Stendörren Fastigheter (STEF) Stockholm Corporate Finance Conference 2025 summary

Business overview and growth strategy

• Focus on warehouse logistics and light industrial properties, primarily in Stockholm, with a portfolio valued at approximately SEK 15 billion and a strong inbuilt rental growth due to urban location.

• Large development rights portfolio of 630,000 sqm, enabling significant future expansion, with recent geographic diversification into Oslo, Copenhagen, and Helsinki.

• High-yielding segment with properties generating around 6.5% yield, long lease terms (4.2 years), and a diversified tenant base, with the largest tenant accounting for only 8% of rental flow.

• Growth driven by acquisitions and internal development, with a strategy to avoid competitive auctions and focus on smaller, higher-yielding property purchases.

• Operational improvements include halving vacancy rates and increasing net operating income by 12-13% over five years, with most growth internally generated.

Financial performance and stability

• Achieved 17% increase in net operating income and 13% growth in management results per share in the first half of the year.

• Maintained strong financial stability with 70% of interest-bearing debt hedged and a long average debt maturity of over three years.

• Recent property acquisitions total SEK 1.7 billion at yields above 7%, split between Sweden and other Nordic capitals.

• Development projects delivered over 20,000 sqm in the past year with 85% occupancy, and ongoing projects have a net operating income potential of SEK 50 million.

• Reduced energy consumption per sqm by 30% over five years, reflecting strong cost control and sustainability focus.

Market positioning and valuation discussion

• Trades at a slight discount to net asset value, unlike many peers in the hot logistics and light industrial sector, due to the market not valuing the development rights portfolio in the share price.

• The development rights portfolio represents about 10% of total property value, but is not reflected in market valuation until developed.

• Management prefers a long-term industrial approach, retaining and developing land rather than selling for short-term gains.

• The market for development rights is illiquid, and timing is crucial for value realization.

• Main shareholder is a private equity fund with a long-term, industrial mindset, supporting the company’s growth strategy.