in COnnECTiOn WiTH BUSinESS ESTABliSHmEnT in THE GöTEBORG REGiOn by wvd19763


									THE REnTAl pROpERTy mARkET in THE GöTEBORG REGiOn 2008
for office, retail, industry and logistics

                                                                OF FER

                                                         in COnnECTiOn WiTH
                                                         BUSinESS ESTABliSHmEnT in
                                                         THE GöTEBORG REGiOn, SWEDEn
                                                         Business Region Göteborg AB is dedicated to
                                                         strengthening and developing trade and indus-
                                                         try in the Göteborg Region. We are a non-profit
                                                         organisation representing 13 member municipali-
                                                         ties. Our goals are to contribute to sustainable
                                                         economic growth, a high level of employment and
                                                         a diversified economy.

                                                         The organisation’s Establishment and Relocation
                                                         Service is a team of four individuals with a mission
                                                         of facilitating the establishment and relocation
                                                         process for foreign businesses, investors and indi-
                                                         viduals. Various databases and a well-developed
                                                         network of real estate brokers, recruiting agencies,
                                                         international schools and advisors help to expedite
                                                         this process. We are a ‘one-stop-shop’ that works
                                                         with key decision makers in both the private and
                                                         public sectors.
                                                           THiS iS WHAT WE DO
                                                           DATABASE FOR AVAilABlE lAnD AnD pREmiSES
                                                           The MALO Database is accessible via the Internet (, showing a
                                                           list of available land and premises in the Göteborg Region for either purchase or
                                                           rental etc. can be viewed and downloaded from this site, on request.

                                                                                                                                          inTERnATiOnAl SCHOOlS
                                                                                     The Göteborg Region has several international preschools, elementary and high schools, serving
                                                                                           the international community. With education being a major factor for those moving with
                                                                                                     families, we value our relationship with the international schools, in facilitating
                                                                                                                                           your establishmentand relocation process.

                                                           REAl ESTATE / HOmE BROkERS
                                                           A long-standing and integrated network of real estate and home brokers eases the
                                                           process of finding accommodation. We foster this network with importance,
                                                           recognizing that housing issues go hand-in-hand, with finding
                                                           office space or land.

For establishment, investment                                                                                                        RECRUiTmEnT COnSUlTAnTS
and relocation matters, contact:                                                  Our contact is well established with the Swedish Employment Office in Göteborg, which is a state-
                                                                                   run, non-profit organisation, offering recruitment expertise, which are branch specific. They can
                                                                                         assist a foreign employer by assessing the recruitment prospects, and publish vacancies on
petra Sedelius                                                                                                               Sweden’s largest job-site, as well as provide suggestions
                                                                                                                                                   regarding suitable job candidates.
Head of Establishment
and Investment Service
Telephone: +46 31 61 24 22
Mobile: +46 705 26 08 28                                   qUAliFiED ADViSORS
                                                           Our extensive network of local authority
                                                           representatives and qualified advisors
Roger Strömberg                                            such as accountants, tax auditors, lawyers,
Director of Establishment                                  business developers, etc. also ease setting up
and Investment Service                                     a business here.
Telephone: +46 31 61 24 12                                 We can also assist you with concerns or
Mobile: +46 705 42 89 01                                   questions relating to multi-cultural/diversity                          issues, infrastructure, regional co-operation,
                                                           inter-national trade, trade and industry
                                                           development in general as well as city
For information and publications on the commercial         planning. Please contact us with your
and industrial life of the Göteborg Region, please visit   queries and let us make your establishment                             and relocation process a successful one.
      INTRODUCTION                                             pg 4
1     GROWTH                                                   pg 8
2     THE TRANSACTION MARKET                                  pg 12
2.1   Transaction volume                                    pg 14–15
2.2   Distribution of capital                                   pg 15
2.3   Future transaction market trends                          pg 16

3     OFFICE SPACE                                            pg 18
3.1   Vacancy trends                                        pg 19–20
3.2   New development projects                              pg 20–21
3.3   Demand                                                pg 21–22
3.4   Rent trends                                           pg 22–23
3.5   Required direct yield                                     pg 24

4     LOGISTICS                                               pg 26
4.1   Vacancies, new development projects and demand        pg 28–29
4.2   Rent rates                                            pg 29–30
4.3   Required direct yield                                     pg 30
4.4   Ad: Sweden’s 20 top logistics locations 2008          pg 32–34

5     RETAIL                                                  pg 36
5.1   Retail development in the region remains strong           pg 37
5.2   Expansion of existing commerce                            pg 37
5.3   Göteborg’s City is the engine of retail                   pg 37
5.4   Göteborg region still hot                                 pg 38
5.5   Current investments in trade in the Göteborg region   pg 38–39

6     CONCLUSION                                              pg 40

In a situation with a shortage of large, connected             region is reconfirming its position as Sweden’s best logis-
areas of land for transport, commerce and logistics            tics region.
companies, there is a higher demand for a compre-                 Every year, Business Region Göteborg publishes the
hensive approach and a good overview over the                  local property report containing information about lo-
region’s local and real estate market. This is one             cal property trends in the Göteborg region. The report is
condition for effective and rational business estab-           based on openness and sound collaboration between the
lishment and relocation within the region. Business            Göteborg region’s business leaders, banks, finance insti-
                                                               tutes, property owners, city building and property office,
Region Göteborg coordinates business activities for
                                                               and other partners. This year’s edition of the report was
the Göteborg region. Over the year, Business Region
                                                               produced in cooperation with Jones Lang LaSalle.
Göteborg, the Göteborg region’s local federation
                                                                 Business Region Göteborg has a land and property ser-
(GR) and the municipalities in the region have con-
                                                               vice that free of cost can help companies in the process of
ducted a project “Land for the commercial and indus-
                                                               setting up an organization with market data, counseling
trial life” aimed at creating a land database that will        and contacts. Land and property information can be ac-
provide companies with a better overview of avail-             cessed at our web site
able land in the region.                                          If you have any comments about the property mar-
                                                               ket or business establishment process in the Göteborg
Despite the economic downturn and a sluggish financial         region, or if you have any questions about the report,
market, the Göteborg region remains extremely attrac-          please contact Roger Strömberg, tel +46 31 61 24 12 or
tive for investors and several international investments       +47 705 42 89 01. Questions about the growth strategy
and set-ups were completed in 2007. India-based com-           for the Göteborg region will be answered by Henrik Ein-
pany ToolTech opened an office and, keen to learn more         arsson, tel. +46 31 61 24 19.
about our technology and expertise, has to date hired
some 25 employees. Several Norwegian companies have            business region göteborg
expanded and established themselves in the region the          September 18, 2008
past years which means that Norway has surpassed Ger-
many in terms of the most companies in the Göteborg            Roger Strömberg Petra Sedelius Caisa Brunander
   The region holds a special appeal, and it is no surprise
that the greatest interest is directed at our geographic
location, harbors, airports, the University of Göteborg,
Chalmers University of Technology, and our traditions
in commerce and industry. The Göteborg region as the
Nordic region’s logistics hub is also a strategic factor for
establishment that attracts international capital. Accord-
ing to the trade journal Intelligent Logistik, Göteborg
                                         REPORT ON THE RENTAL PROPERTY MARKET IN THE GÖTEBORG REGION 2008 5

GÖTEBORG’S COMPREHENSIvE                                                 13 STRATEGIC ISSUES
                                                                    1.    Göteborg’s role in a           8.   Modified transport needs
Thirteen strategic issues were defined in the proposal                    growing region                 9.   Diverse, safe and humane
for the Comprehensive Plan. Goals and strategies have               2.    Attractive urban environment   10. Recreation and health
                                                                    3.    Robust society                     for better quality of life
been defined for each issue on the basis of the City of             4.    More housing                   11. Attractive natural
Göteborg’s budget, goals in the Comprehensive Plan                  5.    Growing and                        and cultural settings
                                                                          changing commerce              12. Access to the coast
for Göteborg (ÖP99), and the work on the Comprehen-                 6.    Expansive economy              13. Special localization
sive Plan.                                                          7.    The Nordic logistics center

