Market Report
Workplace Oo, Vitaminveien 4 2. half-year 2016 Letting assignment on behalf of Skanska CDN 2. half-year 2016 half-year 2. Market report Market
2 Analysis Department. This report hasbeenprepared byour a comprehensive setofdatabases. and builtupdetailedknowledge have closelyfollowedthemarket Since ourestablishmentin2003 we increases thelikelihood ofsuccess. and analysis,whichconsiderably involved. We offerhighqualityadvice property, substantialvaluesare purchase/sell orletcommercial Whether youare planning todevelop, Analysis market incommercial property. very goodknowledgeoftheinvestor our clients’preferences. We have commercial property, adaptedto entire process ofbuyingorselling provide supportthroughout the billion inthelastthree years.We transactions formore thanNOK30 Our expertteamhasconducted T ransactions DNB Næringsmegl NOK 200billion. properties foranamountinexcess of years wehavecompleted valuations of market participants.Inthelastthree one ofthelargest andmostrecognised number ofourassignmentsandare We haveseensignificantgrowth inthe properties anddevelopmentprojects. valuations forportfolios,individual have longexperience ofundertaking external valuationsofproperty. We market there isanincreasing needfor In asteadilymore professional property Valuation more than600,000m2ofspace. years wehavearrangedleasesfor some retail premises. Inthelastthree and combination properties and letting office premises, warehouse for clientsandtenants.We focuson Our brokers findthebestsolution Letting finding thebestsolutionforyouasclient. long experienceandbroadexpertise,arededicatedto purchase/sale ofcommercialproperty.Ouremployeeshave support withanalysis,valuation,advice,lettingandthe cities. Ouraimistobeyourpreferredpartnerandprovide agents andtheonlyonewithofficesineachoffourmain We areoneofNorway’sleading commercialrealestate
3 onomics -ec segments Macro Regions 38 40 44 48 50 54 56 24 28 32 5 6 8 16 etail R Hotels Bergen Housing Summary rondheim Stavanger Employees T CEO’s letter The bond market Macro-economics Macro-economics Warehouse/logistics The transaction market he letting market in Oslo The letting market ntents Co
4 CEO’s The autumn hunting season doesn’t just take place in the mountains - there is a hunt going on for investments around letter the country, at the same time as property owners on their side are hunting for tenants. The situation hasn’t changed significantly since the winter, but rather has intensified. There is however a different make-up to the investors that have dominated the transaction market compared with 2015. At the Anne Helene Mortensen, Chief Executive, same time, we can confirm a positive shift in the office rental DNB Næringsmegling market in Oslo.
At the start of 2016 many people felt that local and national expertise is a big plus. the market was saturated following the Ingrid E. Moe has taken over a position as hectic activity we saw throughout 2015. a letting broker in Oslo after many years as At the time of writing in October 2016 we an analyst on the office market. This means can confirm however that the number of that the letting team in Oslo now consists transactions this year will probably achieve of eight experienced advisors. Mads H. a “podium place”. In the office market in Wanderås, Ingrid’s replacement, is in place Oslo it is pleasing to confirm that vacancy is and has already started work on an analysis falling and rents are up. of the office market in Oslo. Also in Oslo the fifth and sixth members of the transaction You now have in front of you DNB team have joined and we’re pleased to have Næringsmegling’s fresh market updates on board Bjørn Olav Smørgrav (from DNB as at the beginning of October. This is Markets) and Henrik Baardsen (from Pangea supported by underlying analysis of the Property Partners). The transaction team in movements we see in the market. We are Oslo is thus fully equipped for the future with proud to be able to look back over a long a combination of experienced brokers and history at the same time as we analyse advisors with a background from finance. trends and look forward. We see that today’s property transactions In DNB Næringsmegling we wish to provide are becoming steadily larger and more our customers with tailored reviews of complex and involving an increasing the market. We prepare a large number proportion of institutional investors from of analyses that we do not publish. This both Norway and abroad. In arelight autumn, among others, we have studied of this in DNB Næringsmegling we are equity issues and the investment plans of strengthening our cooperation, particularly the equity funds, international funds as well in connection with purchase assignments, as Norwegian fund managers. with DNB Markets, which is a market leader in capital market activities (bonds and Three quarters of the transaction market equities) in Norway. DNB Markets for its takes place in and around the four largest city part has increased its focus on commercial regions, and our offices in Oslo, Trondheim, property as an asset classes in recent times. Bergen and Stavanger work closely together to carry out assignments together where DNB is thus a one-stop shop within appropriate. In this way clients can get the commercial property - with advice and best price for properties they are selling broking for purchases/sales/letting as well as because we have been able to present them analysis and valuations, not to mention debt to local, national and international investors. and equity capital solutions and M&A. Several leading clients confirm that the interaction that they experience between Good hunting! ar in Stavanger in the first half-year ar in Stavanger in the first half-year he office market in Oslo The office market volume a high A low level of construction, in the and moderate growth of conversions to has contributed amount of leased space trend falling vacancy being on a slightly office The year. the peak in the autumn of last since and our space level is 8.3% of total office current fall to 7.1% indicate that the level will forecasts The transaction market in finding challenges Many investors face to buy and arrangers, purchaseproperty in active advisors and investors are enquiries. owners with purchase approaching on Oslo, theDemand is concentrated that giveother main cities and properties to be the 2016 is likely return. a predictable than 200 year running with more third have with 2015 there transactions. Compared and portfolio transactions been fewer large international investors have to a lesser extent been able to satisfy their requirements. evP ary Summ rondheim and Stavanger and R rondheim been the largest net buyers this year. The DNB net buyers this year. been the largest increased both through has contributed group the life insurancelending and through In bond purchases. increased company’s we see that participantsseveral local markets thatwithout established bank relationships ordinary with an wish to invest in property challenges in obtaininglevel of risk face over have risen a little margins Credit finance. at the same time as floatingthe last year, lower. rates have trended interest Yield development is still pushing demand excess Continuing with long leases Properties yields lower. have been traded over the last year in such the range 5.00 to 5.50% at places as Elverum, Lillehammer and Haugesund. International investors with moderate debt have shown levels or 100% equity finance at higher the most willingness to purchase the prime yield has in Oslo, where prices 3.85%. to been reduced OUTLOOK GOOD ly imarily Pr ND A URN RET HIGH I growth are contributing to a high return this year. this to a high return contributing are and high CPI growth alling yield trend was down by 43% compared with the same period in the peak year 2013. was down by 43% compared F the risk of a long- This reduces low prices. is less risk of continuing and there is in better balance The oil market will gradually economy expects that the Norwegian downturn in Norway. DNB Markets lasting economic in letting risk. 2019, something which again indicates a reduction in growth to its trend and return strengthen has been on a of many portfolios and vacancy here proportion a large segment in Oslo constitutes The office of 2014. the autumn since for the first time now increasing are rents Market over the last year. falling trend T vacancy is 10% or higher in Bergen, Office is proving better than expected for property investors, who are on course for a third year of year of who are on course for a third than expected for property investors, is proving better • • • • 2016 here are however large geographic variations and in several segments around segments around and in several variations geographic large There are however outstanding returns. a reduced commercial property has however, markets are challenging. Overall Norway the letting terms a primarily positive outlook. downside risk this year and in general We have for the most part a well-functioning We property, for commercial loan market other among something that is reflected, things, by the fact that the arrangers have Loan financing he Norwegian economy is characterised is characterised The Norwegian economy indicators but expectation by weak growth, show that business now considers Property to be a little brighter. prospects from investors can derive some comfort its has increased the fact that DNB Markets estimates for CPI by a total of 2.3 growth 3-year points for the present percentage with the corresponding period compared outstanding After three last winter. forecast suggest now forecasts years, macro return composed next year broadly that from portfolios will see a moderate property return. in line with the direct return conomic situation and the and the situation Economic property impact on commercial
6 sale, combined with less aggressive demand sale, combined withlessaggressive demand individual properties withgoodlocationsfor at yieldlevelsofaround 5.0%.Alackoflarge the publicsectorare beingsoldintheoilcapital Stavanger butproperties withlongleasesto letting riskhaslimitedthefallinyield for Bergen andT contributed toagenerallyfallingyieldtrend commercial property withalowriskhave Low borrowing costs andexcess demandfor Bergen, T high standard incentral areas. development willbebestforpremises witha continue toriseslowlyinthecoming years.The Our expectationisthatmarket rents will for thefirsttimesince theautumnof2014. suggest thatmarket rent levelsare nowrising by theendof2019.Datafrom Arealstatistikk *Estimations 2016(DNB Markets, SSB) Housing related Other/confidential HEC (longcontract) Hotels Warehouse/logistics (longlease) Retail Office The transactionmarket Stavanger Trondheim Bergen Oslo andAkershus Office market (5y SWAP +margin) Average costofdebt 10y SWAP 3m NIBOR House prices Consumption Employment CPI GDP mainland Main figures rondheim andStavanger higher rondheim aswell.Ahigher
| **YTD Population growth Housing prices R Prime rent warehouse T Employment growth Key indicators 5,50 % 5,00 % 4,75 % 3,85 % Prime yield 3,2 % 2,0 % 1,3 % 7,2 % 2,0 % 0,6 % 2,2 % 1,0 % 2015 urnover shoppingcenter evP ar Norway | Source: DNBMarkets, SSB, DNB Næringsmegling vacant premises. In particular, theshoppingcentres havefew experienced amoderatelygooddevelopment. the logisticsandretail segmentshave challenging fortheoffice andhotelsegments, to NOK6.8billion.Whileconditions havebeen million inthethree cityregions. Theseamount transactions withaminimumvalueofNOK50 T 16% ofthetransactionvolumesofarthisyear. to thethree citiesintotalonlyhavingabout (fewer purchase approaches) hascontributed good prospects. DNBMarkets’ estimatefor property ingeneralhasonlymoderately space changes/capacitygrowth, butretail the endofAugustwhenoneadjustsfor Shopping centre turnoverisup3.0%asat Other segments o date in 2016 we have registered a total of 29 o datein2016wehaveregistered atotalof29 0,9 % 7,2 % 481 1 150 2,3 % 0,6 % 2015 3,5 % 1,5 % 1,0 % 7,8 % 1,3 % 0,4 % 3,7 % 0,8 % 2016E 2 600 2 400 2 600 4 100 Prime rent 1,1 %* 7,8 %* 469** 1 200 3,0 %** 0,4 %* 2016 3,6 % 1,8 % 1,0 % 7,0 % 1,8 % 0,5 % 2,6 % 1,4 % 2017E 11,3 % 9,9 % 10,3 % 8,3 % Vacancy by properties withlongleases. segment hasbeenparticularlycharacterised investors showinginterest. T are nowseeingsomeotherinternational invested incommunity buildingsandwe rents. TheSwedish company Hemfosa has developers offeringnewbuildingsatlower autumn of2013hashowevercontributed to location. Thefallininterest ratesfrom the rising slightlyforproperties withtheright been reduced inrecent yearsandrents are the warehouse market intheOsloarea has very challenginginStavanger. Vacancy in market variesfrom verygoodinOsloto to around NOK30billionthisyear. The hotel growing rapidlyandisnowlikely toamount 2017–2019. F rate ofonly2.3%onaveragefortheyears private consumption nowshowsagrowth 3,00 % 4,00 % 4,00% 5,25 % 3,85 % 3,85 % Prime yieldOslo 3,6 % 1,8 % 1,0 % 4,0 % 2,5 % 0,8 % 1,7 % 1,9 % 2018E Estimated rents urthermore, Internetretailing is 3,7 % 2,0 % 1,0 % 3,0 % 2,7 % 0,8 % 1,5 % 2,1 % 2019E 3,4 (16) 1,4 (8) 1,5 (5) 2,7 (9) 5,7 (24) 9,0 (33) 18,4 (51) NOK bn(quantity) Transaction volume Estimated vacancy urnover inthis
7 eduction in vacancy of 20,000 of 20,000 eduction in vacancy R Q1 2016 to 8.3%. m2 into since that up to including estimate We will be at 370,000 m2 2019 there 320,000 m2 of new building and of conversions. in new interest An increasing buildings that will be completed 2018/2019. from • • • Øvre Vollsgate 15 Øvre Vollsgate he office market continues continues The office market a reduction to be “saved” by as a result in the supply side level of of a continued high a low level conversions and is of newbuilding. Vacancy to 7.1% at expected to fall the end of 2018. Letting assignment on behalf of Abel Eiendom
Oslo in market he lettThe ing
8 STABEKK Office vacancy osl 18,2 T 15,3 BEKKESTUA otal office v 8,5 FORNEBU LYSAKER BÆRUM ASKER/ acncy Oslo, Asker/Bær RØA , Asker and Bærum sept. 2016 (%) E 8,3 BYGDØY SKØYEN VINDEREN um : 8,3 % 7,2 9,0 2,9 CBD 8,2 6,7 within thenext12months. that are vacanttodayorare ready foroccupation Our definitionofvacancyincludesoffice premises YTRE SENTRUM INDRE SENTRUM YTRE SONE outer outer NYDALEN STORO/ Inner zone 3,7 City City CBD E TØYEN SINSEN 33 km Osl KM OSLO LUFTHAVNGARDERMOEN 13,4 16,3 o Airport gardermoen KJELSÅS GREFSEN/ BRYN HELSFYR/ ULVEN ØKERN/ ALNA E
