WIHLY (WIHLY) Q3 2026 Earnings Report, Transcript and Summary

So welcome to the presentation of Wihlborgs 9 months report 2026. Even if many uncertainties in the world continue, the glimpses and ray of light we have seen from time to time start shining brighter and brighter in the region. It was many years since the portfolio of ongoing discussions was as long as and good as it is today. Even if the vacancy will continue up at least 1 more year as a result from acquisition and adding on new areas, the operating surplus and income from property management continue to increase in a way that I'm proud of. We will not be the only one deciding the time schedule of necessary decisions on new leases, but my best estimate is that we have passed the apex on the more challenging time. The buzz of what's going on definitely gives that as a fact. And if not, we are prepared for that as well. Let's start with the Q3 report. And in the end, we will also give some notifications about what we see ahead with the benefits from a larger portfolio. Let's remember that it might look like we have acquired 95 properties, 400 tenants, and 48 employees. In fact, we have acquired a market position that is unbeatable. We start with a summary of Q3 '26. Rental income up 5% compared to a year ago, operating surplus plus 7% income from property management, plus 6%. Net letting negative at minus SEK 27 million, but also important to note that the number of discussions and possibilities ahead are higher than we have seen in many years. And market rents as well as rental income in like-for-like portfolio continue to develop positively. Net debt-to-EBITDA at 10.6x, good access to financing, and the acquisition of 95 properties from Castellum at a value of SEK 13.3 billion was completed in 1st of October. With some more figures on that for the full period. And here, we also find some records. Rental income up 7% to SEK 3.484 billion, a new record. The operating surplus plus up 8% to SEK 2.530 billion, also a record, and income from property management up 8% to SEK 1.604 billion and a new record. The result for the period was SEK 1.539 billion, corresponding to SEK 5.01 per share, and EPRA NRV has increased by 9% to SEK 101.59 per share adjusted for paid dividend, another record. A comparison of the rental income first 9 months '25 and first 9 months '26 indexation, plus SEK 33 million; acquisition plus SEK 68 million; currency effect, minus SEK 60 million; additional charges, plus SEK 27 million, and completed projects, new leases, and renegotiations plus SEK 130 million, which means that our core business is working well and worth pointing out these days. The things we do best, we will have the opportunity and obligation to do more of ahead of us. So positive numbers for rental growth, but negative net letting for the quarter, minus SEK 27 million. New lettings were SEK 60 million and a higher level of termination than last year. Q3 normally starts slow and then picks up. We started quite okay, had a normal quiet period during vacation and then the number of discussions has turned into a really good level. But several expected signings have been postponed a couple of months and, most of all, a large termination was signed a few weeks earlier than we expected. So everything is not slower, sometimes also quicker than necessary. Worth mentioning regarding the large termination in Denmark is that it was expected in Q4, and we have -- we are prepared with 2 different possible tenants in discussion for the whole building. And as mentioned, we have actually a longer list with high volume discussion than we have seen in many years. And that is before we add on the prospect from the Castellum portfolio. So I was positive in Q2 for the fall, and I'm more positive now. The conclusion is that the fall has just started. Here are some of the tenants that we have signed new leases with during Q3. I especially want to mention Fortnox, who adds on a good volume to our project at [ Syret 6 ] as well as [indiscernible] in Helsingborg is also very interesting. All of them are examples of higher standard, higher rent per square meter, and project possibilities in existing buildings. Here, we have the net letting in a historical perspective, lettings in green, terminations in light blue, and dark blue stacks are the net letting. A decent volume of new lettings for Q3, but higher terminations for the quarter. And the list of our 10 largest tenants in alphabetic order, strong customers, and they contribute with 90% of our total rental income. 