyväskylä The technology. new and industries traditional both emphasises structure economic Jyväskylä’s roads. main national important several in total: region Jyväskylä Jyväskylä: of Finland centre in the of Helsinki, north 270 km 185,000 141,000 85 5 Property markets in different regions 86 5 Property markets in different regions which was the second highest figure among the larger cities. cities. larger the among figure highest second the was which at 14.3%, stood recently, unemployment and improved has situation the cities, major However, other in many as years. in recent in Lahti high been has Unemployment 30%. to decreased has share industry’s while region, in the jobs of the 60% around represent currently occupations trade and Services region. in the operators logistics attracted has location favourable region’s The design. and in cleantech competence emphasises also region in the base educational The services. professional to transferred been have jobs more Recently, industries. plastics and furniture woodworking, metal, to is that home city industrial is atraditional Lahti Population: Location: Lahti supply. increasing the to due years, in previous than at aslower pace although increasing, continue rents Residential Jyväskylä. in properties in 2018, comprised Stanley also Morgan and Kojamo by out carried those instance for transactions, portfolio residential largest the and investors, attracting also is market residential rental Jyväskylä level.The same the atin 2017, remain to in 2018 volume expected the and was started was dwellings new 2,000 of some construction the and in Jyväskylä, is high activity construction Residential in 2018. in Jyväskylä properties in commercial invested Assurance Life Nordea well as as by Evli,Fennia, Trevian and managed funds instance, for investors, in 2018. domestic the Of in Jyväskylä transactions in significant involved investor foreign only the was Sagax increased. of transactions number the but significantly, 2017, to in 2018.million Compared decreased volume the €200 some to amounted inJyväskylä volume transaction The in Jyväskylä. projects construction retail ongoing no were there end, year the in 2018, at area in the and completed was project smallish One centre. shopping Seppä sqm 24,000 the instance, for accommodates, area The region. Jyväskylä in the area retail significant most the centre, city the with is, along city the of north area Seppälä the market, property retail In the properties. hotel and retail well as as facilities sports hall, multi-purpose a comprising area inthe is planned project development million A€300 inJyväskylä. development under area significant is another city of the south area Hippos The ”Office property development property ”Office dominated the transactions picking up in Jyväskylä” in up picking market in Jyväskylä” ”Domestic investors”Domestic Lahti region in total: in total: region Lahti Lahti: of Helsinki north-east km 104 120,000 200,000 the largest project underway was Luhta’s 20,000 sqm sqm 20,000 Luhta’s was underway project largest the of 2018, end At the years. in recent in Lahti active rather been has development property logistics and Industrial in 2018. in Lahti project development office new completed only the was This use. office police for area in the property office an developed Senate State’s The use. residential mostly into redeveloped be to is planned area garrison Hennala former The companies. service business for premises office instance, for redeveloped, – has properties of old industrial developer and – a owner major Oy Renor station, railway the near area, Askonalue old industrial the In centre. city in the project sqm 2,500 ongoing one was there end, year at the and completed, were low in 2018, projects major no remained and activity development property Retail sqm. of 34,000 area aleasable with Karisma centre is shopping there area, Karisto the In street. main the along and Triothe centre shopping around is concentrated centre city inthe supply Retail areas. pedestrian increasing well as as terminal transport public anew and facility parking underground new a by, constructing instance, for attractiveness centre’s the increased has city The uses. other into buildings industrial old transferred have that efforts of redevelopment result a as increased has centre city of the attractiveness The and environmental industry sectors. Unemployment has has Unemployment sectors. industry environmental and bio and health food, emphasises city the strategy, In its cities. major inother than is greater sector public in the of occupations proportion The industries. manufacturing in 8% are some region, in the jobs the Of area. in the employer biggest is the sector service the at moment, the cities Finnish major in most As wood. to related mostly are areas industry Traditional Finland. ineastern Savo, is situated of province of the capital the and city auniversity Kuopio, Population: Location: Kuopio in 2018.3.7% as much as by decreased agreements in new rents index, rental KTI the to According years. in recent cities main in other slower than been has growth However, rental area. in the active are funds and companies property residential main the and in Lahti, active is also construction Residential properties. residential and investors local by dominated was market transaction the Otherwise, Corum. and Kielo by out carried were in 2018, transactions when investors foreign attracted market office Lahti the of years, a couple After investors. involve private also would centre leisure and sports water planned of the construction The underway. is still area of the planning The area. leisure and aresidential into area station old of the bus redevelopment the is planning city The Alfaroc. to rented property alogistics acquired fund OP’s where area, inKujala underway was project Another in Nastola. project warehouse and manufacturing in total: region Kuopio Kuopio: of Helsinki north-east km 400 132,000 118,000 mainly included residential and care properties. care and residential included mainly transactions the Otherwise, Kuopio. including cities several in of properties comprised which byCromwell, acquired portfolio the was market property commercial Kuopio the in involvement foreign only in 2018. The investors domestic by dominated was market transaction the in Kuopio, assets several included which Technopolis the transaction, Besides in 2020. completed be to is planned centre The Caverion. and YIT by managed and Leasing, by SEB owned and is financed project Kuntolaakso The inNiirala. facilities parking and hall swimming of anew development onthe agreement service and financing ina20-year entered of Kuopio City The sqm. 47,000 some comprise to is planned centre the total, In premises. service and retail office, of residential, 11,000 sqm some comprises phase first The centre. Portti Kuopion the of phase first the out carrying are Group Lapti and Kuopio of City the Group, VR centre, city the In properties. retail of some refurbishment the and facility parking underground of an completion the by supported been has attractiveness centre’s city city. the The outside 10 km some Center Shopping Matkus constructed newly the with competing is centre city Kuopio in the market space retail The in 2019. building sqm 8,700 another by completed be to is planned campus The area. campus Savilahti in the project Microkatu of its phase of another In 2018, Technopolis construction the completed high. relatively remains space of vacant amount The areas. hospital and University the to close locations in Technopolis well two as as Kuopio’s centre city in the is concentrated stock office Kuopio The investors. local and national of both consisting players domestic by is dominated market property Kuopio in the base investor property The 10.6%. at some area, metropolitan Helsinki the outside cities main in other at a lower level than stands it currently year, and past the during in Kuopio decrease to continued ”Technopolis is expanding its Savonia in Campus Kuopio” 87 5 Property markets in different regions The partners of this publication Kojamo is Finland’s largest private residential real estate company and a front-runner in the rental housing business. Our mission is to create better urban housing.