9 level of interest from public sector tenants, tenants, public sector from level of interest the from the private sector apart as well as believe that there are oil industry. We pointing several important indicators office employment towards growth in and Bærum. The national in Oslo, Asker carried out by business outlook survey positive in the Norges Bank was marginally in the second first quarter and negative index has quarter the In the third quarter. business been positive and Norwegian to future optimistic with respect leaders are a conducts he Manpower group T growth. similar outlook survey which differentiates the size of employer and between regions, The Manpower survey indicates net sector. Oslo where in Greater employment growth large the majority is expected to be from than 250 employees. with more companies the fourth from This is an improvement quarter of 2015 when net expected employment was negative. of both increased Against a background business optimism and low macro-economic the choose to retain we prospects growth demand same moderate estimates on space absorption Space report. as in our previous employment be less than what will probably should indicate because of both growth hidden vacancy and the fact that more efficiently. more using space tenants are ver the last 10 years employment in in Over the last 10 years employment than jobs has risen more typical office in Norway. Office employment in general and Bærum Asker employment in Oslo, of all office one third for roughly accounts and during the employment in Norway, than the by more same period has risen general. in country employment According to DNB Markets in office occupations will probably increase less than employment overall years and represent in the next three They in future. a smaller proportion in petroleum reduction estimate a marked investments in 2016 and 2017, something effects for that will have knock-on is growth employment. The greatest intensive expected to be in less office and such as health, welfare occupations office- education. In the case of more intensive sectors, such as the oil industry, banking and media, demand for space with previous compared may be reduced a new type of space years years. In recent in which tenants absorption has emerged with a view amounts of space lease larger with to subletting to smaller companies and start-up requirements limited space businesses. Such solutions can have synergy productivity benefits, lead to increased and the exchange of information across is international and disciplines. The trend Oslo has been good in Greater growth is not so appropriate although the concept or in buildings which in the city centre difficult to fill. otherwise are Oslo, Asker and Bærum have been hit by the reduction in staffing in oil-related businesses as a result of the fall in the oil price since 2014 to a lesser extent than in other regions, and have seen positive period. We during the employment growth still see however examples of companies in the oil segment, costs reducing that are demand. in lower space which again results In DNB Næringsmegling we find that so level of has been a high far in 2016 there with a good market activity in the office Demand – Main indicators – Main indicators Demand growth signal employment ysaker where we see a fall in office we see a fall in office where ysaker There is still a good level of activity in There is still a good level of activity in the letting market with some geographic clearly In addition, we see exceptions. in new buildings that interest increasing public Large in 2018/2019. will be completed searches sector users have commissioned of these Statsbygg and several through We number of offers. a large have received and good is high demand find that there located willingness to pay for centrally is The exception high quality premises. to be found along the western corridor continue companies the oil-related where their space staffing and thereby to reduce is some there As a result requirements. are owners subletting but also property market the withdrawing buildings from for further development. This is the case at L vacancy of almost 20,000 m2, but where absorption. space pure little is derived from The main reasons for the reduction The main reasons for the reduction in vacancy Is a decline in the supply side of few new office with the completion of buildings, a high level of conversion and moderately positive premises office The level of new demand for space. building is low this year and next and 70,000 m2 in 2016 amounts to respectively properties and 90,000 m2 in 2017. Office have several alternative uses and helped we see by the high level of house prices which extensive conversion, continued with the low level of new combined supply of in a negative building is resulting We expect that the buildings in 2016. office up to 2019. will continue trend For the second year running we are For the second year in the office seeing a fall in vacancy market, with vacancy now standing m2) which at 820,000 m2 (840,000 down is Vacancy 8.3% (8.7%). to corresponds and marks a 0.7% over the last 12 months of increasing a trend turning point from and Bærum as a vacancy in Oslo, Asker other things, of weak demand among result, tenants. Vacancy related oil industry from in the autumn of 2015 and the peaked indicates that vacancy will trend forecast down to 7.1% at the end of 2019. Main features
10 1 000 (100 000) 400 000 900 000 600 000 800 000 800 000 200 000 (50 000) 300 000 840 000 860 000 880 000 920 000 820 000 740 000 760 000 780 000 100 000 250 000 350 000 150 000 50 000 0 - Supply, demandandvacancy(sqm.%) Change inofficevacancybetweenclusters(sqm) Office vacanciesinOslo,AskerogBærum(sqm,%) 2000 2004 Q1 2016
Increased vacancy 1. quarter 840 000
New office building,net 2001
2005 Helsfyr/ Bryn 2002
21 000
Fornebu 2003 2006
9 500
3. quarter 2004
West CBD CBD 2007
3 200 2005 r
educed vacancy absorption 2006 uter Outer zone 2008 3 000 2007
Bærum Asker/ 2009
2 2800 2008
2009 East CD CD 1 000
2010 Vacancy, %(r.a) 2010
Nydalen Storo/
2 400 2011 2011 Økern/ Ulven 2012
5 400 2012 2013 Inner city
6 000 2014
estimetedvacancy,%(r.a.) 2013 2015 Outer city
8 500 2016E 2014 Skøyen 2017E
19 500 L 2015 ysaker 2018E 19 500
Q3 2016 2016 2019E 820 000
0,0 % 2,0 % 4,0 % 6,0 % 8,0 % 10,0 % 12,0 %
11
ebates in the form of rent-free ebates in the form of rent-free has contributed to vacancy falling to vacancy falling has contributed sker and Bærum. Fornebu and Asker ysaker, The future a high level of The combination of new building conversion and low volumes believe that this We in the last half-year. and that negative net continue will trend vacancy that office newbuilding will mean Our forecast in future. is further reduced the fall from means that vacancy will at the end of of 8.3% to 7.9% level current in 2018 and 2019. 2017 and further to 7.1% have adjusted downwards our We last winter due to vacancy forecasts from in the supply side. This is due a reduction being withdrawn from to both properties newbuilding reduced as well as the market a estimates. It is first in 2019 that we expect positive net supply of space. During 2015 and in 2016 we have experienced increased differentiation in the market, between attractivenot only, as before, close to public transport hubsproperties with long walkingagainst properties to such hubs, but also to andistances extent between the westernincreasing of Oslo. The oil industry and the rest corridor important for the westernis much more and vacancy is now particularly highcorridor at L is also to a lesser extentThe western corridor a natural location for the many government space looking for and NGO tenants that are with the capital. in connection chart the our rent As one can see from differentiated a more is towards trend believe We development in the various areas. the out in has been taken that the correction growth and that price most attractive areas, quickly in the city centre more will come a where than along the western corridor, mustspace amount of vacant considerable to returns the market be absorbed before R balance. before periods etc. must also be reduced movement in rents. will be any upward there Storo/Nydalen as a single introduce We report. The previously cluster in this office growing closerare clusters separate office them as a singletogether and we now regard The attractiveness of Storo/Nydalen market. among tenants and is increasing as an area together with falling vacancy will lead to properties. for attractive office pressure price his takes place most often outside most often outside place This takes Conversion users and an over-supply Demanding office certain in resulted has space of office no longer being sufficiently properties a use and being given attractive for office conversion to another new life through use. clusters because the the established office to be less attractive location is considered from users, e.g. because it is far for office public transport hub or that the the nearest Such outdated layout is less appropriate. converted have often been properties office to to housing, and on some occasions use as schools, shops or hotels. In the last half-year we have also seen centrally to converted being properties located office hotels. An example is the old NAL building Petter Stordalen where at Jernbanetorget chain will operate a luxury and the Choice to building close office hotel in the present 2019. Østbanehallen from and over-capacity housing market A strong of a high level make market in the office believe We likely. more in future conversion good sale of new housing in a continued right are as the conditions in the future, are for this as long as new house prices of not significantly higher than the prices market. newer houses in the secondary ek after Indra ek after Indra vantor will complete Spikerverket Spikerverket vantor will complete ffice in the autumn of 2017. in the autumn of 2017. ax Office here is also a large amount of newbuilding amount of newbuilding is also a large There and at area the Hasle/Ulven/Økern around Hoegh Eiendom is Karvesvingen 2 where developing a new building for occupation is currently by Securitas in 2018. There a lower level of newbuilding along the Eiendom started but Ferd western corridor T of Asker the construction There are few big leases that expire in the period 2016–2017, which has reduced in the last buildings demand for new office two years. It is seldom for developers to new buildings speculatively. commence This means that developers must wait for period in the the big leases that expire related several searches 2019–2020, where in the expected to be signed to this are can thus expect quarter of 2017. We second a significantly higher volume of lease signings in the next 12 months than in the a last two-year period, and as a result 2019. from higher level of completions The variation in the supply side supply side The variation in the by three is determined primarily components: new buildings, vacated of existing and the conversion premises office properties. 160,000 m2 of new office in Oslo in 2016 and is expected space involving projects 2017, with the largest building move to Olav Thon’s Riksrevisjon’s new and Entra and Skanska’s in Storgata building Sundtkvartalet. In CBD East OSU with PwC in has signed an agreement in 2019, Eufemia which will be completed being put up on while two buildings are ufemias E a speculative basis at Dronning Eufemias gate 42. In gate 6B and Dronning Nydalen A by Elkjøp stages 2 and 3 for occupation and the T Navia signed for 6,600 m2 of a total of 14,500 m2 in the building, which is to be in mid-2017. completed ffice space is – OfficeSupply is space than just to more converted housing
12 4 000 2 000 3 000 Rent trendsperarea,2007-2019.Highstandard,nominalprice(NOKsqm) New building,potential 1 000 2 500 3 500 1 500
CBD West Signed 2007
CBD East Potential 2008
Inner city 2009 Skøyen 2010 Storo/Nydalen 2011 Økern/Ulven 2012 L ysaker 2013 Helsfyr/Bryn 2014 Sandvika/Asker 2015 2016E 2017E 2018E
13 ∆ last 6 months Ulven Økern/ Bryn Helsfyr/ Vacancy q3 2016 Vacancy 8 % 18 % 15 % 7 % 7 % 9 % 3 % 3 % 7 % 16 % 13 % Storo/ Nydalen
city Outer igh standard %-vis vekst High standard Forecast 0 % - 5% 0 % - 5% 0 % - 5% 5 % - 10 % 5 % - 10 % 5 % - 10 % 5 % - 10 % 5 % - 10 % 10 % --> 5 % - 10 % 5 % - 10 % city Inner op level t East CBD ∆ % last 12 months -5 % - 0 % -5 % - 0 % -5 % - 0 % -5 % - 0 % -5 % - 0 % 0 % - 5% -5 % - 0 % 0 % - 5% 0 % - 5% -5 % - 0 % -5 % - 0 % CBD 10%-> West standard Good Skøyen 5%-10% High standard 1 600 - 1 950 1 800 - 2 150 1 500 - 1 850 2 300 - 2 750 2 850 - 4 100 2 500 - 3 000 2 500 - 3 200 1 900 - 2 600 1 900 - 2 300 1 700 - 2 000 1 550 - 2 000 ysaker L standard High Asker/ Bærum Nominal prices – High standard average (NOK per sqm) 0%-5% 1 500 3 500 2 500 1 000 4 500 3 000 2 000 5 000 4 000 Area Asker/Bærum Lysaker Fornebu Skøyen CBD West Inner city CBD East Outer centre Storo/Nydalen Økern/Ulven Helsfyr/Bryn -5%-0% Development in rents and vacancy levels (Nominal NOK, %) Development in rents
14 Letting assingmentonbehalfofHavEiendom.Ilustration:Alliance ArkitekterandMirrkitekter. The project isunderplanningandtheillustrationsare preliminary. Fiskebrygga
15 s many as 146 transactions As many as 146 transactions in the period registered were 2016 to the end of September that this will and it looks likely year running with be the third than 200 transactions more with long leases Properties have to public sector tenants last year been traded over the 5.50% in the range 5.00 to such as Elverum, at places Lillehammer and Haugesund. challenges Many investors face to buy and in finding property advisors andarrangers, purchase active in approachinginvestors are enquiries. owners with purchase • • • any transactions Many transactions but are taking place able the market is not for to meet demand properties that give a predictable return. Sales mandate on behalf of Breeze AS Sales mandate on behalf of Breeze Luftfartstilsynet, Sjøgata 45/47, Bodø Luftfartstilsynet, Sjøgata 45/47, he The market ction transa