7 out of 10 are governmental tenants and the public sector contributes with 22% of total rental income. Rental value as of 1st of October '26, excluding the large transaction, is SEK 5.260 billion per year, plus 6.7% and rental income, SEK 4.597 billion, plus 5%. Strong figures, and this is an effect from a combination of different things, but the largest parts are new and renegotiated leases, as I mentioned earlier. Looking at the like-for-like figures, all the properties we owned a year ago, excluding projects, compared with updated figures, we can see that rental value is up 2.5% and rental income is up 0.6%. For the full portfolio, this is another example of the fact that if we work with our properties, we can perform well above index. Here with examples from existing portfolio as [indiscernible] Malmo and Vatet in Lund as well as new builds like Posthornet in Lund. Changes in the market value of our properties. We started the year with SEK 64.440 billion in accordance with the external valuation of 100% of our portfolio. We have made acquisitions, which adds on SEK 534 million, investments, SEK 1.458 billion, divestment, minus SEK 4 million; changes in valuation, plus SEK 49 million and together with currency translations of SEK 657 million, that summarized to a value of SEK 67.108 billion. Valuation parameters are without changes since year-end, including assumed indexation of 1%. So very small changes in valuation. The growth comes mainly from investments and the transaction we made in Copenhagen. Here is the long-term trend for portfolio growth from SEK 7 billion to SEK 67 billion in 20 years' time and growth every year. These figures, the running yield show how we actually perform in relation to the valuation. So this is not the valuation yield. And this is also figures excluding properties acquired 1st of October. So overall, an occupancy rate of 89%, excluding Projects & Land with operating surplus of SEK 3.403 billion, which gives a running yield of 5.4%. Fully let, the portfolio would give a running yield of 6.3%. In the office portfolio, the market value is SEK 53.655 billion with an occupancy rate of 89%, 88% in Malmo, 89% in Helsingborg, 88% in Lund, and 92% in Copenhagen. The operating surplus from offices summarized to SEK 2.831 billion and a running yield of 5.3%, 6.1% fully let, just small changes since last quarter. In Q2, these figures were affected by moving our projects Blackhornet and Posthornet from being classified as projects to the running portfolio. In Helsingborg, the occupancy overall for offices are slightly down, but not in the city center where the figures continue to pick up. And that is actually the fact also for the full year in Malmo if we look at the like-for-like portfolio. Higher occupancy today than a year ago, but not at levels that we are satisfied with, of course. The Logistics/Production portfolio has a value of SEK 9.460 billion, 93% occupancy in Malmo, 79% in Helsingborg, 94% in Lund, and 99% in Copenhagen. In all 86% occupancy with a running yield of 6%, 7.3% fully let. Parts of the portfolio in Helsingborg continues to be challenging in a shorter perspective when it comes to occupancy. It's the southern parts in city, and they will be -- in time, be transformed to more housing, the harbor will move, et cetera, which affects our portfolio in that area. But in time, the city will continue to develop well. The development of our total portfolio running yield, 5.4% still brings stability, not least since the portfolio overall has a high quality and good location. An increase of the running yield since 2021, but the vacancy had a negative impact, and we aim to turn that around in line with improvements of the market. And our position in the market has strengthened significantly since 1st of October, but we will come back to that. So what about the market? The world outside the Nordics continue to be challenging in different ways, but in our own market, many things point in the right direction. The economic recovery in Western Skane has gained significant momentum, and the regional unemployment decreased at a faster rate than in other Swedish metropolitan areas, supported also by higher needs in the Copenhagen area, of course. This is our catalog of our value and properties in our 4 cities and Q3. 39% of the value in Malmo, 22% in Helsingborg, 17% in Lund, and 22% in Copenhagen, and we are totally convinced that we will -- we have chosen the right places for our business. The region continues to attract attention investments from example, SAAB, SAS and the logistics sector. It will continue to be positive for the region, for Wihlborgs and for Sweden. Some sustainability highlights. We are now ranked #3 out of 21 peers in GRESB and show positive progress both for measurement in property management as well as for project development. Our project Ackumulatorn 1 for ARM is the first project in Sweden certificated with Miljobyggnad 4.0 and ZeroCO2 certification for refurbishment. Our impact from Scope 1 and 2 have decreased in a very good way in Q3 and largest impact from our less refrigerant loss from cooling machines. And that shows that our focus on reducing conventional refrigerants really makes a difference. And time for financials. Over to you, Arvid.

