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Fast. Balder

Annual Report Apr 16, 2014

2887_10-k_2014-04-16_cedcac0e-29f1-498c-b305-ddb0ed376650.pdf

Annual Report

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Contents

  • 1 Overview
  • 2 Comments by the CEO
  • 4 Comments by the
  • Chairman of the Board
  • 5 Multi-year summary
  • 6 Balder's development
  • 8 Business concept
  • 10 Current earning capacity 11 The share and owners
  • 14 Our customers
  • 16 Organisation
  • and employees 18 Corporate sustainability
  • 20 A property's history
  • 22 The property market
  • 25 The Danish property market
  • 26 Balder's real estate portfolio
  • 28 Residential properties
  • 30 Commercial properties
  • 32 Transactions
  • 34 Property and project development

36 Real estate valuation

39 Financing

  • 42 Opportunities and risks
  • 46 Associated companies

Financial reporting

  • 49 Report of the Board of Directors
  • Consolidated statement of
  • 54 Comprehensive income
  • 55 Financial position
  • 56 Changes in equity
  • 57 Cash flows
  • Parent Company
  • 58 Income statement
  • 59 Balance sheet
  • 60 Changes in equity 61 Cash flow statement
  • 62 Notes
  • 82 Audit report
  • 83 Corporate Governance
  • 88 Board of Directors
  • 89 Management and Auditors
  • 90 Property list
  • 97 Definitions and calendar

Annual General Meeting

The Annual General Meeting of Fastighets AB Balder (publ) will take place on 7 May 2014 at 2.00 p.m. at Restaurang Palace, Södra Hamngatan 2 in Gothenburg.

Shareholders who wish to participate in the Annual General Meeting must be registered in the share register maintained by Euroclear Sweden AB on Wednesday, 30 April 2014, and must give notice of their attendance to the company either by letter to Fastighets AB Balder, Box 53 121, 400 15 Gothenburg, or by telephone +46 31 10 95 70, by fax +46 31 10 95 99 or by email to [email protected]. The company provides a power of attorney form on its website www.balder.se for shareholders who wish to be represented by proxy. The notification must be received by Balder no later than 5 May 2014 at 4.00 p.m.

Notification must include the shareholder's name, Swedish personal identity number or corporate identity number, address, telephone number and the registered shareholding. Shareholders who are represented by proxy must submit a written and dated power of attorney, which may not be more than five years old on the date of the Annual General Meeting. A proxy who is representing a legal entity must submit a certificate of registration or corresponding legitimacy papers showing authorised signatories. Shareholders whose shares are held through nominees must arrange for temporary registration of the shares in their own name in order to have the right to participate in the Meeting. Such registration must be completed at Euroclear Sweden AB by Wednesday, 30 April 2014.

Cover picture: Radisson Blu Riverside Hotel, Lindholmen 39:2, Gothenburg

Kvasten 8, Stockholm

Fastighets AB Balder is a listed property company which shall meet the needs of different customer groups for premises and housing based on local support. Balder's real estate holdings were valued at SEK 27.5 billion (22.3) on 31 December 2013. The Balder share is listed on NASDAQ OMX Stockholm, Mid Cap.

Balder overview

1) Associated companies are included in the overall profit from property management for Balder but not as regards real estate value or lettable area.

Comments by the CEO

Our associated companies performed really strongly and the trend continues to feel positive for associated companies and for all of Balder's operations.

ear shareholder, 2013 was a year in which we followed our trend and overall long-term goal of increasing our profit from property management. Profit from property management per ordinary share also improved by more than 20 per cent this year. The increase during the year amounted to 23 per cent compared to 24 per cent during the previous year. D

There is a biting wind in the wind turbines

However, I have to state that our investment in wind turbines is not currently performing as well and we are recognising an impairment loss in addition to plan in the annual accounts of SEK 37m. The acquisitions were made at a time when the price level in the electricity market was higher than the market situation today.

Changes in value of interest rate derivatives

Compared to the previous year, comprehensive income increased relatively strongly due to changes in value in respect of interest rate derivatives. Even after the positive changes in value during the year, a deficit of almost SEK 500m remains, which will very likely be released over time. The effect for us at present is that we are stuck with higher financing costs than if we had by now carried out the same interest rate hedging.

Property transactions and project development

Our operations in Denmark have performed nicely during the year and we are ready to start the construction of apartments in Copenhagen. The property market in Copenhagen is still very attractive and we are continually evaluating further investment opportunities there. Apart from the above, we have also evaluated a number of possible transactions in Finland and Norway during the past couple of years.

We also see good opportunities to create new projects and development rights in several places within our existing portfolio. In the short-term, we have to plough funds into property development and development properties, but in the longer term I am completely convinced that such investments will deliver an important part of Balder's future profits. We are sowing the seeds now in order to reap the rewards later.

Outlook

The financing possibilities in the banking system are still good for the right objects. This possibility combined with our strong profit from property management even in 2013, as well as our cash holdings and unutilised credit facilities, creates a good basis for making further interesting acquisitions.

Our associated companies performed really strongly during 2013 and the trend for 2014 continues to feel positive for both associated companies and all of Balder's operations. By way of conclusion, I want to mention that Balder's Board of Directors has decided to adjust our goal for the equity/assets ratio from 30 to 35 per cent.

I and all the other "Balder people" look forward to a continued strong performance during 2014.

Erik Selin Chief Executive Officer "We are ready to start the construction of apartments in Copenhagen.

Comments by the Chairman of the Board

A sustainable society is an important perspective for a property company and is essential in order to compete for customers and to create value for shareholders.

" It is important to state that sustainability is more than just an environmental issue – it's also about taking social responsibility.

alder is a growing player in the property sector, where the duties of the Board of Directors include working on the company's long-term development, follow up of the management's operational activities and to assure order in the company. These duties also include advancing the company's efforts to help create a sustainable society. It is important to state that sustainability is more than just an environmental issue – it's also about taking social responsibility. B

Consideration of sustainability issues is essential in order to compete for customers and to create value for shareholders. Reduced energy use means lower costs and increased profitability. Investments in renewable energy in the form of geothermal heating and wind power demonstrate our willingness to contribute to reducing carbon dioxide emissions. Creating healthy indoor environments is important for people's health and well-being both in residential properties and at workplaces. The objective must be to look after and consider external requirements and expectations, to identify business opportunities and savings, which are linked to environmental issues and to maintain reliable communication with customers, owners and other stakeholders. As part of the next step, Balder will now recruit an energy manager for the Group.

Balder has the ambition to also contribute solutions aimed at improving the property portfolio. In connection with taking over run-down residential areas, we have made investments in renovations and repairs, which have had a reasonable impact on the tenant's rent. In such contexts, it is also important to include accessibility considerations and make it possible/easier for families with small children as well as for the elderly to access properties and move within the area.

The company is trying to take its social responsibility in different ways by providing comfort and security in its residential areas. In certain run-down areas, extensive renovations and long-term investments are required in order to reverse negative trends, reduce vandalism, provide security and to also build pride among residents in their area. As a property owner, Balder must emphasise that it is a longterm owner, which is prepared to take the necessary measures. Vårby gård is a good example of such an ongoing commitment.

Christina Rogestam, Chairman of the Board

Multi-year summary

2013 2012 2011 2010 2009 2008 2007 2006
Rental income, SEKm 1,884 1,701 1,466 1,333 854 633 678 524
Profit from property management
before tax, SEKm 854 691 516 417 315 174 179 160
Changes in value of properties, SEKm 854 812 990 1,047 4 –201 642 212
Changes in value of interest
rate derivatives, SEKm 433 –71 –520 148 –23 –333 7
Net profit for the year, SEKm 1,738 1,162 812 1,338 248 –388 785 441
Carrying amount of properties, SEKm 27,532 22,278 17,556 14,389 12,669 7,086 6,758 6,997
Data per ordinary share
Average number of shares, thousands 159,537 159,537 158,656 149,487 112,902 95,910 97,318 94,050
Net profit for the year, SEK 10.11 6.69 4.87 8.95 2.20 –4.04 8.07 4.69
Profit from property management
before tax, SEK 4.57 3.73 3.00 2.79 2.79 1.81 1.84 1.70
Outstanding number of shares,
thousands 159,537 159,537 159,537 149,487 149,487 94,458 97,318 97,318
Carrying amount of properties, SEK 172.58 139.64 110.04 96.25 84.75 75.02 69.44 71.90
Shareholders' equity, SEK 52.14 42.15 35.57 31.13 22.19 19.63 23.49 15.42
Net asset value (EPRA NAV), SEK 60.50 50.37 41.84 32.89 22.16 20.95 22.33 13.06
Share price on the closing date, SEK 66.00 37.30 25.30 29.40 12.50 7.00 13.33 17.00
Dividend, SEK 0.17
Property-related
Rental value full-year, SEK/sq.m. 1,216 1,247 1,163 1,087 1,072 1,298 1,193 952
Rental income full-year, SEK/sq.m. 1,148 1,166 1,088 1,016 1,002 1,218 1,107 859
Economic occupancy rate, % 94 94 94 94 94 94 93 90
Surplus ratio, % 68 68 68 66 69 70 70 69
Carrying amount, SEK/sq.m. 13,985 14,439 12,467 10,887 10,053 12,805 12,275 8,854
Number of properties 498 432 433 432 419 122 121 128
Lettable area, sq.m. thousands 1,969 1,543 1,408 1,322 1,260 553 551 790
Financial
Return on equity, % 21.5 17.0 14.3 33.6 9.6 –18.7 41.5 37.5
Interest coverage ratio, multiple 2.9 2.4 2.1 2.1 2.1 1.6 1.7 2.0
Equity/assets ratio, % 37.3 34.8 35.2 30.9 24.1 23.3 30.1 20.6
Loan-to-value ratio properties, % 57.0 60.4 60.6 64.6 73.3 72.2 74.6 79.5
Loan-to-value ratio, % 55.0 57.8 56.9 63.9 69.0 69.4 69.2 76.4

Balder's development

2005

Fastighets AB Balder is formed in June from the listed company Enlight AB. The name Enlight AB is subsequently changed to Fastighets AB Balder. Balder acquires 21 properties during the year. 1)

2006

Fastighets AB Balder is re-listed on the Stockholm Stock Exchange. Balder's organisation is built up in Stockholm, Gothenburg and Malmö. On 31 December, Balder owns 128 properties with a lettable area of 790,000 sq.m. and a carrying amount of SEK 7.0 billion.

Profit from property management Profit from property management before tax SEKm

2007

Balder refines its real estate holdings through the sale of 29 industrial and warehouse properties to Corem Property Group AB, where Balder becomes a major owner and Corem becomes an associated company. Acquisition of properties takes place in Stockholm through the associated companies Tulia AB and Akroterion Fastighets AB.

2008

Balder restructures during the year of the financial crisis and the company acquires ten properties and divests nine during the year. The associated companies' profit from property management amounts to SEK 157m (13). The strong improvement in earnings is because 2008 is the first full financial year for the company's three associated companies, at that time.

Equity/assets ratio Equity/assets ratio

1) Since the Group started its operations on 1 July 2005, the comparative period for 2005 only covers 6 months.

2009

At the end of June, a takeover bid to the shareholders of Din Bostad Sverige AB was announced, where they were invited to transfer all shares issued by Din Bostad to Balder in exchange for shares in Balder. Balder focuses on renewable energy during the year, by investing in six wind turbines.

2010

During the year, acquisition of 31 properties and divestment of 18 properties takes place. The number of shareholders increases by more than 50 per cent during the year and amounts to approximately 4,900 at year-end. On 31 December, Balder owns 432 properties with a lettable area of 1,322,000 sq.m. and a carrying amount of SEK 14.4 billion.

2011

The new class of shares, preference shares is issued. The issue amounts to SEK 1 billion. Balder acquires 25 retail properties from Catena AB, which are sold to a newly established associated company with PEAB. During the year, the number of shareholders increases by 67 per cent and amounts to 8,200 at year-end.

2012

During the year, acquisition of 14 properties and divestment of 6 properties takes place. Balder acquires residential properties in central Copenhagen, including a block of 523 condominiums built in 1995, situated in the Österbro district, an attractive residential area in central Copenhagen. 75 condominiums are acquired in Örestad, which were built in 2009. Two million preference shares are issued at a value of SEK 565m.

2013

In November, Balder acquires Bovista Invest AB, a transaction involving 4,300 apartments and a total area of 370,000 sq.m. at a value of approximately SEK 2 billion. A directed new issue of 3,500,000 preference shares was carried out in connection with Bovista transaction, which increased shareholders' equity by SEK 1,138m. During the fourth quarter, a turnkey agreement on construction of approximately 200 condominiums in Örestad in Copenhagen was signed for a value upon completion of approximately SEK 400m.

Rental income Rental income

Shareholders' equity

Shareholder's equity

2005 2006 2007 2008 2009 2010 2011 2012 2013

Share price

SEK

2005 2006 2007 2008 2009 2010 2011 2012 2013

SEK

Loan-to-value ratio Surplus ratio

Stock price per ordinary share

Lettable area Lettable area, sq.m. thousands

Business concept

Balder shall, acquire, exploit and manage residential properties and commercial properties located in places that are growing and developing positively, based on local support.

At the top from the left Interior view Rosen 9, Malmö Säby 3:29, Järfälla Close-up Rosen 9, Malmö

Overall goals

Balder's operations are focused on growth, positive cash flows and increased profit from property management. Balder should achieve a position in each region whereby the company is a natural partner for potential customers.

Financial goals

Balder's goal is to achieve a stable and good return on equity, while the equity/assets ratio over time should not be less than 35 per cent and the interest coverage ratio should not be less than 1.5 times.

Operating goals

The company establishes quantitative and qualitative operating goals based on Balder's strategy, overall goals and financial policy. Both short-term and long-term goals are set. The goals relate to financial targets as well as environmental, energy consumption and customer/employee satisfaction goals.

Dividend policy

Since Balder will prioritise growth, capital structure and liquidity during the next few years, the dividend for the ordinary share will be low or may not be declared at all. The dividend for the preference share amounts to SEK 20.00 per year.

Strategy

Balder creates value for the owners, customers, employees and the community.

Balder accomplishes this by:

  • meeting and taking care of our customers,
  • having short decision-making procedures,
  • carefully choosing cost effective management solutions,

• maintaining a high level of activity in management and transactions both internally as well as in partnership.

Balder creates value by acquiring, developing and managing residential properties and commercial properties based on local support and creates customer value by meeting the needs of different customer groups for premises and housing. The company works actively to acquire properties with development potential and to generate growth by investing and developing as well as streamlining and improving the efficiency of property management. Balder should be a long-term owner that bases its operations on stable cash flows and satisfied customers.

The focus is on continuing to be an active participant in the property market, both under own management and in partnership, in locations that are growing and developing positively.

Current earning capacity

The earning capacity is based on the real estate portfolio's contracted rental income, estimated property costs during a normal year as well as administrative costs.

alder presents its current earning capacity on a twelve-month basis in the table below. It is important to note that the current earning capacity should not be placed on a par with a forecast for the coming 12 months. For instance, the earning capacity contains no estimate of rental, vacancy and interest rate developments or changes in exchange rates. Balder's income statement is also impacted by changes in value in the company's real estate portfolio as well as future property acquisitions and/or property divestments. Additional items affecting the operating result are changes in value of financial investments and derivatives. None of the above has been considered in the current earning capacity. B

The earning capacity is based on the real estate portfolio's contracted rental income, estimated property costs during a normal year as well as administrative costs.

The costs of the interest-bearing liabilities are based on the Group's average interest rate level including the effect of interest rate derivatives. The tax is calculated using the effective tax rate during each period and is estimated to largely consist of deferred tax and thus does not affect the cash flow.

Current earning capacity on a twelve-month basis

2013 2012 2011 2010 2009
Rental income 2,260 1,800 1,530 1,405 1,263
Property costs –735 –560 –465 –430 –382
Net operating income 1,525 1,240 1,065 975 881
Management and administrative expenses –165 –120 –105 –105 –93
Profit from property management from
associated companies 170 120 90 20 58
Operating profit 1,530 1,240 1,050 890 846
Net financial items –535 –495 –445 –440 –343
Profit from property management 995 745 605 450 503
Tax –219 –164 –159 –118 –132
Profit after tax 776 581 446 332 371
Profit after tax attributable to
Ordinary shareholders 576 461 366 332 371
Preference shareholders 200 120 80
Profit from property management
according to current earning capacity per
ordinary share, SEK
4.99 3.92 3.29 3.01 3.37

The share and owners

The profit from property management in the past seven years has increased by 29 percent on average. During the same period, the net asset value increased by 27 per cent on average.

alder has two different Classes of shares quoted on NASDAQ OMX Stockholm, Mid Cap; an ordinary Class B share and a preference share. The company's overall market capitalisation as of 31 December amounted to SEK 13,889m (7,800) and the company had 16,089 shareholders (12,476) at yearend. The principal owner in Fastighets AB Balder is Erik Selin Fastigheter AB, which owns 38.0 per cent of the capital and 51.3 per cent of the votes. On 31 December, the share capital in Balder amounted to SEK 172,396,852 distributed among 172,396,852 shares. Each share has a quota value of SEK 1.00, whereof 11,229,432 shares are of Class A, 151,167,420 of Class B and 10,00,000 preference shares. B

Of the B shares, 2,859,600 were repurchased as of 31 December, which means that the total number of outstanding shares amounts to 159,537,252 shares. Each Class A share carries one vote, and each Class B share and preference share carries one tenth of one vote. No repurchasing of shares took place during 2013.

Share price development 2006–2013

Balder's share price closed at SEK 66.00 on 30 December 2013, which corresponds to a percentage growth since 1 January 2006 of 377 per cent. This may be compared to EPRA's Property index for Sweden, which rose by 36 per cent during the same period (EPRA's Property index for European companies displayed a negative development during the same period).

  • Fastighets AB Balder
  • European Public Real Estate Association Sweden Index
  • Generalindex Stockholmsbörsen

Development of net asset value (EPRA NAV)

SEK/ordinary share

Share price/Net asset value

Price development of the ordinary share

The price of the ordinary share was SEK 66.00 (37.30) at year-end, corresponding to a rise of 77 per cent during the year. In 2013, the number of ordinary shareholders increased by 20 percent to 8,969 shareholders. During the same period, 56.7 million ordinary shares were traded, equivalent to 226,825 shares per trading day, which means that 36 per cent of the outstanding shares were traded. Excluding Erik Selin Fastigheter AB's shares, the annual turnover exceeded 60 per cent of the outstanding ordinary shares.

The proportion of foreign-owned shares increased by 35 per cent during the year and amounted to 17.6 per cent. Turnover in kronor increased by 40 per cent between 2012 and 2013 and turnover averaged SEK 11.4m per trading day.

Equity growth

Equity per ordinary share amounted to SEK 52.14 (42.15) on 31 December corresponding to an increase of 24 per cent. The net asset value per ordinary share (EPRA NAV) increased during the same period by 20 per cent to SEK 60.50 (50.37). The difference between shareholders' equity and net asset value is that in the net asset value figure, derivatives and the net of deferred tax and deferred tax assets are reversed.

The reason for the reversal is that the derivative liability is released and gradually reversed to equity, less deferred tax, during the remaining term. The net of deferred tax is reversed as company divestments are currently exempt from taxation, which means that deferred tax is reversed to equity when a company is sold. In the past seven years, the net asset value grew by an average of 27 per cent per year.

2013 2012 2011 2010 2009 2008 2007 2006 Performance of Balder's share Data per ordinary share 66.00 37.30 25.30 29.40 12.50 7.00 13.33 17.00 Share price at year-end, SEK 13,889 7,800 5,104 1,395 1,869 661 1,298 1,654 Market capitalisation, SEKm 4.57 3.73 3.00 2.79 2.79 1.81 1.84 1.70 Profit from property management, SEK 10.11 6.69 4.87 8.95 2.20 –4.04 8.07 4.69 Earnings, SEK 52.14 42.15 35.57 31.13 22.19 19.63 23.49 15.42 Shareholders' equity, SEK 60.50 50.37 41.83 32.89 22.16 20.95 22.33 13.06 Net asset value (EPRA NAV), SEK 77 47 –14 135 79 –46 –22 24 Total yield, % – – – – – 0.17 — – Dividend, SEK 162,397 162,397 162,397 152,347 152,347 97,318 97,318 97,318 Number outstanding, thousands 159,537 159,537 159,537 149,487 149,487 94,458 97,318 97,318 Data per preference share Share price at year-end, SEK 336.00 303.00 267.00 – – – – – Total yield, % 17 21 11 – – – – – Dividend, SEK 20.00 20.00 20.00 – – – – – Number registered, thousands 10,000 6,000 4,000 – – – – –

Performance of Balder's share

Profit from property management before tax amounted to SEK 854m (691), which corresponds to an increase of 24 per cent compared to the previous year. In the past seven years, profit from property management grew by an average of 29 per cent annually. The profit from property management per ordinary share increased by 23 per cent and during the past seven years it has increased by an average of 15 percent.

The price of the preference share was SEK 336 at year-end (303), corresponding to a total annual yield, including dividend, of 17.5 per cent. The number of shareholders amounted to 8,114 (5,900) and 3.1 million shares were traded during the year, equivalent to just over 12,200 shares per trading day, which corresponds to approximately SEK 4 million. The annual turnover in the preference share corresponds to 43 per cent of the total number of preference shares.

The preference share carries a preferential right over the ordinary share to an annual dividend of SEK 20, with quarterly dividend of SEK 5. Record days for the dividend are 10 January, 10 April, 10 July and 10 October. If the dividend on the preference share is not paid in time or for a lower amount, the difference shall be added to amounts unpaid, including interest of 14 per cent.

Dividend policy ordinary shareholders

The Board proposes to the Annual General Meeting that no dividend for the ordinary share should be declared for the 2013 financial year. Balder estimates that the best total yield for ordinary shareholders will be achieved by the dividend remaining low or not declaring a dividend at all in the next few years. Balder will instead continue to grow by investing in new acquisitions and in existing properties and projects.

Analysts following Balder

Albin Sandberg, Handelsbanken Erik Granström, Carnegie Fredrik Cyon, ABG Sundal Collier Johan Edberg, Pareto Jonas Andersson, Nordea Niclas Höglund, Swedbank Nicolas McBeath, SEB Peter Trigarzky, Danske Bank Tobias Kaj, Carnegie

Ownership list as of 31 December 2013

Owners A ordinary
shares
B ordinary
shares
Preference
shares
Total number
of shares
Capital,
%
Votes,
%
Selin, Erik via company 8,298,594 57,218,298 500 65,517,392 38.0 51.3
Arvid Svensson Invest AB 2,915,892 13,542,540 16,458,432 9.5 15.6
Länsförsäkringar fondförvaltning AB 8,962,312 8,962,312 5.2 3.3
Swedbank Robur fonder 7,477,069 7,477,069 4.3 2.7
JP Morgan Chase 6,207,551 6,207,551 3.6 2.3
Handelsbanken fonder 5,388,747 5,388,747 3.1 2.0
Lannebo fonder 3,500,000 3,500,000 2.0 1.3
Second Swedish National Pension Fund 3,231,001 3,231,001 1.9 1.2
SEB Investment Management 2,204,448 2,204,448 1.3 0.8
Rahi, Sharam via company 1,516,300 20,000 1,536,300 0.9 0.6
Other 14,946 39,059,554 9,979,500 49,054,000 28.5 18.0
Total outstanding shares 11,229,432 148,307,820 10,000,000 169,537,252 98.3 99.0
Repurchased own shares 2,859,600 2,859,600 1.7 1.0
Total registered shares 11,229,432 151,167,420 10,000,000 172,396,852 100,0 100,0

Our customers

Customer service is an extremely important function at Balder. Here the company takes the pulse of the operations on a daily basis and can detect internal and external shortcomings at an early stage.

B alder's ambition is to satisfy customer needs through good accessibility and high professionalism. The company mostly has its own employees who perform the work in and around the properties.

Management

Balder has its own management organisation, which enables fast decision-making procedures, proximity to the customer, good local knowledge and the possibility of working with property management on a long-term basis.

The company offers a large choice of premises and housing in different locations at various rental levels. The development of the properties takes place in consultation with customers, based on their needs and wishes. Balder's personnel regularly meet tenants in order to obtain a good view of the actual situation out in the properties.

Satisfied customers

Balder regular conducts customer surveys as part of its efforts to continually improve customer satisfaction. In late 2011, Balder conducted its first customer survey, where a large number of residential and commercial customers were asked to give their opinion about their residential property/premises, about Balder as a landlord, service, cleaning, security and the outdoor environment. The result from the latest survey showed that customers were much more satisfied with Balder as a property owner compared to the previous occasion. More than 90 percent were satisfied with their treatment by Balder personnel. Balder is continuing its purposeful work on improving contact with tenants, among other ways, by sending out more and clearer information.

Customer service

Customer service is an extremely important function at Balder. Here the company takes the pulse of the operations on a daily basis and can detect internal and external shortcomings at an early stage. The customer service function has daily contact with property managers and caretakers who are based locally and have direct contact with the customers.

With a temperature of 25 degrees Celsius in the water and air, it was time for the year's pool opening in Stoeryd, Tranås. The opening day was Saturday, 18 May and more than one hundred tenants came to sunbathe and swim during the day. The pool may be used by all Balder tenants, regardless of whether they live in Balder properties in Stoeryd or elsewhere in Tranås. The pool opening takes place in May and it closes sometime in September depending on the weather. Stoeryd is a unique residential area, which aside from the heated pool, offers tennis courts, a volleyball court, Tranås's largest play centre and 55+ housing for active seniors. Balder's properties in Stoeryd are wonderfully located in a traffic-free green area.Sto

Lease structure

Balder considers that the risk of a sudden deterioration in rental income is low. This is due to the company's lease structure with a good division between commercial properties and residential properties as well as a good geographical spread. In order to offset reduced rental income and a weaker occupancy rate, the company strives for long-term relationships with its existing customers.

Balder's ten largest leases represent 9.1 per cent (8.7) of total rental income and their average lease term amounts to 9.9 (10.5) years. No individual lease accounts for more than 1.7 per cent (1.6) of Balder's total rental income and no individual customer accounts for more than 1.7 per cent (2.6) of total rental income. The average lease term for the entire commercial portfolio amounted to 4.9 years (4.4).

The lease structure on 31 December 2013 is shown in the table, in which leases terminated on that date, where removal will or is expected to take place, are recognised as leases maturing within one year.

Lease structure 31 December 2013

Maturity date Number of
leases
Share, % Contracted
rent, SEKm
Share, %
2014 764 31 166 7
2015 647 26 263 12
2016 543 22 205 9
2017 322 13 160 7
2018– 203 8 351 16
Total 2,479 100 1,146 51
Residential 1) 15,325 1,056 47
Carpark 1) 5,484 16 1
Garage 1) 5,475 42 2
Total 28,763 2,260 100

1) Lease runs subject to a commitment period of 3 months.

Balder's ten largest customers

On 2013-12-31

  • ICA Sverige
  • Kopparbergs Bryggeri
  • County Administrative board of Stockholm
  • Magnora AB
  • Rasta Group
  • SGH Rosen R Hotel
  • Sirius International Insurance
  • Stureplansgruppen
  • Västra Götalands county council
  • Winn Hotel Group

Organisation and employees

Balder is an expanding workplace. Our property management is mainly conducted with our own personnel in order to be close to customers and to be able to swiftly meet expectations and demands.

alder's organisation grew by 75 new employees during 2013. The increase was largely due to the acquisition of Bovista, which was completed during the final quarter. On 31 December, Bovista had 6 people employed within administration and 44 people within management. The operations in Bovista are conducted in the regions Gothenburg/West, Öresund and East. Through the acquisition, Balder's team has grown further with additional skilled and dedicated employees. B

Balder has a flat organisation with short decision-making procedures, enabling swift action, regardless of whether it relates to property transactions or solving problems for a customer. In order to support property management, group-wide resources/ functions are located in Malmö and at the head office in Gothenburg. At year-end, 31 people (25) worked within these functions.

Management organisation

The management organisation is divided geographically into the regions Stockholm Gothenburg/West, Öresund, East and North. Each regional organisation follows the same basic principles but differs depending on the size and property holdings of each region. Each region has a number of local offices which are responsible for let-

ting, operations, the environment and management. Management is mainly conducted with the company's own personnel in order to be close to customers and to able to swiftly meet expectations and demands according to Balder's management vision. At year-end, 259 (190) people worked in the management organisation.

Employees

At Balder, skills and personal qualities, a balanced gender distribution and diversity are important selection criteria during recruitment. These factors have contributed to the company's positive development.

Corporate culture

Balder's corporate culture dominates everything that happens, from the day-to-day work to conversion work and our long-term development. Our ambition is to find the best possible solutions for our customers and for our organisation.

Balder's shared values are:

Passion – work should be performed with consideration and respect for both customers and colleagues.

New thinking – we are not afraid of thinking outside the box. The company supports the ideas of employees through a strong entrepreneurial spirit.

Simplicity – the direct approach is usually the easiest and the best. Employees help each other to develop by spreading ideas within the organisation.

Proximity – we have short decision-making paths due to our flat organisation and decisions should be taken close to where they originate. Proximity and loyalty inspire confidence.

Healthcare

Balder is a good and attractive employer where the well-being and health of employees are key elements. An allowance for keep-fit activities provides employees with better opportunities to meet the demands imposed by working life. The company encourages greater health awareness among employees and takes care to create a pleasant workplace with good social interaction.

" At Balder, the work of an operations technician varies a lot. We handle all from error reports relating to cooling/heating/ventilation to implementing energyoptimising measures in our buildings. This task involves planning to obtain hard-wearing and reliable functions, which makes the work both fun and challenging. I started at Balder in 2012, and have learned a lot during the past couple of years. There is great competence and enterprise in the company ‒ you always have someone to bounce ideas off. Although Balder is a strongly growing company, we have been able to retain a good spirit between colleagues. We help one another, quite simply. Filip Håkansson, Operations Technician

Personnel 2013 2012
Number of
employees 290 215
– of whom, women 102 67
Absence due to illness
– Salaried employees 5 4
– Workers employed
under a collective
agreement 4 3

Gender distribution per age group

Number of employees per region, %

Corporate sustainability

Balder takes environmental responsibility and promotes sustainable development by working according to the EU's climate targets and ISO 14 001. To further strengthen the organisation, Balder has decided to recruit new employees, whose primary task will be to advance the company's environmental work.

Purchased energy per region, %

Energy usage

The efficiency of Balder's energy usage is continually improved while the company is working to phase out the use of fossil fuels and non-renewable sources of energy. Every month the energy and water consumption in the properties is measured and analysed. Improvements to the environment and comfort can be made via the error reporting system and continual property checks. Balder also conducts a dialogue with its tenants in order to identify alternative approaches of energy usage with the aim of improving the environment. For example, Balder can adapt ventilation systems to tenant needs and can turn off the ventilation during periods when the premises are not in use.

Through its monitoring system, Balder obtains effective information for decisions on short- and long-term measures, which can enable a reduction in energy consumption and/or improve the indoor climate.

Balder is continuing its IMD work (individual measurement and debiting), which means that tenants have to pay for electricity and water based on individual consumption. Balder has introduced this system in high consuming properties in order to reduce energy consumption and maintenance in its properties. During the year, consumption in these properties decreased by up to 30 per cent.

Energy consumption Mwh, Gothenburg*

Total 40,090 42,285 –5.2
Dec 5,523 5,900 –6.4
Nov 4,443 4,638 –4.2
Oct 3,192 3,267 –2.3
Sep 1,364 1,646 –17.1
Aug 648 755 –14.1
July 620 740 –16.2
June 752 1,190 –36.8
May 1,995 2,419 –17.5
April 3,654 3,867 –5.5
Mar 5,366 5,497 –2.4
Feb 5,976 5,970 –0.1
Jan 6,557 6,396 2.5
2013 2012 Change,
%

* Degree-day adjusted

More efficient energy consumption in Gothenburg

An example of how Balder takes environment responsibility is when the company, during 2013, took over ownership of the control and regulating unit from Göteborg Energi. In connection with this, work has commenced on replacing the control unit at all properties in the Gothenburg area, with the aim of regulating temperatures in a more energy-efficient way. The new control unit may be connected to the Internet, which means that temperatures may be regulated remotely. This investment has resulted in lower energy consumption, lower return air temperatures, an improved indoor climate for our tenants and reduced carbon dioxide emissions.

Balder's enriching social responsibility

Balder strives to ensure that people should feel comfortable in and around their housing environments. In order to succeed, great commitment is required in the organisation but we also have to collaborate with other players in the market.