16 reached 253lastyear. passed 200forthefirsttimein2014and with theminimumvalueofNOK50million NOK 65billionin2016.Thenumberofsales 12 billionandestimateavolumeofaround with anaggregate valueinexcess ofNOK we are aware ofsome30ongoingprocesses The rangeofoutcomes isnaturallywide,but four NOK1billiontransactionssofarthisyear. is therefore naturalandwehaveonlyrecorded billion. Someslowdownintransactionvolume there were 29transactionsinexcess ofNOK1 opportunities relating toprimeproperties and 2015 provided manyextraordinary purchase approximately NOK50billion.Inaddition, large portfoliotransactionsthatrepresented 205 billion.2015wasparticularlynoticeable for transactions thatintotalamountedtoNOK was therefore extraordinarily highwith482 that were outsidetheirstrategy).Volume in definedsegmentsandsellingproperties portfolios (forexamplebymakingacquisitions profits ondevelopedproperty and refine their Many ownersused2014and2015totake solidity oftheirportfolios. with secure earningsinorder topreserve the alternatives orwishtoretain somebuildings because theylackattractivereinvestment are hesitatingtosellthetopproperties spite ofrecord lowyieldsmanyowners and/or longleasestosolidtenants.In particularly property withgoodlocations difficult togetholdof property andthen market. However, formanyinvestorsitis speaking wehaveawell-functioningloan moving intherightdirection andgenerally city regions. Macro-economic factorsare level ofdemandforproperty inthemain 2016 hasbeencharacterisedbyahigh shows thatthetransactionmarket in The situationasattheendofSeptember The transactionmarket NOK bn. 100 140 120 40 60 80 20 0 2002 Transaction volumeinNorway(transactionsvaluedNOK50mill.anupwards) Forecast 2003 2004 T
2005 ransaction volume commercial property. increasing itsholdingofbondslinked to and through thelifeinsurance company through increasing lendingonthebankside to awell-functioningloanmarket both challenges. TheDNBgroup hascontributed with shortleasesmayhoweverexperience relationships thatwishtopurchase property Smaller investorswithoutestablishedbank have failedduetoalackofaccess tocredit. assessment isthatveryfewtransactions in access tocommercial property loans.Our participants indicatedafearofreduction Last autumnanumberofmarket better thanmanyfeared. functioning wellandhasdeveloped The loanmarketisgenerally office market inOslo. second quarterandbetterprospects for the higher thanexpectedGDPgrowth inthe has beenonthepositiveside-including negative side,muchofthenewsinNorway prospects intheUSA)hasbeenon news internationally(Brexit, weaker growth in lettingrisk.Whilemuchofthemacro from tenants,andthereby alsoareduction for economic growth andincreased demand reduced. Thisonce againgivesabetterbasis oil prices (USD35abarrel orless)hasbeen balance andthelikelihood ofcontinuing low The petroleum market isnowmore in forinvestment. country has strengtheneditspositionasa market hasbeenreducedandNorway The downsideriskintheproperty General trends 2006 2007 2008
Number oftransactions(r.a.) 2009 2010 2011 2012 2013 continuing lowinterest rates. growth intheshorttermandexpectations of present timeisthecombination ofhighCPI yield overtime,buttheparticularfeature atthe interest rateswhichagaincanpushupthe higher CPIgrowth canbereflected inhigher and thattheinterest rateisfixed.Inaddition, a longlease(multiplepricingofincreased rent) assumptions inwhichthemostimportantare period. Notethatthecalculationsinvolvesome of theloanhavingalowerreal valueinthe zero. Thereal return arisesmainlyasresult years compared withifCPIgrowth hadbeen aggregate real return onequityforthethree when viewedinisolation,almost20%extra the estimatedCPIgrowth inthiscasegives, CPI forecasts from lastwinter. Correspondingly three yearscompared withifonehadusedthe the real return onequityofaround 5%forthe viewed inisolation,anaggregate increase in increase ininflationexpectationsgives,when ratio of70%andanunchangedyieldlevel.The rent levelswhichatthestartof2016hasadebt point property withalongleaseatordinary illustrate theeffects,wecantake asastarting for 2016–2018willbearound 8%.Inorder to of November2016andaggregate CPIgrowth the consumer price indexwillbe3.7%attheend DNB Markets expectsthattheannualtrend for percentage pointscompared withlastwinter. for 2016–2018haveincreased byatotalof2.3 debt isfalling.CPIforecasts from DNBMarkets equity, primarilybecausethereal valueofthe growth contributes toahigherreal return on levels. InthecaseofleveragedinvestmentsCPI is derivedtoagreater extentfrom market rent there isonlyalimitedvalueeffect,asthe long leases.Forproperty withshortleases more attractive,particularlyforproperty with a narrow yieldgap(on leveragedproperty) interest rates,somethingthattogethermakes growth andexpectationsofcontinuing low We nowhaveacombination ofhighCPI inflationexpectations Increased 2014 2015 2016 YTD 42 65 Number oftransactions 0 25 50 75 100 125 150 175 200 225 250 275
17
Syndication and fund managers have and fund managers have Syndication for a purchases carried out at least 37 there total of NOK 12 billion. In addition, where have been several transactions advisers for they have acted as purchase bought 100% of a various investors that property. and bond market Both the bank market have been used. Several fund managers have raised equity. by the value the focus has Measured return offering a been on properties yields. with long leases on aggressive The arrangers have been successful with with have been successful The arrangers capital both equity and loan regards to the largest net and have been by far buyers. • • • By arrangers we mean those entities managing syndicates and Norwegian fund by to purchases managers. With regard arrangers we have got yield data on 30 transactions and the average is 6.5%. When we look at them based on value however, on yields below 6%. On by far the most are have 10 years average these acquisitions on the leases and many can be remaining cases”. Often characterised as “dividend the willingness of syndication managers long to pay for buildings with secure is based on leases outside the Oslo region a 10% annual dividend investors receiving level is lower return on equity subscribed (a The loan terms for Oslo property). accepted decisive, and in several cases therefore are used that has been long-term bond finance as well as good to predictability contributes of dividend possibilities due to be absence instalments. Arrangers have repayment also been important on the sale side with 31 sales for a total of NOK 7.7 billion.
hey have been behind at least 12 at least 12 They have been behind with yields of 5.5% or less. purchases bids They often say no to aggressive because they have difficulties in finding alternatives. attractive reinvestment he average yield on sales has only been has only been The average yield on sales than on purchases. 35 basis points lower he category “property companies, companies, The category “property private investors and developers” usually on investor group the largest constitutes side, and so both the sale and purchase 72 purchases far this year has completed for NOK 18 billion and 83 sales for NOK • • have been 65 20 billion. So far there that participants in this group different with property commercial has purchased a minimum value of NOK 50 million, with Ragde Eiendom as the only one with more than five purchases. The trend for property companies, for property companies, The trend to take and developers private investors property has been profits on developed in the market a less significant element than last year. •
s at the end of September international As at the end of September international ten purchases investors had completed for a total of NOK 4.3 billion, and three sales for NOK 4.5 billion. here has been a continuing high level high level a continuing has been There international investors from of interest but so far in for Norwegian property, have materialised 2016 few acquisitions … so far. 2016 we have received Throughout a number of international enquiries from their first investors looking to make investments in Norway and able to invest in the range NOK 0.5 to 2 billion. hree new international investors have new international investors have Three in Norway made their first purchases purchases in 2016. In total these three than NOK 2 billion amount to more with many Norwegian In common several international participants market but investors have the capital ready properties have difficulties in obtaining that fulfil their criteria. This autumn with have been several processes there and portfolios individual properties large made international investors have where making bids. or are • • • There has been a continuing high level level been a continuing high There has investors from international of interest but so far in for Norwegian property, have materialised 2016 few acquisitions … so far. Investor categories Investor and sales purchases • • largest the International investors were investments net buyers last year through portfolios in, among others, several large OK 47 totalling N and made purchases has been considerable billion. There variation in what international investors buy in Norway. In the last two years they in all segments, property have purchased largest in all the four individual properties within “value added” property city regions, by Measured and opportunistic property. value however the bulk of international large to ownership has been directed tenant risk. with low individual properties
18 • acquisition plans. been netsellers,buthavesignificant Equity-based investorshavesofar OPF andStorebrand. yields. SofarthebuyersincludeDNB, KLP mainly properties withlong leasesonlow been inthefourlargest city regions and On thebuyingsideallinvestmentshave • • • • pension funds/banksandtheirfunds. life andnon-lifeinsurance companies/ By equity-basedinvestorswemean that havefailed. to afurthertwosalesonprojects good prices. Thebankshavecontributed 1 billion)afterreceiving approaches at gains onthree properties (roughly NOK can beexplainedbytheownerstaking However, three ofthesalesthisyear regions onhighyields. sale ofproperties outsidethemaincity properties ataggressive yieldsandthe portfolios triggersbothsalesofgood its weightinginretail. R As anexampleNordea isreducing participants are refining theirportfolios. the salesthisyearhasbeenthatthese The mostimportantexplanationfor buyers infuture. their strategies,butintotalbenet will continue tosellproperty outside expect thatequity-basedparticipants 10 billioninNorwayandabroad. We intentions toinvestatotalofNOK5 buying positioninfuture. KLPalonehas participants inthisgroup willbeina and are stillrelevant. However, most important reason forlastyear’ssales New capitalweightingruleswere an for NOK2.2million. is completed) and“only” fourpurchases transaction involvingÅsaneStorsenter 3.8 billion(weassumehere thatthe have made9salesthisyearforNOK pension funds/banksandtheirfunds and non-lifeinsurance companies/ P articipants withinthecategorylife
efinement of
,
R eal estatecompanies/private investors/developers Transaction volumeByinvestorcategoriesin2015(NOKbn). -25 -20-15-10-50510152025 Investment Life insurance/pension companies/banks Club dealarrangersandfund Divestment Owner occupier Cross-border
19 2019E 2018E 2017E 2016E Ring 3 (+/- 25 bps.) prime yield along 2015 2014 Borrowing cost (5-year swap rate + bank margin) cost Borrowing
2013 2012 2011 2010 Normal yield office clusters along Ring 3 (+/- 50 bps.) Normal yield office
2009 2008 2007 for prime offices cost yield gap between yield and borrowing Oslo prime yield offices Yield development 2006-2019 ( %) 2006 1,0 3,0 7,0 2,0 5,0 8,0 6,0 9,0 4,0 0,0 (september)
20 accept a lowerreturn. Onasomewhat for Norwegianparticipants togradually the re-pricing ofproperty tosinkinand It maybethatitwilltake sometimefor will stretch themselvesbelow4%today. find thatveryfewNorwegianparticipants corresponding toyieldclearly below4%.We CBD todayonewouldhavetopay afigure that ifonewantstobuyabuildinginthe market rents wellbelow4%.Itismostlikely we could havecertain transactionsat 3.5% withlittleornodebt.Inotherwords, able tobuyproperty inNorwayonyieldsof foreign investorshavesaidthat theyare currency hedgingcosts. F assumed, particularlywhenweadjustfor yield levelslowerthanwehadpreviously certain internationalinvestors are accepting the bidsare above4%. We are findingthat addition, thoseconsidering asalecanwaitif ready tosellprimeproperty ingeneral.In as itappearsthere are veryfewowners with thebestlocations,atsametime property capitallookingforinvestments is asubstantialamountofinternational prime yieldhasfallenbelow4%isthatthere this cycle.Thereason weconsider thatthe at orveryclosetothelowestyieldlevelin forecast meansthatwebelieve3.85%is an associatedlevellingoutinthecurve.Our arguments forariseinyields,aswell five arguments forafallinyieldsandfour closer tothefigure four. We putforward yield wasintherange4.25to4.00%,but Last winterweconsidered thattheprime • • • • Yields aretrendinglower. inOslo offices The developmentinyieldsfor trending lower. longer termare contributing toyields short termandlowinterest ratesinthe Expectations ofhigherinflationinthe +/-3.70% withmarket rents. few properties could besoldonayieldof the primeyieldstandsat3.85%andthata Stortingsgaten 6meanthatweconsider offers/bids aswellthesaleof A large numberofrejected purchase developments inOsloandNorway. more importantfactorforunderstanding investment alternativeshavebecome a decrease inyieldsandinternational or zero debtratiosare leadingthe International investorswithmoderate yields down. property generallyinOsloispushing Continuing excess demandforoffice urthermore, certain since theautumn of2014.Compared with showing signsof anincrease forthefirsttime over thelastyearandmarket rent levelsare taken out.Office vacancyhasbeenfalling it seemsthatthe“oil correction” hasbeen Continuing low oilprices are lesslikely and has beenreduced overthe lasthalf-year. downside riskintheoffice market inOslo to take therisk,andwebelievethat appears investorsare increasingly willing willingness ofinvestorstopay.However, it slightly overthelastyearandmayaffect road. Therequirement