Thank you very much, Ulrika, and good morning, everyone. Looking at the P&L for the quarter separately, we can see that rental income increased by 5% to SEK 1.160 billion. The operating surplus increased by 7% to SEK 848 million, which means that the surplus margin improved somewhat to 73.1% in the quarter. Income from property management increased by 6% to SEK 527 million. As you can note, there was an increase in interest expense, and this was primarily due to an increase in CIBOR. As you may have noted, 3-month CIBOR has increased from around 2.0% at the start of the year to almost 2.6% now, while 3-month STIBOR has basically been flat during the same period. Property valuations were more or less flat at plus SEK 21 million in the quarter. The changes in market rates meant positive valuation changes in the derivatives portfolio of SEK 350 million, and that makes all in all, a profit for the period of SEK 689 million. The next slide shows the balance sheet end September in comparison with the status 12 months previously. Investment properties amounted to SEK 67.1 billion, up SEK 3.6 billion in 12 months or 6%. Equity stood at SEK 24.9 billion, up SEK 1.4 billion, also an increase of 6% and borrowings amounted to SEK 35.2 billion, up SEK 2 billion versus end Q3 2025. Translating the previous slides into key figures, you can see that the equity ratio was 36.2% in Q3, slightly stronger than end Q2, but the same number as end Q3 2025. LTV stood at 52.5%, roughly in line with last year and also here a little bit stronger than end Q2. Interest coverage ratio was strong at 2.9x. The EPRA NRV per share was SEK 101.59, up 9% versus 12 months previously if you adjust for paid dividend. And the EPRA EPS was up 10% to SEK 4.78. This graph shows the EPRA NRV since 2009. And over that time period, the average annual growth of EPRA NRV has been 14% adjusted for paid dividend. We have set ourselves some financial targets relating to financial stability. The loan-to-value shall not exceed 60%. And in the graph on the bottom right, you can see the development since 2011. From the current level of 52.5%, this number will increase to around 59% due to the completed acquisition in October. Reduction of the LTV to around 55% will primarily be driven by our cash flow generation, but we will, of course, also review the composition of our portfolio to focus on properties where our cluster strategy creates the greatest value. The equity/assets ratio shall be no less than 30% and currently stands at 36.2% and the interest coverage ratio is now at 2.9x, which we think is a strong number, although not, of course, to be compared with the situation when interest rates were 0 a few years back. Another relevant metric for describing financial stability is net debt-to-EBITDA. As you can see on the graph, Wihlborgs has had a stable development to this number since 2006, and currently, we are at 10.6x. On this slide, you can see our sources of financing as of end September, total borrowings of SEK 35.2 billion. 41% of our loans come from bilateral bank agreements with Nordic banks, 36% from Danish mortgage loans, and 23% from the bond market. Despite the geopolitical turbulence and a shaky stock market for the real estate industry, we would claim that access to financing is still good, both from banks and from the bond market. Here, you can see the details of our loan portfolio. The average interest rate is now 3.37%, up from 3.25% in the previous quarter. As mentioned when I commented on the P&L for the quarter, the largest part of that increase comes from the increase in CIBOR. The average fixed interest period is 2.5 years, unchanged from last quarter and in line with our risk management policy. And the average loan maturity is an unchanged 4.9 years. This slide shows the development of these numbers over the last 5 years. And as you can see, there is no drama in this development. A little bit more drama in the graph on this slide. It shows our available funds as of end September. The very large number, SEK 17 billion is, of course, explained by the facility in place to pay for the SEK 13 billion acquisition, which was completed on October 1. Adjusted for that, the available funds were a more normal SEK 4 billion. And with that, I hand back the word to you, Ulrika.