In 2009, Balder acquired Vårby gård in Stockholm, an area, which at the time was

Balder participates in the Swedish national day celebrations in Vårby gård and since 2011, the company has helped to make the day meaningful and memorable. The format of the event including music, culture and food from Sweden and from other parts of the world brings out the best in this multicultural area. In 2012, the comedian Özz Nûjen was the main speaker and in 2013 it was the turn of comedian Martin Lagos. During the day, Balder handed out blue and yellow t-shirts featuring the slogan "I love 143", which is an expression of the "Vårby spirit" and 143 is a part of the Vårby gård postcode.

badly affected by vandalism and criminality. The following year, Balder presented a renovation plan to Huddinge Municipality and gathered support in the area to collectively discuss a solution to Vårby's problems. Schools, police, property owners and the municipality were some of the parties that participated in the planning work in order to improve comfort and well-being in Vårby gård. During the course of the project, Balder started joint action groups, participated in and contributed to activities in the area, collaborated with local players, performed a renovation of Vårby Centrum and let premises to stores, offices, healthcare companies, a gym and a dancing school.

A second chance

Balder collaborates with organisations that work actively with integration and treatment programmes directed towards children and young adults. A home of their own and guidance from professionals with extensive experience of integration and treatment work improves the person's chance of a better future. Examples of organisations that Balder collaborates with include Rebo, Steget Vidare, UngBo and Mitt Liv.

UngBo

UngBo is part of the social services' Children and family unit, in Åstorp Municipality. The work is focused on young people who live in the municipality and who are between the age of 17 and 21. The young people are in need of support and housing. The collaboration works as follows: Balder enters into a lease with Åstorp Municipality, which in turn enters into a sublease with the tenant as well as an individual lease regarding special housing rules. The goal is to create a comfortable home and that the tenant, at the end of the project, should take over the lease. Daria Nowaczews (see photo) is a good example as she recently entered into a lease. Balder and UngBo are proud of the excellent collaboration and UngBo appreciates Balder's ability to look beyond the efforts of the social services and instead see the personal qualities of young people.

"It's nice to finally stand on my own two feet and have my own home. I want to be an inspiration for others and hope that more people will get the same chance I got.

Daria Nowaczews, tenant

Kanoldhuset and the art of making toffee

The history of this distinguished building commenced at the end of the 19th century, when some members of the Kanold family emigrated from Sweden to America. The move occurred after Mrs Kanold had tragically passed away in connection with the birth of her third son. Father Adolf and two of his sons, Fred and Anton, then set off across the Atlantic in order to seek their fortune in a new land. The brothers stayed for eight years and during that time learned the art of making toffee.

On 28 April 1901, the Kanold brothers boarded the ship that would take them back to Sweden with the newly acquired knowledge that would soon prove to be a recipe for success, which they never could have dreamed of. Once in Sweden, the brothers

1901 1929 lived in Gårda in Gothenburg and immediately began making toffee in the house in order to sell to the city's inhabitants. The business idea was simple and so was the execution, since no advanced equipment was required. It was also said that the brothers used the inner windows of the property as trays, to let the toffee mixture harden.

Success

1911 Toffee sales exploded on the streets of Gothenburg and as early as one year later, the business had grown so large that the brothers were forced to look for a new premises. Just at that time, they won the highest prize in the Dramaten lottery. The prize was SEK 50,000, which is today equivalent to about SEK 2 million. In 1911, the

10-year jubilee of the business was celebrated and in the same year work began on building the Kanold brothers' chocolate factory.

Kanold and the chocolate factory

The location of the factory was well thought out with proximity to the Mölndalsån river for transportation of packaging and other products. The first building that was constructed had five floors featuring a red brick frontage. The factory produced candy such as nougat products, 'gummy reptiles', 'cough drops', 'cartoon candy', Devonshire toffee, 'hikers' chocolate' and 'Gustaf Adolf's bust'.

" We welcome Kanoldhuset with its interesting history and exciting future prospects.

Erik Selin, CEO

Extension

1929 Property data 1938 The number of employees increased and in 1929 the brothers decided to construct a staff building, located in the grounds between the factory buildings. The well-being of staff was a high priority and the brothers had sun terraces built for their employees, which was unique at the time, especially considering that the majority of the workers were women. In the 1930s, the brothers had 300 employees and an output value of about SEK 3 million. Today's main building was constructed in 1938 and lies between the two previous buildings. The main building's formwork was modernised. In connection with industrialisation and efficiency improvements during the 1960s and 1970s, the factory was modernised and rationalised. The workforce decreased and was replaced by machinery.

History lives on

2013 In he late 1980s, the brother's business was dissolved and the property, which is now called Bö 93:2, was converted into modern office premises. Many parts, however, were preserved in their entirety. Thus, the building is a mix of new and old, and was built in a dignified and careful manner.

Fastighets AB Balder acquires Kanold Balder strives for the same strong entrepreneurial drive in its corporate culture as the Kanold brothers. Balder is proud to own this property, which has played an important role in Gothenburg's economic development during the 20th century. The property contains 9,200 sq.m., as well as a car park with almost 400 parking spaces.

Source: Antiquum – Antiquarian development consultant

Address Sofierogatan 1–13, Göteborg

Name of property Bö 93:2

Start of construction 1911

Architect F. O. Pettersson

Developer F. O. Pettersson

The property market

Despite an economic slowdown and low growth, the Swedish property market has shown considerable resilience and real estate is continuing to attract capital.

rowth in the Swedish economy was weak during 2013, but the forwardlooking indicators have become stronger and stronger. The situation in the labour market has improved and confidence among Swedish households and companies has increased. Combined with a slightly improved outlook for the world economy and gradually higher global demand, this is creating the conditions for growth to accelerate during 2014. G

Increasing external growth is helping to gradually boost demand for Swedish export goods, which in turn will lead to an industrial recovery. With rising demand, both externally and in the domestic market and increased use of resources, investments in industry will also steadily accelerate. The weak level of investment activity is thus expected to level out and start to recover. However, capacity utilisation is still low within manufacturing industry, and therefore the recovery is expected to take time. This means that we can expect a much slower recovery compared to the upturn from 2004–2007 after the end of the IT bubble.

To support market conditions and to help increase inflation, the Riksbank estimates that monetary policy needs to continue to be expansionary. The repo rate is expected to remain at the current low level for the whole of 2014. When inflation has gained momentum and the recovery is on firmer ground, interest rates are expected to start rising slowly.

The property market

In the longer term, real estate generally and residential property in particular, has proved to be a stable and relatively good investment. A comparison between the annual average yield (measured as yield and increase in value in various property segments according to IPD/Swedish Property index) and the performance of the Stockholm Stock Exchange (measured as share performance and dividend according to the SixReturn Index) during the past ten years, from an overall risk and return perspective, favours an investment in real estate and in residential properties in particular. The annual average shows that an investment in residential apartment buildings has delivered an annual yield of 9.3 per cent during the past ten years compared to the Stockholm Stock Exchange's annual average of 15.6 per cent. The fact that the total yield has been largely positive during the entire period, speaks in favour of property and housing investments in particular. This may be compared with a holding of sha-

Rental levels (highest rent), office, CBD

Vacancy rate, office, CBD

Source: Affärsvärlden CBD = Central Business District Source: Fastighetsvärlden

res, which displayed a much more volatile yield with fluctuations from +70 to –40 per cent since the crisis during the 1990s.

The number of transactions of the kind that have been in vogue involving municipal housing companies and municipalities will probably decrease since we are getting closer to the election. With greater opportunities for returns in alternative investment classes, risk appetite is also increasing with a reduced interest in residential properties in favour of investments in offices, retail and warehouse/logistics and projects. Those players managing pension capital, which are focused on residential will thus probably not be as dominant in the market. This points towards broader demand in the Swedish property market during 2014.

In the local rental market, NAI Svefa estimates that there is a strong demand for modern offices in a number of secondary markets. With the right design, with efficient and compact offices, there is potential for realising new construction projects in several of our regional cities. It seems that an investment in the production of new housing in several secondary markets today can be more attractive than acquisitions from the existing stock. With an increased supply of modern, efficient premises, the risks are increasing in the existing stock, especially in the case of real estate from 1980s and 1990s with relatively high rents per square metre and premises that are often inefficient.

NAI Svefa's assessment is that we will see unchanged rental levels in 2014 with decreased vacancy risks in line with the accelerating recovery in the Swedish economy.

A strong 2013, SEK 99 billion in transaction volume

Swedish players dominated the market with almost 87 per cent of the invested capital and 68 per cent of the sales volume. The average transaction size in the case of Swedish investors was SEK 220m, while for foreign investors the average was SEK 650m.

The residential sector was largest with 31 per cent of the capital, followed by offices, which accounted for 26 per cent. The property market in Stockholm attracted the most capital during the year, almost 32 per cent of the investment volume. However, this was a decrease from last year's figure of 38 per cent.

The Danish property market

In late 2012 and during 2013, foreign investors started to take a serious interest in the Danish property market.

Like the rest of the world, the situation in Denmark changed a lot after 2008. After some years of economic growth, low unemployment, increases in consumption and a high level of activity in the property market, a sharp deceleration occurred in connection with the financial crisis.

During the financial crisis, some property companies and banks went into bankruptcy due to falling real estate values and high levels of borrowing. The stateowned company Finansiel Stabilitet was established in connection with the crisis. This company has taken over loans and pledged assets in relation to a large number of distressed banks and other credit institutions as well as properties from companies and private individuals. Finansiel Stabilitet continually divests some of its assets and is an important player in the Danish property market.

The transactions carried out on the property side after the financial crisis have either taken place via Finansiel Stabilitet or involved properties with good locations where the price level was not affected too much. Properties located outside the larger cities and properties in a poor state of repair have fallen sharply in value.

In Copenhagen, condominium values fell by 35 per cent. However, the value of condominiums has begun to rise again since 2012. The price per square-metre is still quite a way from the peak levels before the crisis, however.

Particularly in late 2012 and during 2013, foreign investors started to take a serious interest in the Danish property market. The properties acquired by investors have been newly constructed residential properties, portfolios of residential and industrial properties and individual properties around Ströget in central Copenhagen.

Foreign players, Danish institutional investors and large property companies are the most active in the Danish property market today. The greatest demand is for properties in Copenhagen and Århus. These cities are growing in terms of population and it is estimated that these markets will become stronger in the future.

The economic growth in Denmark has been negative or flat since the financial crisis. An improved global economy is also expected to mean increased growth in Denmark in the next few years.

The transaction volume lies at a reasonable level and mainly consists of larger transactions such as property portfolios. The volume is expected to increase in line with improving market conditions.

Vacancy levels for office, retail, industrial and logistics properties are now stabilising after having risen since 2008. The segment, which is expected to have the best potential for further vacancy decreases is residential properties in larger cities.

Transaction volyme

Prime rents/vacancies office

Sources The property market: Nai Svefa, DTZ & Colliers Danmark A/S.

Balder's real estate portfolio

Stockholm Region

West Region

Öresund Region

Number of employees: 38

Residential properties
Number of properties 42
Lettable area, sq.m. 156,525
Carrying amount of pro
perties, SEKm
2,731
Economic
occupancy rate, %
98
Commercial properties
Number of properties 15
Lettable area, sq.m. 114,046
Carrying amount of pro
perties, SEKm
2,450
Economic
occupancy rate, %
90

Number of employees: 95

Residential properties

Carrying amount of pro-

Economic

perties, SEKm 2,015

occupancy rate, % 99

Residential properties
Number of properties 130
Lettable area, sq.m. 414,800
Carrying amount of pro
perties, SEKm
3,328
Economic
occupancy rate, %
97
Commercial properties
Number of properties 74
Lettable area, sq.m. 310,931
Carrying amount of pro
perties, SEKm
5,307
Economic
occupancy rate, %
94

Commercial properties Number of properties 43 Number of properties 14 Lettable area, sq.m. 137,338

Lettable area, sq.m. 292,341
Carrying amount of pro
perties, SEKm 6,948
Economic
occupancy rate, % 92

Commercial properties Residential properties

East Region

North Region

Number of employees: 25

Number of employees: 53

Residential properties

Carrying amount of pro-

Economic

Number of properties 87 Lettable area, sq.m. 362,802

perties, SEKm 2,859

occupancy rate, % 96

Residential properties
Number of properties 75
Lettable area, sq.m. 148,916
Carrying amount of pro
perties, SEKm
1,522
Economic
occupancy rate, %
97

Commercial properties

Carrying amount of properties, SEKm 333

Economic

Number of properties 13 Lettable area, sq.m. 26,123

occupancy rate, % 77

Commercial properties
Number of properties 5
Lettable area, sq.m. 4,838
Carrying amount of pro
perties, SEKm
39
Economic
occupancy rate, %
58

Total Balder

Number of employees: 290

Residential properties
Number of properties 348
Lettable area, sq.m. 1,220,381
Carrying amount of
properties, SEKm
12,455
Economic
occupancy rate, %
97

Commercial properties

Number of properties 150
Lettable area, sq.m. 748,279
Carrying amount of pro
perties, SEKm
15,078
Economic
occupancy rate, %
92

Balder's residential properties

Number of properties, 348
Lettable area, sq.m. thousands 1,220
Number of apartments 15,500
Rental value, SEKm 1,178
Economic occupancy rate, % 97
Carrying amount, SEKm 12,455

Residential properties

Residential properties are a stable investment involving stable cash flows and low risk. About a quarter of Sweden's population lives today in rental housing and after detached houses, terraced houses and rights of tenancy, this is the most common form of housing. There is strong interest among property investors in residential properties. The reason for this is due to stable cash flows and low risk. Roughly 80 per cent of Swedish municipalities have a housing shortage, which means low vacancy levels and low relocation levels. Expectations regarding possible conversions to tenant-owner's rights or introduction of market rents influence investor decisions. In view of the low level of housing construction due to high production costs, a regulated rental market, fewer incentive measures and in certain cases a long planning process, interest in investing in the existing stock of residential properties has increased.

One area, which has attracted interest in recent years is properties from the socalled "million programme". In 1965, a Riksdag parliamentary resolution was passed to build one million housing units over a ten-year period in order to improve housing standards and reduce the then prevailing acute housing shortage. It was mainly municipalities in larger cities, which were responsible for housing production via financing from public pension funds.

The need for capital for maintenance and new housing production in combination with new legislation regarding municipal housing companies, has meant that many municipal housing companies are now opting to divest parts of their residential property holdings.

Residential properties, Geographical distribution

Area sq.m. thousands %
Mälardalen 264 21
The Gothenburg area 248 20
Skaraborg 167 14
The Öresund area 157 13
The Stockholm area 137 11
Jönköping, Tranås 99 8
Sundsvall 82 7
Gävle 33 3
Karlstad 33 3
Total 1,220 100

According to the IPD Swedish Property Index, investments in residential properties have displayed an annual, average total yield of approximately 8.9 per cent during the past five-year period. The total yield includes the increase in value together with the annual yield.

According to DTZ, residential property turnover amounted to roughly SEK 30 billion during 2013. The ten largest transactions accounted for approximately SEK 14 billion, in other words almost 50 per cent. Residential property transactions show a greater geographical spread than commercial properties. The reasons are that the supply of residential properties is low in metropolitan areas and that the properties sold are often converted to tenant-owner's rights.

Place
Yield, %
1.50–1.75 35,000–43,000
2.50–3.00 20,000–24,000
3.50–3.75 18,000–21,000

Source: Fastighetsvärlden

In 2013, Balder acquired residential properties to a value of almost SEK 2,000m. This figure relates solely to the acquisition of Bovista Invest from Glitnir Bank in Luxembourg. This transaction involved 370,000 sq.m. in total, of which residental accounted for 320,000 sq.m. Approximately 60 per cent of the residential portfolio's value is in Gothenburg and Västerås.

In 2013, two smaller residential properties were divested to a value of SEK 14m. A more detailed description of the properties is available on pages 32–33. Apart from acquiring residential properties in growth localities, Balder's goal looking ahead, is to build a large number of apartments each year under the company's own management. This should occur through production of new housing on new land allotments as well as by increasing the development density in the existing residential portfolio. Some ongoing and planned residential projects are presented on page 35.

Balder's commercial properties

Number of properties, 150
Lettable area, sq.m. thousands 748
Rental value, SEKm 1,216
Economic occupancy rate, % 92
Carrying amount, SEKm 15,078

Commercial properties

Continued low interest rates are benefitting property companies. Sweden's commercial property sector is essentially located in metropolitan regions. The Stockholm region accounts for 50 per cent of the market's capital value. Together with the Gothenburg and Malmö regions, the share is almost 75 per cent. The total market value of the commercial property stock in Sweden is estimated at approximately SEK 1,000 billion.

The low level of interest rates and the fact that it became easier to secure property-related financing during 2013, both through traditional bank financing and via new forms of capital market financing, has meant that there has been strong interest in acquiring properties. Forms of financing such as corporate bonds and new issues of preference shares have seen a sharp increase during 2013. According to the Swedish Financial Supervisory Authority's prospectus register, property companies have issued bonds and preference shares to a value of almost SEK 10 billion during the past year.

Sweden has historically low interest rates and this benefits property companies since interest expense is the single largest cost item for most property companies. The Riksbank's assessment is that the repo rate will remain at 0.75 per cent until early 2015 and will then gradually increase at a slow rate.

On the transaction side, the trend since 2012 has continued, which means that fewer but larger property transactions were carried out during the year. Most of the buyers were listed property companies, state-owned companies and institutions, while the sellers included foreign players.

According to the IPD Swedish Property Index, investments in commercial properties have displayed an annual, average total yield of approximately 6.3 per cent during the past five years. The total yield includes increases in value together with the annual yield.

Commercial properties, geographical distribution

Area sq.m. thousands
The Stockholm area 292 40
The Gothenburg area 279 37
The Öresund area 114 15
Skaraborg 32 4
Mälardalen 24 3
Sundsvall 5 1
Jönköping, Tranås 2
Total 748 100

According to DTZ, commercial property turnover amounted to about SEK 70 billion during 2013. The ten largest transactions accounted for approximately SEK 22 billion, in other words almost 30 per cent.

According to the property magazine Fastighetsvärlden, estimated and recorded yield values and price levels in respect of office properties in A locations were as

Place Yield, % Price per sq.m.
Stockholm 4.25–4.50 70,000–90,000
Gothenburg 5.00–5.50 28,000–38,000
Malmö 5.25–6.00 18,000–29,000

follows; The value of Balder's properties in Stockholm's inner city amounted to about SEK 4.7 billion, which corresponds to 68 per cent of the total value of our commercial properties in the region. The average value per sq.m. for office properties with A locations in Stockholm amounts to approximately SEK 52,000.

The equivalent figures for Gothenburg are SEK 2.8 billion and 53 per cent, and SEK 2.0 billion and 82 per cent for Malmö. The average value per sq.m. for office properties with A locations in Gothenburg and Malmö amounts to approximately SEK 27,000.

Balder's acquisition strategy in respect of commerical properties is focused on Stockholm, Gothenburg and Malmö. We will continue the work on improving our portfolio and we will divest individual properties outside metropolitan areas where Balder does not have any property management offices.

During 2013, seven properties were acquired at an underlying property value of SEK 2,000m. The largest individual transactions were the acquisitions of Skeppshandeln 1 and Murmästaren 3 in Stockholm and Lindholmen 39:2 in Gothenburg.

In 2013, five properties were divested to a value of SEK 131m including properties in Höganäs, Sigtuna, Vaxholm and Uddevalla. A more detailed description of the transactions is available on pages 32–33.

Transactions

The largest transaction was the acquisition of the housing group Bovista Invest where 60 per cent of the real estate value is in Gothenburg and Västerås. The acquisition will make a siginificant contribution to Balder's results starting in 2014.

n 2013, Balder acquired properties for approximately SEK 4,000m, corresponding to growth in the real estate value of almost 18 per cent. Acquisitions during the year were characterised by the same strategy we have followed in recent years, namely, acquiring centrally-located commercial and residential properties in places that are growing. I

Acquisitions

The largest transaction was the acquisition of the housing group Bovista Invest where 60 per cent of the real estate value is in Gothenburg and Västerås. The acquisition was carried out during the final quarter of the year and will make a significant contribution to Balder's results starting in 2014. Balder sees the acquisition as strategic, as our goal is that residential properties should account for half of the overall real estate value. After the acquisition, residential properties represent 45 percent of the total real estate value. The commercial acquisitions have mainly related to office and hotel properties. In two different transactions Balder has acquired the office properties Stockholm Murmästaren 3 and 7 at Kungsholmstorg as well as the property development project Stockholm Skeppshandeln 1 in Hammarby Sjöstad, which mainly contains a hotel. In Gothenburg, the largest transactions were the purchase of the hotel property Lindholmen 39:2, which is operated under the SAS

Property transactions 2013

Quarter Number Name of property Municipality Property
category
Lettable
Acquisitions
Second 1 Mellomkvarn 1 Skövde Retail 10,959
Second 1 Murmästaren 7 Stockholm Office 3,089
Second 1 Skeppshandeln 1 Stockholm Retail 13,766
Second 1 Lindholmen 39:2 Gothenburg Other 13,299
Third 1 Bö 93:2 Gothenburg Office 9,179
Fourth 1 Fiskaren Större 3 Stockholm Residential 2,597
Fourth 1 Murmästaren 3 Stockholm Office 16,086
Fourth 67 Bovista Residential 370,109
Total 74 439,084

Radisson brand and the office property Bö 93:2, better known as Kanoldhuset, which adjoins Liseberg. Balder estimates that the company will be able to continue acquiring similar assets during the next few years. Meanwhile, we estimate that housing construction under our own management will gradually increase and will account for a significant share of our investments.

Divestments

Balder's strategy for a number of years has been to divest properties held in places where the company cannot sustain a sufficiently large management unit. During the year, properties to a value of SEK 145m were sold in Sigtuna, Höganäs, Falköping, Uddevalla, Trollhättan, Partille and Vaxholm. Several of these divestments have meant that Balder has completely left these locations. Balder estimates that the company will also leave certain other locations during the next few years.

Quarter Num
ber
Name of property Municipality Property
category
Lettable
Divestments
First 1 Oden 19 Falköping Residential 317
First 1 Märsta 1:218 Sigtuna Retail 2,372
Second 1 Kaktusen 29, 30 och 33 Höganäs Office 4,630
Second 1 Fredborg 1 Uddevalla Retail 200
Second 1 Västbjörke 2:84, 85, 88 Trollhättan Residential 2,370
Second Part of Holmsund 7:6 Gävle Residential
Second Part of Tunadal Köping Residential
Third 1 Skulltorp 1:839, 1:771 Partille Retail 1,745
Fourth 2 Domaren 15 och 18 Vaxholm Other 2,572
Total 8 14,206

Property transactions 2013

Property and project development

Balder considers that it important to be able to control the entire value chain, from acquisition of land to completion of projects. This occurs in close cooperation with municipalities and other stakeholders.

uring the year, Balder has started the work on building up a property development organisation. The ambition over time is to create an extensive portfolio of development rights in relation to development properties and property development projects, with the goal of producing a large number of new housing units annually. D

Property development will be mainly focused on residential, both tenancy rights and tenant-owner's rights. Commercial property development will be focused on supporting housing projects and will form part of the basis for new detailed development plans. Through active property development, the ambition is to participate in changing city districts, as well as individual property's conditions or use and thereby create value. By improving the existing property portfolio, land allotments and acquisitions, Balder wants to be a long-term player in property and urban development. Where Balder is already a property owner, the company will focus on creating new development rights on existing land. Where there are opportunities for conversions to tenant-owner's associations, they will be evaluated. Our ambition is to invest in areas where we already operate, with a main emphasis on Stockholm, Gothenburg and the Öresund region, including Copenhagen.

Balder considers that it is important to be able to control the entire value chain, from acquisition of land to completion of projects. The development process occurs in different phases and can take several years, and therefore it is important that it occurs in close cooperation with municipalities and other stakeholders.

Ongoing and planned projects

Copenhagen

Balder will build 200 apartments in Örestad Syd. The project is expected to be completed during the fourth quarter of 2015, and will be let in three phases. The lettable area will amount to about 18,000 sq.m. The apartments will be constructed as slab blocks with 4–10 floors. The frontages will be of light concrete, mixed with brick masonry facades. Örestad Syd is a lively and attractive district in Copenhagen with proximity to communications, nature and shopping.

Gothenburg

Together with the City of Gothenburg and other property owners in Backaplan, Balder plans to develop a new city district of approximately 4,000 housing units and approximately 100,000 sq.m. of retail properties and premises, with Balder and KF as the dominating property owners. Backaplan's central location and good infrastructure means that the area has great potential for meeting the city's need of centrally-located housing, retail and office premises. At present, the area is very lightly developed and great opportunities exist to build a more robust and dense city district, combining elements of residential, retail and service.

Stockholm

At the existing properties in Brommarondellen, Balder is planning to continue with production of new housing and premises. The planning work is expected to begin during 2014. Brommaplans Centrum is a prioritised traffic centre for public transport in Stockholm's urban development. Balder's properties, in the zone between Brommaplan and Riksby, represent an important part of Bromma's future. The buildings are intended to be high-rise slab blocks with premises on the ground floor. The architecture will be adapted to Brommarondellen's central location in the district.

Million programme

A part of Balder's residential portfolio consists of so-called "million programme" areas , which were produced during the 1960s. These areas are characterised by a unilateral housing stock, low development and large-scale parking and traffic solutions. The infrastructure is often well-developed and it is easy to get to and from the apartments. New construction in these areas has been very limited for a long period, while the population has increased. These areas are largely characterised by social imbalances. Balder's assessment is that there is great potential for new housing in these areas. By developing existing zones within city districts, land can be used more efficiently and safer housing environments can be created. Through more efficient use of the existing infrastructure, we estimate that future investments are limited and this means that the initial value of development projects is low. Balder's strategy is to create a broader supply of modern housing by increasing development density through addition of apartment blocks and terraced houses. Consequently there are great opportunities in our own portfolio to offer the market good-value tenancy rights and tenant-owner's rights.

Above Spårvagnen 4, Stockholm, exterior and interior view.

Large photo Tor 10, Skara.

Real estate valuation

In recent years, Balder's strategy has been to acquire centrallylocated properties in the Stockholm, Gothenburg, Malmö and Copenhagen metropolitan areas, while selling in places where the company has no local representation.

alder's real estate portfolio consists of 498 properties where almost half consists of residential properties. The holdings are divided into five geographical regions: Stockholm, Gothenburg/West, Öresund, East and North. Each region is unique with specific characteristics that must be considered when the holdings are valued. B

The value of the properties is based on internal valuations. All properties have been valued using the yield method, which means that each property is valued by discounting the estimated future cash flows. The estimated future cash flow has been derived from existing rental income, operating and maintenance costs adjusted to expected changes in rental and vacancy levels. An estimate is also made of the future development of the immediate surroundings as well as the position of the property within its market segment.

Rental payments

The rental trend is expected to follow inflation over time. Commercial leases are indexed, which means that the rent develops at the same rate as the CPI, consumer price index, during the leasing period. Residential properties have historically developed a little better than the CPI, but in its valuations, Balder has assumed that the rent develops in line with inflation. In commercial leases that expire, an assessment is made of whether the lease is expected to be extended at the prevailing market rental level or if there is a risk that the premises can become vacant. Vacancies are considered on the basis of the current vacancy situation with a gradual adjustment to a market-related vacancy level taking account of the property's individual characteristics.

Operating and maintenance payments

Assumptions have been made regarding future operating and maintenance payments. These assumptions are based on historic outcomes and future projections as well as estimated standardised costs. Operating and maintenance costs are adjusted upwards each year by inflation.

Yield requirement

Yield requirements and the cost of capital used in the valuation model have been derived from comparable transactions in the property market. Important factors in choosing a yield requirement are location, rental level, vacancy rate and the condi-

Net operating income rolling

Rental value, Residential

tion of the property. Market assessments of properties always involve a certain amount of uncertainty in the assumptions and estimates made. The uncertainty in respect of individual properties is normally considered to be in the range of +/– 5–10 per cent. Balder continually monitors the transactions that are completed in the market in order to substantiate and guarantee internal valuations. Balder also conducts continual discussions with external actors regarding acquisition and divestment of properties, which provides us with additional guidance.

On 31 December, Balder's average yield amounted to 5.9 per cent (5.9). The yield requirement for commercial properties amounted on average to 6.0 per cent (6.2) and to 5.7 per cent (5.5) for residential properties.

Change in value of the real estate portfolio

In 2013, Balder acquired properties for SEK 3,606m (3,756). The sales during the year amounted to SEK 145m (69), which generated a profit of SEK 16m (3).

According to Balder's internal valuation, the carrying amount of the properties at year-end amounted to SEK 27,532m (22,278), which corresponds to an unrealised change in value of SEK 838m (809).

External valuations

During the year Balder allowed Savills Sweden to value all properties owned by the company as of 30 June 2013 in order to guarantee its internal valuations. Savill's valuation exceeded Balder's internal valuation by less than 1 per cent. Historically, the difference between Balder's internal and external valuations has been marginal.

Total property portfolio

SEKm According to
valuation
SEK/s.q.m
Rent including vacancy 2,397 1,225
Long-term vacancy –97 –49
Rental income 2,300 1,176
Operating and maintenance –632 –323
Property tax –94 –48
Ground rent –9 –5
Net operating income 1,565 800
Valuation, excluding real estate projects 26,664 13,632
Yield, % 5.9
Region Cost of capital
requirement for
counting of future
cashflows, %
Yield requirement
for estimating
residual value, %
The mean value of yield
requirements for estima
tion of residual value, %
Stockholm 6.0–10.2 4.0–8.2 5.4
Gothenburg /West 6.0–12.0 4.0–10.0 6.1
Öresund 6.0–10.0 4.0–8.0 5.3
East 7.0–12.0 5.0–10.0 6.1
North 7.0–13.0 5.0–11.0 5.7

Financing

Through issues and strong comprehensive income, shareholders' equity increased during the year by SEK 2,907m, equivalent to 35 per cent. Refinancing risk has decreased, due to more capital sources.

alder is a long-term property owner. Access to capital is a requirement for successful property management. Organisationally, the financial operations are centralised to the Parent Company which acts as an internal bank to the Group with responsibility for funding, cash management and financial risk management. Balder is financed by equity and liabilities, where the majority of the liabilities consist of interest-bearing liabilities. The proportion of equity is impacted by the chosen level of financial risk, which in turn is impacted by lenders' equity requirements for offering market-related financing. Balder's long-term goals for the capital structure are that the equity/assets ratio should not be less than 35 per cent over time and that the interest coverage ratio over time should not be less than 1.5 times. B

Balder increased shareholders' equity during the year by SEK 2,907m, equivalent to 35 per cent, partly through new issues of SEK 1,297m, partly through comprehensive income for the year of SEK 1,735m and reduced shareholder's equity by SEK 125m through dividends paid to the preference shareholders.

Interest-bearing liabilities

The Group's interest-bearing liabilities amounted to SEK 16,521m (13,789) on 31 December, which corresponds to a loan-to-value ratio on the properties of 57.0 per cent (60.4). The interest-bearing liabilities consist of bilateral loan agreements with Nordic banks, bond loans of SEK 750m and a certificate programme of SEK 1,000m. The certificate programme is secured through back-up facilities from banks, which means that if we cannot issue certificates, we will use the back-up facilities. The liquidity for bond financing has increased considerably in recent years, which means that Balder today can finance itself at the same prices for longer terms in the bond market than in the interbank market. This has decreased the refinancing risk in the company as we can meet our financing needs through more sources of capital.

Balder has provided mortgage deeds in properties, shares and participations in subsidiaries as security for the interest-bearing loans. In certain cases the security is supplemented by guarantees regarding levels for the interest coverage ratio, equity/ assets ratio, loan-to-value ratio and guarantees from the Parent Company. None of these guarantees deviates from the goals in the financial policy and all guarantees were met during the financial year. Credit agreements contain customary termination conditions.

Development of net asset value

Loan to value ratio, properties

Changes of market rates of interest or changes in lenders' margins affect net financial items. By working with long credit agreements with agreed margins together with a long interest rate refixing period, predictability in the cash flow is achieved. During 2013, bank margins were essentially unchanged, while the market rate of interest (STIBOR) fell. Balders' average interest rate refixing period amounted to 3.5 years (4.8) at year-end and the average fixed credit term amounted to 5.4 years (6.6).

Interest rate derivative instruments are deployed in order to obtain preferred interest rate refixing periods. Balder's view is that derivatives are a more flexible and cost efficient instrument compared to taking out fixed-interest loans, which would provide the same cash flow effect. The difference is greater for accounting purposes as derivatives are continually recognised at fair value in the balance sheet with changes in value recognised in net financial items in the income statement, without application of hedge accounting. When the market rate of interest deviates from the interest agreed in derivative instruments, a surplus or deficit arises in the accounting, which is not the case with fixed interest loans. Changes in value of derivatives amounted to SEK 433m (–71) during the year. The deficit on derivatives, SEK 472m (868), will be released during the remaining term and recognised as income. This means that Balder has a reserve of SEK 472m, which will be reversed to equity, adjusted by deferred tax, in line with the maturity of the interest rate derivatives.