forequityhasrisen one oftheoffice clustersalong theouterring tenants andwithasatisfactorylocationin good standard, normal soundcompanies as 5 yearsremaining ontheleases, ofanormal have definedthistobeoffice propertywith development inyieldfornormalproperty. We The blacklineismeanttoillustratethe a yieldbeginningwiththefigure three. Skøyen leaseratherthanaCBDproperty on one oftheseareas, ordownto4.5%foralong 10-year leaseonayieldofaround 5.00%in low yieldsegmentsare more likely tobuya that mostNorwegianinvestorsbuyinginthe for properties withlongleases.We believe and West Oslohasbecome smaller–also means thattheyielddifference betweenEast development overthelastcouple ofyears L that thelevelvariesfrom around 4.80%at bottom outatcloseto5.00+/-20pointsso 2014 andweexpectthatthecurvewill around 100basispointssince theautumn here. Thelowestyieldhasbeenreduced by demand alsomeansthatthetrend isfalling We assumehere aleaseof10years.Excess the office clustersalongtheouterring road. The orangelineshowstheprimeyieldin borrowing atafixedinterest rate. basis points,dependingontheproportion of could todayhaveayieldgapofsome60to85 credit margins. Withapurchase at3.85%they of primeproperty astheytendtohavelower gap howeveriswiderforthemostsolidbuyers green fieldillustratestheyieldgap.The The red lineshowstheprimeyieldand 5-year swaprateandmargin datafrom DNB. in grey. Theborrowing cost isbasedonthe borrowing cost foranordinary 5-yearloan Oslo, togetherwiththedevelopmentin in in yieldsforvariouscategoriesofoffices The figure belowshowsthedevelopment demand willbereduced. prospects sothatthesubstantialexcess investments graduallywillhavebetter time, togetherwiththefactthatalternative forecasts inanyeventshowanincrease in prime yieldwillrisebecauseinterest rate longer viewweneverthelessexpectthatthe ysaker to5.30%ontheØkern/ Hasle line.The the financialcrisis. much asintheoverheatedmarkets before yield segmentsisnotbeingpulleddownas at 6.25%andthedifference againstthelow basis points.We haveretained ourestimate normalisation oftheyieldgapataround 250 and alittlemore strongly. Thisinvolvesa that thefallinyieldwillcome more quickly increased equityrequirement andbelieve the winterweare givinglessweighttothe several acquisitions. in additionacted aspurchase adviserson 22 purchases foraround NOK10billionand have beenthearrangerswhoaccounted for of NOK1.8billion.Thelargest netbuyers were onlybehindfivepurchases foratotal As attheendofSeptemberhowever they commercial property inthecapitalregion. of newinternationalinvestorsare seeking buying interest and an increasing number investors continue to showahigh-levelof owners intheOsloarea. International purchase processes towards property in severaldifferent categories are initiating driven asnow,andwefindthatinvestors market hasperhapsneverbeensobuyer- be duetoafearofselling“tooearly”.The alternatives andinparttherefusal may can beattributedtoalackofreinvestment subsequently beenrejected. Inpartthis NOK 1billiononaggressive yieldsthathave of severalprocesses withbidsinexcess of addition tothevolumesoldweare aware on aninitiativefrom thebuyer’sside.In properties are soldafterclosedprocesses sales processes wefindfrequently that market suitableforbroad andstructured 50 million.Despitethefactthatwehavea Akershus withaminimumvalueofNOK investors haveboughtproperty inOslo/ segments andatotalof46different We haverecorded salesinallproperty • • • obtain purchaseopportunities. demand andformanyitischallengingto the marketischaracterisedbyexcess transactions inOslo/Akershus,but There hasbeenahighvolumeof Oslo/Akershus The transactionmarket in buyers and arrangershavebeenthelargest net There havebeenmany“closed processes” and 75basispointscompared with2014. down 25basispointscompared with2015 The averageyieldonsaleshasbeen a totalvalueofNOK23billion. So farweregistered 75transactionswith
21 est of Norway 4 % etail properties 9 % etail properties 6 % esidential projects rondheim region 3 % region rondheim Bergen region 5 % region Bergen 4 % Stavanger region Shopping malls 20 % 50 % oslo/Akershus geographically dispersed 28 % region 6 % oslofjord r t 49 % office r logistics/industrial 8 % r 4 % hotels/restaurants 3 % health/education/culture 1 % other/confidential Transaction volume in value by geografi, 2016 Transaction Transaction volume in value by type of property, 2016 by type of property, volume in value Transaction
22 than previously. higher proportion ofthedevelopment gain and thatlandowners/sellersare obtaininga property suitableforbuilding apartments that verymanyinvestorsare lookingfor development inOslo/Akershus. We find volume oftransactionsrelated tohousing also contributing thisyearto asubstantial housing market inthecapitalregion Is amounts toasmuch17years.Astrong remaining leaseperiodand on averagethis these 18transactionswehavedataonthe four salesforNOK1.4billion.On15outof while sofarthisyearwehaverecorded we recorded 14salesforNOK3.4billion, culture andkindergartens etc.Lastyear purposes suchashealth,education, buildings, wemeanproperty usedfor so farthisyear. Inthecaseofcommunity turnover volumeinexcess ofNOK1billion property segmentsandregions haveseena transactions compared with2015.All been lesscharacterisedbylarge portfolio volume. Themarket thisyearhasgenerally account forroughly 10%ofthesales while fivegeographicallyspread portfolios proportion inOslo/Akershus hasbeen58%, segments. Measured bythevalue secure cashflowstospecific property largest netbuyersandhavepreferred The syndicationmanagershavebeenthe 46% ofthesalesvolumehasbeeninoffices. • • • the maincityregions. concentrated onlowyieldpropertiesin volume hastoalargeextentbeen Measured byvaluethetransaction segments volume bygeographyand Breakdown ofthetransaction of 5.5%orless. Of thisbyfarthemosthasbeenonyields 500 millionandmore. been intransactionswithavalueofNOK R largest cityregions. has beenconcentrated onthefour three quartersofthetransactionvolume Measured bothbyvalueandnumbers oughly halfofthesalesvolumehas western Norwegiancitieswhere there is value by2to6%.Forcertain locationsin office properties are generally reduced in property taxmeans,inisolation, that costs. InOslotheintroduction ofthe big citiesaswellhightenantalteration difficult lettingsituationforoffices in the limiting thereturn. There isacontinuing several factorsthathavecontributed to property inNorwaythere havebeen broadly composed portfolioofcommercial result ofrandomeffects.If one takes a growth inNovembertolarge extentisthe November. Experience showsthatCPI Markets’ estimatesforannualgrowth in adjustment of3.7%corresponds toDNB in 2016asaresult ofthesefactors.ACPI the property willincrease invalueby10% adjustment of3.7%,viewedinisolation by anamountcorresponding toaCPI both rental income andcosts increase points from 5.25%to4.95% andthat has beenreduced in2016by30basis with longleasecontracts where theyield If onetakes asastartingpointproperty • • • in 2016. return forthelargepropertyportfolios yield trendarecontributingtoagood conditions, highCPIgrowthandafalling In spiteofsomechallengingmarket R eturn dampen thereturn. credit margins are amongfactorsthat property taxesinOsloandincreased in severalcitiesandtheintroduction of There isachallengingvacancysituation the autumnof2015. by 25to50basispointscompared with risk properties theyieldhasbeenreduced trend in2016.Inthecaseofmanylow- Yields haveprimarilyhadaflattofalling corresponding forecasts lastwinter. by 2.3percentage pointscompared with period 2016–2018havebeenincreased 3.7%. inaddition,theforecasts forthe at Novemberhavebeenincreased to and theestimateforannualgrowth as Both DNBMarkets’ CPIforecast for2016 property valuesup. CPI growth, willcontribute tokeeping combined withrelatively goodbutfalling portfolios. Continued lowinterest rates, from tenantsandcontinuing vacancyin growth suggestmoderatedemand direct return. SlowGDPandemployment coming yearswillbemore inlinewiththe that thereturn attheportfoliolevelin three goldenyears(2014–2016)webelieve the direct return andvaluechanges).After on totalassetsofcloseto10%(thesum solid portfolioscould seeanominalreturn most importantexplanations.Manyofthe likelihood ofahighCPIadjustmentasthe in 2016,withafallingyieldtrend andthe portfolios willhaveagoodreturn year factors webelievethatthelarge property the levelduring2015.Inspiteofthese this yearbeing25basispointslowerthan from moneymarket interest ratessofar for partsoftheirloanshavebenefited investors thathaveoptedforfloatingrates lower moneymarkets interest rates,and T been risingsince thesummeroflastyear. In theloanmarket credit margins have winning thecompetition forcustomers. properties toanincreasing extentare other things,tothefactthatbest to findtenants.Thisisdue,among are “C properties” forwhichitisdifficult size shoppingcentres andlogistics,there number ofsegments,suchasmedium- have achallenginghotelmarket. Ina addition, severalcities,suchasStavanger, high vacancylevels,yieldshaverisen.In net vacationbylesseesandparticularly o someextentthisiscounteracted by
23 igh office vacancy in BergenHigh office South rents in differences Large areasbetween market for primeGood sale prices properties • • • an-Nordic Norway AS an-Nordic Kokstadvegen 23 Kokstadvegen here has been a good good There has been a in the level of activity a market with transaction of NOK volume in excess in 2016. 4 billion so far are experiencing some We in the reduction in activity letting market for offices and continued high office South vacancy in Bergen for the business areas and Sandsli. Kokstad berdeen P Sales mandate on behalf of Aberdeen n Berge
24 c ommercial and industrial areas, Bergen ASKØY FLESLAND KOKSTAD Airport Flesl LUFTHAVN FLESLAND and LAKSEVÅG FYLLINGSDALEN SANDSLI BERGEN NORD bergen KORRIDOREN/ bergen SANDVIKEN City center SENTRUM ÅSANE/ BERGEN SYD Industrial corridor NÆRINGS north south /
E E OSTERØY
25 , , iendom’s om Eiendom’s okstad west, okstad west, onkurransetilsynet, KLP ransaction market ransaction T we have recorded Hordaland In Bergen/ NOK 4 of around a transaction volume 11 includes This figure billion so far this year. than NOK 50 million transactions of more of Åsane purchase as well as Olav Thon’s OK 2 billion. The Storsenter for about N by the reviewed latter transaction is being authorities. competition is a very good The volume of transactions of the Åsane and, subject to approval the same Storsenter sale, we may approach year 2015. levels as the record and completed recorded The largest transaction so far in 2016 is R JS AS. and KG Folkehelseinstituttet buyers and national investors are Foreign and in Bergen interest showing increasing 25% of the transactions for around account in the first half of 2016. Such investors are with looking primarily for prime properties cash flows. long and secure in see that the prime yield for offices We is just under 5% for buildings with Bergen good locations, long leases and solid tenants. a considerable is currently There in overweight of development properties site sales One of the largest the market. at K took place in Bergen aaes sale of the new building in Zander Kaaes Station to KLP Eiendom gate by Bergen is for NOK 760 million. The property 90% let to K Skifte Forsvarsbygg acting through where site of Eiendom sold a zoned commercial Eiendom AS. 427,000 m2 to Posten around has led to increased housing market The strong and substantial demand for housing land Bergen. with planning permission in central for 2016 indicates continuedOur forecast continuing stable yields, and good sale prices, withhigh demand for prime properties long leases. Subject to the Åsane Storsenter completed, and transaction being approved we expect a transaction volume in the region of NOK 6 billion. okstad and Sandsli. okstad and Sandsli. ental market We are recording relatively stable office stable office relatively recording are We at areas, in virtually all market rents we are similar levels to 2015. However, rents in differences seeing especially large has been There areas. between market in the city in rents a moderate increase supply of high- due to a greater centre and a in new buildings quality premises vacancy where in areas in rents reduction is high, such as K to believe that the may be reasons There than our table may be greater reduction periods etc. rent-free indicates as rebates, by our surveys. not covered are R Krinkelkroken 1 Krinkelkroken iendom Norge AS Liv Eiendom Norge on behalf of Nordea Letting assigment ur latest survey shows approximately Our latest survey shows approximately which space, 219,000 m2 of vacant office of vacancy ratio in excess gives an office 10%. Our calculations show an estimated premises in our total volume of office The 2.1 million m2. of around area market offshore in activity by oil and reduction South has in Bergen companies related on vacancy and pressure led to increased office Close to 50% of the vacant rents. is located in these districts. in Bergen space see have few indications that we will We a significant and rapid change in office vacancy in the short term. On a medium- term view fewer planned new office focus on conversion buildings and increased contribute will to housing, hotel and retail years. absorption in the coming to space will suggest that vacancy Our forecasts level out in 2017/18. Office vacancy
26 200 000 100 000 250 000 150 000 50 000 2 000 3 000 1 000 2 500 1 500 500 0 Bergen North Rent levelsinBergen(NOKpersqm.) Vacancy Bergen(sqm,%) 2005 Åsane/ High standard
Vacancy sqm(l.a.) 2006 Sandviken
2007 t op level
2008 Vacancy %(r.a.) center City
2009 Industrial corridor
2010 2011
Sandsli 2012 K okstad
2013 Fyllingsdalen 2014
2015 Laksevåg
2016 0 % 2 % 4 % 6 % 8 % 10 % 12 %
27 ents in the city centre up 12.2% up ents in the city centre 1.3 billion ransactions for NOK 1.3 billion ffice vacancy down to 9.9%, 9.9%, vacancy down to Office increased but expectations of vacancy in 2017 R T so far this year. • • • rondheim, fototrondheim.no) rondheim,
Bassengbakken 4 he volume of The volume of is showing transactions with a decline compared has 2015, but activity picked up somewhat with since the summer ongoing large several In the rental transactions. is market office vacancy slightly down and rents in the city centre are rising.
