Fabege earnings from property management rose 11% to SEK 1.166 billion in January–September 2026, supported by improved net operating income and a larger contribution from residential development. Results released on October 21 also showed stronger third-quarter leasing, although occupancy remained unchanged at 87%.
Key Takeaways
- Nine-month rental income increased to SEK 2.678 billion from SEK 2.581 billion a year earlier.
- Third-quarter net letting reached positive SEK 55 million, but the nine-month total remained negative.
- Management is prioritizing investment and leasing activity, with no immediate share-buyback plans.
Table of Contents
- Fabege earnings grow despite weaker like-for-like rents
- Leasing improves, but occupancy has yet to rise
- Investment needs take priority over buybacks
- Conclusion
Fabege earnings grow despite weaker like-for-like rents
Fabege’s January–September 2026 interim results showed profit from property management increasing from SEK 1.050 billion a year earlier. That measure is distinct from total profit, which was approximately SEK 1.2 billion for the nine-month period.
Rental income grew almost 4% year over year, with completed projects contributing approximately SEK 132 million. However, rental income in the identical portfolio declined 1.2%, reflecting the effect of negative net letting in the previous year.
The contrast matters: overall rental growth did not yet reflect an improvement across the existing portfolio. New project contributions helped offset that weakness. The surplus ratio was 74% over the first nine months and 76% in the third quarter.
| Item | Details |
|---|---|
| Residential development net operating income | SEK 112 million in January–September 2026, including SEK 33 million in Q3. |
| Net interest expenses | SEK 741 million in January–September 2026. |
| Investment spending | Approximately SEK 1.5 billion across the management portfolio, projects and development properties. |
| Undrawn credit facilities | SEK 6 billion. |
Leasing improves, but occupancy has yet to rise
Third-quarter net letting reached SEK 55 million, compared with SEK 9 million a year earlier. New lettings of SEK 93 million exceeded terminations of SEK 38 million.
The stronger quarter did not fully reverse earlier losses: net letting for January–September remained negative at SEK 7 million. Occupancy was unchanged from the second quarter at 87%, separating the improvement in leasing activity from any increase in occupied space.
Quarterly rental income rose 2.3% from the second quarter. In lease negotiations, Fabege reported SEK 60.4 million of renegotiated rents with a 3% uplift, alongside contracts prolonged on existing terms.
CEO Bent Oustad said the company entered the final quarter with better leasing momentum. His stated priorities were to conclude customer discussions, increase occupancy and strengthen future cash flow.
Investment needs take priority over buybacks
Oustad said Fabege had limited excess capital and needed to prioritize investment rather than launch immediate share buybacks. He nevertheless described repurchases as an option that remains under consideration.
Financing activity included an August issue of a SEK 600 million five-year bond at a margin of 103 basis points. The interest coverage ratio increased to 2.7.
Management also flagged a one-off fourth-quarter 2026 accounting effect from ending a lease early as a replacement tenant is brought in. Oustad said future cash flow and annual rent would be higher than under the existing arrangement. Separately, smaller rent rebates linked to a refurbishment are expected to continue until the third quarter of 2027.
Conclusion
The fourth quarter will show whether stronger leasing activity begins to lift occupancy. Its rental-income figures will also need to be read alongside the one-off lease-accounting effect management has identified.
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