AEW acquires portfolio of two modern residential assets in Finland
AEW has acquired two modern residential apartment blocks located in the prime residential Helsinki Metropolitan Area (HMA) sub-markets of Jatkasaari (Helsinki centre) and Matinkyla (Espoo).
Together the two buildings comprise 87 high specification apartments spread across 5,018 sqm. The assets were acquired from the Bank of Åland Residential Property Fund on behalf of a German pension fund.
Developed in 2017, the apartment block in central Jatkasaari is located only 100 metres from the closest tram station and 700 metres from the Ruoholahti metro station which provide a direct connection to Helsinki city centre. The property, which is 99 per cent let, comprises 53 flats (60 sqm average apartment size), and 30 parking spaces on a freehold plot of 876 sq m. The 100-hectare Jatkasaari district is one of Helsinki’s largest urban developments and currently under intense construction on a southern peninsula vacated by a cargo port in 2008. Jatkasaari is being built as a western extension to Helsinki City Centre, located right by the sea. By 2030, Jatkasaari is estimated to have 21,000 residents and 6,000 jobs.
The apartment block in HMA’s sub-market of Espoo is located 950 metres from Matinkyla metro station (with direct connections into Helsinki taking around 20 minutes) and the Iso Omena (the Big Apple) shopping centre – one of Finland’s largest shopping centres. It comprises 34 flats (54 sq m average per unit) and 24 parking spaces on a freehold plot. The asset was developed in 2014 and is currently 100 per cent let.
The Finnish economy has been growing steadily since 2016. GDP growth in 2017 was the fastest since the financial crisis. In Q4 2018 Finland enjoyed its 13th quarter of consecutive GDP growth. The Helsinki region also represents 37 per cent of the country’s total GDP and 32 per cent of all jobs and can therefore be considered as the heart of the Finnish economy.
Lars-Henning Pylla, Separate Account Fund Manager at AEW, says: “Finland is one of the most competitive economies in the world, underpinned by the strength of the Helsinki Metropolitan Area, which is one of the main reasons we took the decision to broaden the mandate’s residential exposure and to invest into this dynamic region. We have focused on smaller-sized, well-equipped units in growing sub-markets that we believe will continue to play a significant role in the region’s long-term economic development, ensuring the future sustainability of the investment.”
AEW has been investing in residential real estate in Europe for more than 20 years. It currently manages a dedicated residential fund, RESIDYS, and the asset class represents approximately 8 per cent of AEW’s circa EUR32 billion European portfolio. Its investment approach is informed and underpinned by its deep expertise and detailed analysis of major demographic trends.
AEW was advised by Castren & Snellman, Vahanen, Yester & Morrow and Cushman & Wakefield. The vendor was advised by Avance and Catella.