hoto: T Let and the sold on behalf of Kaisa Holding AS (P ndheim Tro
28 VAcancy Trondheim, sept. 2016 (%) T SVERRESBORG otal Office v BYÅSEN ILA HEIMDAL acncy Trond heim MUNKHOLMEN E TRONDHEIM City center 6,0 SENTRUM GRENDA FOSSE ELGESETER TEMPE SLUPPEN LERKENDAL 4,8 11,6 : 9,9 % 22,9 MOHOLT PERSAUNET TYHOLT LADE 8,9 TUNGA 12,7 E HEGGSTADMOEN HEIMDAL RANHEIM FLATÅSEN ROSTEN E 20,2
29 rondheim’s rondheim’s ower was sold for ower was sold for yhol T iller was sold on a yield of 6.4%. was sold on a yield of 6.4%. iller T ransaksjonsmarkedet Since late summer we have seen some some late summer we have seen Since properties in activity with several increase to portfolios continue in play. The larger and we expect our region be absent from that turnover volume will end in line with During the autumn DNB a normal year. Næringsmegling will be offering several 50 at NOK priced in the market properties that the consider We million and higher. with prime yield is 5.0% for new property leases location and good, long a central to solid tenants. The yield for “normal” located of a typical standard properties with arteries along the communication short/medium length leases is in the range 6.5–7.5%. 55 million. In addition, an close to NOK 55 million. In addition, an Løvåsmyra property industrial/warehouse at 4 2016 has started much more quietly than quietly than 2016 has started much more corresponding So far transactions last year. to NOK 1.3 billion have been registered, less than 2015. one third which is around of portfolio is the absence The main reason transactions which last year accounted billion. So far this for as much as NOK 1.9 eight transactions year we have recorded than NOK 50 million. Among for more transactions we can mention the largest Solsiden which was 4 on Bassengbakken sold in January for NOK 260 million with a net yield below 5.4%. Oti shopping centre transaction at Orkanger was another large while T in the first half-year, landmark, the T T Løvåsmyra 4 Løvåsmyra S AS of FA of the former owner Sold on behalf rondheim as a whole is 9.9%. as a whole is 9.9%. rondheim rondheim into seven zones and haverondheim ossegrenda have office vacancy have office osten and Fossegrenda rondheim at the end of the first half of 2016rondheim surveyed vacancy for each zone. The average vacancy for T of lowest proportion has the The city centre while Heimdal/ at 6 percent, vacant space R suggest thatabove 20%. Our forecasts vacancy this year will be lower than last year in 2017 as a vacancy but we expect increasing of a number of new of the completion result projects during the year. office Office vacancy inThe total amount of available space T is thus slightly was 180,000 m2. Vacancy of 194,502 m2 at the the figure down from start of 2016. The amount of vacant office of m2, which is a decrease is 131,937 space We have 7,700 m2 in the first half of 2016. divided T ongsberg ongsberg rondheim Maritime Maritime rondheim ents in the centre have increased have increased ents in the centre urthermore, there is even greater is even greater there urthermore, rapphuset, T ontorleiemarkedet ents also reflect alteration costs that are costs that are alteration ents also reflect ven though the general impression is that is that ven though the general impression he trend from last year is intensifying last from The trend holding stable in levels are in that price while falling in peripheral development areas locations. R Examples of new leases in the first half-year: 28 – 8,000 m2 – Falkenborgveien NAV BI – Brattørkaia – 10,000 m2 the previous on average by 12.3% since all the peripheral half-year survey. If we take have see that prices we zones together, been adjusted slightly down by around is for the city centre 1%. The average rent includes This figure NOK 1,772 per m2/year. city centre some leases in the most central average up. which have pulled the properties R level The average rent by the lessor. covered is NOK outside the city centre in premises 1,317 per m2/year. We have written that the city centre is “the have written that the city centre We winner”: This is based on the fact that of the 45,351 m2 that has been let in the first half- than 50% is in the city centre. year more K been characterised The first half-year has among tenants little interest by relatively the This has especially been in relocating. see We users of space. case for the largest of applications the absence this through with last compared consents for official a high level After several years with year. is some that there of activity it is natural to adjust the supply and consolidation his projects. T office demand sides for new is a low level of does not mean that there four are and there activity in the market in completed buildings being new office 2016 (T 62,073 m2 of Overall we have recorded divided between 192 leases. leased space Offices: 45,351 m2 Retail: 6,885 m2 9,387 m2 Warehousing: centre, as well as new buildings for buildings for as well as new centre, and K Autronica respectively F group). building activity ongoing which will involve buildings of five new office the completion in 2017. In 2017 alone some 60,000 m2 of will be added to the market. new offices E we have recorded demand has decreased the same level as the lettings at roughly first half of last year.
30 200 000 100 000 140 000 160 000 180 000 120 000 40 000 60 000 80 000 20 000 2 500 2 300 1 900 1 500 2 100 1 700 1 300 1 100 900 700 Heimdal 2011 Rent levelsinTrondheim (NOKpersqm.) Vacancy Trondheim (sqm,%)
75 159 High standard Vacancy, sqm(l.a.) Fossegrenda 2012 74 429 Good standard
Vacancy %(r.a.) Sluppen 2013 74 973 t Moholt/T op level unga 2014
108 106 Lade/eangen/ Ranheim 2015 center
139 648 City to Lerkendal Elgseter 2016 131 935 9,9 % 0 % 2 % 4 % 6 % 8 % 10 % 12 %
31 he investor side and the the The investor side and to be very banks continue selective. in transaction A decrease due to volume but mainly with the fewer properties investment profile. desired Rising activity in the letting per but smaller areas market, lease. • • • ark Fjordpiren, Hinna Park here has been a There has been a level of somewhat lower activity in the transaction seeing market but we are interest continued good The for low-risk property. activity trend of increased in the rental market is continuing but most leases are for somewhat smaller areas than previously. Letting assignment on behalf of Hinna P
anger v Sta
32 vacancy Stavanger, sept. 2016 T otal office v acncy Sta 2,8 RISAVIKA RANDABERG v anger: 11,4 % 4,9 E airport St LUFTHAVN STAVANGER SOLA KLEPP a v anger DUSAVIKA STAVANGER Border RANDSONE STAVANGER 2,5 city centre 11,2 Border RANDSONE SENTRUM SANDNES zone 1,9 FORUS/LURA zone 20,5 0 % 2 % 4 % 6 % 8 % 10 % 12 % 14 % 16 % 18 % 20 % Significant localvariations Vacancy Forus/Lura JÅTTÅVÅGEN E I STAVANGER UNIVERSITETET University St Border z a RANDSONE STAVANGER E v Forus east anger 14,7 % 4,6 15,8 3,6 one city centre SENTRUM SANDNES DALE Forus E39 18,6 % Forus west 12,9 % TAU 12,5 % Lura
33
olumbus bus terminal erminal AS/ K ransaction volumes so far this year show ransaction volumes so far this year show T with compared decrease a considerable have the same period in 2015 and 2014. We NOK a volume of approximately recorded and it is by far at Forus underlines this trend Properties transaction this year. the largest with a normal or higher risk, including much have received development property, and the price the market less attention from is currently range for this type of property wide. In our view location is most important in this category, and for sale properties in so far we have seen very good interest has been only a little there where properties that leases provided regarding foreseeability the location has been right. foreseeability. In general, there have been there In general, foreseeability. the customer from expectations growing adaptations in side and the use of lease of periods, buy-outs the form of rent-free etc. existing leases, step models Other segments a marginal we have registered In aggregate vacancy for combination in increase in Q2 to around 4.7% around from property mainly relates 5.0% in Q3. The increase in space in available office to an increase buildings. with combination connection is virtually space to retail related Vacancy some 4.5% against unchanged at around to the segment 4.4% in Q2. With regard has there industrial/warehousing/logistics 2.6% % to around from been a decrease 2.0%. around The transaction market 1.3 billion against some NOK 4.7 billion in 2015 and NOK 2.8 billion in 2014. It should be mentioned that transaction volumes at record in both 2014 and 2015 were levels and that 2016 is closer to a “normal the same volume as year” with roughly in the years periods for corresponding 2008 and 2009). from 2006–2013 (apart is good In addition, we find that there availability of capital for both local and the national investors, but buyers (and We to be very selective. banks) continue see that the main focus and preferences or less along still more among investors are was the same lines as in 2015 when there - substantial appetite for low-risk property or to central buildings with leases preferably local government bodies - which as a result pricing. The sale of achieved very aggressive T Unik ent levels appear more specific movement on the tenant side more On the other hand, year. with last compared we see that the majority of the leases that for smaller amounts have been signed are years. with previous compared of space The highest activity we have seen has been in the size range 300–800 m2 and there at users in the market space few large are vacancy for all time. Aggregate the present is a marginal 7.2% which segments is around survey of to the previous in relation increase in Q2 this year. 6.9% around the various between The differences in business clusters and geographic areas and to some extent is continuing the region We see some indications of has intensified. zones and central in central improvement while at Forus and in peripheral areas, to be higher continues there areas R and pressure. competition nevertheless to have stabilised somewhat also within the latter areas. more, we are to the subletting issue In relation in the seeing a slight reduction currently to record but continue amount of new space for various is hidden vacancy that that there at the moment. is not in the market reasons Among other things we see occupiers amount of that have a not inconsiderable which are but have premises surplus space and suitable for division not necessarily also see some sublet space subletting. We there at very low levels where being offered period on the lease, but is a short remaining up, due among which has not been taken greater other things to tenants requiring Ankerkvartalet, Stavanger city center Ankerkvartalet, etting assignment on behalf of Øgreid Eiendom Sentrum on behalf of Øgreid Letting assignment ark of roughly 5% to around 20.5% and 5% to around ark of roughly has been Activity in the letting market the trend continuing rising so far this year, half of 2015. Several leases the second from have been signed and it is positive to see The letting market If one looks at the different geographicalIf one looks at the different the change is greatest in the region areas reduction we have a marked in Sola where but the 4.9%, 14.3% to around around from to two properties is mainly related reduction obtain we have not been able to where The the lessor. of the status from confirmation Jåttåvågen/ at survey also shows a decrease Hinna P orus/Lura. 15.8% at F of about 3% to around a of Stavanger has experienced The centre with Q2. 1% to 4.6% compared rise of around naturally also to above are The issues referred to these figures. relevant Office vacancy is somewhat segment in the office Vacancy According Q2 this year. with lower compared nowto our databases and surveys we are of one 11.3%, which is a decrease at around to Q2. The reality relation point in percentage is somewhat debatablebehind the decrease that is no longer is some space as there reasons, where for unknown publicly offered we have not been able to clarify the status saw the same situation We with the lessor. between the surveys in Q4 2015 and Q1 2016 Q2. Our came back in and, as the space overall assessment is that vacancy seen as a stable. whole is relatively
34 300 000 100 000 250 000 150 000 50 000 2 000 3 000 1 000 2 500 1 500 0 Randaberg 2009 Rent levelsinStavanger(NOKpersqm.) Vacancy Stavanger(sqm,%) High standard Vacancy sqm(l.a.) Sola 2010 Risavika t op level
Vacancy %(r.a.) 2011 border zone Sandnes Sentrum Sandnes 2012 Dusavik 2013 City center Stavanger 2014 border zone Stavanger 2015 Jåttåvågen 2016 ytd Forus /Lura
35 36 Letting assignmentonbehalfofFerd Eiendom Østensjøveien 16
37 -commerce is expected to is expected to -commerce rowth in consumption is is in consumption Growth only 1.3% expected to rise by 2019. this year to 2.7% in E rise by 16% in 2016. is turnover Shopping centre year. up by 3% so far this there yields where Aggressive have been expectations of income. rental increased • • • • rowth in consumption Growth in consumption little a is expected to fall in 2016, before gradually from picking up again next year. Internet retailing is continuing and to grow strongly, this year’s transactions evidence continued good interest for retail properties. Sales mandate on behalf of Salto Eiendom AS Vik-properties (Furnesvegen 18 and Nordåsvegen 4, Brumunddal) (Furnesvegen 18 and Vik-properties il Reta