Thank you. And an update on our investments in progress and a quick overview of some of our largest projects. During the period, we have invested SEK 1.458 billion, and it remains SEK 1.488 billion to invest in approved projects. We continue to expect 6% or a bit above 6% yield on cost for new-build offices, and 7% or a bit above for Industrial and a good mix of refurbishment and new builds in the portfolio. Some examples. A new project from Q2 at Vatet 1 for a company in the automotive tech industry, just bid the project we have completed for ARM. We invest SEK 82 million and get 7.4% yield on cost, including the value of the property and including maintenance, 30% yield in total if we exclude the value of the property. Completion in Q1 '27. The large project at Amphitrite 1 in Malmo for Malmo University is running well in accordance with plan, a bit above 20,000 square meters for Malmo University in a 10-year lease. Investment, SEK 1.130 billion and completion is planned to late Q4 '27. Discussion continues regarding a possible prolonging of the lease to 20 years. At Kranen 7 in Malmo, we will invest approximately SEK 106 million, 100% pre-let to a preschool for the municipality. 2,900 square meters completion is expected to Q3 '27. Public Procurement Act is completed and work has started well. And at Skrovet 6 in Malmo, we refurbished 11,000 square meters, now 90% pre-let and moving in has just started, but will continue until Q2 '27. Let's remember that this is a building that Stad left in January this year, so a very quick turnaround. At Muskoten 20 in Helsingborg, we have just started a new project where we invest for our tenant MilDef, a combination of refurbishments on an existing vacant building of 2,400 square meters. We have new builds 3,400 square meters and adding on the existing lease of 4,400 square meters. So in total, 10,200 square meters and SEK 97 million investment, including value of the land. Yield on cost, 7.2% and completion in Q3 '27. And Note Lund has moved in and Lund University will move in now in Q4. Well-used land area and long leases in total 14,500 square meter investment, SEK 260 million and yield on cost approximately 9%. And now let's talk about the large acquisition with completion 1st of October. Since the competition authorities regulation did not allow us to obtain the detailed information prior to completion of the transaction, completion as an expression might be a bit odd. Now we have a 6-month period to get all the data in place, but we have already taken a lot of actions to make the transformation as smooth and quick as possible. The organization that was included in the transaction has during these first weeks been downsized by approximately 30%. We work a bit differently at Wihlborgs, and it's our ambition to be very quick in adjusting operations so that the whole company works in the same way at least from mid-November. The cost for adjusting the organization is estimated to SEK 10 million in Q4 as a one-off, and we will save approximately SEK 20 million per year. Our focus is also to be quick and find the best business opportunities in a mixed property and customer portfolio. These discussions are already in full action, thanks to very dedicated employees from both sides. In total, 95 properties, 635,000 square meters, and agreed property value of SEK 13.3 billion and a mix between Offices and Industrial. We will get a higher operating surplus and higher income from property management from day 1, an initial running yield of 5.3%, and a mix of properties very much in line with our own portfolio. On top of better earnings, the portfolio also includes a higher vacancy, and we will use that as an upside ahead. Counting vacancy as an advantage can only be done under certain circumstances. Quality and micro-location for the properties must be right, the macro location. There must be a potential for growing needs in the market as such, but most important of all is your own market position. We have bought an unbeatable market position, and that will serve us and our tenants well ahead. If we start to look at Malmo, here is the summary of the largest commercial property owners in Malmo before the acquisitions and after. We had a good position before, and that has been an advantage. But now we can gear up our momentum. In Lund, the shift is somewhat less pronounced. We were already significantly larger than our industry peers to begin with. This has historically been beneficial both for us and our tenants, but now we increased both offices and land for development in the most attractive area. And finally, in Helsingborg, the shift in offices is significant. Only smaller property owners in the area can compete, and no one is close to be able to offer the flexibility that we can. In the Industrial segment, we increased in the attractive Berga and South Vala areas. If we add on the acquired properties to our property table from our Q3 report, it will summarize like this. The rent and notice for Q4 '26 are used as income, and costs are based on historical data. That would give us an operating surplus of close to SEK 4.2 billion and still a running yield of 5.2%. And here is also including the projects, of course, from the Castellum portfolio. Here, we follow some maths showing the impact of our black existing properties and the red ones are the acquired ones. This is the Malmo overview, zooming in at Malmo City and Outer Malmo with Fosie in focus. The overview of Lund and zooming in at the Ideon area. Here is as Gastelyckan and western parts of Lund, the overview of Helsingborg and the areas of Berga and Southern Vala and City of Helsingborg. These maps can be looked at in our presentation afterwards, so see them as an appendix. And with that, we summarize the presentation, continued growth in revenues and profit, still elevated vacancies, but improving activity among potential tenants, completion of the SEK 13 billion acquisition 1st of October, rapid integration in progress, and we describe the acquisition as an excellent strategic fit, and not least, it gives immediate positive effect on operating surplus, and of course, also a long-term potential in the market. And with that, we are open for questions.

