Castellum AB (publ)

Aggressive capital return via buybacks (SEK 8bn authorization; already SEK 7.66bn spent) - Company announced an additional share buyback up to SEK 8bn, dependent on share price vs. EPRA/NAV discount and market conditions. - Already bought back SEK 7.66bn in Jan–Sep, ~62m shares; buybacks expected to continue into 2026/early 2027. - Key intent: allocate capital where returns are best—they won’t reinvest in properties if current property-market returns aren’t compelling, and buybacks are a preferred route while the discount exists. - No set “automatic” cap given by NAV discount alone; they use a return-on-capital framework plus balance-sheet/policy constraints.

Transaction-heavy portfolio reset (“back to basics” + fewer regions) - Signed/divested ~SEK 25bn of assets YTD, including major deals: - AP7: SEK 5.6bn (signed Feb; closed Sept 1). - Alecta: SEK 5.0bn office (signed June; closed Sept 1 / closed during period; Q3 impact). - Skåne assets to Wihlborgs: SEK 13.3bn (signed June; closed Oct 1). - Additional smaller divestments incl. Linköping & Umeå (value SEK 24.6bn total, slightly above prior quarter fair value). - Impact: Wihlborgs assets still shown as “held for sale” in the balance sheet as of the report, though economics move from Oct 1. - Operational cost program: reorganized from 4 regions to 2 with goal to reduce administration costs by ~15% (~SEK 100m).

Performance challenge: negative net leasing is the core headwind (not “just” market pricing) - Net leasing YTD: +SEK 105m including whole portfolio, but excluding projects/like-for-like: -SEK 63m. - Management explicitly says: as long as like-for-like net leasing (ex-projects) stays negative, like-for-like income growth and occupancy progress will be hard. - Occupancy deterioration: from ~94% (best in 2022) to ~87% now. - Q3 like-for-like lease level pressures: - Vacancy dominates—even where average rents improve slightly, vacancy outweighs. - Like-for-like in-place rents: -1.4% (12 months). - Rental income (like-for-like): -1.7% - NOI (like-for-like): -3.6% (also affected by slightly higher costs, plus colder winter this year vs last).