Estate Magasin 1-2015 (English)

The magazine for real estate professionals

N°1 2015

INCORPORATION OF AIFMD IN NORWAY NORWEGIAN REAL ESTATE: - OSLO IS UNDERPRICED Americans are BUYING UP NORWAY CHANGE of environmental pace The office rental market in Norway: From smooth running to sluggish

400% rise in house prices in Norway since 1992:

Does not believe in a market crash Daniel Kjørberg Siraj, deputy group CEO of OBOS, Norwegian´s biggest housing association

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E S TAT E M E D I A

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How to navigate the Nordics

MANAGEMENT SERVICES FOR COMMERCIAL REAL ESTATE History has taught us that it is difficult to navigate in unknown waters. Risks can be larger then they first appear. Yet the Nordic market is a solid safe haven in otherwise rough sea.

If you are looking to enter the Nordics, Basale is a solid partner with a proven track record within asset, property and company management. We know the local waters, can guide you through the obstacles and avoid unnecessary risk. We have helped many foreign investors enter what can appear to be a closed market.

OBOS Basale AS is the largest independent manager of commercial property in Norway. With over 25 years of experience, we provide a complete range of real estate management and advisory services for financial investors and real estate funds.

We are a team of more than 210 specialists with a passion for real estate. Our team comprises of Property Managers, Brokers, Analysts, Auditors, Accountants, Engineers and Attorneys working together for the interest of our clients and their tenants. z If you are looking to enter the Nordic market, then get a serious partner.

Hilmar Auran Alf Martin Brasøygürd

+47 924 53 053 +47 911 20 027

hilmar.auran@basale.no alf.brasoygard@basale.no

NORWAY | SWEDEN | DENMARK

CEO Head of Property Management/ International Relations

www.basale.com

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ESTATE MAGASIN | N°1 2015

The greatest wealth is health Few tasks are as challenging for an architect firm as designing and planning a hospital. Nothing can be left to chance and the complexity is almost overwhelming.

A hospital must be more than just functional.

It should also be an integral part of the healing process or users and patients. The staff, patients and relatives provide us with useful knowledge about the design requirements.

– Virgil

We create sustainable architecture on a human scale, healing environments where people can find calm and space that inspires activity. Streamlined and logical infrastructure ensures both an efficient work-flow for the hospital’s personnel and gives patients and family time for each other.

We combine research, evidence-based design and knowledge of flexible and robust buildings with modern architecture of extremely high quality.

Photo: Hundven-Clements Photography. Illustrations: LINK arkitektur AS / Brick Visual / MIR

LEF T: T HE SK ANDION CLINIC, UPPSAL A, SWEDEN. BELOW: SAUDI HE ALT H PROMOT ING CEN T ER // NAT IONAL DIABE T IC CEN T ER, RIYADH ER S TA H OSPI TAL , S TO CK H O L M, S W ED EN // INSPI H E ALT H C A M PUS, M AL M Ö, S W ED EN // UNN PE T- CEN T ER , T R O MS Ø, N O R WAY.

ENDLESS POSSIBILITIES

ESTATE MAGASIN | N°1 2015

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N°1 2015

EDITOR-IN-CHIEF: Thor Arne Brun, mobile: +47 95 86 56 56 e-mail: thor@estatemedia.no

JOURNALISTS: Thor Arne Brun, mobile: +47 958 65 656 e-mail: thor@estatemedia.no Torgeir Hagøy, mobile: +47 997 47 171 e-mail: torgeir@estatemedia.no Silje Rønne, mobile: +47 9082 9393 e-mail: silje@estatemedia.no Gard U. Sandvig, mobile: +47 950 38 244 e-mail: gard@estatemedia.no Tore Årdal, mobile: +47 915 38 544 e-mail: tore@estatemedia.no Kristian Lerø, mobile: +47 959 07 655 e-mail: kristian@estatemedia.no ADVERTISING , CONTACT: Jan Erik Pedersen, mobile: +47 901 58 211 e-mail: janerik@estatemedia.no Joakim Nessem mobile: +47 958 35 865 e-mail: joakim@estatemedia.no Roy Hugo Øren, mobile: +47 928 16 111 e-mail: roy@estatemedia.no Ola Boisen, mobile: + 47 9513 7283 e-mail: ola@estatemedia.no Camilla S. Matheson, mobile: + 47 995 53 059 e-mail: camilla@estatemedia.no

CEO: Trond Valle, mobile: +47 911 23 334 e-mail: trond@estatemedia.no LAYOUT AND PRODUCTION: Estate Reklame Marion Nævestad, marion@estatemedia.no Gry Flovild, gry@estatemedia.no PRESS: UnitedPress Poligrafija corporation, Latvia

Absolutely terrible The property year 2014 may in short be summarised as having been exceptionally good in Norway and the Nordic countries. In Norway, the final transaction volume closed at € 6,5 billion, ie. almost as much as the average in the peak years 2006 and 2007. Foreign investors have now really entered the Norwegian market and in 2014, they were by far the biggest net buyers of commercial property. Previously, foreign buyers represented only a small percentage of the total transaction volume and the increase is thus historical.

In the Nordic countries as a whole, commercial property in the amount of € 30 billion, changed hands in 2014.

Some investors are looking for properties with a development potential but especially newer office premises in a good location, with solid, long-term rental agreements are the most sought after. We find the highest activity in Oslo but foreign buyers have also made their mark in other big cities in Norway. Office property represents the biggest segment with a volume of around € 3,5 billion, whereas logistic and business properties represent €4,3 billion and €3,23 billion, respectively, of the total sales volume in Norway last year.

The residential market is also attractive and in Oslo, the supply is nowhere near the demand. This has made several commercial property players turn their attention, in full or in part, to housing development. Since 1992, house prices in Norway have gone up by formidable 400 per cent. The government is under pressure to amend the building regulations, which for years have been regarded as rigid and price driving by the developers.

Every medal has, however, a backside. The oil price has plunged downwards over the last year and the price drop is influencing the macro picture in Norway. The drop in oil prices and reduced profitability have led to a number of oil service companies, permanently or temporarily, laying off a substantial number of employees. Several of these companies are now subletting vacated premises, often at a lower rent than the normal market price, thus squeezing the rental prices.

Fresh figures show that Norwegian industry and commerce has scaled down its growth expectations, precisely because of the above. Still, we see that the pressure in the property sector is just as big this year as it was last year. This is explained by for instance very reasonable financing terms – and the expectation that the current situation will last for several years to come.

Cover photo: André Clemetsen Copyright: Estate Media AS RESPONSIBLE PUBLISHER: Estate Media AS, Rådhusgata 26, N-0151 Oslo, Phone: +47 21 95 10 00, fax: +47 21 95 10 01 e-mail: info@estatemedia.no ISSN 1503-559X. All rights Estate Media AS.

«It is absolutely terrible to have money now», a financially strong investor told us recently.

This statement refers of course to the fact that having money in the bank is presently a losing business. Many have therefore concluded that earning a running rate of return in property is an excellent alternative.

As long as the basic conditions remain the same as at the present time, the temperature in the Norwegian property market will continue to be high.

Have a good read!

ESTATE MEDIA

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THOR ARNE BRUN

Editor-in-Chief

ESTATE MAGASIN | N°1 2015

““Strong in negotiations and complex transactions.”

