Investment insights with Sofia Folstad

Propstreet investment insights

Fast paced student housing investor with a clear growth agenda

Sofia Folstad, Head of Finance and Transactions at Studentbostäder i Norden

Tell us about you and why you started to work in the CRE industry

In February this year I joined SBS as the Head of Finance and Transactions. Prior to joining SBS I worked for four years as a Director in the Capital Markets team at Colliers. Prior to this role I spent seven years at SEB in various positions. For me working with real estate has always been an easy choice since it is an industry that is comprehensible. Outside of work I have always been interested in flipping houses/apartments and I am always looking for a new inspiring renovation project. The principle of investing in commercial real estate is the same but of course on a larger scale.

What are your company´s preferred markets and segments?

We are a pure student housing company which focuses on modern affordable housing of high quality. We are the only listed pure play student housing company in Sweden and we are currently traded on Nasdaq First North. Our real estate assets are located in Sweden and Denmark in 16 different cities across the country – from the northern to the southern part. Our main goal is to become the leading student housing company in the Nordic region.

What are your competitive advantages in the market?

We have a first mover advantage since we are the largest pure play student housing company in Sweden. We have built a specialized organization for student housing with a strong focus on digitalization. Since our units are usually smaller than the average rental apartment, the Tenant Associations model for the norm rent enables us to achieve higher rental levels per sqm while maintaining a low monthly rent for the student. All new development projects are sustainable and qualify for both the investment grant and energy bonus. We offer high quality, affordable student housing with a fully digitalized rental management. This in order to make the living experience seamless for our tenants. We are a fast-paced player with a clear growth agenda with the strong owners of SBB, Fastator and Amasten.

What is the most inspiring part of being a real estate investor?

There will always be a demand for real estate. The yields might fluctuate from time to time but the population in the world is still increasing and so will the demand for real estate and long term building rights. For me the student housing segment is especially interesting since it previously has not been an established segment in the Nordics. We are a part of shaping this segment and for me it is inspiring that this change will benefit the overall society and make it possible for more students to reach their dream profession.

How do you become a successful investor?

I think a lot has to do with having a great network of competent and experienced people around you. Also make sure to be stay curious, ask questions and try to learn as much as you can from people with experience and knowledge in your network. Knowledge that will give you the ability to recognize opportunities.

Most interesting market trends right now?

One interesting market trend is modern co-living. We have been spending a lot of time exploring how young people today prefer to live and we are adapting our business and services to meet their needs. We build smaller units which also have access to large common areas where students can socialize.

Our latest acquisition in Copenhagen is a large complex with 578 small apartments and large common areas with roof top terraces, gym, café and a grocery store.

This is something that we want to create in Stockholm as well. In our Stockholm campus, we will have over 1 200 units and are mixing student housing with co-living for young professionals. We have a total project pipeline of more than 2 000 units and are committed to generating growth to our shareholders while creating the next generation of student housing.

How does technology change the investment landscape?

Technology is changing the investment landscape completely; with new digital tools and solutions the market will become more transparent and globalization will accelerate. Digital meetings have enabled us to become more efficient, meet foreign investors and look at investment opportunities outside of Sweden.

What advice would you give to a first-time buyer?

I would say that looking at the global trends is always important to keep up and stay ahead. Continuously ask yourself; how do people want to live and work in the future? Always be forward looking, identify possible blind spots and shortages in your market. Important to remember is that in the real estate business, location is key. And to play it safe, invest in a segment that are more likely to withstand a recession – like student housing.