Kojamo to acquire major Finnish housing portfolio

Kojamo, through its subsidiary Lumo Kodit Oy, has reached an agreement to acquire a residential portfolio from Varma Mutual Pension Insurance Company. 

Reima Rytsölä 

The 4,761 apartments across 60 residential properties are primarily located in the Helsinki, Tampere, and Turku metropolitan areas, with 98% in attractive growth regions.
The acquisition is valued at approximately €900 mln (debt-free). Kojamo will pay for this partly with cash and partly by issuing new shares to Varma. 
Kojamo anticipates that once the portfolio's occupancy rate increases from its current 83% to Kojamo's typical level through its Lumo brand and customer service, the annual rental income will stabilize at €63.0 mln, yielding about 4.9%. This improved occupancy is also expected to boost the portfolio's fair value. 
To finance the cash portion, Kojamo has secured a €600 mln unsecured acquisition facility from Goldman Sachs Bank Europe SE, Nordea Bank Abp, and Skandinaviska Enskilda Banken for 12 months, which is expected to be refinanced through capital market debt.
The deal is contingent on standard real estate transaction conditions, including competition authority approval, with a target completion date of 1 April 2026.
Kojamo CEO Reima Rytsölä stated: “This transaction presents a unique opportunity for Kojamo to return to growth by acquiring a portfolio of significant size and with a strong alignment with our strategy. The properties are located in prime areas with a strong focus on growth centres, and they are of high quality and in good condition. With this transaction, we are pleased to deliver strong shareholder value through accretion in FFO per share. We welcome Varma’s conviction in Kojamo’s leading residential asset management platform capabilities and their increased ownership in Kojamo as part of the transaction.” 
Varma's deputy CEO Markus Aho added: “We have reviewed our investment portfolio to determine efficient ways to invest in the Finnish residential market after, also considering the upcoming pension reform. This transaction provides a natural opportunity to do so through our ownership in Kojamo. Varma will continue as a significant real estate and residential investor in Finland with a strong partner. We are pleased that the housing portfolio will continue to be managed by a stable and professional real estate investor who can further develop its returns and performance.”