Chambers Europe 2014

SMALL TEAMS FOR BIG MATTERS Whether you need advice on investments, development, construction, financing, tax issues or transactional work, please contact us to find out how we can be of assistance.

Stig L. Bech E: slb@bahr.no M: +47 91 37 26 68

Anne Sofie Bjørkholt E: asb@bahr.no M: +47 97 02 21 93

Advokatfirmaet BA-HR DA Tjuvholmen allé 16, NO-0252 Oslo | PO Box 1524 Vika, NO-0117 Oslo T: +47 21 00 00 50 | F: +47 21 00 00 51 | E: post@bahr.no | www.bahr.no

Sam E. Harris E: seh@bahr.no M: +47 92 88 14 26

CONTENT

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6 Editorial

Absolutely terrible THE NORWEGIAN REAL ESTATE MARKET 10 A very god year for transactions

Never before have foreign investors spent so much money in Norway 12 Many are willing to go great lenghts

- In 2015 we will see foreign players acquire an even larger volume 14 Americans are buying up Norway

- And we see capital from China, Saudi Arabia, Israel and Spain

THE NORWEGIAN OFFICE RENTAL MARKET 16 From smooth running to sluggish

A number of players in the oil and gas industry are now forced to sublet parts of their premises

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- Oslo is underpriced - At least relatively cheap compared to many other cities

20 Realising people´s house dream

Daniel Kjørberg Siraj, deputy group CEO of OBOS, Norwegian´s

biggest housing association

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28 “The highest form of beauty is timeless”

- It is a fascinating building which stands out, says civil architect

Per Christian Brynildsen 36 Change of environmental pace

- We see an increasing interest in buildings with a high environmental standard 38 AIFMD in Norway

Per 1 January all market participants governed by the AIf Act must comply with the new regime

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ESTATE MAGASIN | N°1 2014 2015

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Pangea Property Partners is an independent Nordic corporate finance and advisory firm focusing on the real estate sector.

STRONG COMMITMENT – CLEAR RESULTS

2014 was a fantastic year both for our clients and us • Pangea was exclusive advisor to Starwood Capital Group in the largest Nordic transaction of the year – Property value EUR 1.3bn • Executed the largest transaction in Sweden - EUR 750m (Sveareal) • Executed the largest transaction in Norway - EUR 550m (Fortin) • Pangea executed the largest hotel transaction of 2014, when Pandox AB sold 14 hotel properties to Balder for EUR 235m

OSLO STOCKHOLM

• During 2014, the Pangea team executed nearly 60 transaction, both large and small, totaling close to EUR 3.0bn across the Nordics, both buy-side and sell-side

Our company has offices in Stockholm and Oslo with about 30 employees, of which 9 are partners. Since the start in 2009, Pangea Property Partners has advised on more than 200 transactions all over the Nordics with an underlying property value of approximately EUR 12bn. The mandates include single asset and portfolio divestments and acquisitions as well as large corporate transactions, IPOs, capital raisings and debt financing. Additional information can be found at www.pangeapartners.no ESTATE MAGASIN | N°1 2015

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NEWS

HELPING THEMSELVES: Foreign investors were very active in Norway last year. All the below listed Norwegian properties are now in foreign hands.

Foreign investors traded for €1,67 billion Never before have foreign investors spent so much money in Norway. Here you will see who purchased what.

N NEWS Torgeir Hågøy torgeir@estatemedia.no

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ESTATE MAGASIN | N°1 2015

- International buyers stood for a total of approximately €1,67 billion. That is 26 per cent of a total volume of €6,34 billion, says analyst at CBRE, Igor Petkovic.

This equals 25 per cent of the total volume of approximately €6,57 billion, against around 6 per cent in 2014 .

LOOKING FOR ALTERNATIVES

One of the reasons why Norway has become so attractive is that there is an enormous flow of capital waiting to be invested.

- Many investors look to classic property markets such as London, Paris and Munich but that leads to sharp competition and therefore many go looking for alternatives, says head of analysis at CBRE, Anders Lunder.

Norway is such an alternative and one of the factors contributing to elevating this market is a stable economy.

- The economy is healthy and unemployment is low. The foundation is in other words very good, says Lunder.

He says that for a long time Norway has been regarded a safe haven. That still applies, but Norway is a commodity-driven nation and not very many had imagined that the oil price would fall as much as it has.

- So far, however, it has not affected the property market, says Lunder.

THIS IS WHAT THEY PURCHASED

The biggest transaction by far in 2014 was the sale of the property portfolio of DnB NOR Eiendomsinvest ASA. This transaction totalled approximately €1,31 billion but more than half of the properties were located in Sweden through SveaReal AS. The Norwegian share amounted to around €0,56 billion and was purchased by the US investment company Starwood Capital Group. The second-biggest transaction, in terms of volume, was Niam’s acquisition of Jåttåvågen 10-12 in Stavanger for €0,18 billion. The vendor was Hinna Park Invest, a syndicate with principal shareholders Solist Hinna AS with 34 per cent (principal shareholder Solist Investor), Akastor AS with 25 per cent (principal shareholder Aker Kværner Holding AS), Arctic Securities with 8.4 per cent and The Resource Group Trg AS with 7.6 per cent (Kjell Inge Røkke).

HOT IN OIL CITY

Stavanger was much sought after in 2014 and the US company W.P. Carey secured Finnestadveien 44 (Total’s headquarters in Norway) for €87 million. The same company also bought the Apply building in Forus for around €80 million. Foreign investors have purchased property in Stavanger for a total of close to €0,42 billion.

- It has been a very good year for transactions, says head of EiendomsMegler 1 NæringsEiendom, Jan Inge Røyland.

In addition, W.P. Carey purchased Oslo Business Park in Østre Aker vei 90 for around €62 million.

Madison, a US company, also spent a lot of money in Norway in 2014. They increased their ownership stake in Statoil’s regional headquarters in Fornebu from 35 to 94.5 per cent for €81 million NOK. They also acquired 50 per cent of Steen & Strøm Magasin for around €38 million.

Deka’s acquisition of Bekkestua Centre for €50 million was another substantial purchase.

The economy is healthy and unemployment is low.

The foundation is in other words very good Anders Lunder. CBRE

TRANSACTIONS: Property

Buyer

Price

Regnbueveien 9

Blackstone

€13,75 M

Fuglesang Næringspark

Cordea Savills Log. Fund

€14 M

Colosseum Park

Pembroke Real Estate

€22 M

Bogstadveien 2

Aberdeen Nordic Fund I

€23 M

Bankplassen parking

Bouwfonds

€25 M

Grensen 17

Mayer Bergman () partner

€31 M

Onninen HQ in Berger

Not disclosed

€47 M

Bekkestua Senter

Deka

€50 M

Business Park

W.P Carey

€62 MN

Moseidsletta 122 (Apply HQ Stv)

W.P Carey

€77 M

Finnestadveien 44 (Total)

W. P. Carey

€87 MN

Steen & Strøm Magasin

Madison International

€89 M

Jåttåvågen 10-12

NIAM

€179 M

Fornebu Statoil regional HQ

Madison Internationa

€238 M

Fortin portfolio

Starwood Capital

€561 M

Total:

€1524 M

ESTATE MAGASIN | N°1 2015

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NEWS

Many are willing to go to great lengths Foreign investors’ interest is considerable and according to Malling & Co, many investors may be willing to go to great lengths to acquire the best objects.