Göteborg will be an attractive city for people and enter-        In terms of fundamental aspects, Göteborg will be a ro-
prises. This can be realized by concentrating activities         bust city through safe building and construction, pro-
in and developing the region’s core, creating the condi-         tected supply of drinking water, and better security in
tions for a diversified economy, and improving access by         the event of unforeseen events such as accidents and
expanding the infrastructure, primarily public transpor-         sabotage. By avoiding landslide-prone areas for hous-
tation. Attractive residential areas coupled with cultural       ing and factories, and taking consideration to the high
and commercial city life will be built in Göteborg and a         water levels, we can improve our readiness for extreme
recommendation has been made to expand the transpor-             weather conditions and higher water levels. To safeguard
tation system with new links and concentrate new build-          the supply of drinking water requires an alternative to
ings to the center. The locations for new links over the         the Göta River as a source of water supply and that secu-
river are planned in order to tie the city’s districts to-       rity around the supply is improved. A robust Göteborg
gether and make central Göteborg more accessible for             also means that the residents can rely on each other and
the region’s residents and the people of Göteborg.               the municipality and that electronic communication can
                                                                 withstand disruptions.
Göteborg’s planning will provide the prerequisites for an        4. MORE HOUSING
attractive urban environment and a rich city life. An att-       People who live in and want to live in Göteborg will be
ractive city is distinguished by its complexity with a mix       offered good housing and a safe, stimulating environ-
of functions, visual diversity and the possibility to interact   ment in a sustainable urban structure. Planning must
with other people. A blended city is the objective, both         therefore focus on creating enough of many different
when converting central renovation areas and when ad-            forms of residence, all with good physical access. The
ding to other areas. The basis for all planning must be to       focus should be to significantly develop central Göte-
give people the possibility to move around in and be in          borg and make additions in suburbs and strategic loca-
an urban setting. It is increasingly more important to use       tions. The Comprehensive Plan indicates the possibility
green spaces and water as design elements in a city with         of building 2,500 homes per year up until 2025 within
denser development. New buildings should enhance the             the residential city. The expansion of new, larger hous-
city and complement surrounding buildings in a attrac-           ing areas in the city’s suburbs must be co-planned with
tive manner. All development should be adapted to mini-          new regional public transportation connections and is
mize the environmental impact.                                   subsequently only possible at a later date.

5.GROWING AND CHANGING COMMERCE                                needed, chiefly in Hisingen. Gullbergsvass, which today
Population growth coupled with higher buying power             houses logistics companies and a combi terminal, is part
has lead to a significant increase in turnover in the re-      of the plans for a new mix of urban construction, which
gion’s commerce. The conditions will be created for a          means that the combi terminal must relocate. The Na-
commercial and service structure that provides good            tional Rail Administration will examine alternative sites
access for all consumers, competition-promoting estab-         for the combi terminal. A location near Sävenäs has been
lishment opportunities for companies, that takes envi-         proposed on the land utilization map, although other
ronmental issues into consideration, and that promotes         locations are also possible. It is also necessary to contin-
good architecture. This can be done by continuing to           ue to discuss the location of the ferry terminal and the
expand the current central structures. The City of Göte-       Vänern Line’s development to see whether these func-
borg should be developed as the predominant center.            tion can be combined to offer more transports over the
Larger shopping centers and locations are intended to          Göta River.
alleviate the pressure on the city and provide a higher
level of service. The conditions for local squares and         8. MODIFIED TRANSPORT NEEDS
local shops will be improved, and volume commerce              Transports by car and truck are escalating and this in-
should be gathered in one area to enable more effective        crease leads to congestion and air pollution which is why
traffic solutions and a stronger base for public transpor-     public transportation should assume a greater share of
tation. Spreading commerce activities into industrial ar-      the traffic. The goal is to create a traffic and develop-
eas should be avoided.                                         ment structure that is adapted to a more effective and
                                                               sustainable community with good access and a safe traffic
6. ExPANSIvE ECONOMY                                           environment. The K2020 project is aimed at intensifying
The economy of the Göteborg region has over the past           public transportation travel. Realizing the goal demands
twenty years morphed from industry dominated to more           a new public transportation structure for Göteborg with
knowledge-based. The goal is that Göteborg will create         more tram connections across the river and moving the
a strong, sustainable growth, a high level of employment       bus network from Brunnsparken to a city ring in Allén.
and a diversified economy by offering good opportuni-          Growth in West Sweden also mandates an investment in
ties for setting up different types of companies and busi-     the railroad. An expansion of the Västlänken (West Link)
ness while concurrently improve access to Göteborg.            is vital to boost capacity and provide the opportunity for
The Comprehensive Plan has areas and locations which           more direct journeys. The present Götaälv bridge needs
are fundamental for Göteborg’s future development.             to be replaced and more connecting roads over the river
                                                               are needed. Aspects of the traffic system need to be de-
7. THE NORDIC LOGISTICS CENTER                                 veloped to tie together different districts and make room
The volumes of goods in and around Göteborg are grow-          for better public transportation. The Comprehensive Plan
ing steadily, particularly in terms of traffic in Göteborg’s   underscores the crucial correlation between development
Port. Göteborg and the harbor will be strengthened as          planning and traffic. Good public transportation should
the Nordic logistics center. Since more of the goods to        be in place before construction on new areas begins. A
and from the harbor will run on the railroads, the harbor      densely developed city makes it possible for more people
track must be developed. The municipality feels that there     to walk or bike. Development should be concentrated to
are two feasible alternatives: one with short tunnels near     the locations where public transportation is good, such as
the current track, or one with a longer tunnel. New areas      at the proposed locations.
for logistics companies are needed. To provide service to
the harbor and the industries, more business areas are
                                                 REPORT ON THE RENTAL PROPERTY MARKET IN THE GÖTEBORG REGION 2008 7

9. DIvERSE, SAFE AND HUMANE                                                      forming an attractive and sustainable Göteborg by pre-
Göteborg will be a safe city where everyone can feel                             serving and making particularly valuable and irreplace-
comfortable in public places and have the opportunity to                         able natural, cultural and outdoor settings more tangible
meet. This will be realized by creating a better mix with                        and more accessible. Planning will be based on a mutual
well-designed public spaces where barriers are overcome                          and comprehensive outlook on the natural and cultural
and districts are linked together. The diverse needs of                          values supported by present-day facts.
the city’s people will also be considered through better
dialogue in the planning process.                                                12. ACCESS TO THE COAST
                                                                                 Good access to coastal areas, lakes and waterfronts will
10. RECREATION AND HEALTH FOR BETTER qUALITY OF LIFE                             be promoted by linking the coastal areas and other parts
Göteborg will be able to offer good opportunities for                            of the city with paths, sidewalks, bike routes and public
recreation and be a healthy, humane and safe city by im-                         transportation. Future planning will promote a diverse
proving access to green areas, games, sports and club ac-                        selection of activities, experiences and service along the
tivities. Natural, cultural and recreational areas that are                      entire coast and in the archipelago. We will strive for a
removed will be compensated. It is vital that the correla-                       coordinated approach to management of the coastal
tion between traffic and ill-health is observed and that                         zones in respect to nature and cultural values.
activities focusing on public health, social issues, safety
issues, road safety and physical access are recognised in                        13. SPECIAL LOCALIzATION
the physical planning.                                                           As Göteborg is being more developed, it becomes more
                                                                                 difficult to find localizations for businesses that cannot
11. ATTRACTIvE NATURAL AND CULTURAL SETTINGS                                     be combined with housing. The goal is to satisfy enter-
Natural and cultural settings are immensely attractive                           prises’ development needs while keeping disturbances at
and extremely valuable aspects of urban development.                             a minimum. This can be done by creating suitable lo-
Göteborg has everything from unexploited, open coastal                           cations for such operations and distributing these areas
landscapes to valuable culture-historical urban environ-                         better within the region. An intermediate storage of pol-
ments, uncovered monuments and rare species. Natural                             luted masses is one example of such localization and the
and cultural values will be emphasized and contribute to                         locations are presented on the planning map.
                                                                                                                                                Photo: Karim Hatoum

Source: Proposal for the Comprehensive Plan for Göteborg, Summary Exhibition Local Building Committee April 1, 2008, Town Planning Department
                       8 GROWTH

  W TH
 Photo: Karim Hatoum
                                                                                                               GROWTH 9

AND POWERFUL INvESTMENTS ON THE CITY CORE                      The Göteborg region was recently named the best region
The Göteborg region recently adopted a long-term strat-        for entrepreneurship out of 21 European major cities.
egy for sustainable growth. Commuting in the region is         The award was presented by European Cities Entrepre-
growing which means that the labor market region with          neurship Ranking (ECER) which compared the enter-
Göteborg as the core city is a larger part of West Sweden.     prises’ owns assessment of the business climate in their
   The goal is to become an integrated commuting region        respective regions.
and a regional market with 1.5 million inhabitants by 2020.       The study was conducted by ECER together with re-
   To realize this goal requires extensive expansion of        searchers from universities in six different countries. In
the region’s traffic capacity and major inner-city invest-     total, 1,700 enterprises were interviewed in 21 cities. The
ments. Plans for the period up until 2020 include concen-      selection in each city included a mix of innovative com-
tration to and expansion of the region core with 40,000        panies (companies holding patents), classic enterprises
residents and 30,000 workplaces plus peripheral facilities     (commerce, industry and service sectors), and self em-
for top-rate service, culture, events, seminars and trade      ployed. The common denominator for all the companies
shows. However, not only the core will grow but growth         was that they started operations during the past three
will spread throughout the region. This means that other       years. What makes the study unique is that it is the first
parts of the region gain at least 40,000 workplaces and        survey in Europe where the enterprises themselves judge
90,000 residents. Another goal is to increase the number       the quality of local support systems for entrepreneurship.
of residents in the region each year by 8,000 people. Ac-
tive regional and comprehensive planning is in progress to     SECoND CiTiES DomiNaTE
realize this strategy. For more information about the strat-   Göteborg was clearly number one in 2007 in the over-
egy, visit www.                             all ranking list. Göteborg was followed by Stockholm and