We operate in Finland’s most significant growth centres and with 50 years of experience, our Lumo brand provides rental housing and new services for urban housing. We actively develop the value and number of our investment properties Helsinki is the commercial, political and cultural capital by developing new properties and our existing property of Finland and a dynamic hub for international business. portfolio. We want to be the property market front-runner Helsinki is also a great region for living and working. It is and the number one choice for our customers. clean, stable and secure, with a very high standard of living and welfare. Kojamo’s shares are listed on the official list of Nasdaq Many of Europe’s biggest urban development projects Helsinki. are underway in the Helsinki region. New residential and working areas currently under construction make Helsinki www.kojamo.fi one of the fastest growing metropolises in Europe. According to estimates, there will be 860,000 people living in the city and 1,882,000 in the region by 2050.

As a prime location for innovative companies, Helsinki REAL ESTATE ASSET MANAGEMENT LTD welcomes organisations of all sizes. The City of Helsinki offers consultation regarding the business conditions of the LocalTapiola Real Estate Asset Management Ltd provides city to investors and companies that are looking for a new real estate portfolio and asset management services to location. The City also provides support for developers and separate account investors, and customizes portfolios to investors looking for real estate projects. meet the best allocation in the direct Finnish real estate sector for each separate account. www.helsinki-finland.fi We provide well-structured real estate funds to institutional or large real estate investors. The funds are developed by us, and all funds and assets are in our professional hands. Our funds give investors a defined risk and return exposure in the Finnish real estate market in range of the specific fund strategy and sector allocation. Our funds invest in direct KIINKO Real Estate Education is Finland’s leading training properties in Finland, and their investments are leveraged company. We offer a wide range of higher professional in order to optimize the return. Each fund and account has education and training services for middle management its own in-house team focusing on active portfolio and asset and executive-level leaders operating in the real estate and management. construction industries. For our tenants, we provide service concepts such as Carefree KIINKO’s unique concept brings together all players in the Space and Easy Going Home, including business premises industry – end-users, developers, service providers, investors and rental homes with all accessory services. and financiers. This gives us an excellent insight into the needs of our customers and their businesses. The market value of the assets under our management is approximately €3 billion. We have extensive knowledge RE Finland is one of our main events, to be held this year and insight of the Finnish real estate business, including on November 7. With over 600 participants, combining investment strategies, transactions, management and letting. seminars and extensive networking, it is The Finnish Real LocalTapiola is part of the finance house LocalTapiola Estate Summit – gathering executive and expert level Group, and thus benefits from the Group’s vast and versatile representatives from real estate related businesses in Finland. financial knowledge.