N NEWS Torgeir Hågøy torgeir@estatemedia.no

- I believe that in 2015 we will see foreign players acquire an even larger volume, says analyst at Malling & Co, Haakon Ødegaard.

International investors stood in 2014 for around 25 per cent of all the transactions in Norway. In monetary terms, this totals around €1,67 billion.

- It is of course impossible to estimate the final outcome for 2015 but foreign interest is considerable. There is a lot of money waiting to be invested in property, says Ødegaard.

YIELD AROUND 3

The yield of the best properties in Norway are now, according to the brokerage firm, under 4.5. The yield has been on the decline 012

over a long period of time and is expected to fall even more over the year.

- We believe it will fall to around 4.25 at the end of 2015. We also believe that when it comes to the super-attractive objects, the yield might be even lower, perhaps as low as around 3 but that is highly uncertain, says Ødegaard.

If so, it will mean that Oslo is closing in on other big European cities in terms of price. One of the reasons why Norway is attractive is that the prices have been reasonable compared to for example London and Paris. A yield around 3 means closing in on the prices in London where prime yield last autumn was around 3.8. This eliminates Norway’s price advantage.

- The challenge is that everyone wants to buy and no one wants to sell. This may, of course, point towards a fall in volume but we believe it will mean a fall in yield. If we get a yield around 3, more property owners will definitely consider selling, says Ødegaard.

company Hemfosa’s purchase of a portfolio belonging to Entra. The portfolio consists of six properties in Østfold and Lillestrøm with a total property value of €0,16 billion.

- The properties are located in an area where there is very little activity, and consequently we regard them as challenging, says Ødegaard.

MORE SALEABLE OBJECTS

Another observation made by Ødegaard is that more and more objects are saleable, which is only natural when prices rise and competition sharpens.

- There are examples of what we would call challenging properties having been sold, says Ødegaard.

One of his examples is the Swedish ESTATE MAGASIN | N°1 2015

CONTINUED UPSWING EXPECTED: I believe that in 2015 we will see foreign players acquire an even bigger volume, says analyst at Malling & Co, Haakon Ødegaard.

Schweigaards gate 21+23 Norway’s first BREEAM-NOR “Excellent” office buildings. Headquarters for the NSB Group and Gjensidige Forsikring ASA. Sold to KLP in 2014.

LOCATION + BREEAM = high returns

Bergen station 16,000 sqm office building next to Bergen station. The building will have energy rating A/ Passive house and BREEAM-NOR “Very Good”. KLP and the Norwegian Competition Authority move in during Q2 2016.

M62 New office building of 6,250 square metres in Munkedamsveien. The building has been sold and gets BREEAM-NOR “Excellent” classification. RS Platou moves in when finished in March 2015.

Manages and develops properties at and around hubs. romeiendom.no

ESTATE MAGASIN | N°1 2015

S33 20,800 square metres office space in Schweigaards gate 33, eight minutes walking distance from Oslo S. Planned building start by end of 2015. Ambition of BREEAM-NOR “Excellent” classification.

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NEWS

Americans are buying up Norway American investors are behind €1,36 billion of the total foreign property investments of around €1,67 billion

N NEWS Torgeir Hågøy torgeir@estatemedia.no

properties whereas the rest are mainly office premises.

- We have, however, not finished counting yet, so larger transactions may come to light, says Eggen.

FROM CHINA AND SAUDI ARABIA

- American buyers, in practice large property investment funds like Starwood, Madison and W.P. Carey, are behind around €1,36 of the €1,67 billion foreign players have invested in Norway in 2014, says head of analysis at Akershus Eiendom, Ragnar Eggen.

OSLO IS MOST INTERESTING

Finally, in 2014, foreign investors became aware of Norway. For years, Norwegian players have been saying “the foreign investors are coming” – and been wrong. Foreign investors have taken their time in coming to Norway. Then finally, in 2014, they got it right. Foreign investors have purchased Norwegian property in the total amount of 14 billion NOK, which is 27 per cent of the total volume of around €6,34 billion.

- Generally speaking, the Oslo area accounts for the majority of transactions, just over €0,96 billion, whereas Stavanger accounts for around €0,42 billion. The rest is spread out but we don’t know exactly how as the Fortin portfolio is spread across the country, says Eggen, adding that around €0,30 billion of the transactions are trade properties, €12 million - 18 million are logistic /industrial 014

how things work in the Norwegian market.

They must be on the ball and be prepared to act quickly. The international players who have traded in the Norwegian market and experienced good processes, return – and are thus excellent promotors of Norwegian investment opportunities, says Bech.

Analyst at Newsec, Håkon Styrvold, says that although several of the players trading in Norway have their background from the US, they are to a large extent international in the way they are organised.

- They are players like Blackstone Group, Pembroke Real Estate, W.P. Carey, Madison International Realty and Starwood Capital Group. Deka Immobilien from Germany, Meyer Bergman and 90 North from England and Genesta and Hemfösa from Sweden have also been active this year. A number of foreign players have been bidding on properties, and we see capital from for instance China, Saudi Arabia, Israel and Spain actively searching for investments in Norway, says Styrvold.

A GOOD JOB

Property lawyer at BA-HR, Stig Bech, believes that one of the reasons why foreign investors have been so profiled this year is that the brokers long ago came to realise that a large group of bidders are not Norwegian.

- Today, the best brokerage firms take good charge of the sales – and facilitate participation of more foreign investors, who occasionally end up buying. At the same time, the brokers have brought out their inner educator and instructed the foreign investors about ESTATE MAGASIN | N°1 2015

AMERICAN SISU: The private equity company Madison International Realty, here represented by managing director Derek O. Jacobson, has purchased commercial property in Norway for a considerable sum lately.

PHOTO: ILJA HENDEL

Trusted advisor Wikborg Rein has an impressive track record in assisting leading Norwegian and foreign investors in a variety of transaction forms, including the most complex and largest corporate real estate transactions. 2014 was no exception. We have the expertise, the experience, the capacity and a proven methodology for assisting in successful transactions.

Our real estate team consists of 20 highly dedicated and experienced lawyers, and you can meet the team’s representatives at MIPIM.

Meet us at MIPIM Haakon Blaauw Partner hbl@wr.no Mob +47 905 54 064

Gøran Mjelde Aarvik Partner gla@wr.no Mob +47 908 45 263

Wikborg Rein is one of Norway’s leading law firms with 234 lawyers in Oslo, Bergen, London, Singapore, Kobe, and Shanghai.

The firm’s long-standing presence overseas distinguishes Wikborg Rein as the Norwegian law firm with most international experience and expertise.

ESTATE MAGASIN | N°1 2015

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NEWS

From smooth running to sluggish The office rental market is no longer running smoothly in Norway. A number of players in the oil and gas industry are now forced to sublet parts of their premises

N NEWS Torgeir Hågøy torgeir@estatemedia.no

- Technip must for instance let 5,000 sq.m of their new offices in Lysaker, says head of analysis at Malling & Co., Haakon Ødegaard.

After several years of great optimism, believing that everything grows into heaven, the situation has reversed. The oil price is falling and several players in the oil industry have had to let a number of employees go. Many of them have premises “rigged for growth” but now they realise that they may have been too ambitious. A lot of companies have in the recent past given notice to a number of employees and are now in the market for su-

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bletting office space which already is or will be redundant.

One example is Technip, which in June next year will move into their new offices. It now turns out that they will not be needing all of the 18,500 sq.m, and they are therefore in the market to sublet 5,000 sq.m.

