We take a "buy and hold" approach, and we refrain from all forms of property trading, speculative development and other short-term opportunities that might distract us from developing long-term value.
Business concept and strategy
BUSINESS CONCEPT
We invest in commercial properties, focusing on the warehouse and light industrial sector.
STRATEGY
Our focus is on growth, which we achieve through our proven business model, maintaining strong key financial metrics, and increasing our property presence in existing regions.
REFINING RISK-ADJUSTED PERFORMANCE
We invest in properties and markets that are expected to generate a high risk-adjusted return, focusing on regions with diversified business activities and stable population growth. When the company was founded, Stockholm was our core market. Sagax thereafter expanded into Finland with Helsinki as the core market. In the last decade, we have increased our presence across Europe, investing in Benelux, Denmark, France, Germany and Spain.
In the next 10 years, Europe is expected to experience further urbanization creating a stable market for commercial properties where Sagax is present. The risk of a decline in occupancy rates and rent levels due to a weaker rental market is regarded as relatively low, owing to the stable demographics and diversified business operations in these markets.
We aim for well-balanced fixed-interest and debt maturity profiles to secure our operating cash flow. This creates excellent conditions for both expansion and an attractive return on equity.
We apply our long-term strategy to both new and existing leases. We avoid maximizing rent levels in favor of signing longer leases with reputable, creditworthy tenants, and we primarily enter into net leases. This strategy protects the company's operating cash flow from increased expenses deriving from changes in property taxes, consumption levels and utility rates.