“The property fits nicely into KLP Eiendom's growth strategy and the acquisition contributes to increased exposure to Sweden and strengthens the geographical diversification of the portfolio. Although this is the third major acquisition this year for KLP Eiendom, we look forward to making further major acquisitions in the future,” says Ellen Langeggen, Managing Director of KLP Eiendom.

Fleming 7 is located on eastern Kungsholmen in Stockholm, opposite the property Klamparen, which KLP Fastigheter already owns. The building was originally built in 1964 with additions from 1989 and 2017. The building comprises 12 floors, three of which are basement floors. The area is 9.949 square meters, divided into offices, a training center, a restaurant and a warehouse, in addition to approximately 2.200 square meters of parking. The property is BREEAM In-Use certified with the Excellent classification. There are currently some vacant spaces, but fully leased, the rental income amounts to approximately SEK 67 million (EUR 6.05 million) excluding surcharges.

“We strive for a portfolio consisting of modern and centrally located properties. Fleming 7 allows for flexible floor plans that allow the premises to compete with newer buildings when it comes to being able to offer open and efficient premises for tenants. With its attractive location in the heart of Stockholm next to Central Station and Arlanda Express, the property fits nicely into our strategy,” says Anette von Mentzer, CEO of KLP Fastigheter.

“The Stockholm office market has seen a lack of supply of high-quality assets with excellent facilities in desirable central locations, making Fleming 7 a highly attractive proposition to investors. Our tenure saw the previously under-rented property surpass our expectations in terms of rental uplift, and we are now looking to redeploy the proceeds to assets in the future,” says Andreas Norberg, Managing Director and Country Head Nordics at Barings Real Estate.

“We believe that prime offices in excellent locations in Europe’s strongest cities continue to provide excellent investment opportunities, whether for core capital, value-add investments or, indeed, in joint venture development projects with a local and experienced partner. As well as offices, our preferred sectors across our European markets are in the logistics and living sector and, at this point in the cycle, we remain actively eager to explore opportunities on behalf of a range of core, core-plus and value-add strategies in our target countries of the Nordics, Benelux, Germany, UK, Italy, France and Spain,” says Gunther Deutsch, Managing Director, Head of European Transaction, and Country Head Germany at Barings Real Estate.

Cushman & Wakefield advised Barings.