Malling & Co do not have a complete list of the market for subletting but say that in the last few months they have seen an increase in the number of sq.m sublet in this way.

- This is a trend we have seen in the oil and gas industry especially. The trend has become stronger over the last three to four months, says Ødegaard.

- We have been assigned to sublet 7,500 sq.m for them in Kraglund office park just south of Asker, says Ødegaard. The building houses 21,000 sq.m and Aibel has thus to sublet around a third of the building. The company faces the same situation in Bergen where they are in the process of building a new office building of 17,500 sq.m. Here, they are to sublet 8,000 sq.m, ie. almost half of the building’s office space.

A search on finn.no shows that premises in the total of just over 9,000 sq.m are advertised for subletting. Most of the premises offered are, however, not advertised as premises for subletting and are therefore not included in the above figure.

AIBEL SUBLETS 15,500 SQ.M

PUT ON HOLD

Another company forced to sublet parts of its premises, is Aibel. They have recently had to give notice of dismissal and temporary lay-off to many of their staff. This now has consequences in relation to the offices they currently occupy.

Yet another example is Aker Solution. They are subletting 8,500 sq.m in Trondheim. In Tromsø, they have put a new construction project of 15,000 sq.m on hold, and it is uncertain when it will be realised.

THE LAST THREE – FOUR MONTHS

ESTATE MAGASIN | N°1 2015

REAL ESTATE INVESTMENTS IN NORWAY CROSS BORDER CAPABILITY

DLA Piper’s global real estate team operates from 78 offices worldwide, including Oslo. Our unique geographic footprint has given us extensive experience working on multi-jurisdictional real estate matters, including acquisitions, disposals, financings and restructurings.

DLA Piper’s core Real Estate team counts 550 lawyers worldwide, of which 25 lawyers are based in Oslo. We can provide international investors with seamless legal service regardless of investment structure and origin.

Visit us at www.dlapiper.no

KEY CONTACTS:

Magnus Løvlien Lutnæs Partner

Anders Bergene Partner

Bjørn Slaatta Partner

Harald Strømstad Partner

T +47 41 91 65 61 magnus.lutnas@dlapiper.com

T +47 91 89 48 01 anders.bergene@dlapiper.com

T +47 92 69 47 86 bjorn.slaatta@dlapiper.com

T +47 91 31 96 27 harald.stromstad@dlapiper.com

DLA Piper norway is part of DLA Piper, a global law firm operating through various separate and distinct legal entities.

Further details of these entities can be found at www.dlapiper.no | Switchboard +47 24 13 15 00.

ESTATE MAGASIN | N°1 2015

Copyright © 2015 DLA Piper. All rights reserved.

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NEWS

- Oslo is underpriced Although many are of the opinion that property in Oslo is getting expensive, it is still relatively cheap compared to many other cities.

N NEWS Torgeir Hågøy torgeir@estatemedia.no

- We now see more international interest in Norway. The number of foreign investments has gone up, mostly from the US, and so far this year we have seen a handful of concluded deals.

There is, however, an underlying demand for more, says head of capital market research at DTZ in England, Nigel Almond.

STRONG ECONOMY

He thinks there are several reasons why Norway, and Oslo in particular, is getting increasingly attractive to international investors.

For one thing, he refers to the fact that prime yield for office property in Oslo is five per cent, which according to him is historically low.

- In comparison, prime yield in Stockholm is 4.45 per cent whereas in London it is as low as 3.8 per cent. Our Fair Value Index, which measures the attractiveness of property, also shows that office property in Oslo is underpriced, it is in other words a sound investment, says Almond.

He also points out that they see a greater differentiation among the investors, and that property offers relatively good value. With historically low prices in all markets he would, however, be cautious and study the details of each deal closely.

- A large part of the European property market is still attractively priced since the bond rates are still low. We are also likely to see a move from prime to secondary properties, but we have been saying that for more than a year now, says Almond.

VERY LIQUID

Another thing in favour of Norway is, according to the head of capital market research, that it may be considered a relatively safe haven.

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ESTATE MAGASIN | N°1 2015

- The economy is expected to show a sound development, though there is a little headwind due to falling oil prices. Oil is a large contributor locally but the underlying economy is strong and looks sounder than in comparative markets, says Almond.

He says that the Norwegian market is also very liquid. They measure this according to how large the investment volume is compared to the inventory in the market.

- We regard this liquidity a key factor for investors because it measures how easy it is for an investor to get out of the market again. A strong liquidity is therefore positive, says Almond.

He continues to say that Norway’s average liquidity over the last ten years lies 5.3 per cent over the EU average of 4.6 per cent. It is still less than Sweden’s 8.8 per cent. Sweden is one of the most liquid markets in the world.

- The Norwegian market has a lot going for it but there has, of course, been challenges.

Although the liquidity is strong, it is driven by local activity. The market is not as expansive as some other markets. We see that a larger portion of the total Swedish and Finnish markets is cross-border investments. Norway is behind Sweden when it comes to volume. A smaller market means fewer available products and this might affect investors, especially external cross-border investors who often focus on larger markets regardless of liquidity, says Almond. If he were to rate Sweden against Norway, he would rate Sweden above Norway.

- It is all about the size of the market, the liquidity and the diversity of the investor base.

Hopefully, the increasing interest in Norway that we now see, will contribute to break down some of the historical barriers we have seen, says Almond.

There are There are There are endless solutions endless solutions endless solutions We find yours We find yours We find yours

Wiersholm Wiersholm Ranked as leading Norwegian law firm Wiersholm Ranked as leading Norwegian law firm Ranked as leading Norwegian law firm

ESTATE MAGASIN | N째1 2015

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PORTRAIT

JOB OFFER: Daniel Kjørberg Siraj attended an international conference on city development in Shanghai in 2002 and met Martin Mærland and Fritz Huitfeldt from OBOS in a bar. They urged him to apply for a job at OBOS when he was done with politics.

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ESTATE MAGASIN | N°1 2015

SHANGHAIED

BY OBOS Daniel Kjørberg Siraj was shanghaied by Martin Mæland, head of OBOS, in a bar in Shanghai.

Tekst: Tore Årdal, tore@estatemedia.no Foto: Andre Clemetsen, andre.clemetsen@gmail.com

DANIEL KJØRBERG SIRAJ • Born in 1975, grew up in Moi in the county of Rogaland.

• Law degree from the University of Oslo in 2001, completed the Administrative Research Institute (AFF) at the Norwegian School of Economics’ leadership programme in Solstrand in 2010.

• Worked as political advisor and secretary to the Christian Democrats in the Oslo City Government and the City Council during the period 2000 – 2003.

• Held a number of political offices for the Christian Democrats.

He was Oslo’s no. 2 deputy to the Storting during the period 2001 – 2005.

• Started out as a trainee lawyer with OBOS in 2004.

• Group CEO for housing development at OBOS from 2012.

• Appointed deputy group CEO of OBOS last year.

It is Monday morning and a good day at work for Daniel Kjørberg Siraj. The day before, Manchester United humiliated their archival Liverpool by winning 3-0 on Old Trafford and it seems Siraj has forgotten the message “United is absolute rubbish with Moyes ” that he posted to comment an online article after ManU had lost a game in March.