[Operator Instructions] The next question comes from Staffan Bulow from SB1 Markets.

I have a couple of questions, starting with the first. Now when the Castellum deal is closed, could you give some flavor on the ambition to decrease LTV to 55% over the next 2 years if you were to sell? What kind of assets are you looking to sell? Is it fully developed, certain geographies, certain property segments, et cetera?

First of all, we will continue to focus on our cash flow generation, of course. But as always, when you buy a large portfolio, there are some areas that maybe not suit us best. To focus on our strongest hubs, where we can do the best results for our tenants is -- that will continue to be our focus. So -- but I think we will find also some areas and some properties that might be better for another solution. So that process has, of course, started.

Can you perhaps comment on how large the share of the portfolio is in your hubs?

Both. As you saw in the map, a very large part of it, almost all of it is very hitting the best areas in our portfolio and competing very well. So that is the part of why it's so strategic well.

Okay. And then moving on to central admin. If I understand correctly, headcount will increase by 48 employees following the transaction. Could you give some guidance of what you expect sort of normalized annual central admin cost to be following the acquisition?

Correct. It was 48 or 49 employees that come along with the portfolio, and we have reduced that by 30% until now. So we have find a way to reduce cost for staff with approximately SEK 20 million per year already, and that is being fulfilled now during Q4.

But maybe to clarify, the staff that we're taking over is to a very limited degree, central administrative functions.

Okay. That makes sense. And then a question on the occupancy in the Castellum portfolio. I think it declined from 85% to 83% from signing and closing. Were you aware of this increase? And could you provide some color on the underlying drivers here?

We were aware of that things can happen during this time. And for example, the Post moving out during this period. So that has affected the numbers. And of course, when you give signals to people that something is going to happen, maybe you don't really have the momentum to continue at the same pace that they do in a normal situation. So that things can happen during this time between when you agree -- between the agreement and the transaction day. Of course, we were aware of that. But we also see that we have signed leases in the Castellum portfolio that will add on a better volume ahead, but we don't have that numbers in total. So the numbers you see in this sheet is for the rent roll for Q4 '26, and that is a fact. We know that. We don't all know all the additional normal income, but we know what has been notified for Q4. And we have not added on income from new leases signed that will be entered during 2027. So that is not including in the numbers today.

Okay. And one final question. The Danish termination behind the negative SEK 27 million net letting. Could you provide some color on the rental value of that large termination?

Yes. It's pretty much in line with the total negative. So it's a large property where Schneider was the only tenant, single tenant property. And as I tried to point out, we were aware of that they wanted to leave. So we have already 2 ongoing discussions with possible tenants for the whole property. But -- and we had a possibility that these would meet each other in the Q4, but we got the termination earlier. So that's behind.

The next question comes from Oscar Lindquist from ABG Sundal Collier.

So just a follow-up question on the lettings or net lettings. So if we disregard the Danish letting discussion and sort of your comments on activity in the letting market, is that volume increase driven by sort of like-for-like? Or is it driven by the Castellum acquisition?

The net letting is not including any activity from the Castellum portfolio.

I mean forward-looking.

Are you forward-looking? Did you get the question?

Yes. You should interpret our comments on the activity regarding letting discussions as relating to our existing portfolio. It's a little bit too early to have very qualitatively good comments on the ongoing discussions regarding the newly acquired portfolio.

That's correct. Correct. My comment on tenant discussion is without adding on all the ongoing discussions with the Castellum portfolio, of course. But that there is good activities there as well. But I think that maybe we have a high tempo in the original Wihlborgs portfolio.

Yes. And how much of that do you think you can materialize now in Q4?

Always tricky to say, but some of it, I'm certain that it will be decided during Q4.

Okay. And then on Schneider moving out, when are they leaving? And do you expect that letting to be fully reversed in Q4?

They will move out end Q1 '27, so start of March '27. And at least I could say that we have a good opportunity to find a solution for a long-term activity at this property in Q4. But I mean, I can't say the date for a decision, of course. But we have 2 ongoing discussions with different tenants who are interested of the whole property. And additional on that, of course, we had already looked at the possibility to split it down to a multi-tenant facility. So I have good faith in this property, but whether the solution will be concluded in Q4 or take a bit longer. That's impossible to say at the moment.