38 100 105 120 130 110 125 115 95 billion in2016,whichwillprobably bealmost sector isestimatedtohavesalesofNOK3 Norwegian isnowshoppingonlineandthe new e-commerce solutions.E share from traditionalretailers byusing is oneofmanysectorsthattakingmarket trade. Thesaleofgroceries ontheInternet goods accounting forroughly 1/3ofInternet as 75%in5yearswithonlinepurchases of Norwegian market hasgrown byasmuch annual e-commerce report showthatthe NOK 90billion.Figures from theDIBS 2016 toreach atotalturnoverfigure of expected togrow byasmuch16%in The Norwegiane-commerce market is E before increasing graduallyto2.7%in2019. in consumption willriseto1.8%in2017 future. DNBMarkets forecasts thatgrowth indices suggestariseinconsumption in and anupturninconsumer confidence 2016. Onthepositivesidelowinterest rates to leadafallof1.2%inreal incomes in combined withhigherinflationisexpected in householddisposableincome, which rate ofgrowth corresponds toweakgrowth lower thanpreviously forecast. Thelower lower thanlastyear(2.0%)andalsoalittle consumption willbe1.3%in2016.Thisis DNB Markets expectsthatgrowth in Growth inconsumption (Source: SSB) Retail sales/goodsconsumption.Seasonnalyadjustedvolumeindex.AsofJanuary. 2008
-commerce
r etail trade(volume) 2009 2010 2011 r etail trade(trend) very 10th 2012 2013
2014 goodsconsumption (volum) 2% oftotalsalesgroceries inNorway. 3.5 billion and an average yield of 6.3%. NOK 3.5billionandanaverageyieldof6.3%. far thisyearforanaggregate valueofaround billion. Sixshoppingcentres havebeensoldso far haveboughtforapproximately NOK1.5 NOK 3.6billion,whileforeign investorsso main buyerswithtransactionsforroughly buyer sideproperty companies havebeenthe registered forthewholeof2014.On at thesametimeinlinewithwhatwas levels wesawintherecord year2015but excess ofNOK8billion.Thisisbelowthe been recorded withanaggregate valuein So farin2016,30retail transactionshave T space. once adjustmentismadeforchangesin (-0.5%) there hasbeengrowth inallcounties city centres. Withtheexception ofR relatively greater growth thenregional and growth, whiledistrictandlocalcentres had (4.7%) andOslo(4.5%)hadthegreatest shopping centres inØstfold(6.3%),Akershus including V the indexhadtotalsalesofNOK93billion, period lastyear. The237shoppingcentres in changes inspace) compared withthesame have seengrowth of3.0%(adjusted for eight monthsshowsthatshoppingcentres K Shopping centres varud’s shoppingcentre indexforthefirst ransaksjonsmarkedet 2015 AT he , totheendofAugust2016.The 2016E 2017E goodsconumption (trend) 2018E ogaland ogaland 2019E • • • transactions wecanmention: F rom amongthemainretail NOK 420million. property from Nordea Livfor company AXhasboughtthe Grensen 7.TheF Lade Arena. Liv isacquiring NHP’sinterest in Lade Arena,Trondheim. DNB Strøm tobuythecentre. owners Nordea LivandSteen& of agreement withthecurrent Olav Thonhassignedheads Åsane Storsenter, Bergen. rench
39 Continued good demand good demand Continued and logistics for warehouse space. net basis The food sector on a of has absorbed in excess in 33,000 m2 of warehousing the last two years. high frequency Continued of lease signings on new buildings • • • New e-commerce New e-commerce food businesses within have and fresh products amounts absorbed large of the of space in parts 2016 Oslo region during and these new businesses are reinforcing the greater price differentiation between good and less good premises. Kjeller vest 12-14. Planned new building, Hvam jeller Vest AS Letting assignment on behalf of Hetti Kjeller Vest
istics log
e us Wareho and
40 Warehouse/logistics clusters, Osl o E LIERBYEN E DRAMMEN E BILLINGSTAD HØNEFOSS RUD and surrounding areas VINTERBRO E VESTBY BERGHAGAN REGNBUEN/ GRORUDDALEN MASTEMYR KOLBOTN/ GJELLERÅSEN/ OSLO SKYTTA E NÆRINGSPARK LØRENSKOG/ ULLENSAKER ROBSRUD KLØFTA BERGER HVAM GARDERMOEN / E LILLESTRØM
41 Outside typical industry areas and traffic arteries areas ood access to E6 and E18 Good access < 6 m ceiling height < 6 m ceiling
e.g. Groruddalen > 6 m ceiling height > 6 m ceiling Central, good access, Central,
Rent levels for warehouses and logistics premises (NOK per sqm) Rent levels for warehouses and logistics 700 500 800 600 900 400 1 100 1 300 1 200 1 000
42 signings inthelasthalf-year. been confirmed withnew major lease as anattractivearea, somethingthathas previous report Lahaugmoenhasdeveloped Langhus andBerger. Asmentionedinthe Groruddalen havetraditionallybeen The mostattractiveareas outside of OsloEast. sizes uptoaround 5,000m2incentral areas good vacantpremises inexistingbuildings in there nowbeingaverylimitednumberof accessible locations.Theabovehasresulted type ofproducts needcentral andeasily These are companies whichduetothe such asflowers,fruitandbakery products. companies inotherfresh product segments year hasalsoseenincreased demandfrom 33,000 m2ofwarehouse space. Thelast have absorbedonanetbasisinexcess of signed bymarked.no in2015foodbusinesses of some21,000m2.Ifoneincludesthelease food products, whichaloneabsorbedatotal companies involvedinInternetretailing of Three leaseswere signedwithdifferent considerable demandfrom foodbusinesses. The firsthalfof2016wascharacterisedby with completion inQ32019. warehouse extendingtoaround 60,000m2 Moss where F has beenforEuropris’ establishmentin far thelargest leasesigningformanyyears new buildings–Seeexamplesbelow.By leases havebeensigned,particularlyfor and newbuildings.Anumberoflarge for allspace categoriesinbothexisting good numberofleaseshavebeensigned for warehouse andlogisticsproperties. A year showsamarked increase indemand activity inthesegmentandlasthalf- Det There continues tobeagoodlevelof General abritius willputupanew
requirements. tailored analyses.Callusto discuss your DNB Næringsmeglingcanprovide specially on thewarehouse andlogistics segment If more detailedinformation isrequired with alonglease. logistics properties tobe5.25% forthose consider theprimeyieldfor warehouse and and theremaining leaseperiod. We considerably bothwithrespect tolocation that pricinginthesameperiodvaries long leases,andthetablebelowshows with aprice uptoNOK20,000perm2for also sawseveralexamplesoftransactions to overNOK16,000perm2.In2015we this yearvaryfrom justNOK3,500perm2 the remaining leaseperiod.T pricing isverysensitivewithrespect to average price ofNOK12,500perm2but Warehouse transactionsthisyearhavean of approximately NOK5.7bn. logistics properties withanaggregate value transactions inthesegmentwarehouse and So farin2016wehaverecorded 24 The transactionmarket and whichhavebeenwellmaintained. with goodstoragequalities,locations 950 andNOK1,050perm2forbuildings signed havebeenatlevelsbetweenNOK NOK 1,200perm2whilemostoftheleases The toprents onwarehouses are around new buildingslocatedoutsidecentral Oslo. than previously. Thisismainlythecasefor able tooffernewbuildingsatlower rents costs contribute toproperty ownersbeing rates, lowyieldsandattractivebuilding of space byfoodcompanies. Lowinterest slightly withthelasthalf-year’sabsorption warehouse premises. Thishasintensified differentiation betweengoodandless cf. theincreasing tendencyforprice warehouse buildingsofagoodstandard, slight upward trend forcentrally located R The lettingmarket ent levelshaveremained stablewitha ransactions
• • signings inthelasthalf-year: Some examplesofnew • • • transactions sofarin2016: Some examplesof • • • • • • • • • with completion in2019/20. establish anewcentral warehouse the othersideofBerger where itwill ierskogen. decided tolease17,000m2atLierskogen. occupation earlyin2017. 2,600 m2atT from T (9 outof19properties inNorway). the portfolioofNLIEiendomsinvestAS January 2017,alsoinSolheimveien3. 4,000 kvm of warehousing fromleasing 2,400 m2from thesummerof2017. is extendingnow withanadditional 2,400 m2inthesamearea in2015, facility of7,000m2withF in Stavangerfrom RafossEiendom. BlomsterRingen andPrimafloor XXL Elena AS’s Ferd’s Round HillCapital’s Synnøve Finden Vinmonopole Europris Cater Storkjøkken Godtlevert.no Bjørgs BudbilogTransport Kolonial.no Nor Teksti Bertel O. Steen than 8,000m2. warehouse atGardermoen bymore 15,000 m2ofwarehousing from 2018. Lahaugmoen, where theywilloccupy are movingfrom Økern T in Søren Bullsvei2. a big warehouse of 60,000 m2 in Moss. a bigwarehouse of60,000m2 inMoss. Lørenskog. of 13,000m2inSolheimveien3at are extendingtheirexisting erje Stykket. purchase ofStokkamyrveien15-17 haschosenF l isbuildinganewlaundry purchase ofOrkidehøgda3 hasleasedinexcess orvuttaket inVestby for t hassignedaleasefor hasleased6,700sqm hasboughtlandon , whichleased hasrecently abritius atBerger.
abritius tobuild purchase of org to
is is
43 ar 21% in Stavanger in the in the ar 21% in Stavanger evP stable hotel market on a on a A stable hotel market with large national basis, but differences regional R first half of 2016 A weak Norwegian krone in to growth is contributing the number of international visitors • • • Hotell Klubben, Tønsberg Sales mandate on behalf of AC NOR he hotel market is is The hotel market growth showing stable large but with continued The regional differences. the Oslo key figures for market have reached there a high level but continue to be few bright spots with regard to developments in Stavanger. HotelS
44 expected toreopen in2017/2018. to theclosure ofBritanniaHotel,whichis period lastyear, dueamongotherthings first half-year compared withthesame is downhoweverbyaround 4%inthe many yearsofstrong growth capacity on bothprices andoccupancy levels.After the lastfiveyears,whichhasputpressure after acapacityincrease ofalmost34% in to haveestablishedabettermarket balance business trafficof8.5%.T segments, whilewehaveseenafallin to thecourse andconference andleisure first halfof2016.Growth hasbeenrelated prices (2.9%) and R T T for rebuilding. Clarion HotelR reduced alittlein2017when,amongothers, the market. Capacityisexpectedtobe Hotel Kampen(70rooms) havecome onto Karl Johan(181rooms) andBestWestern mainly duetothefactthatComfort Hotel capital hasbeen3.8%sofarthisyearandis business traffic.Capacity growth inthe guest daysintheholidaymarket thanin somewhat unusualforOslotohavemore accounts foranincrease of11.3%anditis strike. Theholidayandleisure segment capacity aswellsomeeffectsfrom the R highest levelsince 2008.Thereduction in number ofrooms soldandprices are attheir 2015. Anall-timehighwasrecorded for the high levelsfollowingstrong growth in The key figures forthecapitalhave reached Oslo figures forthefirsthalf-year. and May,whichhashadsomeimpactonthe affected bystrikes forfourweeksinApril in domestictraffic.Thehotelmarket was 9.3%, butthere hasbeenadeclineof0.3% to anincrease ininternationaltrafficof krone hasbeenanimportantcontributor have notedhoweverthataweakNorwegian have beenlarge regional differences. We corresponding periodlastyear, butthere minimal changescompared withthe On anationalbasisthere haveonlybeen Norway rondheim hashadgoodgrowth inboth evPAR (-1.4%)ismainlyrelated toincreased rondheim oyal Christiana will be closed oyal Christianawillbeclosed evPAR (8.2%)inthe rondheim appears about ayear. and willtherefore beoutofthemarket for Atlantic Hotelisbeingclosedforrenovation in thesummer. Inaddition,RadissonBlue in April,whileThonHotelStavangeropened somewhat. QualityPond(Sandnes)opened may improve thebalance inthemarket future littlenewcapacityisexpected,which reduced by20%and43%respectively. In same periodprices andR of rooms soldhasfallenby11%.Inthe has increased by24%whilethenumber the lastthree yearscapacityinStavanger has hitbusinesstrafficparticularlyhard. In with thedownturninoilindustrythat substantial increase incapacitycombined in recent yearslargely relates tothe with thefirsthalfoflastyear. Thedecline R Stavanger showsafallinallkey figures and Stavanger taken outofthemarket until2018. balanced somewhatbyHotelNorge being The capacityincrease willhoweverbe which willputfurtherpressure onR expected tocome ontothemarket in2017, fall from lastyear. Alotofnewcapacityis beaten byOsloonR prices onanationalbasisandhasonlybeen half-year Bergen hashadthehighesthotel related toincreased capacity.Inthefirst segment of35.6%,whichlargely canbe strong growth inthecourse andconference than previously. There hashoweverbeen impact ofthedownturninoilindustry period lastyearshowingmore clearlythe traffic Isdown5% compared withthesame R Bergen showsafallinbothoccupancy and Bergen NOK 2billion. million, withanaggregate valueofaround hotel transactionsinexcess of NOK50 So farthisyearwehaverecorded seven The transactionmarket evPAR isdownbyafull21%compared evPAR butprices are slightlyup.Business evPAR, inspiteofa evPAR havebeen evPAR. • • • • • we canmention: Among 2016transactions hotel from alocalgroup Petter Haglandhasboughtthe Alstor Hotell,Stavanger. Stordalen). hotel from HomeInvest(Petter EGD Property hasboughtthe Quality HotelVøringsfoss. Hotell forNOK63million. Living HotelinT Viking Eiendomhasacquired City City LivingHotelTromsø. from Danske Bank. A&B Investhasboughtthehotel Norefjell Ski&Spa. Incoronato) forNOK378million. Smarthotel Eiendom(Hodne/ has acquired thehotelfrom DNB ScandinavianProperty F Smarthotel Oslo. romsø from Hoff und
45 1,4 1,4 1,2 1,2 1,6 3,8 -2,7 -3,5 -3,6 -11,7 -0,5 % % 271 574 365 623 528 863 1 484 1 7 109 7 2 265 2 13 754 13 H1 2016 H1 2016 2016E 547 867 307 646 360 590 2 183 2 1 460 1 7 009 7 13 590 13 H1 2015 H1 2015 2015 2014 rondheim rondheim Rooms sold (in 1000) Price capacity (in 1000) Norge Oslo Bergen T Stavanger Norge Bergen T Stavanger Oslo Capacity increase and number of sold rooms (NOK mill.) of sold rooms (NOK and number Capacity increase 0,7 2,9 8,2 2,0 0,9 0,0 All of Norway -1,4
-0,2 -13,0 -21,0 % % 2013 641 821 481 Stavanger 979 469 866 986 604 409 908 H1 2016 H1 2016 rondheim 2012 518 T 797 910 972 967 445 469 996 650 609 H1 2015 H1 2015 Bergen Oslo 2011 Development of RevPAR 700 500 800 600 400 1. half-year rondheim rondheim Bergen Price (NOK) Norge Oslo T Stavanger T RevPAR (NOK) RevPAR Norge Oslo Bergen Stavanger Source: SSB Source: RevPAR and price per room and price RevPAR
46 Drammensveien 145-147,SkøyenAtrium (illustration) Letting assingmentonbehalfofSchage
47 ouse price growth continues at a high rate even though several of the though several of the at a high rate even continues growth House price years. in recent have weakened main demand drivers indebtedness in household the increase and growth House price a risk for the Norwegian economy. represents Krydderhagen, new building project • • DNB Eiendom Nybygg has the sales assignment ext: T DNB Markets Kyrre Aamdal, Kyrre g Housin
