Nordic Investor Confidence Index
Q1 2023
Acquisition interest increases
...despite changing market conditions
VOLUMES (EUR Billion)
Cushman & Wakefield – Nordic Investor Confidence Index
TRANSACTION
76% 51% 50% 77% 45% 64% 75% 47% 58% 78% 58% 74% 77% 52% 64% 15% 32% 39% 4% 38% 24% 21% 45% 34% 19% 27% 21% 15% 34% 28% 9% 17% 11% 19% 17% 12% 4% 8% 8% 3% 15% 5% 8% 14% 8% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Increase: more acquisition than disposal Stable: as much disposal as acquisition Decrease: more disposal than acquisition 0 10 20 30 40 50 60 70 80 90 Denmark Finland Norway Sweden Nordic 2018 2019 2020 2021 2022
INVESTMENT OBJECTIVE
Expectation of stable occupier demand for logistics and office assets
LOGISTICS / INDUSTRIAL
Cushman & Wakefield – Nordic Investor Confidence Index
… with retail demand expected to deteriorate
OFFICE RETAIL
44% 10% 8% 50% 12% 29% 53% 19% 9% 37% 44% 8% 9% 53% 66% 60% 45% 52% 48% 41% 67% 63% 51% 66% 54% 49% 63% 56% 24% 32% 5% 36% 24% 6% 14% 28% 11% 34% 46% 7% 29% 35% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Improve Show little or no change Worsen 32% 10% 52% 42% 8% 17% 32% 49% 41% 36% 43% 48% 67% 42% 49% 20% 52% 19% 21% 48% 35% 33% 19% 49% 59% 48% 29% 15% 43% 79% 31% 81% 79% 20% 60% 65% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Improve Show little or no changes Worsen 63% 35% 31% 57% 23% 63% 20% 10% 58% 15% 13% 60% 22% 13% 37% 55% 59% 43% 59% 89% 37% 69% 67% 42% 58% 57% 40% 60% 66% 10% 11% 18% 11% 10% 24% 27% 30% 19% 21% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Improve Show little or no changes Worsen
Cushman & Wakefield – Nordic Investor Confidence Index … across the Nordics region Strong rental growth in offices Denmark Finland Norway Sweden 117 150 169 202 PRIME OFFICE RENT GROWTH (INDEX 2010=100) Prime Office Rent Growth (Index 2010=100), as of Q4 2022 100 120 140 160 180 200 220 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Denmark Finland Norway Sweden
OFFICE RETAIL LOGISTICS / INDUSTRIAL RESIDENTIAL
Cushman & Wakefield – Nordic Investor Confidence Index
Yields expected to decompress across all sectors… … with office and residential believed to be most affected.
No Data 32% 18% 12% 22% 9% 13% 9% 15% 17% 9% 60% 36% 25% 65% 17% 68% 8% 28% 82% 11% 15% 71% 15% 20% 8% 47% 63% 13% 93% 74% 30% 79% 63% 3% 82% 82% 11% 77% 73% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Decline Remain stable Increase 29% 24% 20% 42% 20% 11% 11% 30% 30% 9% 10% 48% 27% 18% 50% 19% 41% 52% 16% 17% 56% 18% 38% 52% 19% 30% 22% 49% 62% 8% 81% 55% 28% 73% 72% 15% 77% 56% 18% 72% 60% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Decline Remain stable Increase 29% 21% 9% 50% 8% 9% 10% 8% 38% 32% 10% 64% 45% 42% 46% 12% 18% 71% 11% 29% 58% 12% 48% 60% 19% 37% 7% 34% 49% 4% 80% 73% 22% 79% 63% 83% 48% 8% 72% 56% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Decline Remain stable Increase 36% 17% 12% 40% 22% 7% 30% 9% 60% 24% 30% 48% 11% 21% 70% 9% 62% 11% 17% 59% 58% 12% 85% 75% 7% 89% 83% 8% 80% 75% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Decline Remain stable Increase
Prime office yields decompressing in Q4
…
with similar levels across all the Nordic markets
PRIME OFFICE YIELD (Net Initial)
Cushman & Wakefield – Nordic Investor Confidence Index
Denmark Finland Norway Sweden 3.45% 3.50% 3.75% 3.50%
0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Denmark Finland Norway Sweden
Worsening financing conditions universally expected …
NORDIC SWEDEN NORWAY FINLAND DENMARK
Cushman & Wakefield – Nordic Investor Confidence Index
however investors increasingly expecting stable conditions
21% 8% 5% 13% 9% 16% 3% 5% 4% 2% 16% 12% 3% 10% 48% 28% 40% 67% 25% 30% 65% 23% 31% 60% 23% 37% 60% 24% 35% 31% 64% 55% 21% 75% 61% 18% 74% 64% 36% 75% 47% 28% 73% 55% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Improved conditions Unchanged conditions Worsened conditions
Overall value of Nordic portfolios expected to further worsen
PORTFOLIO DEVELOPMENT INFLUENCING FACTORS
Cushman & Wakefield – Nordic Investor Confidence Index
… however investors seem to be slightly less pessimistic
68% 15% 9% 67% 0% 4% 60% 6% 75% 69% 4% 5% 29% 48% 43% 33% 28% 36% 33% 37% 34% 25% 33% 56% 29% 36% 45% 3% 38% 49% 72% 60% 8% 63% 60% 64% 41% 60% 50% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Improving Unchanged Worsening 46% 22% 18% 8% 6% Development of initial market yields
conditions
development
development Development of operating and maintenance cost
Financing
Rental
Vacancy
Office segment expected to perform best … in the more challenging market conditions
SEGMENT EXPECTED TO PERFORM BEST IN THE COMING SIX MONTHS
27% 17% 17% 15% 13% 6% 4% Office Public properties Logistics Residential Industrial Retail Hotels
Environmental aspects remain of high importance to investors …
despite a more challenging market
DO INVESTORS CONSIDER SUSTAINABILITY CLASSIFICATIONS?
WILLINGESS TO PAY A PREMIUM FOR HIGH SUSTAINABILITY
DO INVESTORS CONSIDER SUSTAINABILITY CLASSIFICATIONS?
Cushman & Wakefield – Nordic Investor Confidence Index
96% 93% 94% 100% 97% 100% 94% 95% 95% 100% 98% 100% 98% 96% 98% 4% 7% 6% 6% 5% 5% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Yes No 59% 54% 60% 67% 69% 68% 77% 72% 71% 82% 78% 74% 73% 70% 70% 41% 46% 40% 33% 31% 32% 23% 28% 29% 18% 22% 26% 27% 30% 30% Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Q1 2022 Q3 2022 Q1 2023 Denmark Finland Norway Sweden Nordic Yes No 55% 27% 7% 2% Yes, it is part of our formalized investor prerequisite Yes, but we do not have a formal approach to it Yes, but not of importance No
CONTACT US
Sweden
Michal Toporowski Senior ResearchAnalyst
michal.toporowski@cushwake.com
+46 73 052 65 56
Denmark
Lior Koren Partner, Capital Markets
lk@cw-red.dk
+45 2711 0508
Norway
Hans Petter Skogstad Head of Research / COO
hps@cwrealkapital.com
+47 93 86 66 85
Finland
Ville Suominen
Partner, Valuation & Advisory
ville.suominen@cushwake.fi
+358 44 568 4300