Okay. And then one final question now going into Q4 on sort of the bridge financing effect, could you guide on either what effect do you think this will have on the average paid interest rate or sort of the all-in funding cost of the acquisition?

What I can say, as we've stated before, the bridge financing facility is in place. And initially, the margin that we're paying on the bridge financing facility is well below the average margin that we have on our bank debt. But the way these bridge financing facilities are constructed is that on a quarterly basis, the margin of the facility increases. So initially, it will average down the margin that we're paying. But in time, that will change.

The next question comes from Jan Ihrfelt from Kepler Cheuvreux.

I just have one question, and that is a follow-up question more or less for the former speaker. And could you maybe quantify the, let's say, the extraordinary effect on the financial net in the third quarter due to the upcoming acquisition on October 1.

The extra effect on the financial net in the third quarter was only a few million, like SEK 2 million, SEK 3 million or something. It was basically a commitment fee of this facility.

The next question comes from John Vuong from Van Lanschot Kempen.

Just following up on the integration on the Castellum portfolio. I appreciate it's still early times and you're giving yourself 6 months. But what are your first thoughts after 3 weeks besides the downsizing that you've done? Are you seeing any other low-hanging fruits or synergies?

For example, when we add on the tenant ongoing discussions from both the original Wihlborgs portfolio and the Castellum portfolio, we see immediate possibilities for tenants that are in discussion and don't really find the best solution, and then we can move them to the other parts of the portfolio. So I'm eager to find the first lease signed between these 2 portfolios. So these discussions has already started. And of course, 2 organizations have a bit different kind of contact areas where they are best. So when we add on these skills to the same work, it will give a positive effect also. So I think we have in these few days, succeeded in a very good way to give a new momentum also for new leases and new discussions.

And maybe on that, so to what relative size do you actually add new leasing prospects in terms of, say, tenants that you didn't talk to before?

I cannot quantify that anyway. But I mean, if we take some kind of numbers, we know that the new portfolio includes 400 different tenants. They will have needs. And we see how effectively we have been able to work with that in the Wihlborgs portfolio before. And by adding on a great volume to that, we can achieve more. So, but I can't give you any numbers on how large the -- how much the ongoing discussion volume would be. And my comment regarding a good volume -- better volume now than we have seen in many years, that is only in the Wihlborgs portfolio. So it will, of course, be even better when we add on the discussions ongoing in the Castellum portfolio.

That's fine. And just on that last comment, when you talk about leasing discussions for the existing portfolio, are you talking about filling up existing vacancy? And does that require any CapEx in terms of renovation projects? Or is it just basic catch-ups that you're seeing?

I would say that the quality of the Castellum portfolio is good. So -- and of course, there's examples of things that will need some more work and some more CapEx. But otherwise, it's -- the way we do things in Wihlborgs, I expect us to be able to do the same thing in the Castellum portfolio. Of course, we can add on something a bit of a CapEx, but also get a higher rent than the rent -- the former tenants paid. So it's not any dramatic shift in that. It's just a larger portfolio and larger possibilities, and we will continue to do the way that we have been successful in before.

Sorry, I just meant the existing portfolio without the Castellum portfolio. So you mentioned that leasing discussions there also increased. Is that for existing buildings? Or is that also for new projects?

Mainly for existing buildings. Yes. So, and that will be the same kind of situation that we had before where we add on something, but it's not any dramatic -- it's not any dramatically large project where we have to clear everything out and start over again. More of the volume of discussions have been increased in the normal part of the portfolio, as I said.

The next question comes from Lars Norrby from SEB.

A couple of add-on questions. First of all, on that Danish property where you are talking to 2 potential new tenants. If you manage to sign any of those contracts, would it require any type of significant CapEx or delay in moving in? Or can that come quite quickly?

If it will be one of the single tenant possible tenants, then the CapEx will, of course, be quite much lower. If we should change it into multi-tenant building, it will need some extra CapEx. So our best chance is to go for one of the 2 that needs the full property.

But if I may add on, since we have not signed any new lease, we don't know when a new tenant could move in. But you can bear in mind that it's more common for a rapid move-in, in the Danish market than it is in the Swedish market.