Our new seminar Future Spaces, to be held on May 8 in LocalTapiola Real Estate Asset Management Ltd has been Helsinki, covers a variety of future trends relating to the rewarded with the Finnish Quality Award 2018 and EFQM developed environment as it relates to both people and Recognised for Excellence 5 star. innovations, and offers a unique platform for networking among professionals representing all areas of the construction The Finnish Quality Award is an international reward industry and the real estate business. of excellence, appreciated by the interest groups of the organization. Read more about Kiinko: www.kiinko.fi, www.refinland.fi, www.futurespaces.fi 88

The reward encourages organizations and employees to develop the business systematically, and supports the build- up of a strong brand. SATO is one of Finland’s leading rental housing providers. www.lahitapiola.fi/kiinteistovarainhoito We aim to offer a comprehensive choice of rental housing and an excellent customer experience. As of September 30, 2018, SATO owns around 26,000 apartments in Finland’s

largest growth centres and in Saint Petersburg.

We promote sustainable development and initiatives through our operations and work in open interaction with our Newsec – The Full Service Property House in Northern stakeholders to generate added value. We operate profitably Europe – offers real estate owners, investors and tenants a and with a long-term view. We increase the value of our full range of services within Advisory and Property Asset housing assets through investments, divestments and repairs. Management, including property investment transaction advisory and leasing brokerage, valuation and analysis, We provide our customers with rental homes and customer real estate consultancy and corporate finance services. services. Our service promise is ‘Home the way you want it’, Our service portfolio also includes investment, asset and and our operations are guided by our Customer First service property management, corporate real estate management model. In 2018 we introduced a digital service, OmaSATO, and corporate solutions. for our residents, furthering our mission of home being more than just walls. Newsec was founded in 1994 and is today a partner-owned company with some 1,800 co-workers spread across the seven The SATO Group’s net sales in 2017 were €280 million, Nordic and Baltic markets. In Finland we have approximately operating profit €231 million and profit before taxes €185 400 employees, with offices in Helsinki, Tampere, Turku, million. The value of SATO’s investment assets is roughly Jyväskylä, Hämeenlinna, Kuopio, Oulu, Imatra and Vaasa. €3.6 billion. In a survey carried out in 2018 by the Great Place to Work Institute® Finland, Newsec Finland was nominated for the www.sato.fi 12th time among the top workplaces in Finland, and also the best workplace within the real estate industry.

Internationally Newsec has approximately €45 billion under management and it annually signs lease agreements of some 1 million square meters, manages transactions of some €3.3 SEB is a leading Nordic financial services group, guided by billion and does real estate valuations of underlying property a strong belief that entrepreneurial minds and innovative worth almost €165 billion. Thanks to large volumes, local companies are key in creating a better world. As a relationship presence combined with in-depth understanding of a range bank, SEB in Sweden and the Baltic countries offers financial of businesses, Newsec has a unique expertise in the Northern advice and a wide range of other services. In Finland, European real estate market. Norway, Denmark and Germany the bank’s operations have a strong focus on corporate and investment banking based on The market report Newsec Property Outlook Nordics has a full-service offering to corporate and institutional clients. been published since 2001 and Newsec Property Outlook The international nature of SEB’s business is reflected in its Finland since 2012. presence in some 20 countries worldwide. SEB has been present in Finland since 1984, and today has 320 employees The latest issue can be downloaded at www.newsec.com/ based in central Helsinki. insights/reports. SEB’s team in Helsinki offers a full range of financing and investment banking services to real estate investors. We work with everything from bilateral loans and syndication to a range of capital markets products and M&A advisory. We also offer SEB’s full product portfolio within debt- and RAKLI, The Finnish Association of Building Owners and securities-related advisory services. We also assist our clients Construction, brings together property and construction in foreign exchange, streamlining their cash management, professionals. RAKLI´s members include Finland´s most and providing other customized banking services. prominent owners of residential and commercial properties and infrastructure, tenants of commercial facilities, property www.sebgroup.com or www.seb.fi investors, building contractors and service providers. The members represent both the private and the public sector, and member organisations number almost 220 in total.

