Serena Properties (Serena) is a newly formed real estate company with a portfolio of 21 commercial retail properties in 14 mid-sized towns in Finland. The company owns and manages properties located in established retail areas with tenants that are attractive and largely comprise grocery and discount retailers. The largest tenants are Kesko and S-group. Total leasable area is 152,000 square metres.
The Finnish market for retail properties has higher yield levels than many other segments and geographies due to the recession and a relatively small market with restricted liquidity.
Most of Serena’s tenants are grocery and discount retail store chains that have performed relatively well in a weak domestic economy in Finland.
There are a number of players who invest in retail properties in the Nordic countries, including Svenska Handelsfastigheter, Sveafastigheter Riks, Nordika funds and Vencom.
The year in brief
The agreement to acquire the properties in the portfolio was signed in November 2015. The transaction was completed and the new company was formed in January 2016. The company’s tenants in grocery and discount retail have performed well in recent years in an otherwise weak Finnish retail market.
In June a small property was sold for EUR 2.3m, which exceeded the valuation at the time of Ratos’s acquisition
Under Ratos’s ownership, Serena Properties will systematise their efforts regarding relevant sustainability issues, focusing on the company’s environmental impact, in which energy consumption and heating are key areas.
With the establishment of Serena Properties, Ratos sees an opportunity to streamline day-to-day operations and generate value by developing the retail areas through proactive management. There is potential for growth in value-generating investments to develop the properties, extending leases, and optimising the mix of retail area tenants. Serena will assess attractive Nordic add-on acquisitions in the form of similar properties. Serena has a well-diversified portfolio of retail properties in Finland, with long-term contracts with high-performance retail chains.
Ratos and Varma are strong owners with joint focus to develop and increase the value of the portfolio through more active management.
(Mainly from Ratos's annual report 2015.)