                   0      10              20              30           40             50              60              70
     Göteborg                                                                                                                120
  Birmingham                                                                                                                 100
       London                                                                                                                 80
          Lyon                                                                                                                40
     Frankfurt                                                                                                                20

Source: ECER 2007

then Birmingham. Metropolises such as London, Paris                      more difficult for the capitals to satisfy the need for sup-
and Berlin were further down on the list. Two phenom-                    port programs.
ena stand out: With the exception of Berlin, the capi-                      Not only does Göteborg rank as number one in the
tals all ended up after the country’s second city. Cities                compiled ranking, it also tops the list in two of the sub-
in northern Europe rank higher than cities in southern                   categories and comes second in the other three sub-cate-
Europe where the companies appear to have other ex-                      gories. It is evident that Göteborg and Sweden have prior-
pectations on actual guidance while companies in the                     itized guidance/promotion and ante-creation guidance.
north appear to have a more self-sufficient approach to                  Particularly noted was the significance of the incubator,
entrepreneurship. The capitals appear to be negatively                   as well as Göteborg International Bioscience Business
affected by their size and the number of players which                   School (GIBBS), Chalmer’s Entrepreneurship School and
makes it more difficult to grasp and therefore makes it                  the initiatives conducted by Business Region Göteborg.


  Total ranking      Guidance and            Ante-creation             Post-creation             Financing                  Economic
                     promotion               guidance                  guidance                                             environment

  1. Göteborg               1                         2                          1                         2                          2
  2. Stockholm              3                         1                          2                         6                          5
  3. Birmingham             2                         7                          4                         3                          1
  4. Amsterdam              4                         4                          3                         8                          3
  5. London                 10                        5                          7                         4                          6
  6. Geneva                 9                         6                          5                        10                          4
  7. Brussels               6                         3                         11                         5                          9
  8. Warsaw                 5                        12                          6                         1                         18
  9. Berlin                 17                       10                          8                         9                         10
  10. Lyon                  14                        9                         12                        11                          7
  11. Lille                 11                        8                         10                         7                         12
  12. Frankfurt             13                       15                          9                        13                         13
  13. Munich                8                        14                         14                        15                         14
  14. Barcelona             12                       11                         16                        17                         17
  15. Madrid                7                        20                         15                        20                          8
  16. Porto                 18                       16                         18                        16                         11
  17. Milan                 20                       13                         13                        19                         20
  18. Marseille             15                       19                         20                        14                         15
  19. Rome                  21                       18                         17                        12                         21
  20. Lisbon                19                       21                         19                        18                         19
  21. Paris                 16                       17                         21                        21                         16
Source: ECER 2007            The survey was financed by the French bank Banque Populaire, the television channel Euronews and the European Commission.
                 GROWTH 11

Photo:   Karim

                                   ACT IO
                            T RA NS
     T HE
               THE TRANSACTION MARKET 13

     A RK ET



Both domestic and foreign investors showed a great
deal of interest in Sweden’s property market in 2007.                  TRANSACTION VOLUMES PER SECTOR
However, the autumn’s credit turmoil altered the mar-
ket conditions and banks and investors have become
more cautious in business dealings.                                                   Logistics
In 2007, real estate transactions valued at SEK 129.7
billion were completed in Sweden, which is slightly less                                                    41%
compared to the transaction figures for 2006 of SEK                       17%
132.2 billion. Of the total transaction volume, 41% in-
volved office property, 17% retail and 13% logistics and
industrial property. The distribution between different
types of property is basically identical to 2006. In total,
the share of transactions in logistics property has swelled
the past years as the direct yield levels for segments such                             Mixed
as office and retail dropped considerably causing inves-
tors to look for property in other segments. In addition,       Source: Jones Lang LaSalle
it is no longer considered less prestigious to invest in lo-
gistics property than offices and retail as it was in certain   A shift was discernable during the fourth quarter 2007
circles a few years ago. Alongside office and commercial        on the heels of the market’s credit turmoil. Investors be-
real estate, major investors now view logistics properties      came more reluctant, highly encumbered investors had
as an accepted form of investment.                              more difficulty competing, fewer bids per object were
The past year, Sweden emerged as the fourth largest             made and the transaction processes became longer. This
transaction market in Europe and gained international           means that yield levels have stabilized with an upward
repute, primarily due to sound GNP trends compared to           adjustment of 0.25 percentage points for prime real es-
many other European countries. Moreover, the Swed-              tate. The largest real estate transaction in 2007 was the
ish market is distinguished by transparency and sound           Norwegian company Acta Förvaltning’s acquisition of
liquidity. In 2007, foreign players were involved in cross-     Lindholmen 30:1 on Norra Älvstranden which was pur-
border deals valued at SEK 74 billion or 57% of the total       chased by the Royal Bank of Scotland. The property
transaction volume in Sweden. The three single largest          measures 37,000 m2 and is leased in its entirety to Er-
markets in Europe are the UK (30%), Germany (21%)               icsson, the company for which the property was built in
and France (12%) which together answer for over 63% of          2002. This deal was the single largest deal made outside
the total sales. It is interesting to note that Sweden an-      Stockholm in terms of office property. A second inter-
swers for over 5% of the total transaction sales and that       esting deal completed in 2007 was when the U.S. pri-
we only have 1.5% of the total area in Europe.                  vate equity firm The Blackstone Group sold Bastuban
The total transaction volume in Göteborg for 2007 rose          1, better known as Europahuset, in August. The buyer
by 10% from SEK 8.7 billion to SEK 9.6 billion com-             was Nordea Market in Norway and the purchase price
pared to 2006. Interest from foreign investors was solid        landed at over SEK 700 million, with a direct yield just
in 2007 and these players were involved in over 67% of          over 6%.
the total transaction value in Göteborg for all of 2007.
                                                                                             THE TRANSACTION MARKET 15

These figures can be compared with the SEK 540 million       bought the shopping mall 421 in Högsbo for SEK 811
that Blackstone paid Platzer Fastigheter for the property    million. The seller was Aspelin-Ramm and the property
just two years earlier, marking more than a 30% increase     measures over 33,000 m2 of retail space and the direct
in value. The largest transaction for retail property com-   yield on the deal was about 5%.
pleted in Göteborg in 2007 was when Eurocommercial


                                                                                                         Domestic capital
                                                                                                         Cross-border deals




                      2003        2004              2005               2006                 2007        Q1 2008

Source: Jones Lang LaSalle

With 45% of Sweden’s total transaction volume in 2007
                                                                    TRANSACTION VOLUME PER REGION
(43% in 2006), the Stockholm region still dominates
as the single largest region in terms of invested capital.                                  Malmö
Göteborg is stable at the same level (8%) in 2007 as in
                                                               2007              Göteborg    3%
2006. In total, the rest of Sweden has the past years seen                         8%
an increase in capital invested in the country, a trend
based on the fact that Sweden has enjoyed good growth
and that Sweden is a stable country in which to do busi-                                                     Stockholm
ness. This gives international investors an incentive to                                                        45%
expand their holdings in other parts of the country. In
the Stockholm area, both domestic and foreign players
were active and one of the most noted deals was Boult-
bee’s acquisition of Centrumkompaniet for over SEK                     Rest of
10.4 billion. In total, the Swedish market attracted sev-              Sweden
eral new players in 2007, there among France-based Un-
ibail, the Icelandic Stodir and the UK company Nordic
Retail Fund.                                                 Source: Jones Lang LaSalle

Stabilizing and elevated yield levels have contributed to                                     In 2008, we expect that the trend of rising required direct
making the Swedish players more active on the market in                                       yields will continue for high-quality property in prime lo-
Q4 2007 and Q1 2008. Most recently we have been able to                                       cations. The risk increase will however be higher on real
discern among foreign investors a greater interest in proper-                                 estate out in the country than in Göteborg and other big-
ties that have or will have vacancies since they see greater                                  city regions. Banks are more particular in granting credit
potential for growth there and potential to improve operat-                                   which has prolonged business deals and buyers are now
ing revenue after taxes. This trend is expected to continue                                   required to have more equity. But despite the higher risk
throughout 2008. Norwegian investors answered for a large                                     aversion and higher financing expenses, the real estate
portion of the larger investments in 2007. Acta, DnB Nor                                      market in Sweden and Göteborg is expected to remain at-
Markets, Vital, and Nordisk Areal I AS with financing from                                    tractive in 2008. And although transaction volumes will
First Securities have all invested substantial amounts in the                                 not reach the levels of 2007, turnover will be good none-
Swedish market, particularly in Stockholm. Norwegian in-                                      theless. Moreover, there is the chance that one of Europe’s
vestors acquired property in Sweden for SEK 21.6 billion                                      largest real estate deals ever will be completed in 2008
in 2007, which is 17% of the total transaction volume. The                                    when the state sells Vasakronan. This will have a major
German funds, which were somewhat passive in 2007, ap-                                        impact on the total transaction volume.
pear to be making a comeback in the first half of 2008.


