Interim report January–September 2024

• Rental income increased by 13.2 percent (15.8) and amounted to SEK 885 million (781), of which SEK 57 million (0) comes from project properties. In a like-for-like portfolio, rental income increased by 7.6 percent.
• Profit from property management totalled SEK 380 million (402).
• Changes in the value of investment properties totalled SEK 86 million (-294), of which SEK 47 million (124) was attributable to project properties.
• Profit after tax for the period amounted to SEK 228 million (95).
• Profit/loss for the period attributable to the shareholders of the parent per Class A and B share totalled SEK 0.91* (-0.01) and per Class D share SEK 1.50*(1.50).
• Total investments in existing investment properties for the period amounted to SEK 1,154 million (1,530).
• The property value at the end of the period was SEK 22.6 billion (21.4). Significant events during the quarter.

Significant events during the quarter

• During the quarter, Intea issued three green bonds under its MTN programme and green framework, with a total volume of SEK 1,800 million. Significant events after the end of the quarter.

Significant events after the end of the quarter

• In October, Intea acquired an ambulance centre with a lettable area of 1,600 sqm. The underlying property value in the transaction was SEK 95 million before deduction of deferred tax.
• In October, Intea entered into an agreement with lenders to refinance a backup facility of SEK 1,000 million that would have matured in October.
• In October, Intea acquired a police facility in Gothenburg. The lettable area is estimated to be around 22,000 sqm after completion of new construction and renovation projects. The underlying property value in the transaction was SEK 747 million before deductions of deferred tax and project costs.
• In October, Intea acquired a health care property in Västerås with a lettable area of 1,410 sqm. The underlying property value in the transaction was SEK 46 million before deduction of deferred tax.
• In October, Intea entered into an agreement to acquire a new custody unit under construction in Västerås, with a lettable area of 34,600 sqm. The underlying property value in the transaction amounted to SEK 620 million, without deductions for deferred tax. Project costs incurred to date amount to SEK 200 million. The closing of the transaction is planned for the second quarter of 2025.
• In October, Intea entered into an agreement to acquire a prison in Kristianstad, with a lettable area of 7 000 sqm. The underlying property value in the transaction amounted to SEK 135 million. The closing of the transaction is planned for the first quarter of 2025.

*There are no dilutive instruments.

The CEO’s comments

Yet another robust quarter has come to a close in the ongoing recovery of Sweden’s property market. The drop in interest rates, combined with the absence of major defaults, has swiftly reduced anxiety in the bond market and banks, thereby improving the financing situation for most companies. As a result, business activity is steadily picking up, following several quarters of low activity. While Intea has remained active with both projects and acquisitions throughout the past years of instability, we have also seen a rise in activity in the transaction market, allowing us to complete several favourable deals in recent times.

The process of listing the company on Nasdaq Stockholm was put on hold after market conditions worsened in the spring of 2022. As the market for listings has started to recover during the year, we were able to announce this spring that the company had restarted the process of listing its series B and D shares on Nasdaq Stockholm. Preparations are in full swing.

New times – new opportunities

The company’s business development efforts are starting to bear fruit in the market, and in October, we disclosed a number of transactions that we have been working on during the year. The first was the acquisition of an ambulance centre in southern Stockholm with Region Stockholm as the long-term tenant. This was followed by another deal in the healthcare sector for a completely renovated audiology clinic in Västerås leased by Region Västmanland.

In Gothenburg, we announced a deal for the acquisition of a training and exercise facility for the police that is under construction. We are moving into an exciting phase in the ongoing project, where we have the opportunity to shape 22,000 sqm of cutting edge, purpose-built premises in a facility that is expected to become one of the largest of its kind in Northern Europe when fully completed in the first half of 2027.

We also announced a deal for the acquisition of a large custody unit project in Västerås, where the Swedish Prison and Probation Service is expected to rent around 34,600 sqm with occupancy in stages during 2028. We look forward to bringing the experience from the custody unit that we recently completed to the Swedish Prison and Probation Service in Kristianstad into this project.

Projects are developed

The company’s project activities are progressing according to plan. The new Custody Unit, which forms part of the new Justice Centre in Kristianstad, has now been completed and in July the Prison and Probation Service took over the premises, which have a lettable area of 16,400 sqm and house a much-needed 100 custody rooms that are leased until 2049 with an estimated annual rental value of around SEK 68 million.

Intea is active across the country, with roughly SEK 1.1 billion invested in our ongoing projects between January and September. In total, at the end of the period, the company had ongoing projects with an estimated total investment volume of approximately SEK 3.7 billion at a currently estimated rental value of approximately SEK 349 million. In addition, a project volume acquired after the end of the period of around SEK 3.0 billion is added.

Increased net operating income

The company’s financial position remains solid and we see how both rental income and operating surplus for the quarter increased by 15.8 percent and 15.9 percent respectively compared to the corresponding quarter last year.

The value of the property portfolio at the end of the period was SEK 22.6 billion, an increase of 5.8 percent since the start of the year, which corresponds to an average yield of 5.2 percent.

Credit and capital markets

We see a continued positive progress in the capital market. During the quarter, the company issued SEK 1.8 billion in new green bonds under the MTN programme and the green framework. Bonds totalling SEK 3.4 billion have been issued over the course of the year. The interest in investing in Intea remains strong and the capital market provides an excellent complement to traditional bank financing.

In summary
After a phase of lower transaction market activity, it is rewarding to have completed successful acquisitions once again, with the help of a dedicated and talented team. I look forward to continuing the company’s growth journey and exploring new opportunities!

Charlotta Wallman Hörlin, CEO