48 increased urbanisationhasledtoaparticular have contributed. Economic migrationand to otherformsofinvestmentmayalso and favourabletaxationofhousingrelative in interest rateshasalsoincreased demand housing. Lowunemploymentandthefall which hasledtoincreased demandfor growth inhouseholddisposableincome, prices canlargely beexplainedbyhigh doubled. Themarked increase inhouse secondary housemarket havealmost In thelast10yearsprices intheNorwegian the housingmarket. country weexpectagradualnormalisationin areas are experiencingfalls.Inthispartofthe slowdown, price growth isweakandsome Norway, whichhasbeenhardest hitbytheoil as awholeinfuture aswell.InWestern Norway willdrawupprices inthecountry to increase, thehighprice growth ineastern down. E the supplysideare keeping housebuilding are strong. Atthesametimerestrictions on Oslo andAkershus where thedemanddrivers the yearandprice growth iseverhigherin in thehousingmarket haveincreased during demand forhousing.Theregional differences and interest rateexpectationsare stimulating household incomes. Very lowinterest rates unemployment andlowergrowth in to behighagainthisyear, despitehigher The growth inhouseprices lookslikely ven though housebuilding is expected ven thoughhousebuildingisexpected -4 -2 -3 -1 0 2 3 1 House pricedevelopment( 2005
m/m %(l.a.) 2006 2007
2008 NOK 1000/sqm(r.a.) increase indemand.However, fortheOslo the hypothesisofaninvestment-driven to findstatisticsthatcan confirm or rebut for non-professional investors.Itisdifficult with manyotherinvestmentopportunities more attractiveasaninvestmentcompared It mayalsobethathousinghasbecome contributed toundervaluingprice growth. differences inthehousingmarkets mayhave in recent years.Inaddition,regional rate expectationshavefallenconsiderably and, notleast,thatlong-terminterest effects ofparticularlylowinterest rates years wehaveprobably undervaluedthe In assessingthehousingmarket inrecent August theannualrateofgrowth was9.1%. however ithaspicked upagain,sothatin process ofslowingbutfrom March thisyear appeared thathouseprice growth wasinthe in thesamedirection. Inthelasthalfof2015it while afallinlabourimmigrationalsopoints this indicateslowerhouseprice growth, unemployment hasrisen.Viewedinisolation Growth inreal wageshasdecreased and weakened inthelastcouple ofyears. Several importantdemanddrivershave has reinforced theprice rise. houses inthecapitalformanyyears,which growth hasexceeded thenumberofnew districts, especiallyinOslo.Population increase indemandforhousingcentral 2009 %andNOK1.000/sqm) 2010 2011
2012 Estimated 2013 2014 2015 2016E the economy. house prices andintensifyanydownturnin income. Thismayleadtoamarked fallin to anincrease ininterest ratesorlossof makes Norwegianhouseholdssensitive house prices infuture, thehighlevelofdebt our mainscenario isforfurthergrowth in a riskfortheNorwegianeconomy. E indebted householdsectoralsorepresents house price growth combined withan growth afteratimewilldiminish.High house buildingsuggestthatprice further fallininterest ratesandincreased rise inunemployment,limitedscope fora years. Weak income growth, acontinued for thecountry asawholeinthecoming lead tocontinued growth inhouseprices housing market inWestern Norwaythiswill area. T growth willprobably remain strong inthis and lowinterest ratesmeanthatprice shortage ofhousinginEasternNorway assumed price bubblesinthemarkets. A effects andgeographicdifferences, butnot forward wehavetaken intoaccount interest In ourforecasts forhouseprices going of amarked reversal inprices increases. and thustheincrease inprices, thedanger this represents asignificantpartofdemand an entryticket tothehousingmarket. If letting ortoproviding buyers’children with the demandforapartmentsisrelated to area itappearsthatanincreasing partof 2017E ogether withanormalisationofthe 2018E 2019E 0 5 10 15 20 25 30 35 40 45 ven if
49 rump should win, one must expect increased rowth in the American economy hasGrowth DP has quarters G slowed. In the last three by an annualised rate ofonly increased 1%. The slowdown is attributed toaround a fall in oil investments, an unusually large inventory build-down and the effect of expect dollar on exports. We the strong future, will pick up a little in that growth in modest improvement but a continued fall in suggests a further slight productivity unemployment. In spite of this the nominal moderate with remain will probably picture and inflation below target.weak wage growth toThis suggests that the Fed will continue to normalisationadopt a cautious approach the end of rates and that towards of interest will reach period the signal rate the forecast term risk factor in the short 2%. The greatest election of the presidential is the outcome If against expectations Donaldin November. T and financial turbulence. uncertainty in of the referendum The surprising outcome in both theJune will hit the British economy expect that Great short and long term. We withBritain will seek a trading agreement the EU based on the Canadian model. But it a model a long time before take will probably This suggests a is in place. and agreement orecasts for house prices in the secondary market changed from slightly changed from market in the secondary for house prices Forecasts negative to clearly positive. from rates has been adjusted upwards interest market The track for money at 1% rate is stable interest that the money market this winter and means period during the forecast • • The industrialised countries scrape along, for the seventh year running. Following GDP in the wealthy year 2010 the recovery 1.5% by roughly has increased countries annually. This is a good deal less than what the crisis, to before accustomed we were lower than we had expected, not least in the light of the fact that the industrialised a cyclical upturn, and in are countries lower than what it is in many countries utilisation. to achieve full resource necessary In the seventh year after the end of the it appears to be fruitless to expect recession, and more More will accelerate. that growth the new this is probably that it is recognised in the wealthy norm: the potential growth much lower than is probably countries as now, it During a cyclical upturn, before. growth to assume that actual is reasonable the potential, among other will exceed things because investment picks up and into use. can be brought available resources to be above While unemployment continues the expected normal level in the Eurozone, close to probably the USA and Japan are the full capacity utilisation. In both places be diminished of the upturn could strength shortage of resources, by an increasing by a fall in and in the USA furthermore investment. corporate ext:
T
DNB Markets Kyrre Aamdal, Kyrre
onomic
Macro- ion situat ec is maintaining a The world economy is maintaining a rate. Global GDP will growth reasonable the roughly rise by 3% this year, probably is unevenly But growth same as last year. are economies divided. The emerging times as fast as the three now growing we – for where industrialised countries, the seventh year running – have had to a little. And forecasts trim our growth almost eight years after the financial as a crisis the industrialised countries by to be characterised whole continue inflation unutilised capacity, low price This rates. and historically low interest which the political landscape, also colours fragmented. and more appears to be more the same was unexpected, but at Brexit popular of increasing time an expression frustration frustration in many countries, send globalisation into reverse. that could part of the are differences Increasing Our main view, however, same picture. with to be that globalisation, continues in the emerging growth associated strong In the coming will continue. economies, prices and commodity years higher energy will give a further lift to many of the including Norway. countries, producing Global economy
50 interest rates in2018. further andwillbegin toremove itsnegative will notneedtoeasemonetarypolicy Swedish economy means thattheRiksbank whole forecast period.Theupturninthe below theRiksbank’starget of2%overthe abroad willensure however thatitremains a strong krona andlessprice pressure from unemployment willpushprices higher, but overall activitydownthisyear. E last yearbut,viewedinisolation,willdraw years. Netexportsalsocontributed togrowth in thenumberofasylumseekers inrecent due, amongotherthings,totheincrease rates. Growth inpublicconsumption ishigh, have beenstimulatedbyrecord lowinterest Private consumption andhousing investments this year, buttherateofgrowth willslow. inflation. Production willprobably riseagain production, fallingunemploymentandrising Last yearwascharacterisedbysolidgrowth in The Swedish economyisinacyclicalupturn. indicates inanyeventmodestgrowth. prospects further. Lowgrowth potential last yearandthiscould dampengrowth it. Thepoliticalriskhasincreased overthe cut depositratesfurthertoaccommodate will havetocontinue itsassetpurchases and subsequently slowingagain,sothattheESB reach theESB’stargetY intheNew hit Great Britain.Price inflationwillprobably higher oilprice andlowerexportstoaBrexit- opposite direction howeveristheimpactofa many yearsofhighersavings.Pullinginthe relatively strong growth inhousebuildingafter upturn willcontinue with,amongotherthings, high thisyear. We expectthemodestcyclical first-quarter itislikely thatgrowth willbeas domestic demand.Afterasurprisinglystrong in thefirstinstance drivenbyincreased The Eurozone’sGDProse by1.6%lastyear, lower trend growth intime. poorer termsforforeign traderesulting in recession. Thiswillneverthelessnotprevent further toprevent theeconomy goinginto probably havetoincrease stimulusmeasures very lowinterest ratesthecentral bankwill even greater deterioration.Butwithalready package willcontribute topreventing an pound andtheBankofEngland’ssupport unemployment willriseagain.Theweaker previous report. Afterfallingforfiveyears, one percentage pointcompared withthe our forecast GDPgrowth nextyearbyaround background wehaveadjusteddownwards Investment andemployment.Againstthis weaker developmentinprivateconsumption, long periodofincreased uncertainty, anda ven lower ven lower ear before ear before respectively 5% and10%in20182019. We estimate thatoilinvestmentswill riseby investments alittlefurtherintothe future. developments willleadtoanincrease in of thefieldSnorre 2040andothersmaller be undertaken. Inaddition, development be profitable atthecurrent oilprice, will that theJohanCastberg project, whichwill this yearand10%nextyear. We assume a fallinoilinvestmentsofrespectively 15% investment upbutweneverthelessexpect Sverdrup fieldis contributing to keeping over time.ThedevelopmentoftheJohan adjustment inthelevelofinvestment will becommenced, Indicatingadownward low oilprice means that fewnewprojects completed inthenextcouple ofyears.The now takingplace that are expectedtobe large thisyear. Severaldevelopmentsare fall inoilinvestmentseemslikely tobeas 2015 oilinvestmentwasdownby15%.The price fallreinforced theneedforcutsandin price fallintheautumn2014.Theoil therefore wasalready likely before theoil companies however. Adrop ininvestment terms, damagedtheprofitability oftheoil over severalyears,bothinprice andvolume the Norwegianeconomy. Highcost growth constituted asubstantialgrowth impulse for by volumetheincrease was53%.This rose byalmostNOK85billion.Calculated 2010and 2013oilinvestments Between above 2%in2019. as nextyeartoapproximately 1.4%,andto growth islikely toriseagainfrom asearly private consumption pickup.Therefore, government stimuluswillcontinue and sector willbeless,atthesametimeas the negativedragfrom thepetroleum in theNorwegianeconomy. Infuture and contributing tothere stillbeinggrowth exchange rateare moderatingtheeffects expansive financialpolicyandalowerkrone both intermsofregion andindustry.An development hashittheeconomy unevenly for boththestateandprivatesector. The households andresulted inlowerincome dampened theoptimismofcompanies and cost inflationinthesupplyindustries, the fallinpetroleum investment,reduced The declineintheoilprice hasreinforced fall indemandfrom thepetroleum sector. A lowerrateofgrowth derivesfrom the likely tobeevenlower, atroughly 0.8%. previous year. Thisyeargrowth looks GDP cameoutat1.1%,halfthatofthe Last yeargrowth inNorwegianmainland Norwegian economy the increase. Allinall,weestimate that the flexiblelabour market islimiting to otherpartsoftheeconomy andthat unemployment willspread significantly seems lesslikely thattheincrease in lost theirjobswillfindnewwork. Italso the factthatsomeofthosewho have to come. Theincrease iscountered by sector, there are probably somemore biggest cutshavebeenmadeintheoil will risealittlemore, asalthough the not fallen.We expectthatunemployment such asSweden, DenmarkandPolandhad couple yearsifimmigration from countries increased considerably more inthelast unemployment wouldprobably have flexible labourmarket inNorwayand Economic migrantscontribute toavery some peoplehavelefttheworkforce. has onlyincreased marginally isthat 2015 andthereason thatunemployment employment hasfallensince theendof labour market surveyshowshoweverthat unemployment hasstabilisedthisyear. The of 2015,whileinthewesterncounties unemployment islowerthanatthestart counties ofEasternandCentral Norway to otherpartsofthecountry. Inthe and hasonlytoalimitedextentspread concentrated inthefourwesterncounties particularly hard. Ithasalsobeen has hitsectorsrelating totheoilindustry increase inregistered unemployment year, afteramarked riselastyear. The U under 3%in2019. be lowestthisyear, andincreasing tojust that growth inprivateconsumption will incomes pickingup.Itistherefore likely we seeinflationfallingandgrowth in real come outat1.3%thisyear. F expect thatgrowth inconsumption will slightly lowerthanlastyear. Intotalwe positively togrowth, buttheratewas of services continued tocontribute growth inthefirstquarter. Consumption goods hascontinued thisyear, withzero weak developmentintheconsumption of weakening growth inreal incomes. The but slightlyhigherinflation contributed to was roughly thesamein2015as2014 Growth inhouseholddisposableincome represented byconsumption ofservices. unchanged andtheentire increase was year. However, consumption ofgoodswas consumption growth endedat2.1%last weak growth inthesecond half-year, slowed throughout lastyear. Following Growth inprivateconsumption nemployment hasstabilisedthis urthermore,