Net financial items

Net financial items, excluding changes in value in interest rate derivatives, amounted to SEK –456m (–466), which is a result of lower average interest, despite a larger debt. At year-end, Balder's average interest rate was 3.2 per cent (3.6).

Interest maturity structure 2013-12-31

Interest rate refixing period
Year SEKm Interest
%
Propor
tion %
Within one year 8,254 2.1 50.0
1–2 years 267 4.3 1.6
2–3 years 500 4.5 3.0
3–4 years
4–5 years 3,000 4.8 18.2
>5 years 4,500 3.9 27.2
Total 16,521 3.2 100.0

Finance policy

The financial operations at Balder are conducted in accordance with the goals that the Board establishes annually in the financial policy. The goals are set in order to limit the financial risks that Balder is exposed to, which mainly relate to interest, refinancing and liquidity risk.

The overriding goals of the financial policy are:

  • to secure the supply of short- and long-term capital,
  • that the equity/assets ratio should not be less than 35 per cent over time,
  • that the interest coverage ratio should not be less than 1.5 times.
Financial goals Outcome
Goal 2013 2012
Equity/assets ratio, % 35.0 37.3 34.8
Interest coverage ratio, times 1.5 2.9 2.4

Liquidity

Balder utilises credit facilities in order to balance its liquidity needs. At year-end, Balder's disposable liquidity amounted to SEK 1,004m (470), which was composed of cash and cash equivalents, unutilised credit facilities and financial investments. Balder's cash flow is relatively evenly distributed during the year as about half of the rental income relates to residential rents, which are paid monthly. Remaining rents are mainly paid quarterly.

Key ratios

As of 31 december 2013 2012
Return on equity, % 21.5 17.0
Return on total assets, % 9.7 8.8
Interest coverage ratio, times 2.9 2.4
Equity/assets ratio, % 37.3 34.8
Average fixed credit term, years 5.4 6.6
Average interest rate refixing period, years 3.5 4.8

Opportunities and risks

By actively working with diversification of risks as regards type of property, geographical diversification and customer composition, Balder limits the company's risks. All business activity is associated with risks and these may affect the company negatively but may also generate opportunities.

Sensitivity analysis
Factor Change Earnings effect
before tax, SEKm
Rental income +/– 1 per cent +/– 23
Economic occupancy rate +/– 1 percentage unit +/– 24
Interest-rate level of interest-bearing
liabilities + 1 percentage unit – 82
Property costs +/– 1 per cent –/+ 7
Changes in value of properties +/– 5 per cent +/– 1,377

Rental income, rental development and occupancy rate

51 per cent of Balder's contracted rental income relates to residential properties and 49 per cent to premises. The company's income is affected by the occupancy rate of the properties, the possibility of charging market-related rents as well as customers' payment capacity. If the occupancy rate or rental levels change, irrespective of the reason, Balder's results are affected. Naturally, the risk of large fluctuations in vacancies and loss of rental income increases the more large individual tenants a property company has. Balder's ten largest leases represent 9.1 per cent of total rental income and the average lease term amounts to 9.9 years. No individual lease accounts for more than 1.7 per cent of Balder's total rental income and no individual customer accounts for more than 1.7 per cent of total rental income. There are no guarantees that Balder's major tenants will renew or extend their leases when they expire, which in the longer term can lead to altered rental income and vacancies. The dependence on individual tenants decreases in line with Balder's continued growth through acquisitions. In order to limit the risk of falling rental income and a weakened occupancy rate, Balder strives to develop long-term relationships with the company's existing customers. Balder's leases are normally wholly or partly linked to the consumer price index, in other words, wholly or partly adjusted for inflation.

Balder is dependent on tenants paying agreed rents in time. In some leases, the tenant's obligations are guaranteed by the Parent Company or through bank guarantees. The risk still remains that tenants will suspend their payments or in other respects will not fulfil their obligations. If this happens, Balder's results could be affected negatively.

Unlike commercial properties, residential properties are covered by regulations which among other things mean that the so-called utility value principle determines the setting of the rent.

At year-end, Balder had an economic occupancy rate of 94 percent, which means that the vacancy at year-end amounted to SEK 134m and represents an opportunity for potential new lettings. The table on page 42 shows how profit before tax would be affected by a change of +/– 1 per cent in the rental level and +/– 1 per cent in the economic occupancy rate.

Operating and maintenance costs

Operating costs mainly consist of costs that are based on usage such as electricity, cleaning, water and heating costs. Several of these goods and services can only be purchased from one actor, which can affect the price. To the extent that possible cost increases are not compensated by adjustments of leases or increases in rent through renegotiation of leases, Balder's results can be affected negatively. Maintenance costs include measures aimed at maintaining the standard of the properties in the long term. These costs are expensed to the extent they constitute repairs and replacement of smaller areas. Other additional expenses of a maintenance character are capitalised in connection with the expense arising. Unforeseen and extensive repair needs may also affect the results negatively.

Change in value of the properties

83 per cent of the value of Balder's real estate portfolio is found in the three metropolitan regions Stockholm, Gothenburg/West and Öresund. Balder's investment properties are recognised at fair value in the balance sheet and changes in value are recognised in the income statement. Unrealised changes in value do not affect the

cash flow. Balder carries out an internal valuation of its real estate portfolio in connection with quarterly reports. Parts of the real estate portfolio are also externally valued and compared to the internal valuation.

The value of the properties is affected by a number of factors including propertyspecific factors such as occupancy rate, rental level and operating costs as well as market-specific factors such as yield requirements and cost of capital.

Both property-specific and market-specific changes affect the value of investment properties, which in turn impacts on the Group's financial position and results.

Dependence on key people

Balder's future growth is dependent on the knowledge, experience and commitment of the management group and other key people. The company could be affected negatively if one or more of these people would leave the Group.

Operational risks

Balder can incur losses within the framework of its operating activities due to defective routines or irregularities. Good internal control, appropriate administrative systems, skills development and good access to reliable valuation and risk models provide a good basis for reducing operational risks. Balder continually works on monitoring the company's administrative security and control.

Taxes and changed legislation

Changes in corporate and property taxes, as well as other government levies, rent allowance and interest allowance can affect the basis for Balder's operations. It cannot be ruled out that tax rates will change in the future or that other changes will occur in the state system that affect real estate ownership. In most leases, the customer pays his share of the current debited property tax. Changes in corporate taxation and other governmental levies, may affect Balder's results. A change in tax legislation or practice which implies changes in the possibilities of making tax writeoffs or utilising loss carry-forwards, for example, can mean a change in Balder's future tax situation and can thereby also impact results.

Financial risks

Balder's operations are mainly financed by equity and loans from external lenders. The relationship between equity and liabilities is managed on the basis of the chosen level of financial risk and the amount of equity needed to meet lenders' requirements for securing loans at market-related conditions. Financing via loans means that Balder is exposed to financing, interest and credit risks. Financing conditions include requirements relating to the equity/assets ratio, loan-to-value ratio and interest coverage ratio.

Refinancing risk

Refinancing risk refers to the risk that financing cannot be secured at all, or only at a significantly increased cost. Balder conducts continual discussions with banks and credit institutions aimed at securing the long-term financing. Balder cooperates closely with a handful of lenders in order to secure the company's long-term capital requirements.

Interest risk

Interest risk is defined as the risk that changes in the level of interest rates will affect Balder's financing expense. The interest expense is Balder's single largest cost item. Interest expenses are mainly affected by the current level of the market rate of interest and credit institution margins and also by what strategy the company chooses for interest rate refixing periods. Market rates of interest are mainly affected by the expected inflation rate.

In times of rising inflation expectations, the interest rate level can be expected to rise, which immediately increases the interest expense on loans with short maturities.

Balder has a large proportion of loans which run according to short interest rate refixing periods. Balder deploys interest rate derivatives as part of its interest risk management, in order to achieve preferred interest rate refixing periods.

Credit risk

Credit risk is defined as the risk that Balder's counterparties cannot fulfil their financial obligations towards the company. Credit risk in the financial operations arises during investment of excess liquidity, on entering into interest rate swap contracts and in connection with issued credit agreements. As regards Balder's trade receivables, customary credit checks are carried out before a new lease is entered into.

Foreign exchange risk

Balder owns properties via subsidiaries in Denmark. Companies' revenue and costs are in local currency and are thereby exposed to fluctuations in exchange rates from a Group standpoint. Foreign exchange risk also arises in translation of the assets and liabilities of foreign subsidiaries to the currency of the Parent Company.

Environmental risk

Property management and property development have an environmental impact. Balder has established an environmental policy and works with environmental issues. Under the Environmental Code, those conducting an activity, which has contributed to pollution are also responsible for after-treatment. If the party conducting the activity cannot carry out or pay for the after-treatment of a property, the party acquiring the property and that on the acquisition date was aware of or that should have then discovered the pollution, is responsible. Since Balder mainly owns residential, office and retail properties, this risk is considered limited.

Maturity structure of commercial lease contracts

Number of commercial leases per rental value

Associated companies

Balder's associated companies together own 53 properties with a total carrying amount of SEK 5,086m. Balder also holds shares in the rapidly growing credit market company Collector, where the participating interest amounts to approximately 44 per cent.

Carrying amount per property category, %

Carrying amount per region, %

alder has associated companies that manage properties and that conduct project development. All are 50%-owned by Balder. Apart from these, Balder holds shares in the credit market company Collector, where the participating interest amounts to approximately 44 per cent. The property-managing associated companies include Centur, Akroterion and Tulia, while Bovieran and Fix Holding are focused on project development. B

The property-managing associated companies together own 53 properties (43) with a total carrying amount of SEK 5,086m (4,342), a total lettable area of about 285,000 sq.m. (270,000) and a rental value amounting to SEK 400m (332). Profit from property management, in other words, profit excluding changes in value and tax, amounted to SEK 345m (253), of which Balder's participation amounted to SEK 157m (108). The companies' profit after tax amounted to SEK 429m (239), of which Balder's participation amounted to SEK 204m (105). Balder's results were affected by changes in value in respect of properties and derivatives of SEK 100m (8) before tax. For more information about Balder's associated companies, see Note 15, Participations in associated companies.

Balder's participation in the property holdings of property-managing associated companies

Per 2013-12-31 Number of
properties
Lettable
area,
sq.m.
Rental
value,
SEKm
Rental
value,
SEK/s.q.m.
Rental
income,
SEK
Economic
occupancy
rate, %
Carrying
amount,
SEKm
Carrying
amount,
%
Distributed by region
Stockholm 32 87,980 148 1,683 137 93 1,830 72
Gothenburg 10 30,076 29 952 28 99 373 15
Öresund 7 24,282 23 938 21 91 273 11
Total 49 142,337 200 1,402 186 93 2,476 97
Projects 4 1 67 3
Total 53 142,337 200 1,402 187 93 2,543 100
Distributed by property category
Residential 4 3,406 4 1,282 4 99 80 3
Office 7 34,711 77 2,212 68 88 820 32
Retail 32 94,454 98 1,033 94 96 1,211 48
Other 6 9,768 21 2,128 21 99 364 14
Total 49 142,337 200 1,402 186 93 2,476 97
Projects 4 1 67 3
Totalt 53 142,337 200 1,402 187 93 2,543 100

Balder's participation in the property holdings of property-managing associated companies

SEKm 2013 2012 2011
Rental income 179 159 123
Property costs –40 –33 –25
Net operating income 140 126 98
2013 2012 2011
Carrying amount
properties, SEKm 2,543 2,171 2,023
Number of properties1) 53 43 41
Lettable area, sq.m.
thousands 142 135 125

Fastighets AB Centur

The company is 50 per cent-owned by Peab and Balder and concentrates on property management, project development and property investments. Project development mainly focuses on construction of new retail and office premises and residential apartments but also on improvements relating to real estate projects.

At year-end, Centur owned 27 investment properties (27) with a lettable area of 162,000 sq.m. (160,000) and a rental value of SEK 155m (153). During the year, three properties were acquired for project development. The carrying amount of the properties amounted to SEK 2,027m (1,803). The properties are located in Stockholm, Gothenburg and the Öresund area.

Akroterion Fastighets AB

The company is 50 per cent-owned by GE Capital Real Estate Nordic and Balder respectively. At year-end, 2 office properties were owned (2) in attractive locations in Stockholm with a carrying amount of SEK 1,179m (1,176), a lettable area of 53,000 sq.m. (53,000) and a rental value amounting to SEK 92m (88). Both of the properties have good project development potential and both projects include a mix of commercial and residential areas.

Tulia AB

Balder owns 50 per cent of Tulia and the remaining part is owned by André Åkerlund AB. At year-end, Tulia owned 20 properties (14), which are mainly centrally-located in Stockholm. The lettable area amounted to 70,000 sq.m. (54,000) and the carrying amount of the properties totalled SEK 1,877m (1,360) with a rental value amounting to SEK 122m (95).

Bovieran Holding AB

Balder and Mellberg Förvaltning AB each own 50 per cent of the company. The operations consist of development and construction of residential properties using an internally-developed design Bovieran where the glazed-in courtyard in the form of a winter garden with a Rivieran atmosphere is a distinct feature. The winter garden

Balder's participation in the balance sheets of property-managing associated companies

2013
31 Dec
2012
31 Dec
2,543 2,171
34 22
40 13
2,617 2,206

Equity and liabilities

Total equity and
liabilities
2,617 2,206
Other liabilities 173 123
liabilities 1,454 1,359
Interest-bearing
shareholders' loan 990 724
Equity/

has a pleasant temperature all-year-round and contains lush greenery with tropical, mediterranean, Japanese and Scandinavaian environments.

Bovieran has been built in six different places so far. On Hönö, in Kalmar, Norrtälje, Haninge and Linköping construction is either ongoing or the start of the project is imminent. The company is in the midst of a strong growth phase and will begin a number of further construction projects during 2014. The planned production rate is four to five projects per year. Also see www.bovieran.se

Fix Holding AB

The company is owned in equal shares by Balder and HSB Göteborg and it owns Fixfabriken in Majorna, which is a fully let building. Balder has purchased land together with HSB at the site in Majorna where the Fixfabriken was previously located for many decades. Fix Holding will develop almost 500 new residential units here with supplementary business premises.

The new Fixfabriken will be a sensation among residential areas in Gothenburg, and will feature distinctive architecture and excellent housing quality. Equally important is the fact that Fixfabriken will become a vital new addition and a dynamo for continued development, both in the area and in the city as a whole. It will be fantastic housing, but it will also be an exceptional project, which is intended to serve a model for urban renewal, where participation, transparency and collaboration are not just fine words but firm reality. The objective is to have a detailed development plan ready by 2016.

Collector AB

The company has a stable group of owners where the largest owners are Balder, Ernströmgruppen and Provobis. Balder is the main owner with approximately 44 per cent. Collector is a successful credit market company, which is displaying rapid organic growth with offices in Gothenburg, Stockholm, Malmö, Olso and Helsinki.

The company is a partner focusing on overall solutions in financing, credit management and the legal field. The company's business areas are Collector Consumer, Collector Business and Collector Commerce and the balance sheet total amounted to SEK 4,600m (3,600m). Sales amounted to SEK 700m (590m) and profit before tax was SEK 190m (146). Also see www.collector.se

Financial reporting

49 Report of the Board of Directors

Consolidated statement of

  • 54 Comprehensive income
  • 55 Financial position
  • 56 Changes in equity
  • 57 Cash flows

Parent Company

  • 58 Income statement
  • 59 Balance sheet
  • 60 Changes in equity
  • 61 Cash flow statement
  • 62 Notes
  • 82 Audit report

Audit report

The Board of Directors and CEO of Fastighets AB Balder (publ), corporate identity number 556525-6905, hereby submit the accounts of the Group and the Parent Company for the financial year 2013.

Fastighets AB Balder is listed on NASDAQ OMX Stockholm, Mid Cap segment. The company has approximately 16,100 shareholders (12,500).

Comparisons stated in parenthesis refer to the corresponding period of the previous year.

Operations

Balder's business concept is to create value by acquiring, developing and managing residential properties and commercial properties based on local support and to create customer value by meeting the needs of different customer groups for premises and housing.

Balder shall aim to achieve such a position in each region whereby the company is a natural partner for potential customers that are in need of new premises and/or housing. Growth should occur on the basis of continued profitability and positive cash flows.

Financial goals

Balder's goal is to achieve a stable and good return on equity, while the equity/assets ratio over time shall not be less than 35 per cent and the interest coverage ratio shall not be less than 1.5 times. The company's goal for its equity/assets ratio has changed during 2013 from 30 per cent previously.

Organisation

Balder's business areas consist of the regions Stockholm, Gothenburg/West, Öresund, East and North, which are made up of 16 areas. The regional organisations follow the same basic principles but differ depending on the size and property holdings of each region. Regional offices are responsible for letting, operation as well as the environment and technical management.

The Balder Group, with Fastighets AB Balder as Parent Company, is composed of a large number of limited liability companies and limited partnership companies. Balder's operational organisation is supported by central accounting, property management and finance functions. The Group had a total of 290 employees (215) on 31 December, of which 102 (67) were women.

Balder's management team is composed of six people, of which one is a woman. For information regarding approved guidelines for remuneration to senior executives, see Note 4, Employees and personnel expenses. The Board will not propose any changes in the guidelines to the Annual General Meeting 2014.

Significant events during the financial year

During the second quarter, Balder acquired four properties in the Stockholm and Gothenburg regions to a value of just over SEK 800m. During the second quarter, a directed new issue was also carried out, which provided the company with SEK 160m and a bond loan was also issued for SEK 500m.

Balder acquired Bovista Invest AB in November. The transaction included 4,300 apartments and a total area of 370,000 sq.m. to a value of approximately SEK 2 billion. A directed new share issue of 3,500,000 preference shares was conducted in connection with the Bovista transaction, which increased shareholders' equity during the fourth quarter by SEK 1,138m. During the fourth quarter, a turnkey agreement regarding construction of approximately 200 condominiums in Örestad in Copenhagen was also signed for a value upon completion during the end of 2015 of approximately SEK 400m and the commercial property Murmästaren 3 was also acquired in Stockholm at an underlying real estate value of approximately SEK 500m.

The property portfolio

Balder's commercial properties are located in the centre and immediate suburbs of big cities and surrounding municipal areas and the residential properties are located in places that are growing and developing positively.

On 31 December, Balder owned 498 properties (432) with a lettable area of 1,969,000 sq.m (1,543,000) at a carrying amount of SEK 27.5 billion (22.3). During the year, 74 properties (14) with a lettable area of approximately 439,000 sq.m. (141,000) were acquired for SEK 3,606m (3,756). 8 properties (6) were sold during the year with a total lettable area of 14,000 sq.m. (7,000) for SEK 145m (72), which generated a profit of SEK 16m (3). In 2014, Balder will continue the work on consolidating its property portfolio.

When allocating carrying amounts by region, Stockholm amounted to 33 per cent (34), Gothenburg/West 31 per cent (29), Öresund 19 per cent (22), East 12 per cent (8) and North 6 per cent (7). Of the carrying amounts, 55 per cent (56) related to commercial properties and 45 per cent (44) to residential properties.

Opportunities and risks

Balder's operations, financial position and results may be affected by a number of risk factors.

Rents and customers

Balder's income is affected by the occupancy rate of the properties, the possibility of charging market-related rents as well as customers' payment capacity. The occupancy rate and rental levels are largely determined by the general and regional economic trends. Naturally, the risk of large fluctuations in vacancies and loss of rental income increases when there are more large individual customers in the property portfolio.

In order to limit the risk of lower rental income and a weakened occupancy rate, Balder strives to develop long-term relationships with the company's existing customers. Balder's distribution between commercial and residential properties and

the geographical spread in the portfolio means that the risk relating to rental income is low.

At year-end, Balder had an economic occupancy rate of 94 per cent (94). Balder's ten largest leases represented 9.1 per cent (8.7) of total rental income and their average lease term amounted to 9.9 years (10.5). No individual lease accounted for more than 1.7 per cent (1.6) of Balder's total rental income and no individual customer accounted for more than 1.7 per cent (2.6) of total rental income. The average lease term in the overall commercial portfolio amounted to 4.9 years (4.4).

A change of +/– 1 per cent in rental income would affect the profit before tax by +/– SEK 23m.

Debt and risk management

Balder's greatest financial risk is a lack of financing. To limit refinancing risk, Balder works continually to renegotiate loans and to diversify the maturity structure of loans. Meanwhile, this work ensures that competitive long-term financing is maintained. Balder's average fixed credit term amounted to 5.4 years (6.6).

Interest risk arises through fluctuations in the market rate of interest, which affects results and cash flow. A higher market rate of interest means an increased interest expense but this often also coincides with higher inflation and economic growth. This means that higher interest expenses are partly offset by lower vacancy rates and higher rental income through increased demand and by the fact that rents are indexed. Balder has elected to use interest rate derivatives to limit the risk of financing costs increasing significantly in the event of a higher market rate of interest.

In the event of an immediate increase in the market rate of interest of one percentage unit and the assumption of an unchanged loan and derivative portfolio, the interest expense would increase by SEK 82m. Of Balder's total loan stock at yearend, 50 per cent (60) had an interest rate refixing period of more than one year. The Danish holdings have given rise to a limited currency position. For more information see Note 21, Financial risks and financial policies.

Property costs

Property costs include direct costs such as operating and media expenses, maintenance costs, ground rent and property tax. Each region is responsible for ensuring that the property portfolio is well-maintained and in good condition. Through a local presence, knowledge improves about each property's need of premptive work, which is more cost-effective in the long-term than extensive repairs.

Balder works continually on improvements in relation to operating costs such as heating and electricity consumption in order to continuously improve cost efficiency using rational technical solutions, practical efforts and continual follow up.

A change of +/– 1 per cent in property costs would affect the property costs by SEK –/+ 7m.

Changes in value of investment properties

Balder reports its investment properties at fair value with changes in value in the income statement. Market assessments of properties always involve a certain amount of uncertainty in the assumptions and estimates made. The uncertainty in respect of individual properties is normally considered to be in the range of +/– 5–10 per cent. The uncertainty varies according to the type of property, geographical location and real estate market conditions. Balder continually monitors the transactions that are completed in the market in order to substantiate and guarantee its valuations. In addition, Balder conducts continual discussions with external participants on acquisition and divestment of properties and regularly allows external parties to value parts of the portfolio, which provides additional guidance. Also see Note 13, Investment properties. Profit before tax would be affected by SEK +/– 1,377m in the case of a change in value of the investment properties of +/– 5 per cent. The equity/assets ratio in the event of a positive change in value would amount to 39.1 per cent and in the event of a negative change in value it would amount to 35.3 per cent.

Sensitivity analysis

Factor Change Earnings effect
before tax, SEKm
Rental income +/–1 per cent +/–23
Economic
occupancy rate +/–1 percentage +/–24
Interest-rate level of
interest-bearing
liabilities +1 percentage –82
Property costs +/–1 per cent –/+7
Changes in value of
investment properties +/–5 per cent +/–1,377

Environment

Balder has not carried out any comprehensive study of possible environmental pollution in the property portfolio but estimates that neither the properties nor the customers' operations give rise to any material environmental risks, which could affect the company's position. Acquisitions of properties where a risk of an environmental impact is deemed to exist, are preceded by environmental inspections.

The company's ownership of wind turbines is part of Balder's environmental work. Balder's ten wind turbines produce about 30 per cent of the company's own electricity consumption.

The share and owners

During the year, two new issues were completed. In May, a directed new share issue of 500,000 preference shares took place at a price of SEK 321 per share. A further 3,500,000 preference shares were issued in October, at a price of SEK 329 per share. Combined, the issues provided the company with SEK 1,297 M after transaction costs.

At year-end, the number of repurchased own shares amounted to 2,859,600 shares in total. No shares were repurchased during the year. The purpose of the repurchased shares is primarily to enable, wholly or partly, acquisition financing using own shares.

At year-end, the share capital amounted to 172,396,852 distributed among 172,396,852 shares. Each share has a quota

value of SEK 1, whereof 11,229,432 are of Class A, 151,167,420 of Class B and 10,000,000 preference shares. Each Class A share carries one vote, and each Class B share and preference share carries one tenth of one vote. Of the B shares, 2,859,600 are repurchased, which means that the total number of outstanding shares amounts to 169,537,252.

The Annual General Meeting 2013 resolved to authorise the Board during the period until the next annual general meeting to decide on a new issue of shares of Class B and preference shares corresponding to not more than 10 per cent of the existing share capital. The largest owners are Erik Selin Fastigheter AB with 51 per cent of the votes and Arvid Svensson Invest AB with 16 per cent of the votes. There are no restrictions in the articles of association as to the form of transfer of shares or voting rights at the general meeting.

Since Balder will prioritise growth, capital structure and liquidity during the next few years, the dividend for the ordinary share will be low or may not be declared at all. The quarterly dividend for the preference share amounts to SEK 20.00 per year.

Results

Profit from property management for the year, in other words profit excluding changes in value, derivatives and tax, amounted to SEK 854m (691), which corresponds to SEK 4.57 per ordinary share (3.73). The increase was primarily due to changes in the real estate portfolio. The profit from property management includes SEK 157m (108) in respect of associated companies, which is included in the income statement in participations in profits from associated companies. Net profit for the year after tax amounted to SEK 1,738m (1,162), corresponding to SEK 10.11 per ordinary share (6.69).

The result was impacted by realised changes in value in respect of properties of SEK 16m (3), unrealised changes in value of properties of SEK 838m (809), changes in value in respect of wind turbines of SEK –37m (–), changes in value in respect of interest rate derivatives of SEK 433m (–71) and profit from participations in associated companies of SEK 204m (105).

The Group's rental income amounted to SEK 1,884m (1,701) during the year. The leasing portfolio was estimated to have a rental value on 31 December of SEK 2,394m (1,924) on a full-year basis. The average rental level for the entire real estate portfolio amounted to SEK 1,216/sq.m. (1,247). The decrease in the average rental level was due to the acquisition of Bovista Invest, which mainly consists of 4,300 residential apartments. The rental income shows a considerable diversification of risks as regards tenants, sectors and locations.

The economic occupancy rate amounted to 94 per cent (94) on the closing date. On 31 December, the total rental value for unlet areas amounted to SEK 134m (124) on a full-year basis.

Property costs amounted to SEK 609m (537) during the year. The increase in property costs was due to changes in the real estate portfolio. Net operating income increased by 9 per cent to SEK 1,274m (1,164), which provided a surplus ratio of 68 per cent (68).

Net financial items amounted to SEK –456m (–466) and changes in value of interest rate derivatives amounted to SEK 433m

(–71). Derivatives are continually recognised at fair value in the balance sheet and changes in value are recognised in the income statement without using hedge accounting. Changes in value from derivatives arise in the event of changed interest-rate levels and do not affect cash flow, as long as they are not sold during the period. Balder has hedged against higher levels of interest rates, which means that the market value of derivatives decreases during a period of downward interest rates. The deficit in respect of interest rate derivatives amounted to SEK 472m (868) at year-end. The positive change in value during the year was due to an increase in the level of interest rates which means that the difference in relation to the contracted interest rate level of interest rate derivatives has decreased.

The deficit on derivatives will be released during the remaining term and recognised as income. This means that Balder has a reserve of SEK 472m, which will be reversed in its entirety to equity, adjusted by deferred tax, in line with the maturity of the interest rate derivatives.

Net financial items are equivalent to an average interest rate of 3.1 per cent (3.7) including the effect of accrued interest from Balder's interest rate derivatives.

Value of the properties

Balder carried out an internal valuation on 31 December of the entire real estate portfolio, based on a ten-year cash flow model. Each property is individually valued by computing the present value of future cash flows, in other words future rent payments less estimated operating and maintenance payments. The cash flow is adjusted to the market by taking account of changes in letting levels and occupancy rates as well as operating and maintenance payments.

The valuation is based on an individual assessment of each property, as well as future cash flows and the yield requirement. For a more detailed description of Balder's real estate valuation see Note 13, Investment properties.

Market assessments of properties always involve a certain amount of uncertainty in the assumptions and estimates made. In order to quality-assure its internal valuations, Balder regularly allows parts of the portfolio to be externally valued during the year. On 30 June, Balder's entire property portfolio was externally valued. The external valuation exceeded Balder's internal valuation by less than 1 per cent.

On 31 December, the carrying amount of the investment properties amounted to SEK 27,532m (22,278) according to the individual internal valuation, which implied an unrealised change in value of SEK 838m (809).

Taxes

Balder reported current tax revenue of SEK 6m (–10) and a deferred tax expense of SEK 418m (240).

Current tax and deferred tax have been calculated based on the applicable tax rate for 2013. Current tax only arises in exceptional cases on account of the possibilities of making tax write-offs, tax deductions for certain investments in properties and use of existing loss carry-forwards. Current tax arises for the small number of subsidiaries where no group contributions for tax purposes exist. Current tax for the year mainly refers to companies in Denmark.

The Group's remaining tax deficit has been estimated at SEK 2 billion (2.2) and the temporary differences between the carrying amounts and values for tax purposes of properties and interest rate derivatives amount to about SEK 5.9 billion (4.2). Deferred tax is calculated on the temporary differences arising after the acquisition date. Deferred tax liabilities are calculated on the net of these items and amounted to SEK 862m (443). For more detailed information, see Note 11, Taxes.

Cash flow and financial position

Balder's assets amounted to SEK 30,041m (23,843) on 31 December. These have been financed by equity of SEK 11,296m (8,289) and by liabilities of SEK 18,846m (15,554) of which SEK 16,521m (13,789) are interest-bearing.

Cash flow from operating activities before changes in working capital amounted to SEK 708m (543). Investing activities have burdened the cash flow by SEK 4,593m (3,888). During the period, acquisition of properties totalled SEK 3,606m (3,756), investments in existing properties SEK 880m (273) and investments in property, plant and equipment, financial investments, associated companies etc. and non-controlling interests amounted to SEK 297m (102) and dividends paid totalled SEK 125m (95). Investments have been financed through cash flow from operating activities of SEK 502m (438), by property divestments of SEK 145m (72) and financial investments of SEK 7m (154), no dividend from associated companies (18), a new issue of SEK 1,297m (554) and net borrowings of SEK 3,079m (3,031).

Total cash flow for the period amounted to SEK 160m (40). The Group's cash and cash equivalents, financial investments and unutilised credit facilities amounted to SEK 1,004m (470) on 31 December.

Shareholders' equity

Shareholders' equity amounted to SEK 11,196m (8,289) on 31 December, corresponding to SEK 52.14 per ordinary share (42.15). The equity/assets ratio amounted to 37.3 per cent (34.8).

Interest-bearing liabilities

The Group's interest-bearing liabilities amounted to SEK 16,521m (13,789) on 31 December. The proportion of loans with interest dates during the coming 12-month period amounted to 50 per cent (40) and the average fixed credit term amounted to 5.4 years (6.6). Derivatives contracts have been entered into in order to limit the impact of a higher market rate of interest.

The above-mentioned derivatives are continually recognised at fair value in the balance sheet with changes in value recognised in net financial items in the income statement without using hedge accounting. Changes in value during the year amounted to SEK 433m (–71). Interest-bearing liabilities are described in greater detail in Note 21, Financial risks and financial policies.

Liquidity

At year-end, the Group's financial investments, cash and cash equivalents and unutilised credit facilities amounted to SEK 1,004m (470).

Investments

Real estate investments amounted to SEK 4,486m (4,029) during the year, of which SEK 3,606m (3,756) related to acquisitions and SEK 880m (273) related to investments in existing properties and projects. Remaining investments in projects amounted to approximately SEK 730m (–). Of the total investments, SEK 1,474m (1,413) related to Stockholm, SEK 1,693m (452) to Gothenburg/West, SEK 222m (2,115) to Öresund, SEK 1,083m (25) to East, and SEK 14m (23) to North.

Associated companies

Balder has property-managing associated companies and associated companies which conduct project development, which are all 50 per cent-owned. In addition, Balder owns 44 percent of Collector. The property-managing associated companies include Centur, Akroterion and Tulia. Bovieran and Fix Holding work with project development. Under associated companies on page 46, Balder's participations in the balances sheets and real estate holdings of property-managing associated companies are reported and presented according to IFRS accounting policies.

The associated companies own 49 investment properties in total (43). Balder's participation in the lettable area of the real estate holdings amounts to approximately 142,000 sq.m. (135,000) with a rental value of SEK 200m (168). The economic occupancy rate amounted to 93 per cent (95).

Parent Company

The Parent Company's operations mainly consist of performing group-wide services. Balder has centralised the Group's credit supply, risk management and cash management through the Parent Company having an internal bank function. Sales in the Parent Company amounted to SEK 99m (96) during the year, of which intra-group services represented SEK 83m (81) and the remainder mostly related to management assignments for associated companies.

Profit after tax during the year amounted to SEK 365m (387). The profit was impacted by changes in value in respect of interest rate derivatives of SEK 374m (–97).

The Parent Company's financial investments and cash and cash equivalents, including unutilised credit facilities amounted to SEK 895m (378) on 31 December. Receivables from group companies amounted to SEK 11,506m (10,571) on the closing date. Investments in property, plant and equipment and financial investments amounted to SEK 0m (1) and SEK 218m (60) respectively during the year. The change in non-current liabilities was mainly related to acquisitions during the year.