   Type             Property                     Location                    Price          Buyer                          Seller                          Area
                                                                             (SEK M)                                                                       (m²)

  Retail            Högsbo 23:4                  Högsbo                      811           Eurocommercial                  Aspelin Ramm                    33,000   1)

  Office            Bastuban 1                   Mölndal                     700           Nordea Market                   The Blackstone Group            42,000
  Mix               18 buildings                 Högsbo                      700           LänsPlatzer                     Platzer AB                      97,000
  Residential       Olivedal 5:24                Centrum                     360           Private                         Wallenstam                      4,474
  Office            9 buildings                  Hisingen m fl.              220           Teesland iOG                    Stena Fastigheter               40,000
  Office            Backa 20:5                   Hisingen                    210           Castellum                       Stampen AB                      16,000
  Mix               4 buildings                  Hisingen m fl.              200           Teesland iOG                    Wallenstam                      32,000
  Residential       Drivbänken 1                 Mölndal                     200           Private                         Wallenstam                      710
  Residential       Gamlestaden 10:18            Gamlestaden                 175           Private                         Erik Selin Fastigheter          101
  Office            Lorensberg 45:16             Centrum                     125           Vasakronan                      Folksam                         7,814    2)

  Retail            Tingstadsvassen 3:6          Hisingen                    110           Fastighets AB Balder            Privat                          3,825
  Office            Lindholmen 28:1              Norra Älvstranden           104           Vasakronan                      GFK Personal AB                 3,674
  Office            Lindholmen 30:1              Norra Älvstranden           Conf.         Acta Förvaltning                Royal Bank of Scotland          37,000   3)

Comments: 1) Shopping mall 421 2) Building in the middle of Göteborg. Fully leased. 3) Largest deal completed outside of Stockholm for office buildings.
Source: Jones Lang LaSalle, fastighetsvärlden, Data from Q1 2008

                            Photo: Karim Hatoum
                      18 OFFICE SPACE

                                              PAC E
                                        I CE S
                      O FF
Photo: Karim Hatoum
                                                                                                                                            OFFICE SPACE 19

       OVERVIEW GÖTEBORG                                                                             CBD (CENTRAL BUSINESS DISTRICT)

        HISINGEN                                                                                             Norra
                                                                                                             Älvstranden               Gullbergsvass
                             Science Park                                           Kålltorp
                                                                                                                           Nordstan   Centralstation
       NORRA ÄLVSTRANDEN                                         Gårda
                                                                         EASTERN                                            CBD
                                                                         GOTHENBURG                                    Within
                                 Gothenburg                                                                                                            Ullevi
                                 Business School                                                                       Vallgraven
                                                        Chalmers University
                    REST OF INNERCITY                   of Technology

                                               Sahlgrenska                E6
                                               University Hospital                                                     Vasastaden
 WESTERN                                                                      E20   20 km
 GOTHENBURG                                            MÖLNDAL
Source: Jones Lang LaSalle

3 OFFICE SPACE                                                                                 more central submarkets (the CBD and other inner-city
The real estate markets in Sweden and Europe have en-                                          locations). This trend is a typical ”boom trend” trigge-
joyed strong growth with a drop in vacancies and good                                          red when companies have strong growth that gives them
growth in rent rates the past years. The recent boom is                                        more liquid funds. The result was a greater demand on
also evident in the re-localizations made within the of-                                       central, modern offices that offer high quality and high-
fice space market in Göteborg. Companies, particularly                                         tech standards in 2007 so that vacancies in Class A proper-
in the service and IT sectors, are expanding and moving                                        ties are relatively low in the region. Estimates show more
to bigger and better, more centrally-located offices while                                     than 6,300 square meters (2.9% of the total space in Class
fewer companies are relocating to cut costs.                                                   A properties) vacant space in this segment in the entire re-
                                                                                               gion. The meager selection of Class A properties has made
3.1 vACANCY TRENDS                                                                             it more difficult to match property owners and tenants
The strong financial growth of 2007 generated strong                                           and increasingly more property owners are now finding
employment growth, particularly in the service sector and                                      it difficult to find suitable offices for larger tenants within
a more intense demand from expanding companies cau-                                            their own holdings.
sed vacancies to drop in the Göteborg region. From Q1                                             The subsequent vacancy trend in Göteborg depends
2007 to the Q1 2008, the total vacancy rate dropped by                                         on the employment rates. Since employment rates are ex-
2.3 percent from 10.3% to 8.0% (Göteborg, Mölndal, and                                         pected to remain strong throughout 2008 and office spa-
Kungsbacka). The city, Norra Älvstranden and Mölndal                                           ce in the form of new offices are basically already leased
report the biggest change in vacancy rates the past year.                                      by the time of completion, we predict that vacancies will
While all sub-markets report the same decline in vacan-                                        continue to drop for Göteborg as a whole. Vacancy rates
cies, Q4 2007 and Q1 2008 did deviate when vacancies                                           are expected to continue to decline, landing at about 7%
rose slightly on more outlying submarkets such as West                                         for all of Göteborg at the close of 2008. Europe’s strong
Göteborg and Mölndal. This increase in these smaller                                           economic situation in 2007 lead to a strong demand and
submarkets are however in line with the trend observed                                         office vacancies plummeted in most European cities. The
throughout 2007 when several companies moved from                                              average vacancy rate in Europe for Q1 2008 was 7.1%.
the outer areas (like Hisingen and West Göteborg) in to                                        The lowest vacancy rate among the surveyed cities was

reported for Warsaw at 2.5% while Frankfurt had the hig-
hest at 13.0%. Of the major Swedish cities, Stockholm                 VACANCY RATES, GÖTEBORG (%) Q1 2008
still has the highest vacancy rate (10.5%) followed by Gö-
teborg (8.0%) and then Malmö (6.5%).
   Demand is expected to remain strong in Europe th-
roughout 2008 which, together with a relatively small
addition of newly developed offices, is expected to cause
vacancy rates to fall even more, despite assumptions that      15%
the economy will weaken.
New development projects, which were few in 2007, will           5%
accelerate slightly in 2008 with the completion of over
25,000 sq m of office space. Examples of projects that will













be completed in 2008 include the extension of the Policy
Station in Ullevi Park, the renovation of Gamla Hassel-
                                                                                    Göteborg totalt                               Mölndal                       Västra Göteborg
bladshuset and the new development of Krokslätt’s fac-                             Norra Älvstranden                              CBD                           Övriga innerstaden
tories, corresponding to just over 0.8% of the total stock.
It is worth noting however that basically all new office      Comparison Göteborg’s submarkets
                                                              Source: Jones Lang LaSalle


                 0           2            4              6                    8                                   10                                  12                                 14

Source: Jones Lang LaSalle
                                                                                                             OFFICE SPACE 21

space on the market generated through new development              3.3 DEMAND
and renovation projects in 2008 was rented by the time             Most of the property owners on the Göteborg market re-
of completion. Consequently, companies that want to re-            port a strong 2007, leading in many instances to a short-
locate to new buildings in 2008 will find it difficult to          age of primarily smaller offices measuring maximum
find office space which may attract developers to launch           500 sq m, and good quality offices with high-tech stan-
“dormant” projects, such as Bygg-Göta’s project in Pa-             dards. The demand for smaller offices remains high in
goden (Gullbergs Strandgata), PEAB’s project in Lyck-              Göteborg and over 70% of the new leasing activity refers
holm’s Factories (Nellickevägen) and Wallenstam’s project          to offices measuring no more than 1,000 sq m. This is
in Almedal’s Factories (Skårs led).                                largely because many expanding smaller companies are
   In 2009, new development projects are expected to re-           looking for offices that signify an economic boom. A lack
main at the same level of 2008 with the completion of              of employees may have stifled growth slightly, making a
the new police building, Rättscentrumet near Ullevi Park           prime location and the image factor more central in at-
and some office space in Hisingen. We expect to see more           tracting qualified staff, a fact that particularly benefited
projects completed in 2010 and estimate that over 87,00            CBD in 2007.
sq m will be completed this year, which should add to the             In 2008, companies with fewer than 20 employees
current stock of over 2.8%. Projects that have scheduled           are expected to answer for most of the new jobs creat-
completion for this year included the Navet extension on           ed which benefits continued demand for smaller offices.
Lindholmspiren 3 on Norra Älvstranden, the new police              We do see a trend for companies to request lease agree-
building at Rättscentrum and Skanska’s project in Gårda.           ments with deviation clauses or clauses for optional space
New development is relatively spread out in the region, al-        and that they choose open floor plans in order to more
though the majority will be completed in Norra Älvstran-           quickly accommodate staff changes.
den and Remaining inner city. Södra Älvstranden and the               New leasing activity among the 25 largest property
large terminal adjacent to the railroad near the central sta-      owners, which represent over 70% of the total market,
tion are a few examples of interesting future development          amounted to 100,000 sq m in 2007, slightly less than
areas where there are advanced plans to build both resi-           the 122,000 sq m leased in 2006. Applied to the total
dential and commercial property.                                   stock, this means a turnover of 165,000 sq m in 2007.