Got it. Second and final question regarding the financing of the deal, the transaction, the SEK 13 billion. How have you acted when it comes to interest rate fixing? Is it at a similar level as you have in your total portfolio prior to that transaction or something about that?

I mean we put in place an interest rate risk management policy back in 2018, and we think it has served us well. And also with this acquisition, we continue to follow the same interest rate risk management policy. Basically meaning that a certain proportion of interest maturities shall fall due during different time scales, 0 to 1 years, 1 to 2 years, 2 to 3 years, et cetera. So we continue to work the same way with our interest rate hedging.

The next question comes from Tobias Kaj from Nordea.

I would like to start to ask you regarding potential disposals. Did I understand it correct that you kind of only look at divestments of properties which are outside of your strategic hub? So could you also consider to divest properties within those areas sort of more dry assets?

Absolutely. If it's something that we think that we might not be the best owner of tomorrow, of course, that is always a part of the strategy around the portfolio. So well-developed long-term tenants where we cannot add on much of our skill ahead. That is, of course, also a possibility.

And is it possible to say anything about how long those processes are? Is it likely that you could announce something already during this year in terms of divestments? And if so, how large volumes?

No, I cannot give you any details on that. But -- and as you are aware of, changing things in the portfolio can always take some time. And it's -- for us, it's better that these things will be done in a very good way, and we have patience in this.

And regarding your bridge financing, how many quarters does it take until that will become more expensive than your existing bank financing?

Approximately 4 quarters...

Okay. And do you need to get down below any certain LTV level before you're able to refinance the bridge until more normal or below?

No.

And one final question regarding your occupancy rate, we will see a bit of a decline as the Castellum portfolio is consolidated. Based on the recent quarters' net activity, should we expect to see a continued increase in vacancies due to that as well?

I think it's too early to say. I mean we also have new leases coming into the portfolio in 2027, even more in the end of 2027, of course, but also in Q1. So I think it's a bit early to say. I think we see good activity and we have good leases coming in, which will meet some of the vacancy.

The next question comes from Erik Granstrom from DNB Carnegie. Erik Granström: I have one question. It's regarding your comment about the vacancy rate. You stated that you expect it to continue to increase for at least one more year due to the transaction and so forth. But given after the transaction with Castellum, what is the reason why you're expecting the vacancy to increase 12 months from now?

Maybe I was a bit unclear on that. Sorry for that. It will increase when we include the Castellum portfolio, and that will stick with us for at least a year, just so that we have to be a bit patient before we get the new momentum to turn around. But I don't expect it to continue to increase during 12 months. Sorry, that was unclear.

The next question comes from Viktor Hokenhammar from Danske Bank. Viktor Hökenhammar: Just one question left from my side as well. In your Logistics and Production portfolio, how do you access the vacancy rate here? I think it's around 14%. And also if you have any comment on how it compares to the broader market?

It's especially the southern parts of the Helsingborg city portfolio that is -- have increased vacancy and that affects the portfolio. The most other areas are producing very well, and the vacancy we see there is more of a -- I mean, we have some terminations moving out and -- that is more of just a period thing. But the southern parts of the Helsingborg portfolio where we have to work with them more, is actually that area is more seen as a development area, and that affects the numbers.

There are no more questions at this time. So I hand the conference back to the speakers for any written questions and closing comments.

Just double-check, if we have any questions. Yes, we actually do. Sorry for not being paying attention to that. First question, to drive occupancy higher in the acquired portfolio, will there be CapEx required? If yes, can you give some color?

We got almost the same question before. I don't expect higher CapEx in that kind of refurbishment and adding on qualities than we see in the other part of the portfolio. So pretty much in line with the same thing, not the largest development, new large project thing. It's more adding on some flavor.

Another question. Can you give some color on what sort of interest you foresee for the Castellum portfolio vacancy?

As same as we see from the rest of our portfolio, since the products are very much in line with what we already have and in the same areas. So I think the interest among tenants will be good.

And there was another question regarding interest rate hedging, but we've already talked about that. So no further questions via e-mail.

Okay. So by that, thank you for your attention. And if you have any further questions, please just contact us, and we'll try to answer.

Thank you very much.

Thank you.