Report on the Board work during the year

The Board held 12 board meetings during the financial year of which one was the statutory meeting. The work follows a formal work plan approved by the Board. The formal work plan governs the Board's working methods and the division of responsibility between the Board and CEO as well as the forms for the day-to-day financial reporting. During the year, strategic questions and other important matters for the company's development were discussed, apart from day-to-day financial reporting and decision-making. The company's auditors participate in at least one board meeting and report on their audit of the management's administration and of the accounts.

Corporate Governance

Balder is governed by the corporate governance rules prescribed in the Swedish Companies Act, the Articles of Association and NASDAQ OMX Stockholm's rules for issuers. The Board aims to make it easy for the individual shareholder to understand where in the organisation responsibility and authority lie. The corporate governance in the company is based on Swedish legislation, principally on the Swedish Companies Act, NASDAQ OMX Stockholm's rules for issuers, the Swedish Code of Corporate Governance as well as other rules and guidelines. Some of the Code's principles involve creating a good basis for exercise of an active balance of power among owners, the Board and management, which Balder views as a natural part of the principles of the operations.

Remuneration to the CEO and other senior executives

Guidelines for remuneration of senior executives were resolved upon at the preceding Annual General Meeting. Above all, the guidelines mean that market-related salaries and other terms of employment should be applicable for the company management. The remuneration should be paid in the form of a fixed salary. Taken together, dismissal pay and termination benefits should not exceed the equivalent of 18 monthly salaries. The company management refers to the CEO and other members of the Group management.

The Board's proposed guidelines to the next Annual General Meeting correspond to the present guidelines.

Significant events after the end of the financial year

After year-end, Balder has acquired two retail properties and a development property in Backaplan in Gothenburg and a retail property adjacent to Nordstan's shopping centre in central Gothenburg. The retail properties have a lettable area of about 9,600 square metres. In addition to the above, the hotel property Scandic Opalen was acquired in Gothenburg. The area of the hotel is 18,500 sq.m. After year-end, Balder also opted to establish an loan framework of SEK 5 billion in order to supplement existing financing. Balder has also divested properties in six different transactions for a total sales value of SEK 180m. The sales value exceeded the most recent valuation by about SEK 35m. In March, all repurchased shares were also sold.

Expectations regarding the future trend

Balder's goal is to grow by means of direct or indirect acquisitions together with our partners in the locations where we have operations.

Proposed distribution of earnings

The following amount in Swedish kronor is at the disposal of the Annual General Meeting:

Total 1) 6,102,081,465
Net profit for the year 364,875,404
Retained earnings 1,971,804,522
Share premium reserve 3,765,401,540

1) See change in the Parent Company's equity, page 60.

The Board proposes that the amount be allocated as follows:

Dividend SEK 20.00 per preference share 200,000,000
Carried forward 5,902,081,465
Total 6,102,081,465
Of which share premium reserve 3,765,401,540

The Board's statement regarding the proposed distribution of profits

Consolidated equity has been calculated in accordance with the IFRS standards adopted by the EU and interpretations of these (IFRIC) and in accordance with Swedish law by application of the Swedish Financial Reporting Board's recommendation RFR 1 (Supplementary Accounting Rules for Groups). The Parent Company's equity has been calculated in accordance with Swedish law and by application of the Swedish Financial Reporting Board's recommendation RFR 2 (Accounting for Legal Entities).

The Board considers that full coverage exists for the company's restricted equity after the proposed distribution of profits.

The Board considers that the proposed distribution of profits is reasonable taking account of the assessment criteria prescribed in Chapter 17 Section 3, second and third paragraphs of the Swedish Companies Act (the type, scale, risks, need to strengthen the balance sheet, liquidity and general financial position of the operations).

The Board estimates that the company's and the Group's equity after the proposed distribution of profits will be sufficiently large in relation to the type, scale and risks of the operations. The Board's assessment of the Parent Company's and the Group's financial position means that the dividend is defensible in relation to the requirements imposed by the type, scale and risks of the operations on the size of the Parent Company's and the Group's equity and the Parent Company's and the Group's need to strengthen the balance sheet, liquidity and financial position generally. The proposed dividend for preference shares accounts for 3.2 per cent (2.5) of the company's equity and 1.8 per cent (1.4) of the Group's equity.

Balder's declared goal for the Group's capital structure is that the equity/assets ratio should not be less than 35 per cent over time and that the interest coverage ratio should not be less than 1.5 times, and should also be met after the proposed dividend. In light of this, the Board considers that the company and the Group have a good basis for taking advantage of future business opportunities and also for managing possible losses. Planned investments have been considered in determination of the proposed distribution of profits.

The proposed distribution of profits will not affect the company's and the Group's ability to meet their payment obligations at the right time.

The Board has considered all other known circumstances that may be important for the company's and the Group's financial position and which have not been considered within the framework of what is stated above. In this connection, no circumstances have arisen, which make the proposed dividend appear unreasonable. Record days for the quarterly dividend of SEK 5.00 to the preference shareholders are 10 July, 10 October, 10 January and 10 April.

FASTIGHETS AB balder ANNUAL REPORT 2013 53 Gothenburg, 11 April 2014 Board of Directors

Financial statements

Consolidated statement of comprehensive income

SEKm Note 2013 2012
Rental income 2, 3 1,884 1,701
Property costs 3, 6, 7, 8 –609 –537
Net operating income 1,274 1,164
Changes in value of investment properties, realised 16 3
Changes in value of investment properties and wind turbines, unrealised 1) 13 801 809
Management and administrative expenses 5, 6 –121 –115
Other operating income/expenses –16
Participation in profits of associated companies 15 204 105
Operating profit 3, 4, 5, 6, 7 2,174 1,950
Financial items
Financial income 9 87 45
Financial expenses 10 –543 –511
Changes in value of derivatives 21 433 –71
Net financial items –23 –538
Profit before tax 2,151 1,412
Income tax 11 –412 –250
Net profit for the year 1,738 1,162
Other comprehensive income – items that may later be reclassified in the income statement
Translation difference 8 –6
Participation in other comprehensive income from associated companies –12 –1
Comprehensive income for the year 1,735 1,155
Net profit for the year attributable to
The parent company's shareholders 1,738 1,162
Total comprehensive income for the year attributable to
The parent company's shareholders 1,735 1,155
Profit from property management before tax 854 691
Profit from property management before tax per ordinary share, SEK 2) 4.57 3.73
Profit after tax per ordinary share, SEK 2) 12 10.11 6.69
1) Unrealised changes in value in respect of properties 838 809
Unrealised changes in value in respect of wind turbines –37
Total 801 809

2) There is no dilutive effect as no potential shares arise.

Consolidated statement of financial position

SEKm Note 31 Dec 2013 31 Dec 2012
ASSETS
Non-current assets
Investment properties 13 27,532 22,278
Other property, plant and equipment 14 108 152
Participations in associated companies 15 1,020 760
Receivables from associated companies 748 468
Total non-current assets 29,408 23,658
Current assets
Trade receivables 16 23 26
Other receivables 17 65 18
Prepaid expenses and accrued income 18 32 25
Financial investments 19 305 69
Cash and cash equivalents 25 208 47
Total current assets 633 186
TOTAL ASSETS 30,041 23,843
SHAREHOLDERS' EQUITY AND LIABILITIES
Equity attributable to the parent company's shareholders
Share capital 20 172 168
Other paid-up capital 4,339 3,046
Retained earnings including net profit for the year 6,685 5,075
Total equity 11,196 8,289
Liabilities
Non-current liabilities
Deferred tax liability 11 862 443
Non-current interest-bearing liabilities 21 16,338 13,495
Credit facilities 21, 22 4 122
Derivatives 21 472 868
Total non-current liabilities 17,676 14,929
Current liabilities
Current interest-bearing liabilities 21 179 172
Trade payables 150 76
Other liabilities 465 82
Accrued expenses and deferred income 23 376 295
Total current liabilities 1,170 625
Total liabilities 18,846 15,554
TOTAL EQUITY AND LIABILITIES 30,041 23,843
Pledged assets and contingent liabilities
Pledged assets 24 19,317 15,611
Contingent liabilities 24 925 685

Consolidated statement of changes in equity

Attributable to the parent company's shareholders
SEKm Share capital Other
paid-up
capital
Reserves Retained
earnings
including net
profit for
the year
Total Non-control
ling interests
Total
equity
Equity at 1 Jan 2012 166 2,494 –6 4,021 6,675 4 6,679
Net profit for the year 1,162 1,162 1,162
Other comprehensive income –7 –7 –7
Total comprehensive income –7 1,162 1,155 1,155
Acquisition of
non-controlling interests
–4 –4
New issue 1) 2 552 554 554
Dividend paid preference shares –95 –95 –95
Total transactions with the
company's owner
2 552 –95 459 –4 455
Equity at 31 Dec 2012 168 3,046 –13 5,088 8,289 8,289
Equity at 1 Jan 2013 168 3,046 –13 5,088 8,289 8,289
Net profit for the year 1,738 1,738 1,738
Other comprehensive income –4 –4 –4
Total comprehensive income –4 1,738 1,735 1,735
New issue 1) 4 1,293 1,297 1,297
Dividend paid preference shares –125 –125 –125
Total transactions with the
company's owner
4 1,293 –125 1,172 1,172
Equity at 31 Dec 2013 172 4,339 –16 6,701 11,196 11,196

1) Includes issue costs of SEK 15m (11).

Consolidated statement of cash flows

SEKm Note 25 2013 2012
Operating activities
Net operating income 1,274 1,164
Other operating income and expenses –16
Management and administrative expenses –121 –115
Reversal of depreciation and amortisation 17 16
Adjustment item 3 0
Interest received 27 16
Interest paid –492 –511
Tax paid 0 –10
Cash flow from operating activities before change in working capital 708 543
Cash flow from changes in working capital
Change in operating receivables –332 –59
Change in operating liabilities 126 –47
Cash flow from operating activities 502 438
Investing activities
Acquisition of properties –3,606 –3,756
Acquisition of property, plant and equipment –12 –19
Purchase of financial investments –218 –60
Acquisitions from non-controlling interests –4
Investment in existing properties –880 –273
Acquisitions of Bovista, liquidity 1) 36
Divestment of properties 145 72
Sale of financial investments 7 154
Acquisition of associated companies –67 –19
Dividend paid from associated companies 18
Cash flow from investing activities –4,593 –3,888
Financing activities
New issue 1,297 554
Dividend paid preference share –125 –95
Borrowings 3,865 4,307
Amortisation/Redemption of loans –668 –1,181
Change in credit facilities –118 –95
Cash flow from financing activities 4,252 3,490
Cash flow for the year 160 40
Cash and cash equivalents at beginning of year 47 8
Cash and cash equivalents at end of year 208 47
Unutilised credit facilities 22 491 354
Financial investments 19 305 69

1) Refers to the liquidity that was provided in connection with the acquisition of Bovista.

Parent Company income statement

SEKm Note 2013 2012
Net sales 2 99 96
Administrative expenses –113 –115
Operating profit 4, 5 –14 –19
Profit from financial items
Impairment of shares in subsidiaries 26 –2
Interest income and similar profit/loss items 9 660 909
Interest expenses and similar profit/loss items 10 –440 –351
Changes in value of derivatives 21 374 –97
Profit before appropriations and taxes 578 442
Appropriations
Group contributions paid/received –114 5
Profit before tax 464 447
Income tax 11 –99 –60
Net profit for the year/comprehensive income 365 387

Parent Company balance sheet

SEKm Note 31 Dec 2013 31 Dec 2012
ASSETS
Non-current assets
Property, plant and equipment 14 24 27
Financial assets
Participations in group companies 26 1,822 1,827
Participations in associated companies 15 483 421
Deferred tax assets 11 98 198
Receivables from associated companies 748 468
Receivables from group companies 27 11,506 10,571
Total financial assets 14,656 13,484
Total non-current assets 14,680 13,510
Current assets
Current receivables
Other receivables 17 15 12
Prepaid expenses and accrued income 18 16 12
Financial investments 19 305 69
Total current receivables 336 93
Cash and cash equivalents 25 144 5
Total current assets 481 98
TOTAL ASSETS 15,161 13,608
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity
Restricted equity
Share capital 20 172 168
Unrestricted equity
Share premium reserve 3,765 2,473
Retained earnings 1,972 1,710
Net profit for the year 365 387
Total equity 6,274 4,738
Non-current liabilities
Liabilities to credit institutions 21 5,632 5,020
Credit facilities 21, 22 122
Derivatives 21 361 698
Liabilities to group companies 27 2,782 2,927
Total non-current liabilities 8,775 8,767
Current liabilities
Liabilities to credit institutions 21 58 58
Trade payables 2 5
Other liabilities 6 7
Accrued expenses and deferred income 23 45 34
Total current liabilities 111 103
TOTAL EQUITY AND LIABILITIES 15,161 13,608
Pledged assets and contingent liabilities
Pledged assets
24 5,008 4,741
Contingent liabilities 24 11,076 8,900

Parent Company statement of changes in equity

Restricted equity Unrestricted equity
SEKm Number
of shares
Share capital Share
premium
reserve
Retained
earnings
Net profit for
the year
Total
equity
Equity at 1 Jan 2012 166,396,852 166 1,920 1,972 –167 3,891
Net profit for the year/comprehensive income 387 387
Appropriation of profits –167 167
New issue 1) 2,000,000 2 552 554
Dividend paid preference shares –95 –95
Total transactions with the company's owner 2,000,000 2 552 –262 167 459
Equity at 31 Dec 2012 166,396,852 168 2,473 1,710 387 4,738
Equity at 1 Jan 2013 168,396,852 168 2,473 1,710 387 4,738
Net profit for the year/comprehensive income 365 365
Appropriation of profits 387 –387
New issue 1) 4,000,000 4 1,293 1,297
Dividend paid preference shares –125 –125
Total transactions with the company's owner 4,000,000 4 1,293 262 –387 1,172
Equity at 31 Dec 2013 172,396,852 172 3,765 1,972 365 6,274

1) Includes issue costs of SEK 15m (11).

Parent Company cash flow statement

SEKm Note 25 2013 2012
Operating activities
Operating profit –14 –19
Reversal of depreciation and amortisation 3 4
Changes in value of derivatives, realised 37
Interest received 33 28
Interest paid –239 –180
Cash flow from operating activities before change in working capital –180 –166
Cash flow from changes in working capital
Change in operating receivables 0 –1
Change in operating liabilities 8 –54
Cash flow from operating activities –172 –221
Investing activities
Acquisition of property, plant and equipment 0 –1
Acquisition of shares in subsidiaries –3
Purchase of financial investments –218 –60
Change in lending to group companies –791 –796
Change in lending to associated companies –287 –57
Sales of financial investments 7 154
Acquisition of associated companies –62 –19
Cash flow from investing activities –1,351 –781
Financing activities
New issue 1,297 554
Dividend paid preference shares –125 –95
Borrowings 1,534 811
Amortisation/Redemption of loans –922 –221
Change in credit facilities –122 –45
Cash flow from financing activities 1,662 1,005
Cash flow for the year 139 3
Cash and cash equivalents at beginning of year 5 2
Cash and cash equivalents at end of year 144 5
Unutilised credit facilities
Financial investments 22
19
445
305
304
69

Notes to the financial statements

Note 1 · Accounting policies applied

General information

The financial statements for Fastighets AB Balder, as of 31 December 2013, were approved by the Board of Directors and Chief Executive Officer on 11 April 2014 and will be submitted for adoption at the Annual General Meeting on 7 May 2014. Fastighets AB Balder (publ), corporate identity number 556525-6905, with registered office in Gothenburg, constitutes the Parent Company of a Group with subsidiaries according to Note 26, Group companies. The company is registered in Sweden and the address of the company's head office in Gothenburg is Fastighets AB Balder, Box 53121, 400 15 Gothenburg. The visiting address is Vasagatan 54. Balder is a listed property company which shall meet the needs of different customer groups for premises and housing based on local support.

Accounting policies

The consolidated accounts have been prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and interpretations by the International Financial Interpretations Committee (IFRIC), as adopted by the EU. In addition, the Swedish Financial Reporting Board's recommendation RFR 1, Supplementary Accounting Rules for Groups is applied.

The annual accounts of the Parent Company have been prepared in accordance with the Swedish Annual Accounts Act, the Swedish Financial Reporting Board's recommendation RFR 2 (Accounting for Legal Entities) and statements of the Swedish Financial Reporting Board. The Parent Company applies the same accounting policies as the Group apart from the instances described below in the section "Parent Company accounting policies". The deviations that occur between the Parent Company and Group accounting policies are due to limitations in the possibilities of applying IFRS in the Parent Company on account of the Annual Accounts Act.

The Parent Company's functional currency is the Swedish krona (SEK), which is also the presentation currency of the Parent Company and the Group.

The financial statements are presented in Swedish kronor rounded off to millions of kronor unless otherwise stated.

Assets and liabilities are recognised at historical cost, with the exception of investment properties, financial investments and derivative instruments, which are measured at fair value.

Preparation of financial statements in conformity with IFRS requires the company management to make estimates and assumptions that affect the application of the accounting policies and the recognised amounts of assets, liabilities, income and expenses.

The estimates and assumptions are based on historical experience and other factors that appear reasonable under the existing circumstances. The result of these estimates and assumptions is subsequently used to estimate the carrying amounts of assets and liabilities that are not otherwise clear from other sources. The actual outcome may diverge from these estimates and judgements.

Estimates and assumptions are reviewed regularly. Changes in estimates are recognised in the period in which they arise if the change affects that period alone or, alternatively, in the period in which they arise and during future periods if the change affects both the period in question and future periods.

Assumptions made by the company management in the application of IFRS, which have a material impact on the financial statements, and estimates which may give rise to significant adjustments in subsequent financial statements are presented in more detail in Note 30, Critical estimates and judgements.

The accounting policies set out for the Group have been consistently applied for all periods presented in the Group's financial statements, unless otherwise stated below. The Group's accounting policies have been applied consistently in the reporting and consolidation of subsidiaries.

Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker is the function responsible for allocation of resources and evaluation of the operating segments' results. In the

Group, this function has been identified as the management team, which takes strategic decisions. The Group's internal reporting of the operations is divided into the segments Stockholm, Gothenburg/West, Öresund, East and North, which are harmonised with the Group's internal reporting system. See further in Note 3, Segment reporting.

Classification etc.

Non-current assets and non-current receivables largely consist of amounts that are expected to be recovered or paid after more than twelve months, calculated from the end of the reporting period. Current assets and current liabilities largely consist of amounts that are expected to be recovered or paid within twelve months, calculated from the end of the reporting period. Current liabilities to credit institutions include amortisation agreed for one year. In the Parent Company, receivables and liabilities from/to group companies are recognised as noncurrent, when there is no approved amortisation plan.

Basis of consolidation

Subsidiaries are companies that are subject to a controlling influence, which means that Balder owns more than 50 per cent of the shares or participations. Control means, directly or indirectly, a right to set the company's financial and operational strategies aimed at obtaining economic benefits. When determining whether control exists, potential voting shares that can be called upon or converted without delay should be considered.

Subsidiaries are accounted for according to the purchase method. This method means that the acquisition of a subsidiary that is classified as a business combination is treated as a transaction by which the Group indirectly acquires the subsidiary's assets and assumes its liabilities and contingent liabilities. The acquisition analysis establishes the cost of the shares or entity, as well as the fair value on the acquisition date of the company's identifiable assets, liabilities assumed and contingent liabilities. The consideration also includes the fair value of all assets or liabilities, which are a result of an agreement on contingent consideration. Costs related to the acquisition are expensed as they arise. For each acquisition, the Group determines if all non-controlling interests in the acquired entity are recognised at fair value or at the non-controlling interest's proportionate share of the acquiree's net assets. The cost of acquisition of a subsidiary's shares and operations consists of the fair values of the assets on the date of exchange, liabilities incurred or assumed and equity instruments issued as consideration in exchange for the acquired net assets, as well as transaction costs that are directly attributable to the acquisition.

In business combinations where the cost of acquisition exceeds the net value of acquired assets, and liabilities and contingent liabilities assumed, the difference is recognised as goodwill. When the difference is negative, this is recognised directly in the income statement. When a company is acquired, the acquisition constitutes either the acquisition of an entity or the acquisition of an asset. An acquisition of an asset is identified if the acquired company only owns one or more properties. There are leases for these properties, but no personnel are employed in the company who can conduct business. In a business combination based on joint control, de facto control, the acquisition is recognised at historical cost, which means that assets and liabilities are recognised at the values they have been carried at in each company's balance sheet. In this way, no goodwill arises.

When an acquisition occurs of a group of assets or net assets which do not constitute an entity, the cost for the Group is allocated according to the individually identifiable assets and liabilities in the Group based on their relative fair values on the acquisition date.

The subsidiaries' financial statements are included in the consolidated financial statements from the date control arises until the date control ceases.

Transactions eliminated on consolidation

Transactions with non-controlling interests that do not lead to a loss of control are recognised as transactions in equity, in other words, as transactions with shareholders in their role as owners. In the case of acquisitions from non-controlling interests, the difference between the fair value of consideration paid and the proportion of the carrying

amount of the subsidiary's net assets actually acquired is recognised in equity. Gains and losses on disposals to non-controlling interests are also recognised in equity.

Transactions eliminated on consolidation

Intra-group receivables and liabilities, revenue or expenses, and unrealised gains or losses arising from transactions between group companies, are eliminated in full on preparation of the consolidated accounts.

Recognition of associated companies

Associated companies are considered to be those companies that are not subsidiaries but where the Parent Company directly or indirectly holds between 20 and 50 per cent of the votes of all shares. Participations in associated companies are recognised according to the equity method. The equity method means that participations in an associated company are recognised at cost at the date of acquisition and are subsequently adjusted by the Group's participation in the change in the associated company's net assets.

Participating interests in associated companies are recognised separately in the consolidated statement of comprehensive income and consolidated statement of financial position. Participations in the profits of associated companies are recognised after tax.

Foreign currency

Financial statements of foreign operations

Assets and liabilities in foreign operations are translated to Swedish kronor, at the exchange rate prevailing at the end of the reporting period. Income and expenses in a foreign operation are translated to Swedish kronor at an average rate that represents an approximation of the prevailing exchange rates on the date of each transaction. Translation differences arising on currency translation of foreign operations are recognised via other comprehensive income as a translation reserve.

Transactions in foreign currencies

Transactions in foreign currencies are translated to the functional currency at the exchange rate prevailing on the transaction date. The functional currency is the currency, which applies in the primary economic environments in which companies conduct their operations. Monetary assets and liabilities denominated in foreign currencies are translated to the functional currency at the prevailing year-end exchange rate. Exchange differences are recognised in the income statement, apart from non-current internal balances, which are treated as a part of the net investment in subsidiares and are recognised via other comprehensive income. Non-monetary assets and liabilities, which are recognised at historical costs are translated at the exchange rate prevailing on the transaction date. Non-monetary assets and liabilities, which are recognised at fair value are translated to the functional currency at the rate prevailing on the date of fair value measurement.

Rental income

Rental income is recognised in the consolidated statement of comprehensive income on a straight-line basis according to the terms of the leasing agreement. The total cost of benefits provided is recognised as a decrease in rental income on a straight-line basis over the leasing period. Rental income is recorded in the period it refers to.

Other income

Other income is recognised in the consolidated statement of comprehensive income on a straight-line basis.

Costs for operating lease contracts

Costs relating to operating lease contracts and benefits received in connection with the signing of an agreement are recognised in the consolidated statement of comprehensive income on a straight-line basis over the term of the lease.

Financial income and expenses

Financial income and expenses consists of interest income on bank balances and receivables as well as interest expenses on liabilities.

Interest income on receivables and interest expenses on liabilities are calculated by application of the effective interest method. The effective rate is the interest rate, which means that the present value of all future incoming and outgoing payments during the interest rate refixing period will be the same as the carrying amount of the receivable or liability. Interest income and interest expenses include allocated amounts of transaction costs and possible discounts, premiums and other differences between the initial carrying amount of the receivable

or liability and the amount that is settled at maturity. The interest component in financial lease payments is recognised in the consolidated statement of comprehensive income by application of the effective interest method.

Borrowing costs directly attributable to the construction or production of an asset, which requires a significant time to complete for use or sale are included in the cost of the asset. Capitalisation of borrowing costs takes place provided that it is likely to lead to future economic benefits and that the costs may be measured in a reliable manner.

Financial instruments

Financial instruments are measured and recognised in the Group in accordance with the rules in IAS 39. Financial instruments on the asset side that are recognised in the consolidated statement of financial position include cash and cash equivalents, financial investments, trade receivables and other long-term security holdings as well as derivatives with positive value. Liabilities include trade payables, borrowings and derivatives with negative value. Financial instruments are initially recognised at the cost of acquisition corresponding to the fair value of the instrument plus transaction costs for all financial instruments, apart from those classified as financial assets recognised at fair value via the consolidated statement of comprehensive income, such as derivative instruments, which are recognised at fair value excluding transaction costs. The financial instruments are classified on initial recognition based on the purpose for which the instrument was acquired, which affects the subsequent recognition.

A financial asset or financial liability is carried in the consolidated statement of financial position when the company becomes a party to the contractual terms of the instrument. Trade receivables are carried in the balance sheet when the invoice has been sent. Rental receivables are recognised as a receivable in the period when performance, which corresponds to the receivable's value, has been delivered and payments corresponding to the value of the receivable have still not been received. A liability is recognised when the counterparty has performed a service and a contractual payment obligation prevails, even if the invoice has not yet been received. Trade payables are recognised when the invoice has been received.

A financial asset is derecognised when the contractual rights are realised or expire or the company no longer has control over them. The same applies to a portion of a financial asset. A financial liability is derecognised when the contractual liability is discharged or otherwise expires. The same applies to a portion of a financial liability.

Acquisition and disposal of financial assets are recognised on the transaction date, which represents the day when the company committed to acquire or dispose of the asset. Borrowing is recognised when the funds have been received, while derivative instruments are recognised when the contract has been entered into.

Balder divides its financial instruments into the following categories in accordance with IAS 39.

Financial assets measured at fair value through the consolidated statement of comprehensive income

This category consists of two subcategories: financial assets held for trading and other financial assets that the company initially elected to place in this category, under the so-called Fair Value Option. Financial instruments in this category are continually measured at fair value with changes in value recognised in the consolidated statement of comprehensive income. The first subcategory includes the Group's derivatives with positive fair value.

Loan receivables and trade receivables

Receivables, which do not constitute derivatives, are recognised at amortised cost under the effective interest method. Trade receivables including rental receivables and other current receivables that normally have a term of less than twelve months are recognised at fair value. A receivable is examined individually as regards estimated risk of loss and is carried at the amount, which is expected to be received. Impairments are made for doubtful receivables and are recognised in operating costs.

Financial assets available for sale

The category financial assets available for sale includes financial assets, which are not classified in any other category or financial assets that the company initially elected to classify in this category. Holdings of shares and participations that are not recognised as subsidiaries or associated companies are recognised here. Assets in this category are continually measured at fair value with changes in value recognised in

Note 1 (continued)

equity, however, not those that are due to impairments and dividend income, which are recognised in the income statement. In the event of disposal of the asset, accumulated gains or losses, which were previously recognised in equity, are recognised in the consolidated statement of comprehensive income. This category includes unlisted shares which are recognised under other long-term security holdings.

Financial liabilities measured at fair value through the consolidated statement of comprehensive income

This category consists of two sub-categories, financial liabilities held for trading and other financial liabilities that the company elected to place in this category, the so-called Fair Value Option. The first category includes the Group's derivatives with negative fair value. Changes in fair value are recognised in the consolidated statement of comprehensive income.

Other financial liabilities

Balder's financial policy, which is updated at least once each year, prescribes guidelines and rules for how borrowing should be conducted. The overall objective of financial management is to use borrowing to safeguard the supply of capital to the company in the short and long run, to adapt the financial strategy and management of financial risks to the company's business so that a long-term and stable capital structure is achieved and maintained and to achieve the best possible net financial income/expense within given limits for risk. Borrowing is reported initially at the amount received less transaction costs. After the date of acquisition, the loan is measured at amortised cost under the effective interest method. Non-current liabilities have an expected maturity of more than 1 year while current liabilities have maturities of less than 1 year. Declared dividends are recognised as liabilities after the general meeting has approved the dividend.

Trade payables and other operating liabilities have short expected maturities and are measured at their nominal value with no discounting.

Derivative instruments

Derivative instruments include interest rate swaps that are deployed to cover the risk of changes in interest rates. Derivatives are also terms of agreement which are embedded in other agreements. Embedded derivatives should be accounted for separately if they are not closely related to the host contract. Derivative instruments are measured at fair value. Changes in the value of derivative instruments, stand-alone as well as embedded, are recognised in the consolidated statement of comprehensive income. The Group does not apply hedge accounting.

Cash and cash equivalents

Cash and cash equivalents consist of cash in hand and directly accessible balances at banks and similar institutions as well as short-term highly liquid investments with original maturities of less than three months, which are only subject to an insignificant risk of fluctuation in value.

Impairment testing of financial assets

On each reporting date, the company assesses whether there is objective evidence that a financial asset or group of assets is impaired. Objective evidence consists partly of observable circumstances that occurred and which have a negative impact on the possibility to recover the cost, and partly of a significant or protracted decline in the fair value of an investment in a financial investment classified as a financial asset available for sale.

In the event of impairment of an equity instrument which is classified as a financial asset available for sale, any previously recognised accumulated loss in equity is transferred to the consolidated statement of comprehensive income.

The recoverable amount of loans and trade receivables, which are recognised at amortised cost, is measured as the present value of future cash flows discounted by the effective rate that applied upon initial recognition of the asset. Assets with short maturities are not discounted. An impairment loss is recognised as a cost in the consolidated statement of comprehensive income.

Property, plant and equipment

Owned assets

Property, plant and equipment are recognised as an asset in the consoli-

dated statement of financial position if it is probable that future economic benefits will accrue to the company and the cost of the asset can be reliably measured.

Property, plant and equipment are recognised in the Group at cost less accumulated depreciation and any impairment losses. The purchase price is included in the cost as well as expenses directly attributable to the asset in order to bring it to the location and in the condition to be used in accordance with the aim of the acquisition.

The carrying amount of an item of property, plant and equipment is derecognised on retirement or disposal or when no future economic benefits can be expected from use of the asset. Gains or losses arising from disposal or retirement of an asset consist of the difference between the selling price and the asset's carrying amount less directly related selling expenses. Gains and losses are recognised as other operating income/expenses.

Leased assets

Leases are classified in the consolidated financial statements either as financial or operating leases. Financial leasing exists when the economic risks and rewards associated with ownership have been essentially transferred to the lessee; if this is not the case, it is an operating lease.

Operating leases mean that leasing fees are expensed over the term of the lease, based on use, which may differ in practice from the amount of leasing fees paid during the year.

The Group has no financial leases.

Additional expenditure

Additional expenditure is added to cost only if it is probable that the future economic benefits associated with the asset will accrue to the company and the cost can be measured in a reliable way. Other additional expenditure is recognised as a cost in the period in which it arises. The assessment of whether additional expenditure is added to cost depends on whether the expenditure concerns the replacement of identified components, or parts thereof, whereupon such expenditure is capitalised. Even in cases where new components are created, the expenditure is added to the cost. Repairs are expensed on an ongoing basis.

Depreciation methods

Depreciation takes place on a straight-line basis over the estimated useful life of the asset.

Useful life
Property, plant and equipment
Equipment 3–10 years
Wind turbines 10–20 years

The residual value and useful life of assets are assessed annually.

Investment properties

Investment properties are properties that are held with the aim of receiving rental income or appreciation in value or a combination of both. Investment properties are initially recognised at cost, which includes expenses and borrowing costs directly related to the acquisition. Investment properties are recognised according to the fair value method. The fair value is based on internal valuations which are reconciled as required with external independent valuers. Fair value is based on the market value, which is the estimated amount that would be received in a transaction on the valuation date between knowledgeable parties that are independent of one another and that have an interest in completing the transaction after customary marketing, where both parties are assumed to have acted discerningly, wisely and without compulsion. Both unrealised and realised changes in value are recognised in the income statement. Valuations are performed at the end of each quarter.

Income from property sales is normally recognised on the date of possession unless the risks and rewards have been transferred to the purchaser on an earlier date. Control of the asset may have been transferred on an earlier date than the date of possession and if this is the case the property sale is recognised as income on this earlier date. The assessment of the date of revenue recognition takes into consideration what was agreed between the parties as regards risks and rewards as well as involvement in the day-to-day management.

In addition to this, circumstances that can affect the outcome of the transaction are considered which lie outside the seller's and/or purchaser's control. If the Group starts a conversion of an existing

investment property for continued use as an investment property, the property will continue to be recognised as an investment property. The property is recognised according to the fair value method and is not reclassified as property, plant and equipment during the conversion period.