   Project                                          Submarket              Developers               Area     Planned
                                                                                                    (sq m)   completion

   Nordstaden                                       CBD                    NCC                      13,000   2008
   Krokslätts Factories                             Mölndal                Husvärden                2,600    2008
   Ullevi Park Phase 1 Police station               Remaining inner city   Vasakronan               15,000   2008
   Ullevi Park Phase 2 Courthouse                   Remaining inner city   Vasakronan/NCC           17,000   2009
   Frölunda Torg                                    Västra Göteborg        Diligentia               5,000    2009
   Projekt Gårda                                    Remaining inner city   Skanska                  18,000   2010
   Lindholmspiren 3                                 Norra Älvstranden      Älvstranden Utveckling   15,000   2010

Source: Jones Lang LaSalle

Eco-friendly buildings and offices are a trend gain-
ing in popularity among tenants and property owners                                     RENT SPAN PER SUB-MARKET
in Göteborg. More properties are conforming to EU’s
Green Building program and more buildings are being
Svan accredited. Over 40% of the total energy consump-
tion in Sweden goes to buildings and research indicates
that up 22% of the carbon dioxide emission levels from                                 2000
buildings can be eliminated by more effective energy

                                                                   ‹ SEK/sq m/year ›

use. There is a growing awareness in the industry of the



correlation between energy use, the emission of green-
house gases, other harmful environmental influences                                    1000


and the cost of energy. Consequently, it is important to
weigh in the effects of this when building and managing                                500
buildings. The property owners are now actively looking
for more eco-friendly alternatives for power supply, heat-                               0
ing and ventilation and we see an escalating interest in
biogas, district heating and district cooling.
                                                                  Source: Jones Lang LaSalle

The prime rent rates in Göteborg have been stable during          leases in this segment. The Class A objects that remain are
the period 2001-2006 despite relatively major vacancy chan-       often difficult-to-rent units and the attraction of Class B+
ges. This is mainly attributed to the extremely low access to     and B objects increases thereby pushing up rent rates for
Class A property which results in few new leases. Prime rent      these types of offices. The best rent increase potential in
in CBD was adjusted upward in 2007 by SEK 50 to SEK               the future lies with the properties that best match current
2,250 per sq m, which is also the rate of prime rent for Q1       demands, i.e. that can offer small to medium-sized business
2008. Rents were pushed up with the leases in Läppstiftet’s       premises with open floor plans and good technical stan-
high-rise and by advanced leases in new development pro-          dards.
jects, including NCC’s project in the old Hasselbladshuset.          Prime rent in the best office locations (CBD) is on the
Office shortage is also pressing rent rates up in less central    rise in most European cities. The average increase in Eu-
submarkets such as Mölndal and Norra Älvstranden. There           rope between Q1 2007 and Q1 2008 was just over 9%.
should be room for more prime rent increases within a rela-       The highest increases are reported for Warsaw (+32%),
tively short perspective since access to Class A property is as   Moscow (+31%), Budapest (+19%) and London (+18%).
previously mentioned extremely limited. At the same time,         Due to low vacancy rates in the Class A segment, chances
vacancies in premises of a slightly lower standard (Class B+)     are good that 2008 will see continued strong growth, alt-
but in good locations, are beginning to drop. Our estimates       hough probably not levels equal to those of 2007.
suggest that there is every chance prime rates will reach SEK
2,350 per sq m in 2008.
   The past quarters, rent levels for Class B property have
begun to exceed prime rent rates, a natural turn of events at
the end of an economic boom when the selection of prime
objects is considerably limited and restricts the amount of
                                                                                                       OFFICE SPACE 23


                                                                  ‹ Euro/sq m/year ›






















                       0             200              400   600          800           1000   1200   1400     1600

Prime Rent – European cities; Source: Jones Lang LaSalle

Interest in Göteborg’s real estate market is still strong,    and expectations for relatively good growth in 2008. It
from Swedish and foreign investors alike. This means that     is possible to discern a growing interest from foreign in-
direct yield levels dropped to low levels for the region in   vestors for property with vacancies and future vacancies
2007, and reached an all-time low of 4.60%. Due to the        where they see a greater potential for growth and where
current credit turmoil on the market, a shift was discern-    there is potential to improve operating revenue after taxes.
able on the market in the fourth quarter 2007. Investors      This trend is expected to continue through 2008.
became more reluctant, highly encumbered investors had
more difficulty competing, fewer bids per object were
made and the transaction processes became longer. This               PRIME YIELD PER SUBMARKET
means that yield levels have stabilized coupled with an
upward adjustment of 0.25 percentage points for prime
real estate - such as in CBD where prime yield was adjust-      10%
ed upward by 0.20 percentage points to 4.80 and Norra
Älvstranden where prime yield was adjusted upward 0.25
percentage points from 5.5% to 5.75%.
This trend remained steady during the first half of 2008         8%
with yet another upward adjustment for prime yield and
a slightly high yield increase for Class B property. Prime
yield in CBD was 5.20% for Q1 2008. The trend for di-
rect yield levels in Remaining inner city mimicked that of       6%
CBD and the prime yield levels was adjusted down below
2007 to 5.50%. During the latter half of 2007 and the
beginning of 2008, yield levels rose here too and were
at 5.75% Q1 2008.The stabilized and higher yield levels          4%
have contributed to making the Swedish players more ac-                      West Göteborg   Norra Älvstranden      CBD
tive on the market. The increasing yield levels are however                  Mölndal         Remaining inner city
compensated to a certain extent by the good rent market
                                                              Source: Jones Lang LaSalle
                      26 LOGISTICS

Photo: Karim Hatoum

Once a year, the trade journal Intelligent Logistik sur-       out-and-out property developers who build new, either
veys which cities are Sweden’s best in terms of logistics      with the objective of selling immediately and/or leasing
and compiles a list. Göteborg has topped this list every       after completion or for long-term management. The first
time (six times). There are several reasons for this:          type of developer seldom builds on speculation, but in-
                                                               stead custom-builds each building for a certain tenant.
  •	 Göteborg’s port is the most important port                Example of new development activities for warehouse
     in Sweden since most of the goods from                    and logistics property in the Göteborg area are listed be-
     the U.S.A. and Asia headed for the Nordic                 low:
     countries arrive here.
                                                                •	 Skanska is building a new logistics unit for
  •	 The proximity to other major cities in the Nordic             DHL measuring more than 20,000 sq m in
     countries such as Malmö and Oslo increases                    Backa. The unit is scheduled for completion in
     dependency on a good logistics service in Göte-               2009.
     borg. At the same time, about 70% of the Scan-
                                                                •	 ProLogis is planning to build yet another lo-
     dinavian industries are all within 500 km.
                                                                   gistics unit in Torslanda. This building will
  •	 Chalmers in Göteborg offers an academic                       measure over 15,000 sq m and is expected to
     logistics education program.                                  be completed in 2009.
  •	 Just outside Göteborg is Landvetter’s airport              •	 Papyrus is planning to build a new central
     which can quickly transport goods to other                    warehouse in Arendal. It measures over 27,000
     parts of the country.                                         sq m and construction is scheduled to begin in
                                                                   the autumn of 2008 and finish in the spring
  •	 Finally, the infrastructure in the city is logistics
                                                                   of 2010.