- I am absolutely crazy about Manchester United but I was no good at soccer myself. My brother, in his diplomatic way, used to say that I had the eye for it but not the skills, Siraj smiles as he rushes up the staircase between the reception area and the premises of OBOS Bank.

REALISING PEOPLE’S HOUSE DREAM. His confined office resembles a bedsit. The blinds are drawn, possibly to hide the fans outside. Inside it is rather cramped but the small meeting table in one corner is tidy.

- I could not have worked in a property company guided by profit only. To me, a property is not interesting in itself but it is thrilling to realise people’s house dreams while at the same time taking part in the development of the city. I think OBOS is a fantastic workplace, he says.

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DISCREET: I believe I have handled my political background rather discreetly.

That is important to me, says deputy group CEO Daniel Kjørberg Siraj at OBOS.

LOST THE LOCAL ELECTION. Whereas Siraj earlier wore a Christian De-

mocrats (KrF) button on his lapel, he has now replaced it by an OBOS button. The 2003 local elections were a contributing factor to him starting to work in the membership organisation.

At the previous City Council where Erling Lae and the Conservative Party (Høyre) governed together with the Liberal Party (Venstre) and the Christian Democrats (Kristelig Folkeparti, KrF), Siraj held the post of political advisor. However, with KrF leaving “the good company” the financial framework did not allow him to keep the job.

Moreover, Siraj was mentally done with working with politics twenty-four hours a day. He had also reached the point where he wanted to make use of his law degree.

REMEMBERED THE OBOS INVITATION. That was when Siraj remembe-

red that he had actually been shanghaied by Martin Mæland, head of OBOS. And in Shanghai at that.

- I attended an international conference on city development in

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Shanghai in 2002 and ran into Martin Mæland and Fritz Huitfeldt from OBOS in a bar. I had met them several times before. The funny thing was that Martin said that when I had finished with local government I should apply for a job with OBOS. And that is what happened, says Siraj.

WITHDREW FROM OFFICE. The table was not laid for him when he joined OBOS. Siraj started out as trainee lawyer but worked closely with Martin Mæland and the OBOS management. In November 2014, he was, however, appointed deputy group CEO of OBOS. - Has your former political career been beneficial in your new job?

- I believe I have handled my political background rather discreetly.

That is important to me. I was quarantined for three months, which was nothing. I relinquished all political duties as soon as I possibly could. It is a problem if politicians try to influence the management’s decision-making, he replies.

- We all work towards the same goal, namely to make the city a

ESTATE MAGASIN | N°1 2015

Being a politician is a thankless existence. If you add up the number of working hours, the strain on the family, the pay and the thanks you get later, there isn’t a lot of credit left in the bank, says Siraj.

better place. If you, as a property developer, respect the competence at the other end, you can achieve a lot. But we often disagree, that is just the way it is.

AGGRESSIVE ATTITUDE. Siraj grew up in Moi in the county of Rogaland with approximately 1,500 inhabitants, about as many as live in the blocks of flats along the river Akerselva in Oslo, where he now lives.

- Moi is a typical industrial centre and farming community founded on hard work and humility. It has given me a set of good values. Humility is important at OBOS also. Although OBOS is doing well, we must not think we are world champions and be arrogant. We can always learn more and do things better. We must have an aggressive attitude, not a subsidy culture, he says.

SHALL GROW. OBOS was formed in 1929 and built the first coopera-

tive houses in Etterstad. With the founding of the Norwegian State Housing Bank in 1946 came an efficient model for home building: The municipality provided land, the bank offered mortgages and OBOS built. In the 1960s and 1970s, OBOS developed Oslo’s satellite towns, such as Manglerud, Oppsal, Tveita, Ammerud, Romsås and Holmlia.

To date, OBOS has built more than 100,000 homes.

Today, OBOS is Norway’s biggest housing association with subsidiaries in Tønsberg, Hamar, Fredrikstad, Bergen, Trondheim and Stavanger – in addition to Oslo – and its ambition is further growth.

The acquisition of Block Watne is an important part of the growth strategy.

- Our members come from all levels of society, from thin wallets to thick wallets. We are often asked why OBOS also builds expensive housing. Why should we leave that to others? There must be room for people from every strata of the population at OBOS, therefore we supply all types of housing, from villas in the country to high-end flats in Majorstua.

URBAN PERSON. Siraj moved to Oslo in 1995 and rented a bedsit in St. Hanshaugen. Since then, he has lived in many different places in the city, ie. Høybråten, Holmlia and Grünerløkka.

- Oslo has seen a tremendous growth. While studying, I lived with friends where Anker Student Accommodation now lies, and in the 1990s that was a slum area. When I see how nice the area now is, I am reminded of how much Oslo has changed, he says and adds: - There has been a lot of changes along the Oslo fjord as well, but I never used to go there, so I am so not concerned with the development there. I am an urban person who stays mostly in the city centre.

BIG DIFFERENCES. He thinks Oslo is a good city to live in, a city that can

accommodate many stages of life.

- I find that people in Oslo are generally quite open, it is easy to strike up a conversation with people in various social arenas. Most of Oslo’s inhabitants have moved here, thus there are few fixed social structures.

Another positive factor is that you can live within short distances, says Siraj, who lives within walking distance from his workplace.

- What I don’t like about Oslo is the great social differences. Many people fall outside of the community. There are social differences not only between the different districts but also within the districts, for instance in Grünerløkka where we live. There are people who cannot afford to send their children to SFO or to have them take part in other

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social contexts, and the differences do not seem to get smaller, he says.

- As soccer coach for the youngest kids in Grünerløkka, I am being put in my place. When you meet the boys, who are so nice and easy to get along with but who don’t have equal economic possibilities, it does something to you as a person.

DOES NOT BELIEVE IN A MARKET CRASH. Falling oil prices will mean

We are often asked why OBOS also builds expensive housing. But why should we leave that to others?

tough times ahead for a lot of people. Siraj, however, does not believe there will be a housing market crash.

- A crash has been predicted for a long time. We might, of course, see a downturn but I don’t think it will be very dramatic. Housing is in great demand in Norway and there is a lack of new dwellings in many towns, including Oslo. The interest rate is record low and the unemployment is under control. Moreover, the banking industry and financial services industry are very well regulated with strict requirements regarding advance sales. Thus, we avoid projects that are not sustainable, he says.

A downturn and falling house prices are not altogether negative for OBOS as it enables OBOS to make good bargains. Siraj points out that OBOS invested in its first project in Fornebu in the wake of the financial crisis.

CONCENTRATING ON FORNEBU. OBOS has stood for almost half of the

housing production in the municipality of Bærum over the last three years. Fornebu is the only place in Bærum where a considerable growth is expected in the future and will therefore be important for the house price structure in the municipality, he says.

Siraj finds the process in connection with the building of an underground line to Fornebu fascinating. He would like the process to be speedier, but given his political background he understands that it will take time.

- The Fornebu line will mean a lot to those who live there and even more so to those who work there. The underground will create a totally different proximity to the city of Oslo, he says.

Housing in Fornebu is in great demand and he therefore hopes that more housing will be planned, both on private land and on public land.

BETTER FOR YOUNG PEOPLE. Siraj considers it a great victory that the government has relaxed the building requirements. He understands why the politicians decided to exempt half of the flats of less than 50 square metres from the accessibility requirement. In the long term, this will make housing cheaper for young people.

- If young people can pay €24.000 to 35,000 less for a flat, it will be easier for them to get a foot in the housing market. We will implement the changes as quickly as possible but it will take some time, he says.