Additional expenditure is added to the carrying amount only if it is probable that the future economic benefits associated with the asset will accrue to the company and the cost can be measured in a reliable way. Other additional expenditure is recognised as a cost in the period in which it arises. The assessment of whether additional expenditure is added to the carrying amount depends on whether the expenditure concerns the replacement of identified components, or parts thereof, whereupon such expenditure is capitalised. Even in cases where new components are created, the expenditure is added to the carrying amount.

Impairment losses

The carrying amounts of the Group's assets, with the exception of investment properties, financial instruments and deferred tax assets, are tested on each balance sheet date to determine if there is any indication of an impairment need. If such indications exist, the recoverable amount of the asset concerned is calculated. For exempted assets, as above, the carrying amount is tested in accordance with each standard.

If it is impossible to determine significant independent cash flows to an individual asset, the assets should be grouped, in conjunction with impairment testing, at the lowest level at which it is possible to identify significant independent cash flows – a so-called cash-generating unit. An impairment loss is recognised when the carrying amount of the asset or cash-generating unit exceeds its recoverable amount. Any impairment loss is recognised in the income statement.

The recoverable amount of assets in the category loans and trade receivables, which are recognised at amortised cost, is measured as the present value of future cash flows discounted by the effective rate that applied upon initial recognition of the asset.

Assets with short maturities are not discounted.

The recoverable amount on other assets is the higher of the fair value less selling expenses and the value in use. In calculating value in use, future cash flows are discounted using a discount factor that takes into account the risk-free rate of interest and the risk associated with the specific asset. For an asset that does not generate cash flows, which is significantly independent of other assets, the recoverable amount is estimated for the cash-generating unit to which the asset belongs.

Reversal of impairment losses

Impairments of loan receivables and trade receivables recognised at amortised cost are reversed if a later increase in the recoverable amount can be objectively attributed to an event that occurred after the impairment was made.

Repurchase of own shares

Purchases of own shares are recognised as a deduction from equity. The proceeds from disposal are recognised as an increase in equity. Any transaction expenses are recognised directly against equity.

Cash flow statement

The cash flow statement was prepared using the indirect method, by which the result is adjusted for transactions that do not result in incoming or outgoing payments during the period, as well as for any income or costs attributable to investing or financing activities.

Employee benefits

Short-term employee benefits

Short-term employee benefits are calculated without discounting and are recognised as a cost when the related services are received.

Pensions

Pension plans are classified as either defined benefit or defined contribution plans. The plans are predominantly defined contribution plans. Defined benefit plans only exist in exceptional cases.

Defined-contribution plans

For defined contribution plans, the Group pays contributions to privately managed pension insurance plans on a voluntary basis. The Group has no further payment obligations once the contributions have been paid, in other words, the individual bears the risk. The contributions are recognised as employee benefit expenses when they are due for payment. Prepaid contributions are recognised as an asset to the extent

that a cash refund or decrease in future payments could accrue to the Group.

Compensation on termination of employment

A provision is recognised in connection with terminating the employment of personnel only if the company is demonstrably obligated to end employment before the normal time or when remuneration is provided as an offer to encourage voluntary retirement.

Provisions

Provisions are recognised in the balance sheet when the Group has an existing legal or informal obligation as a result of past events, and it is probable that an outflow of financial resources will be required to settle the obligation and that the amount can be reliably estimated. In cases where the effect of payment timing is significant, provisions are calculated by discounting the expected future cash flow at an interest rate before tax that reflects current market assessments of the time value of money and, if applicable, the risks specific to the liability.

Taxes

Income taxes consist of current tax and deferred tax. Income tax is recognised in the income statement except when underlying transactions are recognised in other comprehensive income or directly against equity, whereupon the associated tax effect is recognised in other comprehensive income or in equity. Current tax is tax that shall be paid or received in respect of the current year, using the tax rates which are enacted or which in practice are enacted on the balance sheet date. This includes adjustments of current tax relating to previous periods.

Deferred taxes are estimated in accordance with the liability method, based on temporary differences between the tax bases of assets and liabilities and their carrying amounts. Temporary differences not taken into consideration; temporary differences arising on the initial recognition of goodwill, the initial recognition of assets and liabilities that are not business combinations and which on the transaction date did not affect the recognised or taxable result. Furthermore, temporary differences are not taken into consideration that are attributable to investments in subsidiaries and associated companies and which are not expected to be reversed within the foreseeable future. The measurement of deferred tax is based on how the carrying amounts of assets or liabilities are expected to be realised or settled. Deferred tax is measured using the tax rates and tax regulations which were enacted or were in practice enacted on the balance sheet date. Deferred tax assets and liabilities are recognised net if they concern the same tax authority (country).

Deferred tax assets related to deductible temporary differences and loss carry-forwards are only recognised to the extent that it is probable that they can be utilised. The value of deferred tax assets is reduced when it is no longer considered probable that they can be utilised.

When a company is acquired, the acquisition constitutes either the acquisition of an entity or the acquisition of an asset. An acquisition of an asset is identified if the acquired company only owns one or more properties. There are leases for these properties, but no personnel are employed in the company who can conduct business. In case of recognition as an acquisition of assets, no deferred tax is recognised. All of Balder's completed acquisitions have been classified as acquisition of assets and therefore no deferred tax is recognised relating to properties in respect of these acquisitions.

Contingent liabilities

A contingent liability is recognised when there is a possible obligation arising from past events and whose occurrence can only be confirmed by one or more uncertain future events or when an obligation arises which cannot be recognised as a liability or provision as it is not probable that an outflow of resources will be required.

New and amended standards adopted by the Group

The standards that the Group applied for the first time for annual periods beginning on 1 January 2013 and, which have a material impact on the consolidated dinancial statements are described below:

In IAS 1 "Presentation of Financial Statements", amendments have been introduced as regards other comprehensive income. The most significant change in the amended IAS 1 is the requirement that the items recognised in "other comprehensive income" shall be presented as divided into two categories. The division is based on whether or not the items can be reclassified to the income statement (reclassification adjustments).

Note 1 (continued)

IFRS 13 "Fair Value Measurement" is intended to improve the consistency of and reduce the complexity of fair value measurements by providing an exact definition and a common source in IFRS for fair value measurement and associated disclosures. The standard provides guidance to fair value measurement for all types of assets and liabilities, financial as well as non-financial. The requirements do not expand the scope of when fair value shall be applied but provide guidance about how it should be applied where other IFRS already require or allow fair value measurement. The standard has only impacted the financial statements through increased disclosure requirements.

New standards, amendments and intepretations of existing standards that have not been early-adopted by the Group.

A number of new standards and interpretations entered into effect for annual periods starting on 1 January 2013 and have not been adopted on preparation of these financial statements. None of these are expected to have any material impact on the consolidated financial statements with the exception of the following:

IFRS 10 "Consolidated Financial Statements" is based on already existing principles as it identifies control as the crucial factor in determining whether a company should be included in the consolidated accounts. The standard provides further guidance to assist in determination of control when it is difficult to judge. The Group plans to adopt IFRS 10 for annual periods beginning on 1 January 2014 but does not expect that it will have any material effect on the accounts.

IFRS 12, "Disclosures of Interests in Other Entities" covers disclosure requirements for subsidiaries, joint arrangements, associated companies and unconsolidated structured entities. The Group plans to adopt IFRS 10 for annual periods beginning on 1 January 2014 and has not yet evaluated the full effect on the financial statements.

IFRS 9 "Financial instruments" deals with classification, measurement and accounting of financial assets and liabilities. IFRS 9 replaces the parts of IAS 39 that are related to classification and measurement of financial instruments. IFRS 9 contains two measurement categories; measurement at fair value or measurement at amortised cost. Classification is determined on the first accounting date based on the company's business model and characteristic features in the contractual cash flows. The greatest change relates to liabilities which are identified at fair value. The part of the change in fair value that relates to own credit risk shall be recognised in other comprehensive income instead of profit or loss provided this does not cause an accounting mismatch. The Group will evaluate the effects of the remaining phases of IFRS 9 when they are finalised by the IASB.

IFRIC 21 "Levies" involves an interpretation of IAS 37 "Provisions, Contingent Liabilities and Contingent Assets". IAS 37 clarifies the criteria for recognising a liability, whereof one criterion is that the company has an existing obligation as a result of an event, which has occurred (Also known as an obligating event). The interpretation makes clear that the obligating event that triggers the duty to recognise a liability to pay a tax or fee is the activity that in the current legislation is described as being the one which triggers the obligation to pay the fee. The Group plans to adopt IFRIC 21 for annual periods beginning on 1 January 2014 and has not yet evaluated the full effect on the financial statements. None of the other IFRSs or IFRIC interpretations which have not yet become effective, are expected to have any material impact on the Group.

Parent Company accounting policies

The Parent Company has prepared its annual accounts according to the Swedish Annual Accounts Act (1995:1554) and the Swedish Financial Reporting Board's recommendation RFR 2, Accounting for Legal Entities. The recommendation means that the Parent Company in the Annual Report of the legal entity should apply all International Financial Reporting Standards and interpretations approved by the EU as far as

possible within the framework of the Annual Accounts Act, and taking into account the connection between recognition and taxation. The recommendation states which exemptions and amendments apply with respect to IFRS. Financial instruments are measured according to fair value under IAS 39.

Differences between the Group and the Parent Company accounting policies

The accounting policies set out for the Parent Company have been applied consistently for all periods presented in the Parent Company's financial statements.

Classification and format

The Parent Company's income statement and balance sheet are prepared according to the Swedish Annual Accounts Act's layout. The difference from IAS 1 Presentation of Financial Statements, which is applied in the presentation of the consolidated accounts, is mainly related to recognition of financial income and expenses and shareholders' equity.

Subsidiaries and associated companies

Holdings in subsidiaries and associated companies are recognised in the Parent Company financial statements according to the cost method. Received dividends are only reported as income provided that they pertain to profits earned subsequent to the acquisition. Dividends which exceed this earned profit are treated as a repayment of the investment and reduce the carrying amount of the participation.

Income

The Parent Company's net sales consist of management services in relation to subsidiaries. This income is recognised in the period it relates to.

Anticipated dividends

Anticipated dividends from subsidiaries are recognised in cases where the Parent Company has the exclusive right to decide on the size of the dividend and the Parent Company has made a decision on the size of the dividend before having published its financial statements.

Financial guarantees

The Parent Company's financial guarantee contracts mainly consist of loan guarantees on behalf of subsidiaries and associated companies. Financial guarantees mean that the company has an obligation to compensate the holder of a debt instrument for losses that they incur because a particular debtor does not complete payment on maturity according to the terms of the agreement. For recognition of financial guarantee contracts, the Parent Company applies RFR 2 p. 72, which implies relief compared to the rules in IAS 39 as regards financial guarantee contracts issued on behalf of subsidiaries and associated companies. The Parent Company recognises financial guarantee contracts as a provision in the balance sheet when the company has an obligation for which payment is likely to be required to settle the obligation.

Leased assets

All lease agreements in the Parent Company are recognised in accordance with the rules for operating leases.

Taxes

In the Parent Company, untaxed reserves are recognised including deferred tax. However, in the consolidated accounts, untaxed reserves are allocated between deferred tax liabilities and equity.

Group contributions and shareholders' contributions

The company recognises group contributions and shareholders' contributions in accordance with the Swedish Financial Reporting Board's recommendation RFR 2. Shareholders' contributions are recorded directly in equity in the case of the receiver and capitalised in shares and participations by the grantor, to the extent that impairment is not required. Group contributions are recognised as income in the income statement of the receiver and as a cost for the grantor. The tax effects are recognised according to IAS 12 in the income statement. Skatteeffekten redovisas i enlighet med IAS 12 i resultaträkningen.

Note 2· Revenue distribution
------------------------------ -- -- --
SEKm 2013 2012 2013 2012
Rental income 1,884 1,701
Rendering of services 99 96
Total 1,884 1,701 99 96

Note 3 · Segment reporting

Balder' operating segments consist of the regions Stockholm, Gothenburg/West, Öresund, East and North. This division is aligned with the Group's internal reporting. The management primarily follows up operating segments based on their net operating income, where common property adminstration expenses have been allocated according to the cost principle. Also see Note 1, Accounting policies applied.

Region Stockholm Gothenburg/West Öresund East North Group
SEKm 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012
Rental income 584 493 624 568 346 341 192 164 137 135 1,884 1,701
Property costs –165 –149 –199 –176 –106 –98 –84 –63 –57 –52 –609 –537
Net operating income 420 344 425 391 240 243 109 101 81 84 1,274 1,164
Changes in value of properties and wind turbines
Commercial properties 213 188 180 81 –5 50 –16 2 –2 –3 371 318
Residential properties 48 97 226 117 20 23 126 78 64 178 483 493
Wind turbines –37 –37
Profit incl. changes in value 681 629 832 590 255 317 182 181 142 259 2,092 1,976
Non-allocated items:
Management and administrative
expenses –121 –115
Other operating income/
expenses –16
Participations in the profits of
associated companies 204 105
Operating profit 2,174 1,950
Net interest income/expense –456 –466
Changes in value of derivatives 433 –71
Income tax –412 –250
Net profit for the year 1,738 1,162
Translation difference/
participation in comprehensive income of associated companies –4 –7
Comprehensive income for the year 1,735 1,155
Assets
Commercial properties 6,947 5,558 5,307 4,303 2,450 2,481 334 31 39 41 15,077 12,414
Residential properties 2,015 1,946 3,328 2,262 2,731 2,445 2,859 1,767 1,522 1,444 12,455 9,864
Investment properties 8,962 7,504 8,635 6,565 5,181 4,926 3,193 1,798 1,561 1,485 27,532 22,278
Non-allocated items:
Property, plant and equipment 108 152
Receivables from associated companies 748 468
Participations in associated companies 1,020 760
Current assets 633 184
Total assets 30,041 23,843
Shareholders' equity and liabilities
Non-allocated items:
Equity 11,196 8,289
Deferred tax liability 862 443
Interest-bearing liabilities, non-current 16,342 13,617
Derivatives 472 868
Interest-bearing liabilities, current 179 172
Non-interest-bearing liabilities 990 453
Total equity and liabilities 30,041 23,843
Investments and acquisitions in:
Commercial properties 1,453 1,393 840 143 10 607 116 2,419 2,143
Residential properties 20 20 853 309 212 1,508 967 25 14 23 2,068 1,884
Total investment properties 1,474 1,413 1,693 452 222 2,115 1,083 25 14 23 4,486 4,029

The Group's registered office is in Sweden. Income from external customers in Sweden amounted to SEK 1,796m (1,622) and total income from external customers in Denmark amounted to SEK 88m (79). Total non-current assets, other than financial instruments and deferred tax assets that are placed in Sweden amounted to SEK 25,852m (20,863) and the total of such non-current assets placed in other countries amounted to SEK 1,789m (1,567).

Note 4 · Employees and personnel expenses

At year-end, the Group had a total of 290 employees (215), of whom 102 (67) were women. The number of employees in the Parent Company at year-end was 121 (110), of whom 44 (41) were women.

During 2013, Fastighets AB Balder had 5 Board members (5) including the Chairman, of whom 1 (1) was a woman. The Group as well as the Parent Company had 6 senior executives (6) including the CEO, of whom 1 (1) was a woman.

Number of employees Group Parent Company
2013 2012 2013 2012
Average number of employees (all in Sweden) 243 229 117 118
of whom, women 75 77 41 45
Salaries, fees and benefits Group Parent Company
SEKm 2013 2012 2013 2012
Chairman of the Board 0.2 0.2 0.2 0.2
Other Board members 0.3 0.3 0.3 0.3
Chief Executive Officer
Basic salary 0.9 0.9 0.9 0.9
Benefits
Other senior executives
Basic salary 5.3 5.3 5.3 5.3
Benefits 0.3 0.3 0.3 0.3
Other employees
Basic salary 83.4 72.3 43.7 39.6
Benefits 1.0 0.8 0.8 0.6
Total 91.4 80.0 51.5 47.1
Statutory social security contributions including payroll tax Group
Parent Company
SEKm 2013 2012 2013 2012
Board of Directors 0.1 0.1 0.1 0.1
Chief Executive Officer 0.4 0.4 0.4 0.4
Other senior executives 1.8 1.8 1.8 1.8
Other employees 26.1 22.8 13.8 12.8
Total 28.4 25.1 16.1 15.1
Contractual pension expenses Group Parent Company
SEKm 2013 2012 2013 2012
Chief Executive Officer 0.3 0.3 0.3 0.3
Other senior executives 0.7 0.7 0.7 0.7
Other employees 4.3 3.6 2.5 2.2
Total 5.3 4.6 3.5 3.2
Total 125.1 109.7 71.1 65.4

Remuneration to senior executives

and other benefits during the year 2013-01-01–2013-12-31 2012-01-01–2012-12-31
SEKm Basic salary
directors' fees
Benefits Pension
expense
Total Basic salary
directors' fees
Benefits Pension
expense
Total
Chairman of the Board Christina Rogestam 0.2 0.2 0.2 0.2
Board member Fredrik Svensson 0.1 0.1 0.1 0.1
Board member Sten Dunér 0.1 0.1 0.1 0.1
Board member Anders Wennergren 0.1 0.1 0.1 0.1
CEO 0.9 0.3 1.2 0.9 0.3 1.2
Management team (5 persons) 5.3 0.3 0.7 6.3 5.3 0.3 0.7 6.3
Total 6.7 0.3 1.0 8.0 6.7 0.3 1.0 8.0

No variable remuneration is paid to any of the company's senior executives.

A defined benefit pension plan agreement has been entered into with the CEO which means that an amount of SEK 0.3m (0.3) will be paid out annually to the CEO when he reaches 55 until he is 65. Future payments will be limited according to agreement by the fund's assets. The payments are not dependent on future employment. The present value of the commitment amounted to SEK 2.5m (1.9). The commitment has been secured by a provision to a pension fund, whose plan assets amounted to SEK 2.5m (1.9). The value of the pension commitment has been calculated in accordance with the Pension Obligations Vesting Act, which does not accord with IAS 19. The difference in cost under the two methods of calculation is not significant.

Remuneration to senior executives follows the guidelines resolved upon at the latest Annual General Meeting. The remuneration should be market-related and competitive. The remuneration should be paid in the form of a fixed salary. Pension terms should be market-related and based on defined contribution pension solutions. Total dismissal pay and termination benefits should not exceed 18 monthly salaries. The CEO's salary and benefits are determined by the Board. Salaries and benefits of other senior executives are determined by the CEO. In the event of termination of the CEO's employment, a mutual period of notice of six months applies. In the event of termination by the company, termination benefits of 12 monthly salaries are payable (not qualifying for pension or holiday pay). A mutual period of notice of six months applies to other members of the management team. No termination benefits are payable.

The Board has the right to depart from the guidelines resolved upon by the Annual General Meeting for remuneration to senior executives, if special grounds exist.

Total absence due to illness Group Parent Company
% 2013 2012 2013 2012
Total absence due to illness as a percentage of ordinary working hours 4.6 3.5 5.6 2.5
of which total absence due to illness over 60 calendar days of the overall absence due to illness 46.4 42.9 54.6 24.6
Distributed by gender, % 2013 2012 2013 2012
Men 3.3 2.5 3.9 1.8
Women 6.9 5.7 8.4 3.6
Distributed by age, % 2013 2012 2013 2012
Employees 29 years old or younger 2.9 1.7 2.3 1.9
Employees 30–49 years old 3.1 2.6 3.7 2.0
Employees 50 years or older 8.0 6.1 12.4 3.6

Note 5 · Audit fees and reimbursements

Group
SEKm 2013 2012 2013 2012
PwC
The audit assignment in Sweden 1.6 1.5 1.6 1.4
The audit assignment in Denmark 0.6 0.3
Audit work apart from the audit assignment 0.2 0.2
Tax consultancy 0.1 0.1 0.1 0.1
Other services 0.7 0.3 0.7 0.3
Total 3.0 2.4 2.4 2.0

The audit assignment refers to the review of the financial statements and accounting records as well as the administration of the Board of Directors and CEO. This item also includes other duties that the company's auditors are obliged to perform as well as advice or other

assistance that is occasioned by review or implementation of such other duties. Everything else is consultancy. Audit expenses are included in group-wide expenses, which are levied on the subsidiaries.

Note 6 · Operating costs distributed according to function and type of cost Note 7 · Specification of property costs

Group, SEKm 2013 2012
Property costs 609 537
Management and administrative expenses 121 115
Total 730 653
Group, SEKm 2013 2012
Personnel expenses 125 110
Depreciation/amortisation 17 16
Media expenses 252 233
Property tax 85 78
Ground rent 12 11
Maintenance and other costs 1) 240 206
Total 730 653

1) Refers to operating costs and administration excluding personnel expenses.

Group, SEKm 2013 2012
Operating and maintenance costs 261 216
Media expenses 1) 252 233
Ground rent 12 11
Property tax 85 78
Total 609 537

1) Includes depreciation of wind turbines.

Note 8 · Operating leases

Leases where the Group is the lessee

The Group has a number of site leasehold rights with operating leases. The lease payments are renegotiated at the end of the leases to reflect market rents. These leases are mostly due for renegotiation in more than 5 years and amount to SEK 270m (271) in total. In the annual accounts for 2013 an expense of SEK 12m (11) was recognised in respect of operating leases in the Group.

No leasing expenses were reported in the Parent Company. There are also a small number of insignificant operating leases, where Balder is lessee, mainly relating to private cars. Payments made during the lease term are expensed in the income statement on a straight-line basis over the term of the lease.

Leases where the Group is lessor

The Group lets out its investment properties under operating leases. The future non-terminable lease payments are as follows:

Group, SEKm 2013 2012
Residential, parking etc. (within one year) 1,114 805
Commercial premises
Within one year 165 94
1–5 years 2,073 2,217
>5 years 3,634 2,666
Total 6,986 5,782

Leases for commercial premises are normally entered into for 3–5 years with a period of notice of 9 months. Leases for residential properties normally run subject to a period of notice of 3 months.

The average lease term in the portfolio's commercial leases amounted to 4.9 years (4.4).

Note 9 · Financial income

Group Parent Company
SEKm 2013 2012 2013 2012
Interest income 60 33 50 32
Interest income, subsidiaries 577 518
Other financial income 27 12 34 359
Total 87 45 660 909

Interest income is mainly related to other receivables. Other financial income mainly relates to changes in value of financial investments, dividends on listed shares and shares in subsidiaries.

Note 10 · Financial income

Group Parent Company
SEKm 2013 2012 2013 2012
Interest expenses, borrowings 369 397 132 126
Interest expenses, interest
rate derivatives 164 107 122 50
Interest expenses, subsidiaries 178 171
Other financial expenses 9 6 8 4
Total 543 511 440 351

Interest expenses and other financial expenses are related to interestbearing liabilities.

Note 11 · Taxes

Recognised in the income statement

Group Parent Company
SEKm 2013 2012 2013 2012
Current tax expense (–)/tax revenue (+)
Current tax 6 –10
Deferred tax expense (–)/tax revenue (+)
Deferred tax related to temporary differences –343 –302 –79 12
Deferred tax on changes in loss carry-forwards –45 –22 –20 –33
Released deferred tax in respect of temporary differences on sale 0 5
Change in untaxed reserves –29 –8
Revalaution deferred tax 87 –39
Total deferred tax –418 –240 –99 –60
Total recognised tax –412 –250 –99 –60
Reconcilation of effective tax
Group, SEKm 2013, % 2013 2012, % 2012
Profit before tax 2,151 1,412
Tax according to current tax rate in Parent Company 22 –473 26 –371
Difference between profit for tax purposes and recognised profit on sale of property 0 –2 0 5
Tax on participation in profits of associated companies –2 45 –2 28
Tax pertaining to prior years 0 7 0 –1
Non-taxable income/non-deductible expenses etc. –1 11 0 3
Revaluation deferred tax –6 87
Recognised effective tax 19 –412 18 –250
Note 11 (continued)
Parent Company, SEKm 2013, % 2013 2012, % 2012
Profit before tax 464 447
Tax according to current tax rate for the Parent Company 22 –102 26 –118
Non-taxable income/non-deductible expenses –1 3 2 –10
Non-taxable capital gains, shares –3 14
Tax-exempt dividends –21 92
Revaluation deferred tax 9 –39
Recognised effective tax 21 –99 13 –60
Recognised in the balance sheet
Deferred tax assets and tax liabilities
Group 2013, SEKm Deferred tax
assets
Deferred tax
liabilities
Net
Deferred tax assets and tax liabilities relate to the following:
Properties –1,359 –1,359
Derivative instruments 104 104
Loss carry-forwards 432 432
Untaxed reserves etc. –39 –39
Set-off –536 536 0
Total –862 –862
No non-capitalised loss carry-forwards exist.
Deferred tax Deferred tax
Parent Company 2013, SEKm assets liabilities Net
Deferred tax assets and tax liabilities relate to the following:
Derivative instruments 79 79
Loss carry-forwards 23 23
Financial investments –4 –4
Set-off –4 4 0
Total 98 98
No non-capitalised loss carry-forwards exist.
Change of deferred tax in temporary differences and loss carry-forwards Recognised in
statement of
Acquisitions
Group, SEKm Balance on 1
Jan 2012
comprehen
sive income
and disposals
of companies
Balance on 31
Dec 2012
Properties –1,021 –80 –1 –1,102
Derivative instruments 230 –39 191
Capitalisation of the value of loss carry-forwards 592 –116 2 477
Untaxed reserves etc. –3 –6 0 –9
Total –202 –242 1 –443
Recognised in
statement of
Acquisitions
Group, SEKm Balance on 1
Jan 2013
comprehen
sive income
and disposals
of companies
Balance on 31
Dec 2013
Properties –1,102 –256 –1,359
Derivative instruments 191 –87 104
Capitalisation of the value of loss carry-forwards 477 –45 0 432
Untaxed reserves etc. –9 –29 0 –39
Total –443 –418 0 –862
Recognised in
statement of
Acquisitions
Parent Company, SEKm Balance on 1
Jan 2012
comprehen
sive income
and disposals
of companies
Balance on 31
Dec 2012
Derivative instruments 172 –19 154
Capitalisation of the value of loss carry-forwards 85 –41 43
Financial investments 1 0 1
Total 258 –60 198
Recognised in
statement of
Acquisitions
Parent Company, SEKm Balance on 1
Jan 2013
comprehen
sive income
and disposals
of companies
Balance on 31
Dec 2013
Derivative instruments 154 –74 79
Capitalisation of the value of loss carry-forwards 43 –20 23

Total 198 –99 — 98

Note 12 · Earnings per ordinary share

The calculation of earnings per ordinary share has been based on the net profit for the year attributable to holders of ordinary shares in the Parent Company amounting to SEK 1,613m (1,067), after taking account of the participation of preference shares in net profit for the period and on the weighted average number of shares during the year amounting to 159,537,252 shares (159,537,252).

No dilution occurred during the year or the preceding year.

Note 13 · Investment properties

Group, SEKm 2013 2012
Opening fair value 22,278 17,556
Acquisitions 3,606 3,756
Investments in existing properties 880 273
Changes in value 839 809
Divestments –129 –69
Currency changes 59 –47
Closing fair value 27,532 22,278

Investment properties are recognised at fair value in consolidated statement of financial position and changes in value are recognised in the consolidated statement of comprehensive income. All investment properties are deemed to be in Level 3 of the valuation hierarchy according to IFRS 13 Fair Value Measurement. The fair value of Balder's real estate portfolio is based on internal valuations. Fair value is the estimated amount that would be recovered in a transaction on the valuation date between knowledgeable parties that are independent of one another and that have an interest in completing the transaction after customary marketing, where both parties are assumed to have acted discerningly, wisely and without compulsion.

On the closing date, Balder carried out an internal valuation, based on a ten-year cash flow model, of the entire real estate portfolio. Each property is valued individually by computing the present value of future cash flows, i.e. future rent payments less estimated operating and maintenance payments and a residual value of ten years. Estimated rent payments as well as operating and maintenance payments have been derived from current rental income as well as operating and maintenance costs. The cash flow is adjusted to the market by taking account of any changes in the occupancy rate and letting levels as well as operating and maintenance payments.

An inflation rate of 2 per cent has been assumed in all cash flow calculations.

Rent payments

The rental trend is estimated to follow inflation taking account of prevailing index clauses in leases during their terms. When leases expire, an assessment is made of whether the lease is deemed to be extended at the prevailing market rent level and whether there is a risk of the premises becoming vacant. Vacancies are considered on the basis of the current vacancy situation with a gradual adjustment to expected marketrelated vacancy rates taking account of the property's individual conditions.

Weighted average number of outstanding ordinary shares Parent Company, thousands of shares 2013 2012 Total number of shares, 1 January 159,537 159,537 Effect of newly issued shares — — Weighted average number of outstanding ordinary shares during the year 159,537 159,537

Operating and maintenance payments

Outcomes, budgetary and projection data as well as estimated standardised costs have been used in the assessment of the property's future property costs.

Yield

Yield requirements and cost of capital used in the calculations have been derived from comparable transactions in the property market. Important factors in choosing a yield requirement are location, rental level, vacancy rate and the condition of the property. The yield requirement and cost of capital used are shown in the table.

The average yield on the closing date amounted to 5.9 per cent (5.9). In the event of a change in the yield requirement of +/– 0.25 percentage points, the Group's real estate value would be affected by about SEK 1,200m.

To guarantee the internal valuations, Balder engaged Savills Sweden AB to value the entire property holdings on 30 June 2013. The external valuation exceeded Balder's internal valuation by less than 1 per cent. On 31 December 2013, after Balder's valuation, the company's total real estate value amounted to SEK 27,532m (22,278). For more information see the Report of the Board of Directors and Sensitivity analysis on page 50.

Future investments

Balder had four properties under construction as of 31 December. The overall investment will amount to about SEK 1,600m on completion, of which about SEK 730m remains to be invested.

In Nyköping, Rosvalla arena, Brandholmen 1:72 is under construction, with a lettable area of about 13,000 sq.m. The property is fully let to Nyköping municipality and is subject to a 25-year lease.

In Stockholm, Skeppshandeln 1 is under construction with a lettable area of almost 14,000 sq.m. and 280 pertaining parking places. The property is 95 per cent let to tenants including ICA, Profil Hotels and Bengt Dahlgren AB.

Balder has signed an agreement to acquire a hotel property in Lund during the first quarter of 2014, when completion of the property is expected. The 9,000 sq.m. property, is fully let and will be managed under the Park Inn by Radisson brand.

Balder has entered into a turnkey agreement regarding construction of approximately 200 apartments in Örestad Syd in Copenhagen. The lettable area will amount to about 18,000 sq.m.

As of 31 December 2013, Balder entered into an agreement to acquire the property Gothenburg Nordstaden 10:15 and will take possession after year-end. On 31 December 2013, Balder's investment undertakings amounted to approximately SEK 830m.

Region Cost of capital requirement for discou
ting of future cash flows, %
Yield requirement
for assessment of residual value, %
The average yield requirement for assess
ment of residual value, %
Stockholm 6.0–10.2 4.0–8.2 5.4
Gothenburg/West 6.0–12.0 4.0–10.0 6.1
Öresund 6.0–10.0 4.0–8.0 5.3
East 7.0–12.0 5.0–10.0 6.1
North 7.0–13.0 5.0–11.0 5.7

Note 14 · Other property, plant and equipment

Equipment Group Parent Company
SEKm 2013 2012 2013 2012
Cost
Opening balance 41 43 7 6
Acquisitions during the year 12 23 0 1
Retirements –25
Closing balance 53 41 8 7
Depreciation
Opening balance –19 –34 –5 –3
Acquisitions –1 –3
Retirements 25
Depreciation for the year –8 –7 –1 –2
Closing balance –29 –19 –6 –5
Carrying amount 24 21 2 2
Wind turbines Group Parent Company
SEKm 2013 2012 2013 2012
Cost
Opening balance 164 164 30 30
Acquisitions
Closing balance 164 164 30 30
Depreciation and impairments
Opening balance –34 –26 –6 –4
Acquisitions
Depreciation for the year –9 –9 –2 –2
Impairment for the year –37
Closing balance –80 –34 –8 –6
Carrying amount 84 131 22 24
Total carrying amount 108 152 24 27

Depreciation is recognised in administrative expenses and media expenses.

Note 15 · Participations in associated companies

Participations in associated companies are recognised in the Group using the equity method and in the Parent Company using the cost method.

Accumulated cost Group Parent Company
SEKm 2013 2012 2013 2012
Opening balance 760 654 421 402
Acquisition of associated companies 67 19 62 19
Dividend –18
Participations in the profits of associated companies after tax 204 105
Change in shareholders' equity of associated companies –11 –1
Closing balance 1,020 760 483 421

Participating interest in associated companies' statements of comprehensive income

Group, SEKm 2013 2012
Rental income 179 159
Property costs –40 –33
Net operating income 140 126
Changes in value of properties, unrealised 99 7
Management and administrative expenses –8 –9
Other operating income 1) 100 65
Operating profit 331 190
Net interest income/expense –74 –74
Changes in value of derivatives, unrealised 1 1
Profit before tax 257 116
Tax –53 –11
Net profit for the year 204 105
Profit from property management before tax 157 108

1) Relates to Collector AB and Bovieran Holding AB.

