Klövern AB (publ)

Interim Report January - September 2014 - Seite 2

So far this year the market for office premises in Stockholm and Göteborg has shown signs of a positive development with lower vacancy rates and rising rental levels. The vacancy rate in the office market in Stockholm is just over 9 per cent, the lowest level since 2001. Relatively few properties coming on to the mar­ket have been built speculatively, which is a sign of health.

As the supply of historically cheap finance is good, yield requirements are declining for most kinds of assets, and property is no exception. That is the case also for well-situated office properties outside CBD, where there is often a great demand for newly built offices. A higher degree of institutional buyers, who will often accept lower required yields than other potential buyers, contribute to pushing yields down.

During the first six months of the year, about 70 property transactions took place in the Stockholm market to a value of SEK 22 billion. Klövern's acquisition of Glo­ben City for a price of SEK 3.8 billion was the largest single transaction. In addition to acquisitions, Klövern focuses on developing its project portfolio. At the moment construction is in full spate at Kista, where Tele2's new head office will be ready by the summer of 2016. Another example is the old post office in Uppsala, situated close to the central station, where we are undertaking a major refurbishing and extension project.

At an extraordinary general meeting on 22 October, the board directors of Klövern intends to seek shareholder approval for an authorization to issue more preference shares as well to introduce Class B common shares. Those two steps would provide Klövern with improved conditions to continue to develop both its current project port­folio and also make further acquisitions.

Downward pressure in the interest rate market continues to have a positive impact on Klövern's financial costs. The average interest charge has now declined to 3.7 per cent compared to 4.3 per cent a year ago and this development is expected to continue. Because of interest rate reductions there is a natural inertia in shifts in interest charges because of market movements.

In a world that is otherwise fairly full of challenges, I can note that Klövern continues to deliver good results and I view developments in the final quarter of this year positively.", says Klöverns CEO Rutger Arnhult.

For further information, please contact:
Rutger Arnhult, CEO, [phone], [e-mail]
Lars Norrby, IR, [phone], [e-mail]


Klövern is a real estate company committed to working closely with customers to offer them efficient premises in Swedish growth regions. As of 30 September 2014, the value of the properties totalled SEK 29 billion and the rental value on an annual basis was SEK 2.9 billion. Klövern is listed on Nasdaq OMX Stockholm Mid Cap. For further information, see www.klovern.se.

Klövern AB (publ), Box 1024, SE-611 29 Nyköping, Sweden. Phone: [phone], fax: [phone],
e-mail: [e-mail].

This information is such that Klövern AB (publ) is obliged to disclose under the Securities Market Act and/or the Financial Instruments Trading Act. The information was made available for publication on 22 October 2014.

Klövern AB (publ): Interim Report January - September 2014

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This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Klövern AB (publ) via Globenewswire

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