- What are your thoughts on housing tax?

- I am generally sceptical to increased housing tax being what it takes to save AS Norway. Housing tax is not a very targeted tax, it hits indiscriminately. It will be a city tax.

TO THE TOP. Not many people get the opportunity to see Oslo from

this angle in Hammersborg, where OBOS has its head office. The Oslo fjord blinks down below in the sun whereas the areas surrounding the city are desperate for snow. From here, you can look down on most of

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ADVOKATENES INNTOG: - Det er riktig at advokater får flere oppdrag innenfor næringseiendom, men ofte er disse oppdragene initiert av næringsmeglerne, mener Aslaksen.

VALUES: Siraj grew up in Moi in the county of Rogaland. - Moi is a typical industrial centre and farming community founded on hard work and humility. It has given me a set of good values.

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EIGHT QUICK ONES - What was your first job?

- It was a summer job at Moen Bjøllefabrikk where I helped make the sheep bells used at the Olympic Games in Lillehammer. I mounted the thing inside which makes the sound.

- Your first property?

I bought a third of an USBL flat at Holmlia in Oslo together with two friends. We could not afford one each so we pooled our resources.

- What do you listen to?

- My wife is somewhat embarrassed about it but I am very fond of country music. It has been my secret until now.

- What do you read?

- Mostly historical novels of different kinds, as well as newspapers on tablet.

- What do you do in your spare time?

- I spend a lot of time with my children and I coach the youngest boys of Grüner Fotball in soccer. I also workout in the gym at OBOS. - What annoys you?

- I am rather impatient and can therefore get annoyed if things go too slow or when I feel I am being worked against without understanding why.

- What makes you happy?

- A pling on the telephone announcing a house sale, laughing children and my wife when I come home from work. And, of course, when Manchester United is winning.

- What is your verdict on the current government so far?

- It has to some extent delivered in our field but there is a lot more to be done before we are satisfied. If nothing else, it has become easier to build homes.

VICTORY: Siraj considers it a great victory that the government has relaxed the building requirements. – If young people can pay 200,000 to 300,000 NOK less for a flat it will be easier for them to get a foot in the housing market, he says.

the buildings in the capital.

- The drop is steep at OBOS, says the deputy group CEO as he, when instructed by the photographer, moves closer to the roof edge of the 11-story building.

DONE WITH POLITICS. It is already several years since Siraj gave up politics. He has been approached about various offices but has been consistent in refusing. He is not very keen on making a comeback on the political scene.

- No, I am too impatient for that. Being a politician is a thankless existence. If you add up the number of working hours, the strain on the family, the pay and the thanks you get later, there isn’t a lot of credit left

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in the bank, says Siraj.

- OBOS is engaged in residential building, commercial property, accountancy, estate agency business, management, broking and banking. If you don’t start an airline, you might perhaps form a political party?

- We would at least have had one representative in the Oslo City Council and if so, residential construction would be one of our most important issues.

ESTATE MAGASIN | N°1 2015

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ARCHITECTURE

«The highest form of beauty is timeless» - It is a fascinating building which stands out, it cannot be copied, and though some have tried they were doomed to fail. It is simply being itself – quite unique, says Per Christian Brynildsen.

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ESTATE MAGASIN | N°6 2013

Cacsa Malaparte ble tegnet rundt 1937. Forfatteren Cuzio Malaparte fikk hjelp av en lokal steinhugger til ü skape sitt drømmehus.

ARCHITECTURE

A ARCHITECTURE Silje Rønne silje@estatemedia.no

The architect does not remember when he first heard about Casa Malaparte. Probably while studying, perhaps at a lecture or in a magazine 30 years ago. The red “brick box” with its reverse pyramid staircase leading to the roof terrace made an impression on him.

A strange building he says, but one of the world’s most beautiful.

- It is a classic among connoisseurs and I am not even sure everyone in our office knows about it, says Per Christian Brynildsen, civil architect MNAL and partner of Ratio Arkitekter.

The villa spreads out along the top of a cliff, 32 metres above the sea, in Punta Massullo in the eastern part of the Isle of Capri in Italy. It is a good example of modern Italian architecture. Casa Malaparte’s interior and exterior, especially the roof terrace, are prominent features in Jean-Luc Godard’s film from 1936, Contempt (Le Mépris). The house was built for and by the author Curzio Malaparte who is said to have been an audacious man who fell out with Mussolini in 1933. Rumours have it that he got the Italian architect Adalberto Libera to design the villa before throwing the drawings away and making his own version.

- The story of who designed it is somewhat unclear. He probably received help from a local architect, at first simply to get the building application approved, but the drawings look quite different, he says and points at a picture in an Italian book about the house.

- Perhaps he processed the design together with the architect during construction. I would therefore say that the house is independent, Brynildsen continues. The house is today owned by the author’s heirs and is closed to the public.

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A HES JOKE Seven years ago, in the summer, the architect visits the Isle of Capri. It is morning, the sun is shining and Brynildsen is expectant. He shall finally see the villa up close. Casa Malaparte is very inaccessible, it can only be reached by boat or on foot. The architect decides on the latter. It is a long walk among bays and headlands before the house suddenly appears before him.

- You walk down a long path, and with each step the expectations grow. Finally, you stand before a barred gate where it says that entrance is forbidden. That was as close as I got.

Nobody lives there today. Whether it is used for receptions, conferences or dinner parties, the architect does not know for sure.

- The house is fascinating in every way. It has a simple shape. It seems, however, as if it has simply been placed on the ground and followed the outline of the rock in a very easily understood way, without in any way ruining the cliffs or the surrounding nature. It is pure and at the same time, it has elements distinguishing it from being a regular box, he explains.

From an architectural point of view, the staircase is peculiar. It is narrow at the bottom and widens to cover the entire width of the house. The windbreak on the roof is also not a familiar motif in architecture, according to Brynildsen.

- There are no balustrades on the roof terrace; no safety or comfort measures.

Only a platform and the strange windbreak in the shape of a curved stone wall. I have seen a picture of the person who lived there, on a bike, cycling on the roof. At the end of the terrace, there are two classic chairs, he explains.

The architect can also reveal that the author Curzio Malaparte was well known for his social events, and that several contemporary celebrities visited this beautiful place.

- Perhaps it is the arrogant, or rather the superior attitude to convention and HES 1, that makes the building so unique.

Curzio Malaparte named the villa «Casa como me», «The house like myself». He describes himself as eccentric, difficult and unapproachable, just like the house. The architect thinks that just to get permission to build it must have been challenging, even in Italy in the 1920s and 1930s, when it was built.

ESTATE MAGASIN | N°1 2015

– Like art, architecture does not have to be ultimately explained. You either feel that it is good, it speaks to you – or it doesn’t. A good idea is often a mixture of intuition, experience and perhaps also chance – it cannot be copied. Things simply fall into place and that is nice.

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Health, Environment and Safety

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ARCHITECTURE

The house is inaccessible. You can reach it by foot or by boat. If you arrive by boat, you will have to walk 99 steps to the top.

- The villa is like the first Porsche models, a car in «stasis» or in balance, which cannot be improved or copied. It has of course developed over the years but the actual Porsche idea – a rear engine and terrible backseats – that’s how it is, and that’s that. It is more or less the same with Casa Malaparte – that’s the way it is, take it or leave it.