Summary of participating interest in associated companies' statements of financial position

Group, SEKm 2013 2012
Assets 2,786 2,274
Shareholders' equity including shareholders' loan 1,146 776
Liabilities 1,640 1,498

Group holdings of participations in associated companies in 2013

Company Corporate identity number Registered office Number of shares Share, % Value of share
of equity in the
Group, SEKm
Carrying amount in
Parent Company,
SEKm
Collector AB 556560-0797 Gothenburg 5,596,806 44 469 364
Tulia AB 556712-9811 Gothenburg 50,000 50 218
Akroterion Fastighets AB 556714-5478 Stockholm 500 50 176 100
Fastighets AB Centur 556813-6369 Stockholm 500 50 89 4
Bovieran Holding AB 556813-3168 Gothenburg 5,000 50 47
Mötesplatsen Intressenter AB 556859-0417 Alingsås 320 32 14 15
Proximion Holding AB 556915-7331 Stockholm 50,000 34 6
Bergsspiran AB 556736-4475 Gothenburg 250 25 0 0
Fix Holding AB 556949-3702 Gothenburg 50,000 50 0
Balder Skåne AB 556699-9230 Gothenburg 1,000 50 0
Total 1,020 483

Note 15 (continued)

Group holdings of participations in associated companies in 2012

Company Corporate identity number Registered office Number of shares Share, % Value of share
of equity in the
Group, SEKm
Carrying amount in
Parent Company,
SEKm
Collector AB 556560-0797 Gothenburg 5,596,806 38 354 302
Akroterion Fastighets AB 556714-5478 Stockholm 500 50 159 100
Tulia AB 556712-9811 Gothenburg 50,000 50 140
Fastighets AB Centur 556813-6369 Stockholm 500 50 62 4
Bovieran Holding AB 556813-3168 Gothenburg 5,000 50 30
Mötesplatsen Intressenter AB 556859-0417 Alingsås 320 32 15 15
Bergsspiran AB 556736-4475 Gothenburg 250 25 0 0
Majornas Projektutveckling AB 556813-6310 Gothenburg 500 50 0 0
Total 760 421

Note 16 · Trade receivables

Trade receivables are carried at the amount which is expected to be received. All trade receivables that have fallen due for more than 30 days are assessed individually as regards a risk of loss. Impairments are made for doubtful receivables. The net profit for 2013 was charged with SEK 10.7m (18.1) in respect of actual and feared bad debt losses. The receivables are of a short-term character and therefore the carrying amount corresponds to fair value.

Age distribution of trade receivables

Group, SEKm 2013 2012
–30 days 17 19
31–60 days 3 4
61–90 days 2 3
91 days– 26 41
Total 48 67
Doubtful trade receivables –25 –41
Trade receivables, net 23 26

Doubtful trade receivables

Closing balance –25 –41
Doubtful trade receivables during the year –2 –16
Actual bad debt losses during the year 18 14
Acquired opening balance –1 –2
Opening balance –41 –37
Group, SEKm 2013 2012

Note 17 · Other receivables

Group Parent Company
SEKm 2013 2012 2013 2012
Other receivables 65 18 15 12

Other receivables are of a short-term character and therefore the carrying amount corresponds with the fair value.

Note 18 · Prepaid expenses and accrued income

Group Parent Company
SEKm 2013 2012 2013 2012
Insurance 5 4
Interest income 8 7 8 7
Rental income 2 4 2 1
Property costs 9 6
Other items 8 3 6 4
Total 32 25 16 12

Note 19 · Financial investments

Group Parent Company
SEKm 2013 2012 2013 2012
Quoted securities
Shares and bonds 305 69 305 69
Total 305 69 305 69

Financial investments are measured at fair value through profit and loss (see Note 9).

Note 20 · Share capital

On 31 December 2013 the registered share capital consisted of 172,396,852 ordinary shares, of which 11,229,432 were Class A shares and 151,167,420 Class B, and 10,000,000 preference shares. Of the Class B shares, 2,859,600 had been repurchased as of 31 December 2013, which means that the total number of shares outstanding was

169,537,252. Each Class A share carries one vote, and each Class B share and preference share carries one tenth of one vote. An ordinary share entitles its holder to a dividend that is determined in due course while a preference share entitles its holder to an annual dividend of SEK 20.00 per share. All shares entitle holders to voting rights at the Annual General Meeting.

Share capital trend Quota
Day Mounth Year Event Change in
number of shares
Total number
of shares
Total number of
outstanding shares
value per
share, SEK
Change in share
capital, SEK
Total share
capital, SEK
27 June 2005 Start date 75,386,104 75,386,104 1.00 75 386 104
18 August 2005 Issue in kind 2,000,002 77,386,106 77,386,106 1.00 2,000,002 77,386,106
18 August 2005 Reduction of the share capital by
decreasing nominal amount
77,386,106 77,386,106 0.01 –76,612,245 773,861
18 August 2005 Issue in kind 1,287,731,380 1,365,117,486 1,365,117,486 0.01 12,877,314 13,651,175
18 August 2005 Set-off issue 18,846,514 1,383,964,000 1,383,964,000 0.01 188,465 13,839,640
18 August 2005 Consolidation of nominal amount
to SEK 1
–1,370,124,360 13,839,640 13,839,640 1.00 13,839,640
27 January 2006 Issue in kind 1,000,000 14,839,640 14,839,640 1.00 1,000,000 14,839,640
9 October 2006 Issue in kind 1,380,000 16,219,640 16,219,640 1.00 1,380,000 16,219,640
2008 Repurchase, own shares –476,600 16,219,640 15,743,040 16,219,640
28 August 2009 Issue in kind 9,171,502 25,391,142 24,914,542 1.00 9,171,502 25,391,142
4 June 2010 Bonus issue 76,173,426 101,564,568 99,658,168 1.00 101,564,568
1 February 2011 New issue 6,700,000 108,264,568 106,358,168 1.00 6,700,000 108,264,568
20 May 2011 Bonus issue 54,132,284 162,396,852 159,537,252 1.00 162,396,852
16 June 2011 Directed new issue of preference
shares
4,000,000 166,396,852 163,537,252 1.00 4,000,000 166,396,852
31 January 2012 Set-off issue preference share 1,000,000 167,396,852 164,537,252 1.00 1,000,000 167,396,852
11 October 2012 Set-off issue preference share 1,000,000 168,396,852 165,537,252 1.00 1,000,000 168,396,852
24 May 2013 Directed new issue of preference
shares
500,000 168,896,852 166,037,252 1.00 500,000 168,896,852
22 October 2013 Directed new issue of preference
shares
3,500,000 172,396,852 169,537,252 1.00 3,500,000 172,396,852
31 December 2013 172,396,852 169,537,252 1.00 172,396,852

The Board will propose to the Annual General Meeting for the financial year 2013 that no dividend on ordinary shares (—) should be declared and a dividend of SEK 20.00 per share for preference shares should be declared (20.00). All issued shares are fully paid.

Note 21 · Financial risks and financial policies

Finance policy

The Group is exposed to five different kinds of financial risks through its operations. Financial risks refer to interest risk, liquidity risk, refinancing risk, price risk and credit risk. The financial policy prescribes guidelines and rules for how the financial operations shall be conducted and establishes the division of responsibilities and administrative rules. Departures from the Group's financial policy require the approval of the Board. Responsibility for the Group's financial transactions and risks is managed centrally by the Parent Company's financial department. Financial risk is managed at a portfolio level. Financial transactions shall be conducted based on an assessment of the Group's overall needs relating to liquidity, financing and interest risk.

Financial policy goals:

  • the equity/assets ratio should exceed 35 per cent over time,
  • the interest coverage ratio should not be less than 1.5 times,
  • secure the short-term and long-term supply of capital,
  • obtain a stable long-term capital structure.

The Group has market-related covenants for its funding. These were fulfilled during the financial year.

The goals are followed up regularly in reports to the Board prior to presentation of the company's interim reports.

Outcome
Financial goals Goal 2013 2012
Equity/assets ratio, % 35.0 37.3 34.8
Interest coverage ratio, times 1.5 2.9 2.4

Capital risk

The Group's goal as regards the capital structure is to secure the Group's ability to continue its operations, so that it can continue to generate a return to shareholders and value for other stakeholders.

Refinancing risk

Refinancing risk refers to the risk that Balder may not be able to obtain refinancing in the future or only at a significantly increased cost. Balder has signed credit commitments of SEK 1,000m, which are intended as a back-up facility for Balder's SEK 1,000m certificate programme. This means that if Balder cannot issue commercial paper through the programme, the company will utilise its back-up facility for the unissued amount. Balder works continually on raising new loans and on renegotiating existing loans. Over time, 50 per cent of the loan portfolio should have a credit term of more than two years and not more than 35 per cent of the loans should mature during a single year.

Liquidity risk

Liquidity risk refers to the risk of a lack of sufficient cash and cash equivalents to be able to fulfil the company's payment obligations relating to operating costs, interest, amortisation and dividend on preference shares. According to the financial policy, there should always be sufficient cash in hand and guaranteed credit facilities to cover one month's payment obligations. Regardless of long-term goals, the Board can decide to temporarily boost liquidity, for example, to be better prepared for major transactions. On the closing date, Balder's cash and cash equivalents, financial investments and unutilised credit facilities amounted to SEK 1,004m (470).

Duration analysis of financial liabilities

Cash flow per year relating to financial liabilities assuming the current size of the Group. The cash flow refers to interest expenses, amortisation, trade payables and settlement of other financial liabilities. Net financial items have been calculated based on the Group's average interest less interest income and interest allowances.

Refinancing occurs on a regular basis, so no interest expense for a longer period than 10 years is indicated.

Group 2013-12-31

Other liabilities 465
Trade payables 150
Interest expenses 1) 1,578 1,020 996 1,249
Maturity structure, loans 9,792 2,929 989 2,811
SEKm 0–3 years 4–5 years 6–7 years ≥8 years

Group 2012-12-31

SEKm 0–3 years 4–5 years 6–7 years ≥8 years
Maturity structure, loans 7,351, 2,593 989 2,856
Interest expenses 1) 1,458 942 918 1,332
Trade payables 76
Other liabilities 82
Total 8,967 3,535 1,907 4,188

Parent Company 2013-12-31

SEKm 0–3 years 4–5 years 6–7 years ≥8 years
Maturity structure, loans 3,650 1,251 433 356
Interest expenses 1) 537 348 340 495
Trade payables 2
Other liabilities 6
Total 4,195 1,599 773 851

Parent Company 2012-12-31

Total 4,137 1,167 783 897
Other liabilities 9
Trade payables 5
Interest expenses 1) 552 358 350 510
Maturity structure, loans 3,571 809 433 387
SEKm 0–3 years 4–5 years 6–7 years ≥8 years

1) Refers to interest expenses during the period 0–10 years.

Interest risk

Interest risk refers to the risk of fluctuations in cash flow and earnings due to changes in interest rates. The key factor for interest risk is the interest rate refixing period. Long interest rate refixing periods ensure predictability in cash flow but in most cases also mean higher interest expenses.

The Group's interest rate exposure is centralised, which means that the central finance function is responsible for identifying and managing this exposure. The interest risk shall be managed using risk hedging instruments such as interest rate swaps, interest rate ceilings and interest rate floors. The overriding key ratio used is the interest coverage ratio. On each measurement date, the interest coverage ratio shall exceed 1.5. To ensure cost-effective management of interest risk, an assessment of the interest risk is made when raising loans with short interest rate refixing periods based on the Group's overall loan portfolio. Interest rate derivative transactions are carried out as required to achieve the desired interest risk in the overall borrowing.

Balder has mainly used swaps and interest rate ceilings to manage its interest risk, which mature between 2016 and 2026. Fluctuations in market interest rates give rise to theoretical surpluses or deficits in respect of these financial instruments, which do not directly affect cash flow. Derivatives are continually recognised at fair value in the balance sheet and changes in value are recognised in the income statement without using hedge accounting. Derivatives are measured based on quoted prices in the market. The changes in value during 2013 amounted to SEK 433m (–71). The fair value of financial instruments is based on measurements by intermediary credit institutions. The reasonability of the measurements has been tested by engaging another credit institution to value similar instruments at the end of the reporting period, see sensitivity analysis on page 50.

Foreign exchange risk

Balder owns properties via subsidiaries in Denmark. The foreign exchange risk arising relates to the translation of the assets and liabilities of foreign subsidiaries to the Group's presentation currency. The current exposure is low.

Price risk

Balder's income is affected by the occupancy rate of its properties, the level of market-related rents and customers' payment capacity. A +/– 1 percentage point change in the rental level or the economic occupancy rate has an effect on profit before tax of +/– SEK 23m and +/-24m respectively.

Credit risks

Trade receivables The risk that the Group's customers will not fulfil their obligations, i.e. that payment will not be received for trade receivables, constitutes a customer credit risk. The credit of the Group's customers is assessed by obtaining information about the customers' financial position from various credit rating agencies.

An estimate of the credit risk is made in conjunction with new leases and conversion of premises for existing customers. Bank guarantees, advance rental deposits or other security are required for customers with low creditworthiness or unsatisfactory credit histories.

Credit is monitored continually to follow developments in the creditworthiness of customers.

Financial operations

Balder's financial operations give rise to credit risk exposure. The risk is mainly counterparty risk in connection with receivables from banks and other counterparties that arise in the trading of derivative instruments. Balder's financial policy includes special counterparty rules which stipulate the maximum credit exposure for different counterparties.

Borrowing, maturity structure and interest rates

At year-end, Balder had binding loan agreements with credit institutions totalling SEK 16,521m (13,789). The credit agreements mainly consist of bilateral contracts with Nordic banks as well as a certificate programme for SEK 1,000m. On 31 December 2013, the outstanding certificate volume was SEK 685m (614). Net interest-bearing liabilities less cash and cash equivalents of SEK 513m (116) amounted to SEK 16,008m (13,673).

Agreements can be divided into five categories:

  • loans against security pledged in the form of promissory note receivables from subsidiaries with pledged mortgage deeds. The security has been augmented by collateral in the shares of subsidiaries,
  • loans against mortgage deeds pledged on property,
  • loans against subsidiaries' limited partnership shares pledged,
  • certificate programme,
  • bond loan.

In certain cases, the security is augmented by guarantees concerning interest coverage ratios, equity/assets ratios and loan to value ratios. Balder satisfied all of its guarantees at year-end. Credit agreements contain customary termination conditions.

The average fixed credit term in loan agreements amounted to 5.4 years (6.6) on 31 December 2013. The maturity structure of loan agreements, presented in the table showing the loan terms, indicates when loan agreements are due for renegotiation or repayment. The average effective interest on the closing date equalled 3.2 per cent (3.6) including the effect of accrued interest from Balder's interest rate derivatives. The average interest rate refixing period on the same date was 3.5 years (4.8). The proportion of loans with interest dates during the coming 3-year period amounted to 59 per cent (42).

Note 21 (continued)

Interest rate refixing period

Year Carrying
amount, SEK
Interest,
%
Share, % Fair value,
SEKm
Within one year 8,254 2.1 50.0 5,483
1–2 years 267 4.3 1.6 30
2–3 years 500 4.5 3.0 283
3–4 years 500
4–5 years 3,000 4.8 18.2 0
>5 years 4,500 3.9 27.2 7,500
Total 16,521 3.2 100.0 13,796

The fair value of financial liabilities, which are not derivative instruments has been estimated by discounting the future cash flow using the current market rate of interest at the end of the reporting period. The discount rate used in the estimation of fair value is in the range 3.2–3.3 per cent.

Carrying amount and fair value of financial instruments

Trade and loan
receivables
Financial assets/liabilities
measured at fair value
through profit or loss
Derivatives 1)
Other liabilities Total
carrying amount
Total
fair value
Group, SEKm 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012
Trade receivables 23 26 23 26 23 26
Receivables from associated companies 748 468 748 468 748 468
Financial investments 2) 305 69 305 69 305 69
Total receivables 770 494 305 69 1,075 563 1,075 563
Non-current interest-bearing liabilities 16,338 13,495 16,338 13,495 16,342 13,502
Credit facilities 4 122 4 122 4 122
Derivatives 3) 472 868 472 868 472 868
Non-interest-bearing liabilities,
non-current
Current interest-bearing liabilities 179 172 179 172 179 ,172
Trade payables 150 76 150 76 150 76
Total liabilities 472 868 16,671 13,865 17,143 14,733 17,147 14,740
Parent Company, SEKm
Receivables from group companies 11,506 10,599 11,506 10,599 11,506 10,599
Receivables from associated companies 748 468 748 468 748 468
Financial investments 2) 305 69 305 69 305 69
Total receivables 12,253 11,067 305 69 12,558 11,136 12,558 11,136
Non-current liabilities to credit
institutions
5,632 5,020 5,632 5,020 5,632 5,020
Credit facilities 122 122 122
Derivatives 3) 361 698 361 698 361 698
Non-interest-bearing liabilities, non-cur
rent
Liabilities to group companies 2,782 2,927 2,782 2,927 2,782 2,927
Current liabilities to credit institutions 58 58 58 58 58 58
Trade payables 2 5 2 5 2 5
Total liabilities 361 698 8,474 8,132 8,835 8,830 8,835 8,830

1) Financial assets/liabilities held for trading.

2) Financial investments are Level 1 in the valuation hierarchy.

3) Derivative instruments are Level 2 in the valuation hierarchy.

Derivative instruments have been recognised net as a liability. This liability includes positives values of SEK 51m (–).

Note 22 · Credit facilities

Note 23 · Accrued expenses and deferred income

Group Parent Company
SEKm 2013 2012 2013 2012
Granted credit facility 495 476 445 426
Utilised portion –4 –122 0 –122
Unutilised portion 491 354 445 304
Group Parent Company
SEKm 2013 2012 2013 2012
Personnel expenses 27 12 9 7
Interest expenses 74 53 34 24
Prepaid rents 220 168
Property costs 47 44
Other items 8 19 2 3
Total 376 295 45 34

Note 24 · Pledged assets and contingent liabilities

Pledged assets Group Parent Company
SEKm 2013 2012 2013 2012
Real estate mortgages 17,848 14,477
Shares in group companies 1,469 1,134
Promissory notes 5,008 4,741
Total 19,317 15,611 5,008 4,741
Contingent liabilities Group Parent Company
SEKm 2013 2012 2013 2012
Guarantees for subsidiaries 10,151 8,215
Guarantees for associated companies 925 685 925 685
Total 925 685 11,076 8,900

Note 25 · Cash flow statement

Group Parent Company
2013 2012 2013 2012
208 47 144 5
208 47 144 5
144 5
208
47
Interest and derivative expenses paid Group Parent Company
SEKm 2013 2012 2013 2012
Interest received 27 16 33 28
Interest paid –328 –403 –117 –130
Derivative expense paid –164 –108 –122 –50
Total –465 –495 –206 –152

Intra-group interest income and interest expenses for 2013 and 2012 did not affect the cash flow.

Note 26 · Participations in group companies

Specification of the Parent Company's direct holdings of participations in subsidiaries
Carrying amount
Subsidiaries Corporate identity number
Registered office
Number of shares
Share, %
Balder Storstad AB 556676-4378 Gothenburg 1,172,306 100 1,046 1,046
Balder Mellanstad AB 100 150 150
Din Bostad Sverige AB 556541-1898 Gothenburg 18,500,000 100 626 626
Egby Vindkraftverk AB 556760-5919 Gothenburg 1,000 100 0 2
Balder Danmark ApS 34058016 Copenhagen 80,000 100 0 4
Total
1,822

The Balder Group owns 100 per cent of 201 additional companies (172) via the above-mentioned subsidiaries, as presented in each subsidiary's annual accounts.

Parent Company, SEKm 2013 2012
Accumulated cost
Opening balance 1,827 1,796
Dividend/Shareholders' contribution –4 28
Impairment losses –2
Acquisitions 3
Closing balance 1,822 1,827

Note 27 · Receivables from/liabilities to Group companies

Receivables Liabilities
Parent Company, SEKm 2013 2012 2013 2012
Opening balance 10,571 8,507 2,927 2,310
Change in lending to subsidiaries 935 2,064 –145 617
Closing balance 11,506 10,571 2,782 2,927

There is no fixed amortisation plan.

Note 28 · Related parties

Related parties

Group

The Group is controlled by Erik Selin Fastigheter AB which holds 51.3 per cent (52.0) of the votes in the Parent Company Fastighets AB Balder. The Parent Company in the largest group of which Balder is part is Erik Selin Fastigheter AB.

Parent Company

Apart from the related parties shown for the Group, the Parent Company has a controlling influence over subsidiaries according to Note 26, Participations in group companies.

Summary of related party transactions

Group

Erik Selin Fastigheter AB has purchased property-related administrative services from Balder for SEK 2m (2). The price of the services is based on market-related terms.

Parent Company

The Parent Company has performed property-related administrative services on behalf of its subsidiaries amounting to SEK 83m (81). The Parent Company functions as an internal bank. On the closing date, receivables from subsidiaries amounted to SEK 11,506m (10,571). The price of the administrative and financial services is based on marketrelated terms.

Note 29 · Significant events after the end of the financial year

After year-end, Balder has acquired two retail properties and a development property in Backaplan in Gothenburg and a retail property adjacent to Nordstan shopping centre in central Gothenburg. The retail properties have a lettable area of about 9,600 sq.m. In addition to the above, the hotel property Scandic Opalen in Gothenburg was acquired. The area of the hotel is 18,500 sq.m.

Associated companies

Apart from the relative parties described above, the Balder Group owns associated companies according to Note 15, Participations in associated companies.

During the financial year, Fastighets AB Centur and Tulia AB purchased management and administrative services from Balder amounting to SEK 14m (13). Net receivables from associated companies amounted to SEK 748m (468) on the closing date. The price of the administrative and financial services is based on market-related terms.

Transactions with key people in executive positions

The company's Board members and companies owned by these members control 66.9 per cent (67.9) of the votes in Balder. With regard to the Board, CEO and other employees' salaries and other remuneration, expenses and agreements relating to pensions and similar benefits as well as agreements in respect of termination benefits, see Note 4, Employees and personnel expenses.

After year-end, Balder has also opted to establish a loan framework of SEK 5 billion in order to supplement existing financing. Balder has also divested properties in six different transactions for a total sales value of SEK 180m. The sales value exceeded the most recent valuation by about SEK 35m. In March, all repurchased shares were also sold.

Note 30 · Critical estimates and judgements

The company management and the Board have discussed the development, the choice of and the disclosures in respect of the Group's key accounting policies and estimates, as well as their application.

Investment properties

For important assumptions and estimates in connection with valuation of investment properties see Note 13, Investment properties.

Balder reports its properties according to the fair value method which means that changes in value are recognised in the income statement. Thus the results can be affected considerably.

Balder performs an internal valuation of the properties in connection with each quarterly report. In order to quality-assure its internal valuations, Balder regularly allows parts of the portfolio to be externally valued during the year. On 30 June, Balder's entire property portfolio was externally valued by Savills Sweden AB.

Taxes

Balder controls loss carry-forwards, which mainly derive from operations that were conducted previously. Furthermore, there are loss carryforwards in subsidiaries that own properties. Balder estimates that it will be possible to utilise all loss carry-forwards against future profits, under current tax rules.

However, Balder cannot provide any guarantees that current or new tax rules will not restrict the possibilities of utilising the loss carry-forwards.

Classification of acquisitions

IFRS 3 contains a rule that acquisitions must be classified as business combinations or asset acquisitions, which means that an individual assessment must be made of each particular transaction. The assessments of acquisitions made during the year resulted in all transactions being classified as asset acquisitions.

Note 31 · Parent Company information

Fastighets AB Balder (publ) is a Swedish-registered limited liability company with its registered office in Gothenburg. The Parent Company's shares are listed on NASDAQ OMX Stockholm, Mid Cap segment. The address of the head office is Box 53121, 400 15 Gothenburg, Sweden.

The visiting address is Vasagatan 54. The consolidated accounts for 2013 include the Parent Company and its subsidiaries, together referred to as the Group.

The annual accounts and the consolidated accounts were approved for issuance by the Board of Directors and CEO on 11 April 2014. The consolidated income statement and balance sheet and the Parent Company income statement and balance sheet will be subject to adoption by the Annual General Meeting on 7 May 2014. The Board will propose to the Annual General Meeting that no dividend (—) be declared for ordinary shares and that a dividend of SEK 20.00 per share (20.00) be declared for preference shares for the financial year 2013.

The annual accounts have been prepared in accordance with generally accepted accounting principles in Sweden and the consolidated accounts have been prepared in accordance with the international

accounting standards IFRS referred to in the European Parliament's and Council's regulation (EC) No. 1606/2002 from 19 July 2002 on application of the international accounting standards. The annual accounts and consolidated accounts give a true and fair view of the Parent Company's and Group's financial position and results of operations. The Report of the Board of Directors for the Group and the Parent Company provides a true and fair review of the development of the Group's and the Parent Company's operations, financial position and results of operations and describes material risks and uncertainties facing the Parent Company and the companies forming the Group.

Gothenburg, 11 April 2014

Christina Rogestam Chairman of the Board

Sten Dunér Fredrik Svensson Anders Wennergren Board member Board member Board member

Erik Selin Board member and CEO

Our audit report was submitted on 11 April 2014 Öhrlings PricewaterhouseCoopers AB

Bengt Kron Authorised Public Accountant

Audit Report

To the Annual General Meeting of Fastighets AB Balder (publ). corporate identity number 556525-6905

Report on the annual accounts and consolidated financial statements

We have audited the annual accounts and consolidated financial statements of Fastighets AB Balder (publ) for 2013. The company's annual accounts and consolidated financial statements are included in the printed version of this document on pages 49–81.

The Board of Directors and the Managing Director are responsible

for the annual accounts and consolidated financial statements The Board of Directors and the Managing Director are responsible for the preparation and fair presentation of these annual accounts in accordance with the Annual Accounts Act and of the consolidated financial statements in accordance with International Financial Reporting Standards, as adopted by the EU, and the Annual Accounts Act, and for such internal control as the Board of Directors and the Managing Director determine is necessary to enable the preparation of annual accounts and consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor's responsibility

Our responsibility is to express an opinion on these annual accounts and consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the annual accounts and consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the annual accounts and consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the annual accounts and consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company's preparation and fair presentation of the annual accounts and consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors and the Managing Director, as well as evaluating the overall presentation of the annual accounts and consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinions

In our opinion, the annual accounts have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, the financial position of the parent company as of 31 December 2013 and of its financial performance and its cash flows for the year in accordance with the Annual Accounts Act. The consolidated financial statements have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, the financial position of the group as of 31 December 2013 and of its financial performance and cash flows in accordance with International Financial Reporting Standards, as adopted by the EU, and the Annual Accounts Act. The statutory administration report and the corporate governance report are consistent with the other parts of the annual accounts and consolidated financial statements.

We therefore recommend that the annual meeting of shareholders adopt the income statement and balance sheet for the parent company and the group.

Report on other legal and regulatory requirements

In addition to our audit of the annual accounts and consolidated financial statements, we have examined the proposed allocation of the company's profit or loss and the administration of the Board of Directors and the Managing Director of Fastighets AB Balder (publ) for the year 2013.

The responsibility of the Board of Directors and the Managing Director

The Board of Directors is responsible for the proposal for appropriations of the company's profit or loss, and the Board of Directors and the Managing Director are responsible for administration under the Companies Act.

Auditor's responsibility

Our responsibility is to express an opinion with reasonable assurance on the proposed appropriations of the company's profit or loss and on the administration based on our audit. We conducted the audit in accordance with generally accepted auditing standards in Sweden.

As a basis for our opinion on the Board of Directors' proposed appropriations of the company's profit or loss, we examined the Board of Directors' explanatory statement and a selection of supporting evidence in order to be able to assess whether the proposal is in accordance with the Companies Act.

As a basis for our opinion concerning discharge from liability, in addition to our audit of the annual accounts and consolidated financial statements, we examined significant decisions, actions taken and circumstances of the company in order to determine whether any member of the Board of Directors or the Managing Director is liable to the company. We also examined whether any member of the Board of Directors or the President has, in any other way, acted in contravention of the Companies Act, the Annual Accounts Act or the Articles of Association.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinions

We recommend to the Annual Meeting of shareholders that the profit be appropriated in accordance with the proposal in the statutory administration report and that the members of the Board of Directors and the Managing Director be discharged from liability for the fiscal year.

Gothenburg, 11 April 2014 Öhrlings PricewaterhouseCoopers AB

Bengt Kron Authorised Public Accountant

Corporate governance

Corporate governance in Swedish listed companies is governed by a combination of written rules and practice, by which the owners directly and indirectly control the company. The rules and regulations have been developed through legislation, recommendations, the Swedish Code of Corporate Governance and through self-regulation. The Code is based on the principle comply or explain, which means that all rules need not always be complied with if there is a reason and it is explained.

Some of the Code's principles are to create a good basis for exercise of an active and responsible ownership role and to create a well-adjusted balance of power between owners, the Board and the executive management, which Balder views as a natural part of the principles for the operations. The Code also means that certain information should be made available on the company's website. The Swedish Code of Corporate Governance is administered by the Swedish Corporate Governance Board and is available on www.bolagsstyrning.se.

Balder applies the Code, which is intended to serve as part of the self-regulation within the Swedish business community.

Articles of Association

The company's name is Fastighets AB Balder and the company is a public company (publ). The registered office of the company is in Gothenburg.

The company's objects shall be directly or indirectly, through wholly-owned or part-owned companies, to acquire, manage, own and divest real property and securities and carry on other activities connected therewith.

The articles of association, which are available on Balder's website, among other things, contain information regarding share capital, number of shares, class of shares and preferential rights, number of Board members and auditors as well as provisions regarding notice and agenda for the annual general meeting.

Annual General Meeting

The Annual General Meeting is the company's highest decisionmaking body in which the shareholders exercise their rights to decide on the affairs of the company. The Board and auditors of the company are elected by the annual general meeting according to the proposal of the nomination committee. The annual general meeting also passes resolutions regarding amendments of the articles of association and regarding change in the share capital. To participate in passing resolutions, the shareholder must be present at the meeting, either personally or by proxy. In addition, the shareholder must be registered in the share register on a certain date prior to the meeting and notification of participation must be given to the company within a certain determined period. Shareholders who wish to have a special matter dealt with at the annual general meeting can normally request this if the request is made in good time to Balder's Board of Directors prior to the meeting.

Resolutions at general meetings of shareholders are normally passed by simple majority. In certain questions, the Swedish Companies Act prescribes that proposals must be approved by a larger proportion of the shares represented and cast at the meeting.

Annual General Meeting 2013

At the annual general meeting on 7 May 2013 in the Restaurang Palace in Gothenburg, 128 shareholders were represented, holding 75 per cent of the total number of votes. All Board members and the company's auditor were present at the general meeting.

The annual general meeting adopted the financial statements for 2012 and discharged the Board and CEO from liability for the financial year 2012.

The following resolutions were passed by the Annual General Meeting on 7 May 2013:

  • not to declare any dividend to ordinary shareholders and to declare a quarterly dividend to preference shareholders of SEK 5 per share, however, a maximum of SEK 20,
  • the Board shall, during the period until the next annual general meeting has been held, be composed of five ordinary members without deputies,
  • directors' fees of a fixed amount of SEK 460,000 should be paid to the Board, of which 160,000 to the Chairman of the Board and SEK 100,000 to the other Board members who are not permanently employed by the company. The amount includes remuneration for committee work,
  • re-election of the current Board members Christina Rogestam, Erik Selin, Fredrik Svensson, Sten Dunér and Anders Wennergren. All members are elected until the annual general meeting 2014. Christina Rogestam was re-elected as Chairman of the Board.
  • approval of the Board's proposed guidelines for remuneration to senior executives,
  • mandate for the Board to decide on new issue of not more than 5,000,000 preference shares and/or shares of Class B corresponding to not more than 10 per cent of the existing share capital. The new issue shall be used by the company for payment of acquisitions of properties or acquisition of shares or participations in legal entities that own property or in order to capitalise the company ahead of such acquisitions or to capitalise the company in other respects.
  • mandate for the Board to decide on repurchase and transfer of the company's own shares for the purpose of adjusting the company's capital structure and for transferring own shares as payment or for financing of property investments.

Minutes taken at the annual general meeting on 7 May 2013 are available on the company's website. The annual general meeting for 2014 will take place on 7 May 2014 in Restaurang Palace, Södra Hamngatan in Gothenburg. Information concerning the annual general meeting is published on the company's website.

