Propstreet investment insights
Anders Johansson, CEO at Fortinova
The Swedish CRE Industry provides for a unique opportunity within the residential market. Sweden has had an ever-growing housing shortage which in many aspects is a challenge for society as a whole. However, as an investor in residential real estate in Sweden we are enjoying a high demand for our product, leaving us with one of the markets highest occupancy rates, stable cash flows and an attractive risk adjusted return.
We are focusing on the residential market in Western Sweden. Western Sweden is according to us one of the most expansive areas in Sweden which facilitates an even higher demand for our apartments and commercial areas which in turn favors our objectives.
In order to be successful in the real estate market you have to know your market. That is, you can benefit from knowing the location you are Investing in. It could be a very different case weather you invest north or south of main street. It is just not enough to analyze macro, but you actually need to be a part of the local community to know where the next opportunity – or risk – might appear. We make sure that we interact with the communities and staff the organization with people that live in the communities where we are investing in.
I would say it is working with people. We can truly make a different in people’s lives. We offer space, weather it being a space where you create a family, a space where you build your business or any other space where you can pursue your dreams. We want to provide a space where people can grow so we can grow with them.
Haha, I don´t think there is just one easy way. However, never promise more than you can deliver and keep things simple. Don´t complicate things and stay true to your business plan.
I think it is interesting to see how more and more investors find their way to the residential market. It seems like the market appreciates the attributes of the Swedish residential market just as we did when we did our first investment. We have for some time seen a yield compression which seem to continue in our whole region.
The market is becoming more and more transparent and efficient. Technology makes it easier to find and analyze investment opportunities. It makes the process easier. However, as the market becomes more transparent the threshold for entering the market becomes lower which in some cases can increase the competition.
If you really want to become a first-time buyer, you have to – buy. It might sound easy but could possibly be a big decision. You can only decide if you want to go for it or not. Do not overanalyze, there are so many things that will turn out in ways you could not imagine, for better or worse. In most cases It will turn out ok so really, my advice would simply be to stop reading and go out there and create your story. Good Luck!