- We architects, mere mortals, might have considered the height of the windbreak, and the furnishings, but it is a sculptural element, which has a function but which also changes into something irrational. Not very sensible but elegant and poetic. The white colour and the curved shape contrast strongly with the rusty red.

The simple shape of the house influences the interior design also. Personally, the architect likes rooms which open up and intertwine, things lying behind and you can see through.

You will not find qualities like that in Casa Malaparte. The villa has straightforward rooms which are big and functional. The main room, or the sitting room if you like, offers a spectacular view at each corner and in addition, a generous fireplace. The office is the heart of the house, the only room with a 180-degree view and windows on three walls.

This was where the author sat and wrote. The architect thinks that the rooms are comple-

tely subordinate to the superior idea. None of the rooms are particularly exposed with large windows or balconies in the façade, they are basic and rectangular, a suitable frame around basic needs like eating, sleeping, washing and conversing. They are whitewashed and classical like all houses along the Mediterranean shores.

DOOMED TO FAIL - In Vienna, I have seen a building which is almost a copy, it is a red box with a sloping staircase at the end, leading to a roof terrace where you could get refreshments. It is located at a public transport junction and serves as a ticket office for busses etc. To us who know Casa Malaparte, it is obvious that they have copied it. They have in my opinion failed completely, it is terribly banal and silly. It is not architecture.

There are many reasons for Brynildsen being fascinated by the villa. The fact that Curzio Malaparte has only designed this house

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ARCHITECTURE

When travelling, Per Christian Brynildsen always carry paper and pencil. He prefers to sketch rather than take pictures of beautiful buildings.

NAME: PER CHRISTIAN BRYNILDSEN AGE: 54 YEARS • •

•

Position: Civil architect MNAL and partner at Ratio Arkitekter, former co-owner of Medplan.

Education: Degree in architecture from Arkitekthøgskolen in Oslo, diploma in 1986. He previously worked for Bergersen Gromholt og Ottar arkitekter 1986-89, Jon Kåre Schultz 1989-90 and Platou arkitekter 1990-91.

As a student he designed a leper hospital in India together with Jan Olav Jensen (Jensen & Skodvin).

Brynildsen is best known for having designed Stavanger Concert Hall.

AWARDS: • • • •

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Erskine Award 1991 Aga Khan Award 1998 Betongelementprisen 2012 Award for Practical Excellence in Design of Buildings for Performan

is one reason. Usually, architects design a number of buildings, enabling you to see their development, and sometimes they are successful and at other times they are not.

- “Casa Malaparte” is a somewhat strange name. “Mal” in Italian means bad. I don’t know the exact meaning of the name but it sounds like a bad or unfortunate match. It has a kind of gloomy and mysterious undertone.

Brynildsen believes that the house could fast become a tourist attraction if it was open to the public. It may not appeal to every tourist but architects would definitely flock to it.

- Not gaining access is part of the excitement. It is ok that inaccessible places exist.

It is a little like the Norwegian mountains.

It is a good thing that there are no motorways leading to the mountain tops, you have to make an effort. That makes it a little more exclusive.

That does not mean that he would say no to an overnight stay. The dream is to spend a whole day there, from sunrise to sunset.

- It would have been fun to stay there overnight, to bathe, to dive into the Mediterranean, to swim around and to go for a walk in the grounds – just to experience it.

The architectural process on the other hand is irrelevant. To him, the house is interesting as a completed building, without explanatiESTATE MAGASIN | N°1 2015

on, instructions, interpretation – it has to be experienced.

- Like art, architecture does not have to be ultimately explained. You either feel that it is good, it speaks to you – or it doesn’t. A good idea is often a mixture of intuition, experience and perhaps also chance – it cannot be copied. Things simply fall into place and that is nice.

THE PORSCHE OF ARCHITECTURE - The villa is

like the first Porsche models, a car in «stasis» or in balance, which cannot be improved or copied. It has of course developed over the years but the actual Porsche idea – a rear engine and terrible backseats – that is how it is, and that’s that. It is more or less the same with Casa Malaparte – that’s the way it is, take it or leave it.

He compares it to meeting a person who makes an impression on you, not because he or she reminds you of someone but because the person is him- or herself and nobody else.

- I would say that the highest form of beauty is timeless. It is in itself a sign of quality if it lasts and survives the fashion trends. If you, as an architect, try to follow the fashion, the product will be outdated. It can take 3 – 5 years from initial design to completed building. If you copy something you see in an architectural magazine, you are already five years behind, Brynildsen concludes.

Experience the Oslopolitan way of life.

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ESTATE MAGASIN | N째1 2015

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ENVIRONMENT

Change of environmental pace In NCC’s opinion, the long awaited change of pace in environmental matters has now finally come true.

E ENVIRONMENT Torgeir Hågøy torgeir@estatemedia.no

- We see an increasing interest in buildings with a high environmental standard, and in 2014 we signed contracts to build several schools and other public buildings emphasising energy consumption and materials, says Terje Stachnick Hansen, head of communications at NCC Construction.

The company believes this is a trend that will be further strengthened in 2015.

- The same applies to the private market because tenants attach more and more importance to low energy cost and healthy indoor environment, says Hansen.

INCREASING DEMAND

According to NCC, an increasing number of customers have become aware of the advantages of homes with low energy cost and a good indoor climate. That also applies to tenants in office buildings, who

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see that modern and environmentally ambitious buildings contribute to recruiting and retaining the right employees.

A number of surveys show that a healthy indoor climate contributes to increased efficiency.

- We do not have any figures indicating how much the market for buildings with an environmental profile has grown in the last few years, but we see a marked increase in our assignment portfolio. It is our experience that most private clients in the Oslo area now demand Breeam standard or selected environmental qualities. A major reason for this is that both tenants and/ or subsequent property buyers demand environmental qualities, says Hansen.

- Contracts we have signed in all segments over the past year show that clients primarily want a “sharper” building than

DEMAND ENVIRONMENTAL QUALITIES: - It is our experience that most private clients in the Oslo area now demand Breeam standard or selected environmental qualities. A major reason for this is that both tenants and/or subsequent property buyers demand environmental qualities, says Terje Stachnick Hansen, head of communications at NNC Construction.

what the minimum requirements of the authorities demand, he adds.

SCHOOLS BECOME PASSIVE BUILDINGS

At NCC, they have now elevated the question of sustainability to group level and NCC’s sustainability manager is member of the group management. According to the company’s vision, their aim is “to renew our industry and provide superior sustainable solutions”.

- Projects developed by NCC have a high environmental profile. For years, our requirements to our own projects have been stricter than the minimum requirements laid down by the authorities. Today, we develop and build Norway’s first ever Swan-labelled f lats, and the office projects we develop and build have always ambitious standards, for instance in relation

to Breeam certification, says Hansen.

He says that in their experience, the public authorities focus more on passive building standard than on Breeam standard in larger parts of the country.

- Schools are concrete examples of the public authorities to a greater degree demanding eco-buildings. Today, NCC is building Ulsmåg School in Bergen, 90 per cent of it being in wood, together with Hegg School in Buskerud and Ris School in Oslo. The last two are to be built to passive building standard, says Hansen.

tenant and a more conscious and committed attitude to the properties they rent would have a very positive environmental effect.

- To give you an example, our new head office in Østensjøveien 27 consumes around half of the energy of an average Norwegian office building of the same size, says Hansen.