The core of our operations is to influence, connect, develop, communicate and provide insights.

Welcome to our website: www.rakli.fi. 89 Sirius Capital Partners focuses on opportunistic and value- YIT is the largest Finnish and significant North European add real estate investments in Finland. We make funds or club construction company. We develop and build apartments deals based on an investment theme. Our investors range and living services, business premises and entire areas. from global institutions to multi managers and fund of funds. We are also specialised in demanding infrastructure construction and paving, and we are a property owner, too. A strong track record in the Finnish real estate investment Our Partnership properties segment is responsible for the market coupled with experience in collaborating with leading financing the development phases of major development global players make Sirius a unique investment manager projects and the ownership and subsequent realisation of to work with. Sirius’ founding partners have extensive plots and developed properties at the right moment. experience in real estate investments and in principal positions in leading industry firms over the past 15-20 years. Our largest, and also Finland’s largest, construction project is Tripla, which is a three-block complex to be completed Sirius has raised a total equity capital of some €450 million in Central Pasila, Helsinki, in stages during 2019 and 2020. for four vehicles. Sirius currently invests on behalf of its third It includes the Mall of Tripla shopping centre, a parking fund, Sirius Fund III, and continues being heavily involved facility, public transport hub, apartments, a hotel and offices. in the management of the newly stock-listed company Cibus It is a perfect example of our urban development strategy. Nordic Real Estate that it has created for the IPO of the two earlier funds, Sirius Fund I Grocery and Sirius Fund II. Together with our customers, our nearly 10,000 professionals are creating more functional, attractive and sustainable cities www.sirius.fi and environments. We work in 11 countries: Finland, Russia, Scandinavia, the Baltic States, the Czech Republic, Slovakia and Poland. The new YIT was born when over 100-year-old YIT Corporation and Lemminkäinen Corporation merged on February 1, 2018. Skanska is one of the world’s leading construction and project development companies, focused on selected home Our pro forma revenue for 2018 was approximately €3.8 markets in the Nordic region, Europe and USA. Supported billion. YIT Corporation’s share is listed on Nasdaq Helsinki by global trends in urbanization and demographics, and Oy. by being at the forefront in sustainability, Skanska offers competitive solutions for both simple and the most complex www.yitgroup.com assignments, helping to build a sustainable future for customers and communities. The Group has about 37,000 employees. Skanska’s sales in 2018 totaled €16.6 billion.

Skanska’s operations in Finland cover construction services and residential and commercial project development. Construction services include building construction, building services, and civil and environmental construction. Skanska Oy employed 2,152 people in Finland at the end of the year 2018.

Skanska CDF Oy is part of Skanska Commercial Development Nordic, which initiates and develops office properties. The company’s operations are concentrated in the three metropolitan regions in Sweden, the Copenhagen region in Denmark, the Oslo region in Norway, as well as Helsinki in Finland.

www.skanska.fi

90 Publisher

KTI Finland Eerikinkatu 28, 7th floor 00180 Helsinki | FINLAND Tel. +358 20 7430 130 www.kti.f Graafinen ohje Photos: Partner companies’ archives Marraskuu 2015

REAL ESTATE ASSET MANAGEMENT LTD 2019 The Finnish Property | Market

THE FINNISH PROPERTY MARKET 2019 KTI Finland in co-operation with: City Helsinki; of KIINKO Real Estate Education; Newsec; LocalTapiola; Kojamo; RAKLI; SEB Group; Sirius Capital SATO; Partners; Skanska and YIT.