Fabege AB Unsponsored ADR

Solid Q3 earnings + improving property values (good) - Net lettings: +SEK 55m in Q3; rental income: SEK 2.7bn (+~4% vs Q2). - Occupancy: 87% (flat vs Q2). - Profit drivers: Residential development NOI (Q3): +SEK 112m; profit from residential development YTD: +SEK 112m (as stated) and property management profit +~11% YoY to SEK 1.166bn. - Valuation uplift: +SEK 259m in the quarter; portfolio yield ~4.55% (down 4 bps vs year-end). - Q3 profit before tax: SEK ~1.4bn; profit after tax: ~SEK 1.2bn (tax benefits included).

Leasing momentum is positive, but vacancy reduction remains the #1 task (good + challenge) - New leasing: +SEK 93m, terminations: -SEK 38m; overall net impact +SEK 55m. - Renegotiations: SEK 90m in Q3 (+~3% on renegotiated rents to SEK 60.4m); YTD renegotiated volume SEK 320m (slightly -0.6% YoY). - Management guidance style (not “formal guidance”): rental development shown is already in the book; they aim to accelerate leasing and reduce vacancy going forward. - They reported “nice kickoff” for Q4 and expect a better run-rate from signed projects.

Clear forward impact schedule for big projects (important forecast detail / surprising mechanics) - DNB Carnegie: full effect expected in Q4 2026 (and impacts are reflected in leasing/rent timing). - Mimer: partly in Q3 2026, full effect in Q4 2026 (phasing due to renovation of phase 2). - Wenner-Gren Center: cited as kicking in from Q4 2027 with full effect; they expect rental levels to exceed expectations, but stated leasing timing depends on tenant decision cycles during refurbishment. - One-off Q4 dip/IFRS/rent effects (negative/surprising): management highlighted Q4 discount/IFRS-type timing related to rebated components and refurbishment/tenant operations.