The Göteborg region as a logistics location benefits enor-     Logistics buildings developed in Sweden today com-
mously by Göteborg Landvetter Airport, from which              monly have pre-leased spaces. It is uncommon for devel-
there are freight routes to the U.S.A. and Asia. In addi-      opers to build on speculation. There are however excep-
tion, the airport is trafficked by most of the major freight   tions, the most well-known being ProLogis, which has
companies and is today one of the largest in Scandinavia       built premises on speculation all over Sweden, which in
in intercontinental air freight. More than 60,000 tons are     turn means that the vacancy rate for brand-new logistics
transported via the airport every year. Through invest-        property is low, less than 2-3% in all of Sweden. Even
ments in the airport and by ensuring new development           the spaces that ProLogis has built the past years are oc-
projects in 2007, The Swedish Civil Aviation Administra-       cupied suggesting that there is a vast need for good and
tion expects to double the airport’s cargo capacity.           modern logistics buildings in Sweden today.
                                                                  On the other hand, it is more difficult for property
4.1 vACANCIES, NEW DEvELOPMENT                                 owners to lease premises that date back to the 1960s and
PROjECTS AND DEMAND                                            1970s. These premises are seldom flexible and often lack
In total, vacancy levels are low in Göteborg, below 4%         good planning. The vacancy rate for Sweden is therefore
for modern warehouses and logistics property. On the           relatively high compared to the rest of Europe. Estimates
other hand, there are a fair number of vacancies in older      indicate that the vacancy rate in Sweden is between 10
industrial premises with few docks. Today, it is mostly        and 15% while the rest of Europe reports rates of be-
                                                                                                                        LOGISTICS 29

  tween 5 and 10%. Vacancies did however drop during                     for diminishing its climate impact. Even if the afore-
  the boom and are closer to 10% at present. Oftentimes,                 mentioned make demands primarily on the actual user
  higher vacancy rates in Swedish towns in the country-                  and not on the property owners, it means that property
  side push up the figures, while vacancy rates are some-                owners will be indirectly affected. There is an increas-
  what lower in the typical logistics and industrial cities of           ing demand for railroads directly into the premises. At
  Göteborg, Jönköping, Norrköping and Örebro.                            the same time, there is also a growing demand that the
     The logistics sector is also experiencing a greater in-             actual building is “green” and for more combi terminals
  terest in the environment. The transport sector is the                 so that the number of transports can be reduced.
  only sector in Sweden today that steadily increases its
  emission levels, answering for over one third of all of                4.2 RENT RATES
  Sweden’s carbon dioxide emissions and over one third of                Rent rates for warehouse and logistics property on the
  the emission of liquid hydrocarbon. While shipping and                 Göteborg market were relatively stable throughout
  air freight have decreased or maintained their emission                2007. We did however notice an increase on the Stock-
  levels, road freight’s emission levels are climbing. Giv-              holm market which tends to influence other parts of

  en that there are today about 53,000 trucks in Sweden,                 Sweden though with a certain delay.
  it is not difficult to understand that emission levels are                Prime rent, or the top rent rates for warehouses/lo-
  extremely high. Increasingly louder voices are demand-                 gistics property larger than 10,000 sq m in Göteborg
  ing that the transport sector start taking responsibility              is at SEK 600–650/sq m. The difference in rent rates


                                                             ‹ Euro/sq m/year ›
                          0   10   20   30   40   50   60   70     80      90     100   110   120   130   140   150   160   170   180

compared with smaller warehouse and logistics proper-          in such a short time for logistics property in particular is
ty, i.e. up to 5,000 sq m is slight since prime rent in this   that logistics property has become an investment alter-
segment is SEK 700–750/sq m.                                   native since the direct yield levels for segments such as
   It is possible to rent older warehouse and logistics        office and retail dropped considerably causing investors
property in good condition in Göteborg for about SEK           to look for property in other segments. In addition, it is
400–500/sq m depending on the property’s parame-               no longer considered less prestigious to invest in logis-
ters. Of particular significance are ceiling height, loca-     tics property than offices and retail as it was in certain
tion, infrastructure access, number of loading docks and       circles a few years ago. Alongside office and commercial
the standard of the property. As for older warehouses          real estate, major investors now view logistics properties
with low ceilings, the market rent is SEK 350-400/sq           as an accepted form of investment.
m. The area around Backa stands out in terms of rates             We have seen a rise in direct yield during the most re-
with rents ranging between SEK 500-550/sq m for lar-           cent quarter. For logistics property in Göteborg measur-
ger warehouses. For smaller new-built units in the area,       ing more than 10,000 sq m, prime yield is now 6.05%,
i.e. up to 3,000 sq m with some offices, rents reaching        while the figure for logistics property in Stockholm me-
SEK 1,000/sq m have been reported.                             asuring less than 5,000 sq m is now 6.55%. Obviously, the
   Terminal buildings that commonly have loading docks         bank situation in the U.S.A. is the reason for the increase.
on both ends of the building are a good example of whe-        The situation has made it more difficult for investors to
re the design of the property is clearly reflected in rent     borrow money from banks to buy property, which in turn
levels. Since the loading docks entail considerably higher     has pressed down property prices. In terms of logistics
investments the rent rates are higher. In Göteborg, we es-     properties we see the greatest differences in Class B and
timate the interval at between SEK 750 and 850/sq m.           C locations. For real estate in Class B locations like Jön-
   From a European perspective, the top rent rates in          köping yield has risen between 0.50% and 0.75% while
Göteborg are slightly over the port city of Hamburg            property in Class C locations like Östersund have seen an
and as for Europe’s largest port – Amsterdam/Rotter-           increase in required direct yield of about 1.0%.
dam – there are differences in rent rates. In Rotterdam,
the rents are lower compared to Göteborg, while they
                                                                      DIRECT YIELD LEVELS
are higher in Amsterdam. In all, this means that the rent
rates in Göteborg are not markedly different from its
three largest logistics competitors. Otherwise, Oslo had            9,5%
the largest rent increase in Europe for this type of pro-           9,0%
perty with an increase of over 10% since Q1 2007.                   8,5%

4.3 REqUIRED DIRECT YIELD                                           7,5%
When we entered the new millennium, direct yield for
logistics property was at 8.50–9.00%. Since then we’ve              6,0%
watched the figures drop considerably to last year’s low            5,5%
at 5.75% for logistics property in Göteborg measuring               5,0%
more than 10,000 sq m and 6.25% for logistics property              4,5%

in Stockholm measuring less than 5,000 sq m. At most,
direct yield levels dropped in 2006 when the yield for
                                                                           Prime Yield Stockholm                                        Prime Yield Göteborg/others
logistics property in Stockholm fell by 1.75 percentage
points. The reason why direct yield has fallen so much         Source: Jones Lang LaSalle
Photo: Karim Hatoum

                      LOGISTICS 31

           20 TOP NS

                                                                                                                            Photo: Kristian Pedersen, Stadsbyggnadskontoret


Below is a list of Sweden’s best logistics locations/         going direct routes and commuters for railroad goods
regions for 2008. It represents the best establishment        is an advantage when increasingly more consumer prod-
locations for central warehouses with distribution of         ucts are imported from Southeast Asia. World-leading
consumer products, chiefly within all of Sweden but           auto clusters, excellent transport infrastructures, leading
also in the rest of the Nordic countries.                     academic logistics education programs and a strong re-
                                                              gional collaboration make Göteborg number one. The
Geographic and demographic locations are most impor-          land shortage has been resolved but the traffic situation
tant in terms of ranking on the list of Sweden’s top logis-   in the city and the shortage of railroad tracks to the har-
tics locations. Sweden’s demographic center is between        bor are a problem. Moreover, Stockholm which before
Örebro and Norrköping. This means that the popula-            ranked at the bottom of the list, has acquired a number
tion-dense Öresund region, as well as almost two-thirds       of major logistics organizations in Arlandastad, Rosers-
of Sweden’s land which is north of Gävle, is far from         berg and Jordbro. A new combi terminal in the north
Sweden’s demographic center.                                  can strengthen Stockholm’s position. In terms of labor
                                                              market figures, Enköping, Håbo and Nykvarn are in-
GREATER GÖTEBORG IS STILL NO. 1                               cluded in the figures for the Greater Stockholm area as
The largest harbor in the Nordic countries with ocean-        well as the county of Stockholm. In just a few years, the
                                                                                                        LOGISTICS 33

