Icelandic investor among buyers of prime Helsinki real estate

Finnish owners make massive profit on deal

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Finnish pension and insurance companies made a tidy profit on investments into the CapMan Real Estate Fund. Their investment of EUR 20 million into the fund is yielding more than EUR 50 million after CapMan sold a portfolio comprising 22 office properties for EUR 337 million.
      The buyers were Samson Properties of Icelandic investor Thor Björgólfsson, the Ajanta company of investor Ari Salmivuori, and the Royal Bank of Scotland, which has also bought a part of the Kamppi Center shopping mall in the centre of Helsinki.
      The majority of the properties are going to the Icelandic company.
      An exceptionally large proportion of the purchase price is being made with borrowed money.
      The deal gives the Icelandic company restitution of sorts for a setback that that it suffered earlier this year. The Finnish state sold the real estate firm Kapiteeli, which had been coveted by Samson, to the Finnish company Sponda, even though Samson had offered more money.
      The Icelandic investor persevered, and Samson and Ajanta contacted CapMan soon after the Kapiteeli deal fell through.
      Thor Björgólfsson and Ari Salmivuori have worked together for a year and a half - ever since Salmivuori persuaded Thor to invest in the telecommunications operator Saunalahti. Later the two sold Saunalahti to Elisa, and they now own one sixth of that company.
     
CapMan is selling a number of valuable properties in the centre of Helsinki, as well as office space in Keilaranta in Espoo, and near Helsinki-Vantaa Airport.
      CapMan bought most of the properties in the portfolio a year and a half ago from Etera, Henki-Sampo, and Kaleva. The sale came earlier than originally planned, says Jukka Iivari, Chairman of the Board of CapMan Real Estate Investments.
      The seller had originally expected to yield the same amount of return in 5-8 years. "This was a good deal from the point of view of our investors", Iivari pointed out.
      CapMan CEO Heikki Westerlund calculated that the seller was making a profit of EUR 75 million over the original purchase price.
      Of the yield, EUR 21 million goes to the company that administers the investment fund, which CapMan owns together with the real estate consulting company Corintium, run by Jukka Iivari. CapMan's share of the profit is EUR 13.5 million, and the remaining EUR 7.5 million will be shared by Corintium and the real estate investment team.
      News of the deal boosted CapMan's share price on the Helsinki Stock Exchange by six percent on Wednesday.


Links:
  CapMan press release: CapMan Real Estate I fund sells its current portfolio for EUR 377.5 million

Helsingin Sanomat