CEO Marcel Kokkeel:
Citycon had a good start to the year 2017. The Swedish and Norwegian portfolio showed continued strong performance, while the ongoing (re)developments and performance of the non-core properties weighted negatively on the Finnish like-for-like results. Overall, like-for-like net rental income growth including Kista Galleria (50%) totalled 1.1%.
The outlook for the Finnish economy is gradually improving. We have seen leasing demand increasing for our assets in the Helsinki area, including our large (re)development projects, whereas we still expect some pressure on rental levels in other parts of Finland. The second phase of the Iso Omena extension will open on 20 April almost fully leased. With the opening of the new extended M.E.E.T restaurant concept, seven-screen cinema and Espoo’s first Zara, Iso Omena has become the natural heart of Espoo and one of the leading shopping and leisure destinations in the Helsinki area.
In 2017, Citycon’s focus will remain on operational improvement and upgrading the portfolio quality via asset rotation and (re)developments. Since the strategy update in 2011, Citycon has divested 52 properties for a total value of EUR 400 million and we aim to expedite further capital recycling. As previously communicated, our plan is to divest EUR 200–250 million of non-core assets, mainly in Finland, within the coming 1.5 years. Additionally, we have identified further potential to recycle capital in Norway and plan to divest smaller, non-urban Norwegian assets for up to EUR 200–250 million over the next three years.
Source: Citycon's Interim Report, January-March 2017