Stockholm region’s largest new central warehouse will        waiting on a decision about ICA’s future logistics ven-
open in Enköping.                                            tures and new sluices that can secure Lake Mälaren’s
  Both Halmstad and Varberg’s positions improve with         shipping future.
the extension of the central warehouse.                         Eskilstuna/Strängnäs will be home to one of this
                                                             year’s largest new companies, many new companies and
jÖNKÖPING/NäSSjÖ THIS YEAR’S SURPRISE                        a growing combi terminal as well as excellent access to
Jönköping/Nässjö climbed from sixth to fifth place, pri-     land for new projects.
marily due to all the big, new logistics companies. The         Sweden’s second-largest container port in Helsingborg,
new railroad commuter from Göteborg also makes it            a population base of over 2 million and a new large port
easier to transport imported goods.                          for auto imports in Malmö makes the Öresund region
   Borås climbed to ninth place. The region is evolving      stand out as possibly the foremost inter-regional growth
as a logistics region with its proximity to both harbors     area in the Nordic countries. When Malmö’s northern
and airports and a strong, active logistics network in the   port area is completed, Malmö will most certainly at-
form of Logistics Sweden.                                    tract new logistics companies. Trelleborg was moved to
   The region of Skaraborg which includes Falköping,         the Öresund region on this year’s list.
Skara, Skövde, Götene and Lidköping also rose in the            Gävle, with a rapidly-growing harbor for ocean ship-
ranking this year, in part due to the expansion of Jula’s    ping and Sweden’s third largest container harbor, has
central warehouse in Skara and in part due to the recent-    improved its infrastructure with the new European road
ly-opened combi terminal in Falköping.                       E4 to Uppsala.
   “We think it’s perfectly fair that our region ranks so       “We’ve already secured new business in form of im-
highly. The combi terminal is a huge success”, says Leif     port of prefabricated units for Uppsala that are shipped
Bigsten, Economic Development Officer in Falköping.          from the Baltic countries”, says Ulf Wiik, Marketing Di-
                                                             rectors for Gävle Port.
PROxIMITY TO THE MARKET                                         In addition to Gävle, both Oxelösund and Södertälje
   Norrköping/Linköping are geographically close to          Ports are part of the Greater Stockholm harbor infra-
Sweden’s logistics center and all-round transport infra-     structure. All three are growing rapidly. All three can
structure. Proximity to Europe’s foremost growth mar-        accommodate more railroad goods. Railroad and combi
kets east of the Baltic Sea and leading academic logistic    options are however a problem for Stockholm’s ports.
education programs warrant a place in the top.               The possibility, at least in the future of transporting
   Örebro is close to Sweden’s and the Nordic countries’     goods on the railroad, is an option increasingly more
logistics center. The Örebro region includes Hallsberg,      product owners are demanding.
with its rapidly growing combi terminal and Arboga              This according to associate professor Nils G. Storha-
which landed in tough competition with other locations       gen who has extensive experience from logistics in the
the Swedish Armed Force’s new central warehouse.             construction industry. He recently concluded a project
   “But we also see ourselves as part of an even larger      concerning the future logistics of the consumer goods
region in the center of Middle Sweden. We are evolv-         industry.
ing into a cluster for logistics-related IT competence”,     “It is evident that larger consumer good chains are look-
says Göran Dahlén, Economic Development Officer in           ing for more sustainable solutions”, says Nils G Storha-
Arboga.                                                      gen. “But marketing capabilities are significant when it
   Västerås, home of the largest lake harbor with good       comes to where the different companies finally end up.”
transport infrastructure and two combi terminals, is


1.    Greater Göteborg
2.    Norrköping/Linköping
3.    Örebro/Hallsberg/Arboga
4.    Stor-Stockholm (County + Enköping, Håbo, Nykvarn)
5.    jönköping/Nässjö
6.    västerås
7.    Eskilstuna/Strängnäs
8.    Öresundsregionen
9.    Borås/Ulricehamn
10.   Halmstad
11.   Gävle/Sandviken
12.   Nyköping/Oxelösund
13.   Skaraborg region
14.   Trollhättan/vänersborg/Uddevalla
15.   Karlshamn/Karlskrona
16.   växjö/Ljungby/älmhult
17.   Falun/Borlänge/Insjön
18.   Kristianstad/Åhus/Hässleholm
19.   Karlstad
20.   Sundsvall region
The six criteria
We evaluate all the relevant circumstances that deter-
mine where companies set up central warehouses/
logistics centers for consumer products, with distri-
bution primarily in Sweden but also for the entire
Nordic region. Our studies are based on open sourc-                                 11
es, interviews with the industry’s relevant player and
statistics for new logistic establishments during the
year and five years back in time.

The ranking is based on the following criteria
1. Geographic location, proximity to the demo-                                           12
   graphic centers of Sweden and the Nordic region.
2. The volume of existing and planned logistics                 13
3. Full-service and access in logistics infrastructure
   (roads, railroads, harbors, freight airports and
   combi terminals).
4. Range of logistic services, relevant academic
   education and access to labor force.
5. Degree of established cooperation and networks                              15
   in the region.
6. Price and access to land for new businesses.

               Photo: Karim Hatoum
Photo: Thomas Fallander

                          E TA IL
                                                                                                                  RETAIL 37

 BUSINESS ANALYSIS             by Magnus Kroon, Swedish Trade Federation

The retail sector continues to do well in the Göteborg           the development of current projects and new, spectacu-
region. Naturally, coupled with a steady increase in con-        lar shopping malls. Allum is one such example. Notable
sumer buying power, population growth plays an impor-            is that the current market for retail trade in the region
tant role here. The figures from the Swedish Retail In-          between 1999 and 2007 has grown by over SEK 13 mil-
stitute (HUI) indicate that growth for the retail sector         lion. We do however see a certain weakening in terms
in Sweden was 6.7% in 2007 and the figures for 2008              of new projects for volume retail in the region, which
are promising. The forecasts HUI has prepared are op-            may indicate that the retail sector is now in a period of
timistic. HUI estimates that theretail sector as a whole         consolidation. This is much needed and gives commerce
grows by 5,5 % in current prices in 2008. Growth in              in the region strength to continue to develop in a more
everyday commodities is estimated at 6.0% and 5.5% for           structured way.
durable consumer goods. Measured in current prices,
the retail sector will continue to grow at the same steady       5.3 GÖTEBORG’S CITY IS THE ENGINE FOR RETAIL
rate observed over the past few years. However, a sub-           Göteborg’s City should be, and according to many, is
stantially larger share of the growth is attributed to price     the engine for retail trade in the region. To maintain this
increases in the food industry. Volume growth for the            position, retail in the City must be allowed to grow and
food industry in 2008 is expected to brake at 1.5%, the          spectacular projects must be permitted. The conditions
lowest since 1998. In the durable consumer goods sec-            for enabling this have never been better! Two significant
tor, volume growth continue to surpass sales increases in        City areas are under development: Avenyn/Heden and
current prices. As before, substantial price reductions in       Södra Älvstranden. We hope that these two areas will
the electronics sector is the reason. Wise from previous         have an innovative design with a content that comple-
years, the Göteborg region developed better than the             ments the City as a whole.
nation as a whole and the retail sector has now enjoyed             In addition to these two areas, it is imperative to pro-
uninterrupted growth since 1996, which is historic.              mote the excellent growth rate of existing commercial
   In 2007, retail in the region employed about 25,000           areas in the City. Innerstaden and Nordstan are exam-
people, making the retail sector a prominent employer in         ples of areas that are regularly modernized to appeal to
the region.                                                      consumers.
   Yet another key factor for trade is that the tourist in-         In the long term, a second challenge lies in better de-
dustry is doing well. Robust year-round tourism for both         fining and enhancing the shopping streets. The area sur-
business travels and private tourists gives retail an added      rounding Götaplatsen and the expansive area around
boost. Thorough and well-executed activities aimed at            Svenska Mässan needs to be connected to Östra Hamn-
positioning Göteborg as a year-round events city and a           gatan and the waterfront. The thoroughfare should be
sound and innovative retail sector pays off!                     planned to accommodate the stores. The actual routes
                                                                 are actually short, both in terms of time and distance,
5.2 ExPANSION OF ExISTING COMMERCE                               but the mental distance for residents or tourists is cur-
It is worth noting that initiatives to expand existing           rently too far. If we manage to bring things into the city
trade locations have seriously taken off the past year.          and create a natural flow, Göteborg will be able to offer
The vitalization of Frölunda Torg has begun, as has the          an impressive, top-rate shopping street which will gener-
process of transforming Backplan. The retail trade out-          ate positive effects for the entire region.
side City has noticeably grown over the years through

5.4 GÖTEBORG REGION IS STILL HOT                                  •	 A possible doubling of shopping space in Angereds
It feels crucial to note that international investors are still      Centrum in Göteborg is in the works.
extremely interested in the Göteborg region. This applies         •	 Considerable expansion of shopping space in Möln-
both to shop concepts and investments in retail property.            dals Centrum is planned in the form of a spectacu-
Several projects are currently in the planning phase. The            lar project. The city of Mölndal is collaborating with
economic situation will obviously be significant to the              Steen & Ström.
timeframe for some of the investments listed below.
                                                                  •	 In Mölndal, Kållereds Centrum is trying to position
                                                                     itself as the region’s second Home Center after Bäck-
                                                                     ebol. Hornback for instance is looking for space for
                                                                     its second home improvement store in the Göteborg
An additional 4,000 sq m will be added to the shopping
mall Nordstan in Göteborg.
                                                                  •	 In Partille, KF Fastigheter wants to build a new
                                                                     shopping mall to complement Allum. The project is
  •	 Åhléns will open its second department store in the
                                                                     for the Daros land.
     autumn of 2008 in City on Kungsgatan.
                                                                  •	 The municipality has large-scale development plans
  •	 The city and property owners will invest a total of
                                                                     and is earmarking 40,000 sq m for new shopping ar-
     SEK 60 million to create more pedestrian streets in
                                                                     eas by 2012.
     the inner-city area.
                                                                  •	 In Kungälv, the Kongahälla land next to Ica Maxi is
  •	 Frölunda Torg in southern Göteborg is undergoing
                                                                     earmarked for development. Plans currently include
     a major transformation and renovation. The project
                                                                     an additional 16,000 sq m of shopping space.
     will be completed in three phases and is scheduled
     for completion in 2012, entailing the addition of            •	 Alingsås is planning for an external shopping center
     26,000 sq m to Frölunda Torg.                                   in Bolltorp with 30,000 sq m for volume trade. In
                                                                     addition, we note that Affärshuset Storken will be
  •	 A new shopping area measuring 30,000 sq m is
                                                                     completed in October 2008, marking the addition of
     planned for Gamlestaden in SKF’s factory area in
                                                                     27 new shops to Alingsås inner city area.
     Göteborg. Acquisition is possible earliest 2012.