BIG UPSIDE

There is a significant upside in relation to energy and environment if the public authorities, state and local authorities, demand more eco-buildings. Nationally, the public authorities are a considerable

ESTATE MAGASIN | N°1 2015

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LAW

Incorporation of AIFMD in Norway The AIFMD was implemented into Norwegian legislation by the Alternative Investment Fund Act of 20 June 2014 ("AIF Act") and regulations of 26 June 2014 ("AIF Regulation"). Per 1 January 2015 all market participants governed by the AIF Act must comply with the new regime.

GREAT IMPACT: The AIFMD regime will impact on the management, administration and marketing of alternative investment funds.

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ESTATE MAGASIN | N째1 2015

the AIFMD regime in this article REAL ESTATE FUNDS GOVERNED BY THE NORWEGIAN AIF REGIME

J LAW Camilla Wollan Anders Bergene Magnus Løvlien Lutnæs

The AIFMD regime will impact on the management, administration and marketing of alternative investment funds ("AIFs"). Alternative investment funds are collective investment schemes not subject to the UCITS regime, typically hedge funds, private equity and real estate funds. These funds have been operated in a regulatory void outside the scope of European regulators and the AIFMD is the first single market framework for this sector. The benefit of the AIFMD for the market participants is the opportunity to passport their services throughout the EU based on a single authorization. The AIF managers can also easily market their funds towards professional investors in line with the notification procedure across EU/EEA. Smaller AIF managers whose assets under management amount to less than EUR 500 million (for unleveraged funds with long lock-in periods) or EUR 100 million for other types of AIFs will be subject to a tailored regime. These AIF managers will only be required to register with the national regulator and to comply with certain reporting obligations. The sub-threshold AIF managers will not be entitled to passport their services or market their AIFs in other EU member states. We will only focus on the AIF managers fully authorized according to

Organisation and ownership structure in Norwegian real estate companies and funds varies. We have a few listed real estate companies, but mainly privately owned entities usually organised as private limited liability companies, limited partnerships or internal partnerships. The Norwegian state, insurance companies and pension funds are also large-scale direct owners of real estate.

With respect to real estate funds there are approx. 25- 30 fund providers in the Norwegian market, however, some of the Norwegian fund providers are in process of closing their real estate funds.

In the Norwegian incorporation of the directive, there is no statutory exemptions for the real estate companies and funds, nor a public view of the Norwegian regulator to that effect. It is up to each real estate company or fund to assess whether they are encompassed by the area of application of the AIF Act. An analysis of the undertaking must be performed based on the structure, ownership, business purpose, governance structure, corporate documents and irrespective of type of undertaking.

Usually a real estate company holds a general commercial purpose and strategy (i.e. not a defined investment policy) and its management is involved in the day-today management through actively operated property portfolios, acquiring real estate, developing property projects and managing tenancy relationships, which would points it away from being an AIF. According to the Norwegian Financial Supervisory Authority ("FSA"), the number of Norwegian applications for AIFM authorisation are about 35, of which 13 relates to securities asset management undertakings.

Camilla Wollan, Anders Bergene and Magnus Løvlien Lutnæs are partners in DLA Piper Norway DA.

MARKETING OF REAL ESTATE AIFS IN NORWAY

With respect to marketing of units (direct and indirect offering or placement) in AIFs, the AIFMD differs between marketing to professional investors and to non-professional investors.

The directive does not comprise regulation on marketing of units in AIFs towards non-professional investors. Each member

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state is entitled to set its own regime. Under Norwegian law it is not permitted to market units in AIFs to non-professional investors without obtaining a prior marketing permit from FSA to do so. The AIFMD regime applicable for marketing activities to professional clients is less stringent and it is based on a notification procedure.

A non-professional investor means any investor not considered as a professional client or may upon request be treated as such. A professional client meets two of the following tree criteria: a total balance sheet of EUR 20 million, turnover EUR 40 million or own capital EUR 2 million.

MARKETING OF REAL ESTATE EU AIFS TO PROFESSIONALS IN NORWAY

Marketing of units in real estate AIFs established within the EU to professional investors in Norway shall be notified in line with the article 32 of AIFMD and according to the AIF Act section 6-3.

The AIF manager shall submit a notification to the competent authority of its home state. The competent authority shall no later than 20 days after receipt of the complete notification file to the FSA if the AIF is intended to be marketed in Norway.

The AIF manager is entitled to start marketing the units in Norway as soon as it has received notification from the home state authority that the marketing notification has been filed.

The requirements set out for the notification follow home state regulation. We refer to the AIFMD requirement and Annex IV setting out the documentation and information to be provided in case of intended marketing in EU member states other than the home state of the AIF.

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MARKETING OF REAL ESTATE EU AIFS TO NON-PROFESSIONAL INVESTORS IN NORWAY

In Norway a AIF manager is allowed to market units of an EU AIF towards non-professional investors subject to a marketing permit from the FSA. The application for a permit to market an AIF to non-professional investors shall comprise inter alia the key investor document and describe the arrangements made for the marketing of the AIF, including measures taken to ensure that the marketing to non-professional investors shall occur in accordance with applicable conduct of business rules and include a statement that the AIF is permitted to be marketed to non-professional clients in their home state by the competent authority.

A key investor information document shall be prepared for each AIF. The information shall be presented in a way that it is easily understood, clear and not misleading and forms the basis of an informed investment decision. The key investor information document shall be made available on the AIFM's homepage. The information to non-professional investors shall be provided in the Norwegian language, unless there is an exemption from this in the AIF Regulation or a dispensation has been granted.

If the AIFM is required to publish a prospectus according to the Norwegian Securities Trading Act chapter 7, only such information not contained in the prospectus needs to be disclosed separately or as additional information in the prospectus.

The FSA shall be informed by the manager in advance about any material change to the information provided in the marketing application. In the event the FSA

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is of the opinion that the change is not in line with the applicable legislation, then the AIF manager shall be informed. The FSA has the power to stop the implementation of a change, or take other measures to stop the marketing of the AIF. The FSA may also impose additional requirements on the AIF manager when issuing the marketing permit to safeguard the protection of Norwegian investors.

WITHDRAWAL OF MARKETING PERMIT

The FSA may revoke an authorisation to market an AIF, if the requirements set out in the legislation are no longer met, the conditions for the permit are violated.. The FSA may, in special cases, revoke a permit for the sake of protecting non-professional investors.

WHO CAN BE THE DISTRIBUTORS OF THE UNITS IN AN AIF

The units of an AIF can be marketed by a manager with an AIFM authorisation, or an asset manager with an authorization according to the Norwegian Securities Fund Act section 2-1. Other regulated entities may also be entitled to market units in an AIF in cooperation with the manager. It does not follow from the AIF Act who can be distri042

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butors of units in an AIF save for the AIF manager and asset manager and applicable legislation must be interpreted in each case.

MARKETING OF REAL ESTATE NON-EU AIFS ESTABLISHED OUTSIDE EU/EEA

The Norwegian legislator has allowed managers of non-EU AIFs to market AIFs to Norwegian professional investors, however, it is conditioned upon a marketing license issued by the FSA. FSA has entered into MoUs with other foreign supervisory authorities to cater for marketing of non-EU AIFs in Norway and supervisory cooperation in place is one of the terms for marketing.

Det er til tider hektisk og intenst ……

Nils Røang, RED Gruppen AS

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Nils Røang, RED Gruppen AS

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