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Publicerad: 28 september 2018, 18:44
Max Barclay. Photo: Newsec.
There has been a significant increase in foreign and especially inter-Nordic transactions in the Nordic countries in recent years, while the share of domestic transactions has decreased. Data clearly shows, that for the first time, domestic investors are experiencing growing competition from their neighboring countries. Nordic buyers are now larger than non-Nordic buyers, at 24 and 16 percent respectively.
Swedish, Finnish, Norwegian, and Danish investors, that earlier tried their luck in Germany, the UK or Southeast Asia, have to a large extent concluded that there are advantages to keeping their money closer to home. Though people may joke about Finnish saunas, Norwegian cross-country skiing, Danish herring lunches, and Swedish consensus-based decision-making, one cannot deny the fact that our countries and cultures have a great deal in common. Although certain traditions and expressions may differ, we all find it fairly easy to understand one another. A sense of understanding reduces uncertainty and risk – and as we all know, that’s good for business.
Our analyses clearly show that investor origin influences preference. Investments made between the Nordic countries are primarily directed at offices, but also segments such as public properties and logistics. Non-Nordic investors focus on core real estate in the capitals, with a preference for shopping centers. Nordic investors prefer capitals too, but are also interested in alternative locations. For example, housing in smaller Swedish regional cities is very popular in this group, along with housing in Copenhagen and offices in Oslo.
Furthermore, what we in the Nordics perceive as cultural differences are often lost on an outsider. A person from China or the US does not necessarily know in which country Copenhagen is located, and is likely to be more familiar with terms such as Scandinavia, the Nordics, or the Baltics, than they are with e.g. Finland. We experienced this ourselves earlier this year as a partner at Fastighetsnytt’s newest addition, Business Arena in London. Newsec had representatives from each of our countries present to meet with UK-based international investors. We found that there was great interest in our region, and it was particularly striking that those we spoke to were looking for one, rather than several, partners to team up with when considering an investment in the Nordics and Baltics. In order to cater to the needs of this group of investors, we recently launched our London office headed by Richard Angliss.
If you are interested in reading more about investments in the Nordics and Baltics, the latest edition of Newsec Property Outlook is free to download.
Head of Newsec Advisory
Note: Data relevant to this column can be found under market data in Nordic Real Estate Update.