                                                                                        Montage, Avenyn Kv. Örbyhus new facing

Montage: Thorbjörnsson+Edgren arkitektkontor AB
                                                                                                                                           RETAIL 39


         Entrance                                                                                                 Section


   Municipality                   Shopping mall/                                            Turnover,                       Turnover,
                                  Dept. store                                               total retail                    total retail
                                                                                            2006                            2007

   Ale                             Ale Torg                                                 392                             400
   Göteborg                        Angered C                                                322                             325
                                   Arkaden                                                  280                             350
                                   Backaplan 1)                                             590                             600
                                   Bäckebol                                                 2,215                           2,300
                                   Frölunda Torg                                            1,504                           1,700
                                   Hus 421      2)                                          260                             1,200
                                   Kompassen                                                268                             260
                                   NK                                                       525                             540
                                   Nordstan                                                 2,900                           3,400
   Kungsbacka                      Kungsmässan                                              1,245                           1,350
   Mölndal                         Kållered                                                 2,100                           2,200
   Partille                        Allum   3)                                               1,150                           1,500
   Stenungsund                     StenungsTorg                                             444                             510
   TOTAL:                                                                                   14,195                          16,635
The figures are VAT inclusive but do not include figures from Systembolaget and Apoteket.
Comments: 1) Turnover for Backaplan does not include turnover for Siba, HCJ Huset, Backa 1, Backa 3, TOYS”R”US.
          2) Building in inner-city Göteborg. Fully leased.
          3) The largest deal made outside Stockholm for an individual office building.

                  S IO N
          O N C LU

                           Photo: Karim Hatoum
                                                                                                                             CONCLUSION 41

This report has been prepared
by Business Region Göteborg…
The vision for Göteborg Region is to be a leading center      to business development and competitiveness. Business
for competence, tomorrow’s industries and growth en-          Region Göteborg promotes a good business climate
terprises in Northern Europe.                                 through constant improvements in infrastructure, edu-
                                                              cation, the environment, housing and service, etc. The
BACKGROUND                                                    company works for tomorrow’s trade and industry,
The commercial and industrial Secretariat was formed in       which is to say all industries and companies that contrib-
1977 as a unit that reported directly to the Göteborg
Municipality Board. The Göteborg region’s 13 munici-                 TRIPLE HELIx MODEL
palities have since 1992 created a unique collaboration
that promotes development and growth in the Göteborg
region. As a result of this collaboration, The commercial
and industrial Secretariat became a corporation on Janu-
                                                                                        ll e e s

ary 1, 2000 and was named Business Region Göteborg                                                              m
                                                                                      co iti

                                                                                                            in d m e r
                                                                                    d er s

AB.                                                                                                             u s c ia
                                                                                 a n ni v

                                                                                                                   tri l a
The company has 76 employees who work for and with                                                                       life nd

the companies in the Göteborg region. The Board is                                                  BRG
comprised of political representatives and reflects the fi-
nancial initiatives of the municipalities. All of the eco-                                        Public
nomic development officers in the 13 municipalities are                                        organizations
members of Business Region Göteborg. Strong coop-
eration in the Göteborg region is one prerequisite for
growth. The platform for our efforts is a close-knit in-      Business Region Göteborg applies the tested, three-headed Triple Helix model to stimulate
teraction with the Göteborg region as our common la-          innovation and development in the region.

bor market and economy.
                                                              ute or will contribute to future growth in the region.
BUSINESS CONCEPT                                              GOALS AND INDICATORS
Business Region Göteborg is a neutral partner that con-       Business Region Göteborg’s overall goals are that the
tributes to the development of businesses, new invest-        labor market region will include 1.5 million people in
ments and new companies, as well as a sound business          2020, to contribute to sustainable economic growth, a
climate for tomorrow’s trade and industry in the Göte-        high level of employment and a diversified economy. Be-
borg region. Business Region Göteborg is a nonprofit,         tween 2007 and 2010, Business Region Göteborg will
independent organization. Distinguished by its entre-         contribute to making annual growth in the region high-
preneurial spirit, the company’s efforts will contribute      er than for the country as a whole (growth measured in

…in collaboration with
jones Lang LaSalle.

Jones Lang LaSalle is a real estate services firm with     than 150 experts and a network of Nordic consultants in
more than 170 offices and operations in more than 700      all areas of the real estate sector. The company has one
cities in some 50 countries around the world. Jones Lang   of Europe’s most comprehensive real estate and rental
LaSalle provides owners, tenants and investors with real   property databases to provide employees on every local
estate and investment counseling on local, regional and    market access to relevant market information. In Swe-
global levels. The company’s turnover is about USD 2.7     den, the analysis department regularly maps the domes-
billion and a global portfolio of over 110 million sq m.   tic real estate market and compiles financial and prop-
LaSalle Investment Management, the company’s invest-       erty-related data used to identify profitable investment
ment operations, is a real estate manager with about       objects.
USD 49.7 million in managed assets.                           If you have questions about Jones Lang LaSalle and
   In 2008, Forbes magazine ranked Jones Lang LaSalle      our services, please call +46 (0)8 453 50 00 or visit www.
as one of the 400 Best Big Companies for the third con-
secutive year.                                                Please direct questions about the report to Pär Abra-
   In the Nordic countries, Jones Lang LaSalle has more    hamsson, +46 (0)31 708 53 61.
                                                                                                                                                     CONCLUSION 43

                                 Business Region Göteborg would like to thank the following
                                 companies/partners who facilitate activities when marketing
                                 the Göteborg region as a place to establish businesses and
                                 invest in at investor fairs like MIPIM and ExpoReal:
                                Alaska Fastigheter AB                                              Higabgruppen
                                Aspelin Ramm                                                       NCC
                                Castellum                                                          Skanska
                                Eklandia Fastighets AB                                             vasakronan
                                Harry Sjögren AB                                                   vinge
                                Chalmersfastigheter                                                Wallenstam
                                Diligentia                                                         Wistrand
                                Förvaltnings AB Framtiden                                          älvstranden Utveckling

                                 Business Region Göteborg welcomes the region’s new
                                 establishments and expansions of the following companies:
                                 Cochlear                                                           Parex Bank
                                 Cosentino                                                          Power Pipe
                                 DnB NOR                                                            Prologis
                                 Dormy Golf                                                         Taktica
                                 Frode Laursen                                                      v-TAB
                                 Hornbach                                                           zara Group
                                 Intersport                                                         Weigl Group AG
                                 Kuhne Nagel

Business Region Göteborg AB                   Ale Municipality                Kungsbacka Municipality          Lilla Edet Municipality         Stenungsund Municipality
Box 11119                                     Jerry brattåsen                 michael Fransson                 Kjell hermansson                anette oscarsson
                                              Tel +46 (0) 303-33 02 77        Tel: +46 (0) 300 83 40 50        Tel +46 (0) 520 65 95 40        Tel +46 (0) 303 68 301
404 23 Göteborg
Norra Hamngatan 14                            Alingsås Municipality           Kungälv Municipality             Mölndal Municipality            Tjörn Municipality                        Lennart anderberg               anette Svahn                     Lars Ekberg                     berndt Grönlund
                                              Tel +46 (0) 322 61 69 01        Tel: +46 (0) 303 23 90 88        Tel +46 (0) 31 315 13 11        Tel +46 (0) 304 60 14 90
Business Region Göteborg
Roger Strömberg, petra Sedelius               Härryda Municipality            Lerum Municipality               Partille Municipality           Öckerö Municipality
Tel: +46 (0)31 61 24 12, +46 (0)31 61 24 22   helene Evensen                  hans parck                       Nina orback-Schultz             bo michelson             Tel +46 (0) 31 724 63 06        Tel +46 (0) 302 52 16 16         Tel +46 (0) 31 792 11 35        Tel +46 (0) 31 97 63 63        

business Region Göteborg ab      visiting address:          Business Region Göteborg AB
box 111 19                       Norra hamngatan 14, 1 tr   works to strengthen and develop
404 23 Göteborg                  Tel +46 (0) 31 61 24 02    trade and industry in the Göteborg   Fax +46 (0) 31 61 24 01    region. We are a nonprofit orga-                                      nization representing 13 member
                                                            municipalities. our goals are to
                                                            contribute to sustainable economic
                                                            growth, a high level of employment
                                                            and a diversified economy.

To top