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APG buys 22.8% stake in Finnish residential firm from Varma

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Dutch pensions asset manager APG has bought almost a quarter of Finnish housing rentals company SATO from Finnish pensions insurer Varma, as part of its drive to boost residential exposure in Europe.

The parties did not say how much the transaction was worth, but SATO has a portfolio of about €2.4bn residential units, and following the deal, APG said its stake in the company would be roughly 22.8%.

Robert-Jan Foortse, head of European property investments at APG, said: “APG is focused on increasing its residential exposure in Europe, particularly in key metropolitan areas that have a growing population.”

The €359bn pensions asset manager had been a significant investor in the residential sector in the Netherlands for many years, he said, and had more recently made two investments in the residential sector in London. 

“SATO is an interesting investment opportunity for us,” Foortse said. 

“The expected strong demographic favourable trend in the Helsinki Metropolitan Area underpins the demand for the rental apartments provided by SATO,” he said.

For its part, Varma, which has around €38.7bn under management, has an ongoing strategy of increasing the international diversification of its real estate portfolio. 

A month ago, it said its decision to invest in Swedish residential property developments through the Aros Bostad III joint venture fund represented a reactivation of this strategy. 

Reima Rytsölä, Varma’s chief investment officer, said the sale of half of its stake in SATO to APG was “a demonstration of the success of the of SATO’s long-term strategy to become a leading rental housing company in Finland.”

Varma had increased its stake in SATO in recent years, and had become the largest shareholder in the company, he said.

“Even after the transaction, we remain a large shareholder in the company,” Rytsölä said.

The pensions insurer said that after the transaction, its shareholding in SATO was around 22.8%, which made APG the second largest shareholder in the Finnish company.

Private residential company SATO is the second largest rental housing firm in Finland, owning and renting some 24,000 residential units in Finland and St. Petersburg, Varma said.

It said SATO aimed to grow its portfolio to €4.0bln by 2020.

 

 

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