51 and in the absence of further monetary of further monetary and in the absence to a this will contribute policy easing of a decline in spite krona Swedish stronger for Better prospects in the rate of growth. mean that Norges the Norwegian economy rates interest Bank has finished lowering of falling in the process and the bricks are krone. for a stronger into place urther urther to remain at the current at the current to remain interest rates downturn even greater level. The risk of an has also been in the Norwegian economy several signs that the are as there reduced, is now behind us. The low point for growth to be fragile and it will continues economy bank central the a long time before take thus rates. We can begin to raise interest at the the base rate will remain that forecast years. for the coming 0.5% current years the central During the last eight have economies banks in most western expansive monetary adopted an ever more banks policy. Again this year the central have increased both in Norway and abroad In the USA base stimulus measures. rates have admittedly been unchanged rate rises have but the indicated interest been pushed further out in time. In the Britain and Sweden Japan, Great Eurozone, and the rates have been reduced interest have extended the banks central countries’ and further period of securities purchases sheets. F expanded their balance but we believe easing is possible in future a approaching banks are that the central the gains from they consider point where any such further easing to be less than in they will throw In practice the costs. the towel but will never say this out loud. low base rates, continued Continuing of government bonds in many purchases and low inflation low growth countries, rates will raise indicate that long interest very little. The yield curves will thus remain unusually flat at today’s low levels. The super cycles in the foreign exchange diminished, years have market in recent Growth reversed. and for some currencies has been disappointing in many of and the major industrialised countries expectations as to monetary policy have with scepticism Increased been revised. to monetary policies that have been regard at times had implemented has furthermore a significant and unexpected impact. In the USA we now expect that the increase and rates will be very cautious in interest strengthening that the period of a marked behind us. Despite of the dollar is therefore in Japan we believe weak inflation prospects This water. bank will tread that its central to strengthening contribute will probably Uncertainty year. the yen over the coming will put a damper on following Brexit weaker pound and we foresee in the interest sterling in both the short and long term. The appears to be undervalued krona Swedish ogether with inflation, ven if housebuilding is expected to pick igh house price growth and ever higher growth High house price risk of household debt suggest an increased T financial imbalances. of which will be above the inflation target expected, 2.5% for longer than previously Bank will allow this suggests that Norges In spite of high unemployment and lower house price in household income, growth high again this to remain growth is likely rates, which are low interest Very year. long while, are low for a expected to remain stimulating housing demand. The regional have in the housing market differences growth Price this year however. increased where is ever higher in Oslo and Akershus and housebuilding is held demand is strong on the supply side. down by restrictions E growth up a little, the high house price to push in Eastern Norway will continue as a whole in for the country growth price which has Norway, In Western the future. hit by the slowdown in the been hardest is weak growth industry, price petroleum or negative. In this part of the country we expect a gradual normalisation of the indebted n ever more A housing market. to pushing household sector may contribute further up, which may increase house prices exacerbating the risk of a fall in house prices any downturn in the economy. he weakness of the Norwegian krone krone The weakness of the Norwegian in significantly during 2015 has resulted in the last growth higher imported price to years which has contributed of couple an increase estimate lifting inflation. We while of 3.7% this year, prices in consumer prices tax and energy inflation (where core excluded) is expected to rise by 3.2%. are situation has led to The weak economic moderation in wage settlements and we of 2.5% this year. estimate wage growth wages a fall in real to This corresponds wage lowest real the of 1.2% this year, we expect for 35 years. In future growth to decline the weak krone the effect from and gradually have an opposite effect. This to low inflation in future will contribute and we estimate that inflation will fall to 2.6% next year and 1.7 and 1.5% respectively in 2018 and 2019. abour by the Labour as measured unemployment average for will be 4.8% on Survey Market gradually to a peak of 2016. It will then rise falling a little in 2019 5.0% in 2018, before growth of years of stronger after a couple in the Norwegian economy.
52 Letting assignmentonbehalfofSkanskaCDN Vitaminveien 4,Workplace Oo
53 ctivity in the Norwegian bond Activity in the Norwegian has now begun to pick market to the up after a quiet start year property A high volume of new so far bonds has been issued in 2016 A phasing out of shadow it more ratings will make expensive difficult and more for small and medium- to finance sized companies themselves in the bond market *High yield segment (HY) rating with a B+ = companies or lower Investment grade segment (IG) raising with a BB- = companies or higher • • • affect spreads. Increased global credit risk has global credit Increased affect spreads. and “risk “risk on” frequent also led to more off” periods. In addition, the EU’s common supervisory body, ESMA, has decided that it ratings ifwill be forbidden to publish credit forone is not an official rating agency such as, and Poor’s, Moody’s andexample, Standard by broking Fitch. Shadow ratings prepared in common practice firms, which has been be phased out Scandinavia, will therefore analysts will continue during 2016. Credit and bonds to analyse the same companies without giving a specific rating. The Nordic to function because will continue bond market bank finance supplement to it is a reasonable grounds however, are, There for companies. difficult and to fear that it will be more expensive for small and medium- more to raise money in the sized companies it will be a little less because bond market been. then it has previously transparent
art of the reason for this is that Swedishart of the reason ntra issued its first issued its first “Entra unsecured bonds “green” NOK 1bn., in an amount of and a with a 7-year term coupon of 3-month NIBOR +94 bp. ntra and Steen & Strøm raised financeEntra and Steen & Strøm Entra made its first green during September. bond issue of NOK 1 billion with aunsecured of 3-month NIBOR 7-year term and a coupon plus 94 bp. and Steen & Strøm issued NOK plus 94 bp. and Steen & Strøm 400 million of bonds with a 6.5-year term and of 3-month NIBOR plus 110 bp. a coupon The volume of bonds issued by Norwegian been affectedproperty companies has largely by the volume of transactions in the property transaction In 2015 a new record sector. NOK 130 billion andvolume was set of around of new property new record a corresponding bonds of close to NOK 18 billion. The volume of transactions so far in 2016 has been much less than in 2015 but nevertheless we see that the NOK 14 almost volume of bond issues is already billion. P and such as Vasakronan companies property amounts in the Rikshem have raised large during the year. Norwegian bond market high has been a relatively In addition, there such as companies number of issues from Entra and Norwegian Property. will be more volatility believe that there We in the bond market in future then we have we have had years, when seen in the last three Due even tightening of spreads. a relatively monetary policyto the expansive European has values, the market and inflated property sensitive to surprises that can more become ext: T DNB Markets Kristina Solbakken, market bond The here was a substantial price correction correction was a substantial price There in the for investment-grade companies last year after a Norwegian bond market Due to long period of tightening spreads. as a result international sentiment improved European support buying by the of continued Bank (ECB) and the fall in the oil price, Central quickly than normalised more this market in 2014 than expected, if at higher spreads issuers,and 2015. The most solid and frequent such as, for example, the major Norwegian have not had problems companies, property at goodin raising money in the bond market For example, both the summer. levels since The Norwegian bond market had a turbulent start to 2016 following the during 2015. substantial fall in the oil price was a low level of new issues during theThere of the first half of 2016 with the exceptionrest of a two-week period in May and June. It money in expensive to borrow became more for all types of Norwegian bond market the high yield companies and oil-related company this bond financing have been excluded from and as in the sector, year due to the problems expected we have seen several restructurings believe We this year. for this type of company high for non oil-related the primary market to look is now beginning yield companies for the lowest riskbrighter and the market at the opened again of these companies beginning of September.
54 20,0 10,0 200 14,0 16,0 18,0 12,0 100 140 160 180 120 4,0 6,0 8,0 2,0 40 60 80 20 0 - 2009 2013 Bond issuersintherealestatesector, Y Bond volumeissuedincommercialpropertytheNorwegian bondmarketbyyear(NOKbn.) companies(includingcommercialproperty). Credit speadsindustry jun. IG A 2013 aug. vgOf3Y 2013 okt. HY 2010 2013 des. A 2014 feb. vgOf5Y 2014 apr. 2011 2014 jun. A 2014 aug. vgOf7Y 2012 2014 okt. TD 2016. 2014 des. A 2015 feb. vgOf10Y 2013 2015 apr. 2015 jun. 2015 aug. 2014 2015 okt. Source: Stamdata,DNB Markets 2015 des. Andre olavThonEiendomsselskapAS thonHoldingAS(700) riksheimAB(700) pioneerPublicroperties AS(1000) oBOSBBL(1055) entraAS(2800) 2015 ML 33HoldingAS(682) Norwegian Property AS(1335) Vasakronan AB(publ)(2200) 2016 feb. 2016 apr. 2016 jun. 2016 YTD 2016 aug. 2,6 11,1
55 Ingrid Elisabeth Moe Advisor 0047 922 82 740
Jan Vidar Løvsland Senior advisor 0047 916 11 063
www.dnb.no/næringsmegling Henrik Baardsen Advisor 0047 482 67 622 Brunvoll Kent Real estate broker 0047 920 39 426 Mads Hofrenning Wanderås Analyst 0047 938 64 162
Bjørn Olav Smørgrav Advisor 0047 901 02 731 Siri Jordfald Advisor 0047 918 89 225 Magnus H. Jacobsen Analyst 0047 938 64 162
Steinar Frøland Real estate broker 0047 982 69 111 Frode Johansen Frode Senior advisor 0047 901 02 731 Jørn Mandius Jacobsen Analyst 0047 993 99 277
Joachim Wulff MRICS Analyst 0047 452 08 528 Harly Eilertsen Business developer 0047 993 99 630 Geir Gjerde Advisor 0047 924 85 462 s Employee
Anne Helene Mortensen Chief Executive 0047 906 84 481 Ervik Ketil Senior real estate broker/lawyer 0047 920 54 411 Idar Bjørdal Senior real estate broker 0047 922 55 568 Richard Gilde Richard MRICS Senior analyst 0047 950 39 839 ion uat al v /
sis Analy Letting Transactions Gunnar Selbyg Director 0047 913 78 318 Jørn Skovly Director 0047 900 33 874 Morten Roland Director 0047 957 56 622 oslo
56 0047 41681066 compliance officer real estatebroker/ Settlement officer/ Randi Justnæs 0047 90980462 Director Rossy Addington Back Trondheim 0047 97697205 real estatebroker Director/ John EdvinArnstad Transactio Bergen
Office
- IT/ /Val 0047 90567398 Senior advisor/lawyer Lars ErikWirsching 0047 91661564 Finance consultant Nina T 0047 91661551 compliance officer Real estatebroker/ Marte Skarland uation finance ranås Hansen
/Marketing 0047 93407436 Real estatebroker Mariann Fossmark 0047 91661520 IT Peter Ibsen 0047 91661524 Real estatebroker Martin Udbye -coordinator/market
0047 92624755 Market coordinator Therese Hansen 0047 45210027 Market coordinator Ida LouiseWæraas 0047 91661528 Senior realestatebroker Hans K.Norderud ing lett
0047 91661565 Real estatebroker Siw Ramstad 0047 92032198 Director Frode G Stavanger yland
0047 95057288 Real estatebroker T 0047 47463180 Real estatebroker Pål Støvne-Bjørnsen onje Ø. Hadland
0047 95742908 Advisor Stian Dreyerørensen 0047 92813134 Market coordinator Karin Aakerholm
57 his report has been prepared by DNB by DNB has been prepared This report © DNB Næringsmegling. ASA. The subsidiary of DNB Næringsmegling AS, which is a whollyowned but DNB to be reliable, considered that are is based on sources report that the information in the report Næringsmegling AS does not guarantee of DNB the opinions reflect in the report Statements or complete. is precise and DNB of the report, Næringsmegling AS at the time of preparation the right to change its opinions without notice. Næringsmegling AS reserves to recommendation as an offer or is not to be interpreted This report a lease, financial instruments or securities. DNB or sell property, purchase loss or indirect for direct no responsibility Næringsmegling AS accepts Editorial and/or use of this report. or expense due to the interpretation on 05. October 2016. was completed preparation
dit Cre
Figures: DNB Markets, SSB, DNB Næringsmegling Kartagena/Statens Kartverk/ NE Byrå/DNB Næringsmegling Kart: Photo: Employess Oslo, CEO: Nye Bilder. Fotograf Løtvedt Employees Bergen: - DNB Næringsmegling Graphic design: Ida Louise Wæraas Text: to a particular All text unless credited author - DNB Næringsmegling Magnus Havikbotn Jacobsen, Wanderås Mads Hofrenning - Analysis, DNB Næringsmegling Editors: Gunnar Selbyg,
58 59 DNB.NO/Næringsmegling
Oslo Trondheim Dronning Eufemias gate 30, Beddingen 16, 0021 Oslo 7014 Trondheim
Bergen Stavanger Solheimsgaten 7C, Haakon VIIs gate 9, 5058 Bergen 4005 Stavanger