This article first appeared on GuruFocus .
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Rental Income:2.5 billion, slightly above the same period last year.
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Net Operating Income:Decreased to 1.9 billion.
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Surplus Ratio:74% for the period, 78% for the quarter.
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Profit from Property Management:150 million, compared to 112 million in the previous year.
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Real Changes in Value:338 million for the quarter, minus 988 million for the first nine months.
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Property Value:Total property value at 78.5 billion.
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Equity per Share:120 Swedish crowns per share.
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EPRA NRV:146 crowns per share.
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Equity Asset Ratio:45%.
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Loan to Value Ratio:43%.
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Interest Coverage Ratio:2.7% for the quarter, 2.5% for the entire period.
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Average Interest Rate:Decreased to 2.83% at the end of the quarter.
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Net Letting:Positive with 99 million for the quarter, 3 million for the year.
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Occupancy Rate:Management portfolio occupancy at about 87%.
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Release Date: October 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Fabege AB ( STU:WILC ) reported increased rental income and net operating income for the third quarter.
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The company experienced a positive net letting of approximately 9 million, indicating improved leasing activity.
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Fabege AB ( STU:WILC ) maintained a strong balance sheet with an equity asset ratio and loan-to-value ratio unchanged at 45% and 43%, respectively.
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The company successfully issued a bond of 1.25 billion with a favorable margin of 100 basis points, reflecting strong demand in the capital market.
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There is an observed increase in inquiries and viewings, particularly in the Stockholm inner city, suggesting a potential uptick in market activity.
Negative Points
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Rental income on a like-for-like basis decreased by EUR74 million, equivalent to a 3.2% decline, mainly due to relocations from previous negative net lettings.
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Net operating income decreased to EUR1.9 billion, impacted by non-recurring property costs and higher repair and maintenance expenses.
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The occupancy rate in the management portfolio remains low at about 87%, with significant vacancies in certain areas.
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The company reported a negative change in property values amounting to minus 988 million for the first nine months.
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Fabege AB ( STU:WILC ) faces challenges in achieving its target of a 5% vacancy rate by 2030, with current vacancy rates remaining flat around 13%.
Q & A Highlights
Q: Is the increased activity mostly in the inner city, and are there specific sectors showing interest in taking up space? A: Yes, the increased activity is primarily in the inner city, but we also see higher interest in areas like Arenastaden. The sectors showing interest include auditors, lawyers, and rapidly growing AI companies. The overall optimism about the economy is contributing to this trend.
Q: How do current rent levels compare to market rates or ERVs? A: Current rent levels are generally in line with market rates. Some are slightly higher, some are at the same level, and a few are lower, but overall they align with our expectations.
Q: Regarding the positive reversion in Q3, was it due to a specific asset being under-rented, or is it a market trend? A: The positive reversion involved several tenants, including one larger one, and required some investments. It's a good deal overall, indicating a stabilizing market. Many contracts are being extended on similar terms.
Q: Are rent negotiations still showing declines, and where are these concentrated? A: Rent negotiations have stabilized, with a slight decline of 0.1% compared to previous quarters. The changes are mainly in city areas, and larger deals often involve some investments.
Q: When do you expect like-for-like rents and values to bottom out, and what about vacancy rates? A: We hope rents and values will bottom out soon, with potential improvements in coming quarters. Vacancy rates are expected to improve from current levels, with a target of reaching 95% occupancy by 2030.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