The share and owners

FASTIGHETS AB balder annual report 2013 83 The Balder share is listed on NASDAQ OMX Stockholm, Mid Cap segment. At year-end, the number of shareholders amounted to 16,089. Balder carried out two new issues during the year. Both issues were of preference shares and amounted to 4,000,000 preference shares in total. Balder's share capital on 31 December 2013 amounted to SEK 172,396,852 distributed among 172,396,852 shares. Each share has a quota value of SEK 1.00, whereof 11,229,432 shares are of Class A, 151,167,420 of Class B and 10,00,000 preference shares. Of the B shares, 2,859,600 are repurchased, which means that the total number of outstanding shares amounts to 169,537,252. Each Class A share carries one vote, and each Class B share and preference share carries one tenth of one vote. Each shareholder at the general meeting is entitled to vote for the number of shares held and represented by him/her. Further information regarding shares and share capital is found on pages 11–13, The share and owners.

Board of Directors

The Board of Directors is elected by the annual general meeting and according to the articles of association shall consist of at least three and at most seven members. The members are elected at the annual general meeting for the period until the end of the first annual general meeting that is held after the members were elected. During 2013, the Board was composed of five members and is responsible for the company's organisation and administration. The Board works according to an established formal work plan with instructions concerning division of responsibilities between the Board and the CEO.

New Board members receive an introduction to the company and its operations and participate in the stock exchange's training according to the stock exchange agreement. The Board subsequently receives continual information, including about regulatory changes and such issues concerning the operations and the Board's responsibility in a listed company.

The rules of the Swedish Companies Act apply to resolutions in the Board, to the effect that more than half of the members present and more than one third of the total number of members must vote for resolutions. The Chairman has the casting vote in the event of the same number of votes.

The Board work is governed by the Swedish Companies Act, the Articles of Association, the Code and the formal work plan that the Board adopted for its work.

Balder's Board of Directors is composed of persons who possess broad experience and competence from the real estate sector, business development and financing. Most of the Board members have experience of board work from other listed companies.

Both of the major owners Erik Selin Fastigheter AB and Arvid Svensson Invest AB are represented on the Board through Erik Selin and Fredrik Svensson.

Balder's signatories, apart from the Board, are any two jointly of Chairman Christina Rogestam, CEO Erik Selin and CFO Magnus Björndahl.

The Board's duties and responsibilities

The Board's overriding duty is to manage the affairs of the company on behalf of the owners so that the owners' interest in a good long-term return on capital is satisfied in the best possible way.

The Board has responsibility for ensuring that the company's organisation is appropriate and that the operations are conducted in accordance with the articles of association, the Companies Act and other applicable laws and regulations and the formal work plan of the Board. The Board shall perform the Board work jointly under the leadership of the Chairman.

The Board shall also ensure that the CEO fulfils his duties in accordance with the Board's guidelines and directions. These are found in the instructions to the CEO drawn up by the Board. The Board members should not be responsible for different lines of business or functions. Compensation and remuneration questions for the CEO are prepared by the Chairman and presented to the rest of the Board prior to decision.

The Board's duties include, but are not limited to the following:

  • festablishing business plans, strategies, significant policies and goals for the company and the Group that the company is Parent Company of ,
  • determining the company's and Group's overall organisation,
  • choosing and dismissing the CEO,
  • ensuring that there is a functioning reporting system,
  • ensuring that there is satisfactory control of the company's and Group's compliance with laws and other regulations that apply to the operations,
  • approving a new formal work plan and instruction to the CEO annually,
  • approving financial reporting in the form of interim reports, year-end reports and annual accounts that that company shall publish,
  • ensuring that the company has a functioning approvals list and approvals process.

Chairman of the Board

It is the duty of the Chairman to ensure that the Board's work is conducted effectively and that the Board fulfils its duties. The duties of the Chairman include, but are not limited to the following::

  • organising and leading the Board's work and creating the best possible basis for the Board's work,
  • •ensuring that the Board's work occurs in accordance with the provisions of the articles of association, the Companies Act and the formal work plan of the Board,
  • monitoring that the Board's decisions are executed effectively,
  • continually monitoring the company's development through contact with the CEO and acting as a discussion partner,
  • ensuring that the Board members, through the agency of the CEO, receive sufficient information and decision data for their work,
  • making sure that each new Board member is given a proper introduction upon joining the Board.

The formal work plan of the Board of Directors

The Board adopts a formal work plan for the board work each year. This formal work plan describes the duties of the Board and the division of responsibilities between the Board and the CEO. The formal work plan also describes what matters shall be dealt with at each board meeting and instructions regarding the financial reporting to the Board. The formal work plan also prescribes that the Board shall have an audit committee and a remuneration committee. The Chairman of the Board shall serve as the chairman of the committees.

Board meetings

The Board shall, in addition to the statutory meeting, hold Board meetings on at least 4 occasions annually. The CEO and/ or CFO shall as a general rule present a report to the Board. The company's employees, auditor or other external consultants shall be called in to board meetings in order to participate and report on matters as required.

The Board constitutes a quorum when more than half of the Board members are present. The Chairman has the casting vote in the event of the same number of votes.

The Board's work

Balder's Board held 12 board meetings during 2013 of which one was the statutory meeting. Under the current formal work plan, the Board shall hold at least five ordinary Board meetings, including the statutory meeting, per calendar year. The Board meetings are held in connection with the company's reporting. Matters of significant importance to the company are dealt with at each ordinary board meeting such as acquisition and sale of properties, investments in existing properties and financing questions. In addition, the Board is informed about the current business situation in the rental, property and credit markets. Among the regular matters dealt with by the Board in 2013, included acquisition strategies, capital structure and financing position, common corporate policies and the formal work plan for the Board.

Remuneration Committee

The remuneration committee has a preparatory function in relation to the Board in questions regarding principles for remuneration and other terms of employment for the CEO and other senior executives. The remuneration committee shall monitor and evaluate the application of the guidelines for remuneration and levels of compensation to senior executives that the annual general meeting has determined and shall also draw up proposals for new guidelines for principles of remuneration and other terms of employment. Ahead of the annual general meeting's resolution, the Board shall propose principles for remuneration and other terms of employment for the CEO and other senior executives.

Based on the resolutions of the annual general meeting, it is the duty of the remuneration committee to decide on remuneration to the CEO and other officers. The remuneration committee is composed of all independent Board members and should meet at least once every year. For further information see Note 4, Employees and personnel expenses.

Audit Committee

The audit committee shall be responsible for preparing the Board's work by quality-assuring the company's financial reporting, assisting the nomination committee in drawing up proposals for auditors and their fees and ensuring a qualified independent audit of the company. The audit committee shall meet the company's auditor at least once per calendar year.

During 2013, the audit committee, which was composed of all independent Board members, has met the company's auditor on one occasion and has received a report on the performed audit.

The composition of the Board of Directors, number of meetings and attendance

Attendance at meetings
Name Elec
ted
Indepen
dent
Board
meetings
Audit com
mittee
Remuneration
committee
Christina Rogestam 2006 Yes 12/12 1/1 1/1
Erik Selin 2005 No 12/12
Fredrik Svensson 2005 Yes 12/12 1/1 1/1
Sten Dunér 2007 Yes 12/12 1/1 1/1
Anders Wennergren 2009 Yes 12/12 1/1 1/1

Further information about the company's Board may be found on page 88 and on Balder's website, www.balder.se.

Disqualification

Board members or the CEO may not deal with issues concerning agreements between themselves and the company or Group. Nor may they deal with issues regarding agreements between the company and a third party, if they have a material interest that can conflict with that of the company. Lawsuits or other actions are on a par with the agreements referred to above. Where applicable, it is incumbent on the Board member or CEO to disclose if a disqualification situation would arise.

Nomination Committee

The annual general meeting resolves on the procedure for election of the Board, and when applicable, auditors. The annual general meeting 2013 resolved that a nomination committee should be established before the 2014 annual general meeting in order to submit proposals on the number of Board members, election of Board members including the Chairman of the Board and remuneration for Board members as well as for auditors.

The nomination committee's proposals shall be announced no later than in conjunction with the notice convening the annual general meeting. All shareholders are given the opportunity to submit nomination proposals to the nomination committee.

The annual general meeting 2013 adopted the nomination committee's proposal that the nomination committee should be composed of one representative for each of the two largest shareholders or ownership spheres in addition to Lars Rasin, who represents the other shareholders. The chairman of the nomination committee shall be Lars Rasin. The names of the other two members and the owners they represent shall be announced not later than six months before the annual general meeting. The nomination committee's term of office extends until a new nomination committee has been appointed. If Lars Rasin resigns as chairman of the nomination committee, the company's Chairman shall appoint a new chairman of the nomination committee until the next general meeting of the company.

The nomination committee ahead of the annual general meeting 2014 is composed of Christian Hahne, representing Erik Selin Fastigheter AB, Rikard Svensson, representing Arvid Svensson Invest AB, and chairman Lars Rasin.

The nomination committee has decided to propose the reelection of the current Board members Christina Rogestam, Fredrik Svensson, Sten Dunér, Anders Wennergren and Erik Selin. It is proposed to re-elect Christina Rogestam as Chairman of the Board.

CEO and Management

The CEO is responsible for the day-to-day administration pursuant to the guidelines and policies determined by the Board. The CEO shall report on Balder's development to the Board and prepare the order of business at Board meetings according to an approved agenda. The CEO shall ensure that the required material is compiled and distributed to the Board members prior to board meetings.

The Management normally meets once every month with a standing agenda, including property transactions, finance and overall management issues. The Group Management consists of six persons and includes resources such as the CEO, accounting, finance, management, property transactions and personnel.

Audit

The company's annual accounts and the administration of the CEO and Board are reviewed by the company's auditor who submits an audit report for the financial year to the annual general meeting.

The auditor reports to the Board on his audit plan for the year and his views on the accounts and annual accounts.

Öhrlings PriceWaterhouseCoopers AB with Bengt Kron as chief auditor, was elected at the annual general meeting on 7 May 2013 as auditor for a period of four years until the annual general meeting 2017.

Ahead of the Annual General Meeting 2014

Ahead of the annual general meeting on 7 May 2014, the Board of Directors proposes:

  • that no share dividend shall be declared to the ordinary shareholders,
  • a quarterly dividend of SEK 5 per share shall be declared to the preference shareholders, however, a maximum of SEK 20,
  • guidelines for remuneration of senior executives,
  • a renewed mandate for the Board until the next annual general meeting, to repurchase and transfer B shares in Balder equivalent to not more than 10 per cent of all shares in the company,
  • a renewed mandate for the Board until the next annual general meeting, on one or more occasions, to resolve on new issue of preference shares and/or ordinary shares of Class B equivalent to not more than 10 per cent of the existing share capital. It shall be possible to subscribe for the shares in cash, in kind or through right of set-off.

Ahead of the annual general meeting on 7 May 2014, the nomination committee proposes:

  • re-election of the current Board members Christina Rogestam, Fredrik Svensson, Sten Dunér, Anders Wennergren and Erik Selin. It is proposed to re-elect Christina Rogestam as Chairman of the Board,
  • it is proposed to pay directors' fees of SEK 160,000 to the Chairman of the Board and SEK 100,000 to the other Board members who are not permanently employed by the company. Amounts include remuneration for committee work,
  • that the general meeting resolves that the nomination committee shall be composed of one representative for each of the two largest shareholders or ownership spheres in addition to Lars Rasin, who represents the other shareholders. The

chairman of the nomination committee shall be Lars Rasin. The names of the other two members and the owners they represent shall be announced not later than six months before the annual general meeting. The nomination committee's term of office extends until a new nomination committee has been appointed

Information to the stock market

Balder issues interim reports for the operations three times per year; on 31 March, on 30 June and on 30 September. In addition to this, Balder's reports its full-year accounts on 31 December and publishes its annual accounts in good time before the annual general meeting.

The annual accounts for 2013 are now available for distribution and on Balder's website. All documents as well as press releases and presentations in connection with reports are available on Balder's website, www.balder.se.

The Board of Director's report on internal control

The Board is responsible for the internal control under the Swedish Companies Act and under the Code. This account has been prepared in accordance with the Swedish Annual Accounts Act and the Code and is thus limited to internal control in respect of the financial reporting. Financial reporting refers to interim reports, year-end reports and annual accounts. This report does not constitute a part of the formal annual accounts.

Balder's internal control follows an established framework, Internal Control – Integrated Framework, which consists of five components. The components are control environment, risk assessment, control activities, information and communication as well as monitoring.

Control environment

The control environment constitutes the basis for the internal control in respect of the financial reporting. A good control environment is built on clearly defined and communicated decisionmaking procedures and guidelines between different levels of the organisation, which together with the corporate culture and shared values establish the basis for managing Balder in a professional manner. Balder's internal control is based on a decentralised organisation with 498 properties, each with its own profit centre, which are administered from regional offices. To support the control environment and provide necessary guidance to different officers, there are a number of documented governing documents such as internal policies, guidelines, manuals, the formal work plan of the Board, decision-making procedures, rules for approvals as well as accounting and reporting instructions. Governing documents are updated as required in order to always reflect applicable laws and rules.

Risk assessment

The focus is on identifying the risks that are considered most significant in Balder's profit/loss and balance sheet items in the financial reporting and what measures can reduce these risks. The risk management is built into the above mentioned control environment document. Different methods are used to measure and minimise risks and to ensure that the risks that the company is exposed to are handled according to Balder's current policies and rules. The Board conducts an annual review of the internal control in accordance with the formal work plan of the Board. The risk assessment is continually updated to cover changes that have a material impact on the internal control in respect of the financial reporting.

The most significant risks that have been identified in connection with the financial reporting are errors in the accounts and in the valuation of the real estate portfolio, deferred tax, interest-bearing liabilities, refinancing, tax and value added tax as well as the risk of fraud, loss or embezzlement of assets.

Control activities

A number of control activities are built-in to ensure that the financial reporting provides a true and fair view at each point of time. These activities involve different levels in the organisation, from the Board and company management to other employees. The control activities are aimed at preventing, discovering and correcting errors and deviations. The activities consist of approval and reporting of commercial transactions, follow up of decisions and approved policies of the Board, general and application-specific IT controls, checking of external counterparties and follow up of results at various levels in the organisation. Other activities are follow up of the reporting procedures including the annual accounts and consolidated accounts and their conformity with applicable rules and regulations, approval of reporting tools, accounting and valuation principles as well as power of attorney and authority structures.

Balder's regional offices participate in the basic control, follow up and analysis in each region. To ensure the quality of the regions' financial reporting, an evaluation is made in conjunction with the Group's controllers. The follow up at a regional level combined with the controls and analyses at a Group level are an important part of the internal control, to ensure that the financial reporting essentially does not contain any errors.

Information and communication

Balder has determined how information and communication in

respect of the financial reporting should occur so that the company's information disclosure should take place in an effective and correct manner. Balder has guidelines for how the financial information should be communicated between the management and other employees. Guidelines, updates and changes are made available and known to the employees concerned by means of oral and written information and on Balder's intranet. The Board receives further information about risk management, internal control and financial reporting from meetings and reports from the company's auditors.

Monitoring

There is an appropriate process for continual follow up and annual evaluation of the observance of internal policies, guidelines, manuals and codes and of the appropriateness and functionality of the established control activities. There is a special process for monitoring that reported deficiencies are remedied.

Different methods are used to measure and minimise risks and to ensure that the risks that the company is exposed to are handled according to Balder's current policies and rules. The Board conducts an annual review of the internal control in accordance with the formal work plan of the Board.

The Board receives a report once every year from Balder's auditor regarding internal control, risk management and financial reporting.

Need of internal audit

Balder has a decentralised organisation that manages 498 properties from regional offices. Financial operations and the finance function for the entire Group are conducted in the Parent Company.

There is a controller function in the Parent Company which monitors the administration of the regional offices and the financial operations in the Parent Company. Balder's size and decentralised organisation together with the controller function in the Parent Company mean that a special internal audit function is not motivated at present.

Gothenburg, 11 April 2014

Christina Rogestam Chairman of the Board

Sten Dunér Fredrik Svensson Anders Wennergren Erik Selin Board member Board member Board member Board member and CEO

Auditor's statement regarding the Corporate Governance Report

To the Annual General Meeting of Fastighets AB Balder (publ) Corporate identity no. 556525-6905

The Board of Directors is responsible for the corporate governance report for 2013 on pages 83–87 and for ensuring that it is prepared in accordance with the Annual Accounts Act.

We have read the corporate governance report and based on this reading and on our knowledge of the company and the Group, we

believe we have a sufficient basis for our opinion. This statutory review has another aim and direction, and is substantially less exhaustive in scope, than an audit conducted in accordance with International Standards on Auditing (ISA) and other generally accepted auditing standards in Sweden.

We consider that a corporate governance report has been prepared and its statutory content is consistent with the annual accounts and the consolidated financial statements.

Gothenburg, 11 April 2014

Öhrlings PricewaterhouseCoopers AB

Bengt Kron

Authorised Public Accountant

Board of Directors

At the top from the left: Christina Rogestam Sten Dunér Anders Wennergren Fredrik Svensson Erik Selin

Christina Rogestam, born 1943

Christina Rogestam, born 1943 Chairman of the Board since 2006. Education: Bachelor of Arts, Social studies.

Previously President and CEO of Akademiska Hus AB, Chairman of Metria AB and Board member of Lönnbacken AB. Shareholding in Balder:

70,000 B shares, 1,160 preference shares and 3,000 B shares and 2,080 preference shares via company.

Fredrik Svensson, born 1961

Board member since 2005. Education: Master of Business Administration. CEO of AB Arvid Svensson, Chairman of Klövern AB, Board member of Novotek AB and of Tenzing AB. Shareholding in Balder: 2,915,892 A shares and 13,542,540 B shares, all via company.

Sten Dunér, born 1951

Board member since 2007. Education: Master of Business Administration.

CEO of Länsförsäkringar AB. Chairman of Länsförsäkringar Bank, Länsförsäkringar Sak and Länsförsäkringar Fondliv. Board member of Länsförsäkringar Liv and Svensk Försäkring and the Employers' Organisation of the Swedish Insurance Companies. Shareholding in Balder: No shareholding in Balder.

Erik Selin, born 1967

Board member since 2005. Education: Business school economist.

CEO of Fastighets AB Balder. Chairman of Collector AB and Collector Credit AB and Skandrenting AB, Board member of Västsvenska Handelskammaren and of SveaReal AS. Shareholding in Balder: 10,500 B shares and 500 preference shares and 8,298,594 A shares and 57,207,798 B shares via company.

Anders Wennergren, born 1956

Board member since 2009. Education: Bachelor of Laws. Lawyer, partner and Board member of Advokatfirman Glimstedt. Board member of Sefa AB and Coryseva AB. Shareholding in Balder: 2,050 B shares and 3,336 A shares and 232,068 B shares via company.

Balder's Board of Directors is composed of five people, including the Chairman. Board members are elected annually at the annual general meeting for the period up to the end of the next annual general meeting.

.

Management

Erik Selin, born 1967

Board member since 2005. Education: Business school economist. CEO of Fastighets AB Balder. Chairman of Collector AB and Collector Credit AB and Skandrenting AB, Board member of Västsvenska Handelskammaren and of SveaReal AS. Shareholding in Balder: 10,500 B shares and 500 preference shares and 8,298,594 A shares and 57,207,798 B shares via company.

Benny Ivarsson, born 1955

Head of property. Employed since 2006. Education: Master of Business Administration. Shareholding in Balder: 9,992 B shares and 8,500 preference shares and 13,360 B shares via company.

Magnus Björndahl, born 1957

CFO. Employed since 2008. Education: Master of Business Administration. Shareholding in Balder: 21,000 B shares.

Sharam Rahi, born 1973

Head of property management and Vice CEO. Employed since 2005. Education: Compulsory school. Shareholding in Balder: 737,822 B shares and 788,978 B shares and 20,000 preference shares via company.

Petra Wing Engström, born 1965

Head of personnel and administration. Employed since 2007. Education: Business school economist. Shareholding in Balder: No shareholding in Balder.

Marcus Hansson, born 1974

Head of finance. Employed since 2007. Education: Master of Business Administration. Shareholding in Balder: 64,500 B shares.

. Auditor

Öhrlings PricewaterhouseCoopers AB

Chief auditor: Bengt Kron, born 1965 Auditor of the company since 2009, elected at the annual general meeting on 7 May 2013 for four years until the annual general meeting 2017.

At the top from the left: Erik Selin Magnus Björndahl Petra Wing Engström Benny Ivarsson Sharam Rahi Marcus Hansson

Property list

Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
category
Site leasehold
right
Office Retail Industrial/
Warehouse
Education/ Care Hotel Residential Other Total Tax assessment
value, SEKm
Stockholm Region
Botkyrka Freja 2 Balders väg 4–16 1900 Residential 7,060 220 7,280 51
Botkyrka Freja 3 Bot Balders väg 1–5, 9–15 1900 Residential 7,060 220 7,280 50
Botkyrka Hallunda 4:11 Iduns väg 2–16 1900 Other Yes
Botkyrka Hallunda 4:9 Balders väg 2–16 1900 Other Yes
Botkyrka Idun 2 Iduns väg 2–8, 12–16 1900 Residential 7,060 256 7,316 51
Botkyrka Idun 3 Iduns väg 1–5, 9–15 1900 Residential 7,060 7,060 52
Huddinge Bäckgården 8 Vårby Allé 8, 10, 14–22 1974 Office Yes 2,818 1,731 3,805 8,354 49
Huddinge Vårby Gård 1:16 Vårby Allé 58 m fl 1900 Residential 222 37 51,857 2,662 54,778 375
Järfälla Jakobsberg 2:2583 Järfällavägen 100–104 m fl 1982 Other 2,620 1,725 718 15,232 1,759 22,054
Järfälla Säby 3:29 Kopralsvägen 2–10 m fl 2008 Residential 5,344 8 5,352 81
Lidingö Fjällräven 1 Vesslevägen 3 m fl 1900 Residential 100 4,300 2,561 6,961
Nacka Sicklaön 354:1 Ektorpsvägen 2–6 m fl 1980 Office 8,571 3,925 1,245 4,350 320 18,411 113
Nacka Älta 9:130 Ältavägen 170, 172 1992 Retail 960 880 1,840 19
Nyköping Brandholmen 1:69 Idrottsvägen Other
Nynäshamn Musköten 1 Björn Barkmans väg 1–48 1900 Residential 16 100 22,494 207 22,817 140
Solna Puman 1 Bangatan 21 m fl 1972 Office 2,115 2,115 16
Solna Sparrisen 2 Anderstorpsvägen 8–16 m fl 1974 Office 11,811 511 12,322 102
Stockholm Berget 2 Västmannagatan 13 1900 Other 1,176 339 1,515 31
Stockholm Doggen 1 Vinthundsvägen 157 1974 Office 1,650 1,650 7
Stockholm Doggen 2 Vinthundsvägen 159 A–B 1984 Office Yes 4,690 4,690 28
Stockholm Fiskaren Större 3 Götgatan 21 1929 Residential 235 993 1,375 2,603 53
Stockholm Gladan 3 Sankt Göransgatan 159 m fl 1948 Office Yes 5,355 124 5,479 83
Stockholm Granen 21 Floragatan 21 1972 Office 4,284 8 4,292 161
Stockholm Holar 3 Skalholtsgatan 10 1985 Other 6,203 1,002 7,205 77
Stockholm Islandet 4 Adolf Fredriks Kyrkogata 13 m fl 1908 Office 1,845 245 66 2,156 48
Stockholm Järnplåten 231) Kungsgatan 37 m fl 1937 Office 4,504 2,013 6,517 237
Stockholm Katthavet 8 Näckströmsgatan 8 1929 Retail 8,022 8,022 184
Stockholm Kilaberg 1 Kilabergsvägen 4, 6, 8 m fl 1900 Office Yes 8,095 4,790 4 12,889 73
Stockholm Kungsbacken 8 Drottninggatan 108 m fl 1929 Office 1,787 563 56 2,406 55
Stockholm Kvasten 8 Norrlandsgatan 14 1929 Office 1,336 614 58 10 2,018 159
Stockholm Lindansaren 23 Saltmätargatan 5–11 m fl 1929 Office 7,172 803 498 293 8,766 181
Stockholm Luftspringaren 10 Saltmätargatan 19 1900 Office 498 498
Stockholm Luftspringaren 16 Saltmätargatan 19 A 1900 Office 642 372 61 613 794 2,482 37
Stockholm Lärftet 2 Brommaplan 407–413 m fl 1941 Residential Yes 204 530 114 895 1,743 22
Stockholm Magneten 19 Johannesfredsvägen 9, 11 1923 Office 6,801 2,454 70 9,325 41
Stockholm Magneten 25 Ekbacksvägen 32 1900 Office Yes 3,132 1,030 620 4,782 31
Stockholm Magneten 32 Voltavägen 13–15 m fl 1900 Office Yes 6,990 450 2,667 10,107 81
Stockholm Meteorologen 4 Finn Malmgrens Väg 9 m fl 1991 Residential Yes 399 725 1,124 17
Stockholm Meteorologen 5 Finn Malmgrens Väg 11 m fl 1991 Retail Yes 1,090 74 1,227 2,391 34
Stockholm Miklaholt 2 Haukadalsgatan 10 1981 Office Yes 1,128 788 1,916 16
Stockholm Motståndet 7&9 Ulvsundavägen 174 m fl 1900 Office Yes 1,906 1,283 888 176 4,253 24
Stockholm Murmästaren 3 Hantverkargatan 29 1926 Office 15,966 120 16,086 323
Stockholm Murmästaren 7 Hantverkargatan 31 1929 Office 2,531 472 79 3,082 75
Stockholm Prästgårdsängen 3 Prästgårdsängen 6 m fl 1986 Office Yes 5,444 847 0 6,291 47
Stockholm Silket 2 Brommaplan 422–426 m fl 1941 Retail Yes 174 602 94 555 7 1,432 19
Stockholm Singeln 9 Sorterargatan 8 1970 Office Yes 5,072 5 238 5,315 26
Stockholm Skeppshandeln 1 Hammarby Allé 47 2013 Retail 13,766 13,766
Stockholm Spelbomskan 14 Gyldéngatan 6 m fl 1900 Other 2,700 2,700
Stockholm Spårvagnen 4 Birger Jarlsgatan 57 1995 Office 18,843 3,069 1,086 102 23,100 761
Stockholm Tråden 1 Brommaplan 418, 420 m fl 1941 Retail Yes 555 41 537 1,133 14
Stockholm Vattenkraften 1 Solkraftsvägen 5, 13–19, 23 1989 Office Yes 7,189 734 2,842 12 10,777 4
Stockholm Vreten 8 Västberga Allé 9 m fl 1952 Office 9,072 2,847 11,919 77
Stockholm Vreten 17 Västberga Allé 11 m fl 1900 Office Yes 6,550 6,550 52
Stockholm Vreten 25 Västberga Allé 1 m fl 1900 Office Yes 9,777 580 2,198 55 12,610 109
Sundbyberg Eken 14 Ågatan 10 1936 Office 8,410 217 286 8,913 88
Uppsala Berthåga 53:1 Naturstensvägen 41–115 m fl 2007 Residential 3,814 3,814 48
Uppsala Årsta 94:1 Stålgatan 57–101 1900 Residential 5,274 31 5,305 67
Uppsala Årsta 95:1 Stålgatan 35–39 2005 Residential 4,117 4,117 51
Total Stockholm 186,213 36,825 23,742 29,424 9,198 131,140 13,137 429,679 4,544

1) 81.6 per cent owned by Balder.

Other acquisitions during 2013.

Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
category
Site lease
hold right
Office Retail Industrial/
Warehouse
Education/
Care
Hotel Residential Other Total Tax assessment
value, SEKm
Gothenburg/West Region
Ale Nödinge 38:14 Ale Torg 7 m fl 2007 Retail 3,920 10,419 10 14,349 106
Ale Surte 1:245 Göteborgsvägen 99 m fl 1967 Residential 215 337 1,216 90 1,858 12
Ale Surte 1:293 Göteborgsvägen 93 A–F 1946 Residential 356 424 780 4
Ale Surte 1:294 Brattåsstigen 6 1992 Residential 176 609 785
Ale Surte 4:38, 4:119 Göteborgsvägen 64, 66, 68 m fl 1958 Retail 908 1,320 387 457 139 3,211 15
Alingsås Bagaren 14 Hantverksgatan 2 m fl 1991 Residential 556 556 5
Alingsås Bagaren 2 Hantverksgatan 4 1992 Residential 424 9 433 4
Alingsås Björkhagen 1 Stadsskogsgatan 40 m fl 2007 Residential 3,212 3,212 41
Alingsås Bolltorp 4:13 Bolltorpsvägen 19 A–B m fl 2003 Residential 14,166 14,166 168
Alingsås Dryckeshornet 1 Södra Ringgatan 2 1900 Other 177 5,404 5,581 29
Falkenberg Faktorn 6 Skreavägen 7 1900 Office 2,424 1,809 162 4,395 13
Falköping
Falköping
Agaten 11
Agaten 6
Peter Ryttings väg 20 m fl
Sigurd Kochs Gata 4
1962
1964
Residential
Residential
880
466
51 931
466
4
2
Falköping Anden 16 Banérgatan 16 1900 Residential 135 568 703 3
Falköping Ansgar 1 Sankt Sigfridsgatan 45–49 m fl 1965 Residential 2,022 247 2,269 9
Falköping Apotekaren 2 Sankt Olofsgatan 9 1912 Residential 623 660 1,283 5
Falköping Avenboken 1 Margaretagatan 44 m fl 1961 Residential 0 1,234 1,234 6
Falköping Avenboken 2 Margaretagatan 42 m fl 1961 Residential 0 1,226 1,226 6
Falköping Bagaren 7 Östertullsgatan 3 m fl 1994 Residential 994 2,409 3,403 22
Falköping Byggmästaren 9 Odengatan 16 A–B 1959 Residential 100 2,240 2,340 9
Falköping Draken 8 Odengatan 31 1900 Residential 660 660 2
Falköping Ejdern 14 Banérgatan 1 m fl 1962 Residential 2,236 69 2,305 11
Falköping Flugsnapparen 1 Kapellsgatan 1 1959 Residential 570 30 600 3
Falköping Flugsnapparen 2 Allégatan 3 1959 Residential 570 570 3
Falköping Flugsnapparen 6 Kapellsgatan 3 1959 Residential 570 570 3
Falköping Guldsmeden 21 Trädgårdsgatan 22 1940 Office 325 78 220 623 2
Falköping Guldsmeden 7 Storgatan 20 1987 Retail 259 827 468 20 1,574 6
Falköping Göken 12 Allégatan 9 A m fl 1952 Residential 423 423 1
Falköping Hammaren 7 Eriksgatan 33 A–B 1900 Residential 376 376 2
Falköping Hovslagaren 16 Jakobsgatan 18 B m fl 1960 Residential 2,104 87 2,191 10
Falköping Kemisten 1 Stora Torget 7 m fl 1900 Retail 316 215 531 2
Falköping Lejonet 2 Hjelmarsrörsgatan 24–46 1972 Residential 6,724 151 6,875 30
Falköping Mejseln 4 Sankt Sigfridsgatan 20 1900 Residential 312 312 1
Falköping Muraren 15 Sigurd Kochs gata 16, 18, 20 1962 Residential 1,611 15 1,626 7
Falköping Muraren 3 Hwassgatan 7 A–B 1960 Residential 960 960 5
Falköping Muraren 4 Hwassgatan 5 A–B 1952 Residential 745 745 4
Falköping Muraren 5 Hwassgatan 3 A–B 1959 Residential 787 787 7
Falköping Muraren 6 Gärdesgatan 18 A 1900 Residential 787 787
Falköping Oxeln 1 Wetterlinsgatan 24 A–C 1953 Residential 1,357 25 1,382 7
Falköping S:t Lars 1 Per Larsgatan 4 1900 Residential 69 811 880 4
Falköping Sankt Jakob 14 Sankt Sigfridsgatan 27 1940 Residential 316 316 2
Falköping Sankt Jakob 18 Eriksgatan 29 1940 Residential 293 293 1
Falköping Sankt Johannes 18 Sankt Sigfridsgatan 5 1939 Residential 400 400 2
Falköping Sankt Olof 18 Sankt Olofsgatan 14 m fl 1990 Residential 432 1,599 2,031 9
Falköping Sankt Staffan 13 Bryngelsgatan 6 1900 Office 1,703 366 2,069 7
Falköping Sankt Tomas 13 Warenbergsgatan 11 1938 Residential 393 393 2
Falköping Skalbaggen 1 Scheelegatan 21 A–B 1900 Residential 748 108 856 3
Falköping Skalbaggen 11 Kapellsgatan 19 1959 Residential 434 434 2
Falköping Skalbaggen 12 Kapellsgatan 27 1954 Residential 540 540 3
Falköping Skalbaggen 5 Danska vägen 148 1954 Residential 540 540 3
Falköping Skogslinden 3 Margaretagatan 34 m fl 1900 Residential 716 716 4
Falköping
Falköping
Skogslinden 4
Spettet 1
Margaretagatan 32 m fl
Wetterlinsgatan 18 A–C
1900
1951
Residential
Residential
712
1,308
27 712
1,335
4
6
Falköping Svanen 24 Danska vägen 129, 131 1970 Residential 1,180 1,180 5
Falköping Trädgårdsmästaren 18 Marknadsgatan 7 A–B 1971 Residential 1,272 20 1,292 6
Falköping Trädgårdsmästaren 19 Högarensgatan 8 A–C 1900 Residential 1,018 1,018 5
Falköping Trädgårdsmästaren 22 Marknadsgatan 9, 11 1967 Residential 2,020 2,020 10
Falköping Urd 3 Odengatan 19 m fl 1965 Residential 745 1,186 1,844 3,775 11
Falköping Vargen 1 Wetterlinsgatan 13 C–E 1955 Residential 1,441 1,441 7
Falköping Vargen 2 Dotorpsgatan 67 A–B 1956 Residential 1,163 43 1,206 6
Falköping Vargen 3 Wetterlinsgatan 13 F–H 1955 Residential 242 832 1,074 5
Falköping Vargen 4 Wetterlinsgatan 11 G–H 1957 Residential 1,130 521 1,651 6
Falköping Vargen 5 Wetterlinsgatan 11 A–B 1956 Residential 1,086 357 1,443 6
Falköping Vargen 6 & 8 Wetterlinsgatan 11 C–E 1956 Residential 1,503 23 1,526 7
Falköping Vargen 7 Wetterlinsgatan 11 F 1957 Residential 981 51 1,032 5
Falköping Vitsippan 2 Hagbergsgatan 4 1958 Residential 532 532 2
Gothenburg Askim 243:20 Askims torg 4–6 1972 Office 1,923 638 553 1,251 39 4,404 25
Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
category
Site lease
hold right
Office Retail Industrial/
Warehouse
Education/
Care
Hotel Residential Other
Total
Tax assessment value, SEKmr
Gothenburg/West Region continued
Gothenburg Backa 171:3 Backavägen 1 1955 Retail 4,417 4,417 50
Gothenburg Backa 21:14 Exportgatan 47 B 1989 Other 564 0 1,834 108 2,506 11
Gothenburg Bagaregården 5:8 Kungälvsgatan 6 C–D 1929 Residential 584 584 8
Gothenburg Bagaregården 5:9 Kungälvsgatan 6 A–B 1929 Residential 581 581 8
Gothenburg Bergsjön 34:1 Atmosfärsgatan 1–47 1967-1970 Residential 198 281 22,188 22,667 103
Gothenburg Bergsjön 9:6 Kosmosgatan/Zenitgatan 1967-1970 Residential 3,710 239 370 41,610 45,929 200
Gothenburg Biskopsgården
7:1-7:3 m fl
Långströmsgatan 2–52 m fl 1967 Residential Yes 1,192 639 520 42,756 45,107 212
Gothenburg Brämaregården 60:3 Virveltorget 6 m fl 1969 Office Yes 2,415 737 3,152 14
Gothenburg Brämaregården 72:4 Brämaregatan 15 m fl 1958 Office Yes 2,492 889 42 11 3,434 22
Gothenburg Bur 134:1 Oxholmsgatan 28 1989 Residential 302 302
Gothenburg Bö 93:2 Sofierogatan 1 1940 Office 8,417 472 316 9,205 81
Gothenburg Gamlestaden 25:11 Marieholmsgatan 4 m fl 1990 Office Yes 3,318 681 3,999 24
Gothenburg Gamlestaden 26:13 Vassgatan 3 1988 Office Yes 5,431 5,110 3,530 14,071 72
Gothenburg Gullbergsvass 11:2 Gullbergs Strandgata 38, 40 1977 Other Yes 5,865 5,865 24
Gothenburg Gårda 15:1 Fabriksgatan 7, 9 2001 Office 7,158 207 511 7,876 122
Gothenburg Gårda 15:1 Drakegatan 2–4 1937 Residential 1,655 87 6,717 8,459 150
Gothenburg Högsbo 1:1 J A Wettergrens gata 7 1967 Office 11,129 3,836 286 15,251 60
Gothenburg Högsbo 11:10 Victor Hasselblads gata 8 1982 Office 4,050 4,050 18
Gothenburg Högsbo 38:17 Sisjö Kullegata 5, 7 1986 Office 1,680 1,680 12
Gothenburg Högsbo 38:20 Sisjö Kullegata 6 1989 Office 2,068 792 2,860 19
Gothenburg Högsbo 38:8 Sisjö Kullegata 8 1990 Office 4,138 2,948 7,086 41
Gothenburg
Gothenburg
Inom Vallgraven 14:1
Inom Vallgraven 15:3
Södra Hamngatan 2
Drottninggatan 30 m fl
1929
1930
Retail
Office
3,847 2,637
379
169 2,190 4,827
4,395
80
86
Gothenburg Inom Vallgraven 19:6 Drottninggatan 35 1929 Office 525 597 1,122 17
Gothenburg Inom Vallgraven 33:7 Magasinsgatan 26 1929 Office 2,189 897 258 387 3,731 46
Gothenburg Inom Vallgraven 36:4 Kaserntorget 11 A 1900 Office 2,455 10 9,414 4,851 16,730
Gothenburg Inom Vallgraven 4:2 Östra Larmgatan 16 m fl 1929 Office 2,068 630 62 1,001 3,761 61
Gothenburg Inom Vallgraven 4:4 Lilla Kungsgatan 3 m fl 1929 Office 5,819 5,819 68
Gothenburg Inom Vallgraven 54:9 Lilla Torget 4 1929 Office 836 836 14
Gothenburg Inom Vallgraven 58:6 Kyrkogatan 9 1900 Retail 1,815 230 20 2,728 4,793 106
Gothenburg Inom Vallgraven 8:1 Östra Hamngatan 46–48 m fl 1850 Retail 1,540 1,629 36 3,205 110
Gothenburg Inom Vallgraven 8:20 Kyrkogatan 33 1940 Retail 803 803 17
Gothenburg Järnbrott 145:6 Svängrumsgatan 45–57 1900 Residential 3,844 13 3,857 29
Gothenburg Kobbegården 6:725 Datavägen 12 A 1988 Office 3,388 3,388 22
Gothenburg Kålltorp 36:7 Solrosgatan 13 A 1935 Residential 769 105 874 11
Gothenburg Kålltorp 39:1 Råstensgatan 2 A–C m fl 1936 Residential 791 791 10
Gothenburg Lindholmen 39:2 Lindholmspiren 4 2013 Other 13,299 13,299 51
Gothenburg Lorensberg 46:1 Teatergatan 4 m fl 1929 Retail 299 1,288 42 326 1,955 30
Gothenburg Lorensberg 46:10 Kungsportsavenyn 17 m fl 1944 Office 983 572 1,555 32
Gothenburg
Gothenburg
Lorensberg 46:11
Lorensberg 46:12
Vasagatan 52 m fl
Kungsportsavenyn 11, 13 m fl
1929
1929
Retail
Retail
2,394 1,203 1,203
2,394
19
55
Gothenburg Lorensberg 46:5 Kungsportsavenyn 7 1929 Retail 201 766 967 20
Gothenburg Lorensberg 46:6 Kungsportsavenyn 9 1950 Retail 1,176 1,176 31
Gothenburg Olskroken 10:5 Olskroksgatan 30 1900 Office 3,034 1,477 4,511
Gothenburg Olskroken 25:11 Falkgatan 7 1900 Other 1,969 292 2,261
Gothenburg Rud 8:10 Munspelsgatan/
Speldosegatan/Tamburingatan
1962-1963 Residential 1,014 430 43,673 10 45,127 331
Gothenburg Sannegården 25:1 Säterigatan 20 1971 Other 782 2,685 3,467 18
Gothenburg Sannegården 28:5 Sjöporten 1–5 m fl 1945 Office 1,230 307 1,537 23
Gothenburg Tingstadsvassen 3:6 Motorgatan 1 m fl 1900 Retail 64 3,493 230 7 3,794 77
Gothenburg Torslanda 153:1 Mossfyndsgatan 15 1989 Residential Yes 362 362
Gothenburg Torslanda 155:3 Mossfyndsgatan 10 1989 Residential Yes 300 300
Gothenburg Torslanda 95:1 Torslanda torg 1–4 1973 Retail 244 4,578 16 871 968 6,677 48
Gothenburg Utby 39:11 Västra Tvärskedet 3 1990 Residential 116 351 467
Kungälv Klocktornet 36 Västra gatan 57–61 1972 Retail 3,351 423 3,774 28
Kungälv Krabbetornet 1&35 Västra Gatan 84–88, 90, 92 1961 Retail 213 840 430 1,483 12
Kungälv
Kungälv
Nedre Platt 1
Rhodin 19
Östra Gatan 1
Strandgatan 77–79 m fl
1967 Other
Retail
2,822 10 7
2,839

27
Kungälv Skomakaren 10 Triogatan 5 1988 Office 1,781 478 79 1,474 312 4,124 31
Kungälv Slottsträdgården 5 Gamla torget 2 m fl 1958 Other 6,100 6,100 26
Lerum Floda 3:121 Gamla Vägen 26–32 A–D 1991 Residential 1,016 1,016 11
Lerum Lerum 43:21 Skattegårdsbacken 6–38 1991 Residential 1,383 1,383 3
Lerum Torp 1:328 Lindvägen 34 A–F 1900 Residential 428 11 439 4
Mariestad Enen 23 Stockholmsvägen 11, 16, 18, 20 1900 Retail 3,889 1,952 5,841 40
Mariestad Furan 11 Stockholmsvägen 23 1962 Residential 121 1,620 637 2,378 32
Mariestad Furan 12 Stockholmsvägen 25 1962 Residential 4,254 4,254
Mariestad Fårtickan 1 Bergsgatan 20–34 1967 Residential 4,632 4,632 24

Acquisitions via Bovista during 2013.

Other acquisitions during 2013.

Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
Site lease
category
hold right
Office Retail Industrial/
Warehouse
Education/
Care
Hotel Residential
Other Tax assessment
Total
Gothenburg/West Region continued
Mariestad Granen 8 Viktoriagatan 20 1900 Other
Mariestad Hunden 3 Nya Torget 3 1965 Retail 3,438 264 116 3,818
Mariestad Murklan 1 Bergsgatan 18 m fl 2005 Residential 12,599 12,599
Mariestad Staren 8 Nygatan 14 1957 Retail 355 1,621 86 2,062
Mölndal Stockrosen 3 Norra Ågatan 38 1900 Office 600 5,292 190 6,082
Mölndal Stockrosen 6 Norra Ågatan 34 1900 Office 551 1,212 252 2,015
Mölndal Stockrosen 10 Norra Ågatan 26 C 1900 Office 1,708 53 1,761
Skara Almen 4 Sankta Annagatan 12 m fl 1986 Residential 17 602 90 709
Skara Aspen 1 Malmgatan 9 A–C m fl 1929 Residential 1,415 50 1,465
Skara Bisittaren 2 Stenåsgatan 4 1900 Residential 354 354
Skara Bisittaren 6 Härlundagatan 41 m fl 1990 Residential 300 300
Skara Boken 38 Brinkagatan 2 A–C m fl 1929 Residential 967 967
Skara Bromsen 5 Richertsgatan 1 1990 Residential 534 534
Skara Fjärilen 6 Folkungagatan 15 m fl 1929 Residential 350 350
Skara
Skara
Frigga 4
Frigga 5
Mariebergsgatan 4 A–B
Mariebergsgatan 6 A–B
1900
1900
Residential
Residential
824
828
824
828
Skara Heimdal 1 Hindsbogatan 43 A–B m fl 1900 Residential 632 50 682
Skara Heimdal 4 Hindsbogatan 37 A–B m fl 1900 Residential 647 25 672
705
Skara Plymen 4, 5 Vallgatan 36 A–B 1900 Residential 705
Skara Rådhuset 40 Nicolai Gränd 1–3 m fl 1900 Residential 198 1,905 2,103
Skara Sländan 1 Borggatan 8 A–C 1954 Residential 1,434 1,434
Skara Smörberget 2 Stenåsgatan 10 1900 Residential 410 410
Skara Svärdet 11 Vallgatan 30 1990 Residential 412 412
Skara Tallen 7 Hindsbogatan 20 1937 Residential 852 852
Skara Tor 6 Marumsgatan 16 1900 Residential 312 829 1,141
Skara Tor 10 Hindsbogatan 17 1929 Residential 689 689
Skara Tyr 1 Hindsbogatan 45 A–B m fl 1947 Residential 623 57 680
Skövde Dagsländan 10 Barkvägen 2–32 A–D 1972 Residential 100 22,202 22,302
Skövde Ekoxen 10 Timmervägen 1–37 1974 Residential 1,504 180 1,429
21,395
5,352 29,860
Skövde Mellomkvarn 1 Mellomkvarnsvägen 2–4 1972 Retail 10,959 10,959
Skövde Skultorp 1:58 Vibogatan 1 1978 Residential 904 863 57 1,405 3,229
Skövde Skultorp 36:1 Klagstorpsvägen 1 A 1961 Residential 187 1,042
Skövde Smeden 5 Petter Heléns gata 2 1977 Office 2,598
Skövde 2,598
Storängen 13 Kåsatorpsvägen 5 1992 Office 2,181 60 2,241
Tidaholm Ankan 15 Norra Kungsvägen 68 A–B 1900 Residential 248
Tidaholm Ankan 16 Norra Kungsvägen 66 A–B 1900 Residential 248
Tidaholm Drott 16 Norra Kungsvägen 23 A–C,
25 A–C
1900 Residential 606
Tidaholm Gimle 3 Smedjegatan 6 A–F 1900 Residential 400 400
Tidaholm
Tidaholm
Linden 4
Sleipner 23
Långgatan 41 A–D
Egnahemsvägen 16 A–F, 18 A–D 1990
1900 Residential
Residential
324
720
720
1,732
Tidaholm Spoven 16 Plånaregatan 2–10 m fl 1989 Residential 1,732
Tidaholm Thule 3 Solkullegatan 11 A–F 1988 Residential 522
Tiljan 5 Västra Drottningvägen 94 A–C 1988 Residential 352
Tidaholm Hörnviksgatan 9 A–D, 11 A–D 1990 Residential 656
Tidaholm Titanen 12 1900 Residential 224
Tidaholm Tordyveln 1 & 9 Västra Ringvägen 5 A–B Residential 224
Tidaholm Tordyveln 3 Västra Ringvägen 1 A–B 1900 512
Tidaholm Tumlaren 1 Västra Drottningvägen 64 A–B 1943 Residential 2,341 265 2,901
Trollhättan Hoppet 1 Drottninggatan 13 m fl 1900 Residential 295 16,253
Trollhättan Oden 7 Drottninggatan 25–33 m fl 1976 Retail 13,823 1,014 1,416
Trollhättan Plogen 1, 3 Lantmannavägen 5–47 1969 Residential
Yes
333 11,156
Trollhättan Plogen 2, 4 Lantmannavägen 49–107 1967 Residential
Yes
10,555
Propellern 7 Saabvägen 1, 3 1995 Office 4,759 9
Trollhättan
Trollhättan
Sjöfrun 5 Magasinsgatan 4 A–B m fl 1900 Residential 193 1,367 161
Strandpiparen 12 Slättbergavägen 22 1952 Residential 110 654
Venus 9 Österlånggatan 44 m fl 1900 Residential 1,250 475 1,594
Trollhättan
Trollhättan
Trollhättan
Verkmästaren 14 Ekholmsgatan 11 m fl 1900 Other 1,421 75
Uddevalla Bagge 7 Kungsgatan 10 m fl 1968 Retail 1,239 1,380 100
Uddevalla Kålgården 51 Kyrkogårdsgatan 4, 6 m fl 1963 Other 1,189 890 500 294
6,200
10 11,489
10,555
4,768
1,721
3,319
1,496
2,719
9,083
Uddevalla
Vänersborg
Sälghugget 1
Resedan 15
Lillbräckegatan 1–27
Kungsgatan 5 m fl
1972
1900
Residential
Yes
Residential
1,425 239
1,168
106 13,338
1,203
35
Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
category
Site lease
hold right
Office Retail Industrial/
Warehouse
Education/
Care
Hotel Residential Other Total Tax assessment
value, SEKmr
Öresund Region
DK, Greve Ventrupparken 6 Ventrupparken 6 1900 Retail 4,723 4,723
DK,
Copenhagen
Staevern Örestad Robert Jacobsens Vej 81 2009 Residential 6,830 6,830
DK,
Copenhagen
Österfaelled Torv Marskensgade 13 1996 Residential 43,500 43,500
DK,
Copenhagen
Sundby Overdrev
1034, 1035, 0955a
Else Alfelts Vej 89, 91 m fl Residential
Halmstad Bonden 5 Skånegatan 59 m fl 1900 Other 6,935 140 166 376 7,617
Halmstad Eketånga 24:45 Rörkullsvägen 7 m fl 1990 Office 1,215 1,159 1,148 3,522 15
Halmstad Flygaren 17 Svetsaregatan 17 1900 Other 600 600
Halmstad Hjärtat 4 Nygatan 2 m fl 1987 Retail 214 1,498 597 4 2,313 30
Halmstad Makrillen 8 Kungsgatan 5 1929 Other 305 1,840 2,145 14
Helsingborg Amerika Södra 28 Bryggaregatan 7 m fl 1950 Residential 501 23 5,720 1,363 7,607 82
Helsingborg Skalbaggen 7 Drakegatan 5 m fl 1900 Residential 688 96 784 5
Helsingborg Skalbaggen 15 Gustav Adolfs Gata 13 1900 Residential 762 19 781 6
Helsingborg Skalbaggen 16 Gustav Adolfs Gata 11 m fl 1900 Residential 195 2,155 30 2,380 18
Helsingborg Skalbaggen 17 Gasverksgatan 34 1900 Residential 83 712 32 827 6
Helsingborg Skalbaggen 18 Gasverksgatan 36 1900 Residential 34 818 82 934 6
Helsingborg Skalbaggen 19 Gasverksgatan 38 1900 Residential 708 72 780 5
Helsingborg Skalbaggen 20 Gasverksgatan 40 1900 Residential 83 632 109 824 5
Helsingborg Skalbaggen 21 Gasverksgatan 42 1900 Residential 711 117 828 2
Helsingborg Skalbaggen 22 Gasverksgatan 44 A–B m fl 1900 Residential 143 1,905 24 2,072 15
Helsingborg Skalbaggen 23 Gustav Adolfs Gata 17–19 m fl 1900 Residential 42 3,643 51 3,736 24
Helsingborg Skalbaggen 24 Gustav Adolfs Gata 15 1900 Residential 2,134 2,134 17
Helsingborg Verdandi 1 Bifrostgatan 71–75 m fl 1929 Residential 62 3,763 3,825 43
Helsingborg Württemberg 20 Gustaf Adolfs Torg 8 1937 Retail 1,657 6,123 4,786 1,314 13,880 117
Landskrona Banér 13 Skolallén 6 1931 Residential 298 1,303 14 1,615 8
Landskrona Berzelius 12 S:t Olovsgatan 36 1984 Residential 840 840 4
Landskrona Delfinen 25 Rönnebergsgatan 10–12 1947 Residential 868 868 5
Landskrona Erik Dahlberg 3 Östergatan 8/Nygatan 5 1905/1985 Residential 411 364 775 5
Landskrona Juno 3 Ödmanssonsgatan 16/
Brockgatan 2
1931 Residential 163 1,139 1,302 6
Landskrona Juno 37 Ödmanssonsgatan 28–30/
Bredgatan
1905/1985 Residential 68 2,146 2,214 12
Landskrona Lyckan 1 Suellsgatan 31 1987 Residential 866 866 5
Landskrona Sankt Göran 12 Eriksgatan 168/
Vagnmansgatan 2
1905 Residential 251 894 1,145 5
Landskrona Vildanden 6 Prästgatan 7 1900 Residential 55 391 446 2
Lund Dioriten 1 Brunnsgård m fl 2001 Office 3,080 3,080 36
Lund Lagfarten 1 & 2 Magistratvägen 10, 12 1968 Office 3,472 1,294 4,766 30
Lund Rivan 4 Åkergränden 14 m fl 1978 Retail 334 579 318 1,231 5
Lund Rügen 1 Stralsundsvägen 1–25 1900 Residential 3,083 3,083 41
Lund Rügen 2 Stralsundsvägen 29–43 2006 Residential 5,264 528 5,792 76
Malmö Ledebur 15 Amiralsgatan 20 m fl 1990 Office 6,377 1,235 7,612 61
Malmö Lejonet 2 Mäster Johansgatan 14 1929 Office 4,929 39 68 314 504 5,854 112
Malmö Rosen 9 Engelbrektsgatan 2 1960 Other 1,430 9,777 11,207 225
Malmö Spinneriet 8 Baltzarsgatan 20, 22 m fl 1900 Office 12,148 3,097 2,346 5,540 1,491 24,622 479
Malmö Von Conow 54 Baltzarsgatan 31 1964 Office 9,393 3,567 579 2,584 4,751 20,874 284
Åstorp Asken 14 Skolgatan 14 1929 Residential 167 239 47 771 1,224 5
Åstorp Blåklockan 9 Fågelsångsgatan 32 A–B 1966 Residential 808 808 4
Åstorp Boken 4 Skolgatan 14–20 m fl 1956 Residential 264 1,302 139 7,566 9,271 39
Åstorp Ekorren 27 Skolgatan 7 1929 Residential 337 639 976 4
Åstorp Hyllinge 5:122 Smedgatan 2 m fl 1963 Residential 142 120 7,431 152 7,845 22
Åstorp Hästhoven 12 Fabriksgatan 19 A–C m fl 1960 Residential 455 358 103 2,633 3,549 14
Åstorp Kastanjen 16 Esplanaden 7 m fl 1972 Residential 1,959 833 3,412 156 6,360 27
Åstorp Linden 11 Nyvångsgatan 1 A 1961 Residential 1,472 1,472 3
Åstorp Lotusblomman 15 Nyvångsgatan 31 1961 Residential 340 340 3
Åstorp Lungörten 1 Nyvångsgatan 2 A 1961 Residential 792 792 4
Åstorp Lärksoppen 10 Ekebrogatan 111 1972 Residential 10 8,050 165 8,225 33
Åstorp Lärkträdet 10 Ekebrogatan 1–78 1970 Residential 6,107 142 6,249 24
Åstorp Moroten 10 Torggatan 35 A 1954 Residential 818 818 4
Åstorp Resedan 1 Norra Storgatan 10 A–D 1964 Residential 28 1,061 1,089 5
Åstorp
Åstorp
Svärdsliljan 7
Tranan 1
Östergatan 16 A
Fjällvägen 10–12
1958
1991
Residential
Residential
457 6,457
3,805
6,914
3,805
30
21
Total Öresund 52,946 23,517 9,974 1,317 17,157 151,685 13,975 270,571 2,051

Acquisitions via Bovista during 2013.

Other acquisitions during 2013.

Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
category
Site lease
hold right
Office Retail Industrial/
Warehouse
Education/
Care Hotel
Residential Other Total Tax assessment
value, SEKmr
East Region
Arboga Gesällen 15 Storgatan 61 1958/1972 Residential 436 202 5,048 5,686 18
Arboga Getingen 1 Västermovägen 19–25 1968 Residential 9,515 9,515 30
Arboga Hjulmakaren 25 Vikingagatan 4 A–C 1977 Residential 3,497 3,497 14
Arboga Ringsborg 1 Kapellgatan 29 1983 Office 1,488 1,488 5
Arboga Riskan 1 Österled 26 1963 Residential 283 3,846 4,129 15
Arboga Vilsta 10 Lundborgesplanaden 12 A–I 1964 Residential 59 8,264 8,323 31
Arboga Vilsta 21 Lundborgesplanaden 8 A – 10 B 1970 Residential 6,532 6,532 24
Arboga Vilsta 9 Lundborgesplanaden 2 A–6 B 1960 Residential 200 835 46 7,439 8,520 30
Finspång Hårstorp 4:7 Norrköpingsvägen 30 1970 Office 1,732 230 1,962 5
Finspång Kalkugnen 3 Kalkugnvägen 1 1968 Retail 1,296 2,063 3,359 12
Finspång Kjusorna 12 Stora Allén 24–26 1962 Residential 735 641 82 2,231 3,689 12
Finspång Klubben 5 &
Generatorn 2
Kraftkärrsvägen 1, 3 1966 Residential 50 4,673 4,723 20
Finspång Klubben 6 Östermalmsvägen 29 1963 Residential 3,448 3,448 13
Finspång Kuggväxeln 7 & 8 Östermalmsvägen 30–32 1957/1959 Residential 300 81 251 10,482 11,114 41
Finspång Köpmannen 3 Bergslagsvägen 6 1930 Retail 740 551 1,291 4
Finspång Köpmannen 6 Vallonvägen 15 1981 Office 4,514 117 140 50 4,821 22
Finspång Lodet 1 Kanalgatan 9 1956 Residential 18 1,710 1,728 7
Finspång Luntan 1 Kanalgatan 11–13 1954 Residential 1,378 1,378 5
Finspång Manan 1 & 2 Kalugnsvägen 10 1957/1966 Residential 575 2,577 3,152 12
Finspång Manteln 9 Gröna vägen 25–27 1955 Residential 75 1,644 1,719 6
Finspång Murklan 1 Norra Storängsvägen 38–40 1958 Residential 164 3,556 3,720 13
Finspång Ringugnen 1 &
Lervagnen 1
Östermalmsvägen 36–44 1965 Residential 386 8,641 9,027 33
Finspång Soldaten 10 Bergslagsvägen 41–43 1970 Residential 257 178 2,673 3,108 14
Finspång Trasten 7 Kraftkärrsvägen 15–19 1956 Residential 3,880 3,880 15
Finspång Vinkelhaken 4 Bergslagsvägen 9 1969 Retail 3,586 255 16 3,857 15
Gotland Soldaten 1 Volontärsgatan 1–226 1900 Residential 3,315 3,315 32
Gotland Vibble 1:457 Tvinnaregatan 1–263 1989 Residential 7,741 7,741 51
Hjo Norr 5:8 Karlsborgsvägen 8–36 1929 Residential 1,000 2,270 3,270 11
Jönköping Björnen 6 Tormenåsgatan 15 1991 Office 773 176 949 6
Jönköping Hålan 6:2 Bågvägen 1–46 1900 Residential 9,968 9,968 47
Jönköping
Jönköping
Lejoninnan 10
Mjälaryd 3:300
Nygatan 2–6
Mickels väg 10, 12, 13, 15
1965
1900
Residential
Residential
11,147
2,611
337 11,147
2,948
80
17
Jönköping Tigern 7 Backgatan 2, 4 1900 Residential 5,985 5,985 47
Köping Disa 1 Torggatan 11 m fl 1894 Residential 662 924 1,586 7
Köping Fenja 10 Östra Långgatan 3 m fl 1965 Retail 1,473 2,073 1,169 578 5,293 16
Köping Freja 3 Stora Gatan 6 A–B 1979 Residential 416 1,324 1,740 8
Köping Freja 11 Stora Gatan 8 m fl 1909 Residential 124 876 1,612 69 2,681 11
Köping Immanuel 2 Tunadalsgatan 28–34 1965 Residential 120 11,131 273 11,524 45
Köping Inga 1 Sankt Olovsgatan 52, 54, 56 1945 Residential 177 97 2,271 179 2,724 12
Köping Tunadal 6-8 Tunadalsgatan 6 m fl 1973 Residential 330 8,226 990 9,546 46
Norrköping Gärdet 1 Rågången 71, 73 1900 Residential 491 4,609 5,100 33
Norrköping
Norrköping
Kullerstads-Åby 2:48
Kullerstads-Åby 3:7
Bergslagsvägen 32
Eskilsvägen 6
1962
1954
Residential
Residential
75 723 258 608
404
1,406
662
5
3
Norrköping Lammet 2 Kungstorget 2 m fl 1948 Residential 173 1,950 2,405 34 4,562 27
Norrköping Lokatten 12 Hospitalgatan 9, 11 m fl 1992 Residential 1,693 380 5,364 531 7,968 69
Norrköping Planket 20 Bråddgatan 54 1983 Residential 1,139 1,139 10
Norrköping Planket 23 Plankgatan 46 1940 Residential 25 60 940 600 1,625 9
Norrköping Prinsen 18 Hospitalgatan 42–52 m fl 1967 Residential 30 9,558 5 9,593 79
Norrköping Sprutan 8 Gamla Rådstugugatan 52 m fl 1940 Residential 346 1,318 92 1,756 13
Norrköping Stenhuggaren 25 Sandgatan 28 1960 Residential 2,914 2,914 23
Norrköping Storgatan 10 Drottninggatan 10–12 1908 Residential 484 1,213 688 2,385 14
Norrköping Storgatan 9 Drottninggatan 14 m fl 1985 Residential 252 355 5,968 231 6,806 58
Norrköping Stävan 2 Rösgången 32 1959 Residential Yes 3,639 3,639 25
Norrköping
Tranås
Tullhuset 1
Bågskytten 4
Gamla Rådstugugatan 11 m fl
Grännavägen 21
1907
1949
Residential
Residential
273 1,320
478
1,593
478
13
2
Tranås Bågskytten 5 Stjärngatan 13 A 1991 Residential 500 500 3
Tranås Falkberget 24 Mjölbyvägen 1 m fl 1969 Residential 1,017 70 1,087 5
Tranås Flundran 2 Granitgatan 2 1966 Other 1
Tranås Forellen 3 Beckhemsvägen 22–32 1972 Residential 5,577 125 5,702 21
Tranås Forellen 4 Beckhemsvägen 21 A–B 1900 Other 150 250 400
Tranås Forellen 5 Beckhemsvägen 14–20 1971 Residential 348 6,019 10 6,377 22
Tranås Gäddan 2 Beckhemsvägen 2 A–F 1966 Residential 3,402 3,402 13
Tranås Jupiter 17 Tingvägen 20 A–F m fl 1988 Residential 476 476 2
Tranås Kometen 10 Nämndemansgatan 6, 8 1944 Residential 708 708 3
Tranås Kullen 1 Västra vägen 7 A 1946 Residential 670 34 704 3
Tranås
Tranås
Laxen 2
Laxen 3
Beckhemsvägen 4, 6, 8, 10
Beckhemsvägen 8
1967
1973
Residential
Other
324 9,161 308
575
9,793
575
34
1
Tranås Lejonet 5 Sveagatan 4 A–E 1940 Residential 1,279 35 1,314 7
Tranås Lindkullen 11 Majorsgatan 18 1929 Residential 814 814 3
Tranås Lindkullen 12 Majorsgatan 20 1949 Residential 943 128 1,071 4
Lettable area, sq.m.
Municipality Name of property Address Year of con
struction
Property
category
Site lease
hold right
Office Retail Industrial/
Warehouse
Education/
Care
Hotel Residential Other Total Tax assessment
value, SEKmr
East Region continued
Tranås Lindkullen 13 Majorsgatan 22 1946 Residential 999 10 1,009 4
Tranås Nordstjärnan 7 Storgatan 38 m fl 1965 Residential 265 966 1,504 216 2,951 11
Tranås Norra Gyllenfors 9 Torget 3 m fl 1950 Residential 369 4,938 30 5,658 35 11,030 59
Tranås Oden 12 Storgatan 43 1992 Residential 367 1,213 1,997 110 3,687 19
Tranås Sutaren 2 Beckhemsvägen 12 A–I 1968 Residential 496 2,752 551 3,799 13
Tranås Södra Framnäs 20 Framnäsgatan 2 A–F 1984 Residential 402 402 1
Tranås Tigern 14 Götgatan 29, 31 1960 Residential 736 736 3
Tranås Tjädern 23 Framnäsgatan 1 A–K m fl 1983 Residential 684 684 4
Tranås Tornsvalan 3 Östra Järnvägsgatan 1, 3 1985 Residential 2,073 10 2,083 11
Tranås Västermalm 23 Storgatan 15, 17, 19, 21 m fl 1955 Residential 2,560 2,913 1,181 6,654 25
Tranås Öringen 1 Granitgatan 5, 7, 9 1971 Residential 3,040 3,040 13
Töreboda Advokaten 1 Norra Torggatan 7 1985 Retail Yes 1,286 842 2,128 7
Töreboda Byggmästaren 5 Norra Torggatan 10 1929/1992 Residential 239 1,142 1,381 4
Töreboda Plåtslagaren 9 Stora Bergsgatan 4 A–B 1947–48/
1992
Residential 1,849 1,849 5
Töreboda Rönnen 11 Stora Bergsgatan 20 A–B 1957 Residential 217 822 1,039 2
Töreboda Sotaren 12 Vadsbogatan 10 A–12 B 1947 Residential 976 976 3
Västerås Fältmössan 1/
Vapenrocken 1 Rönnbergagatan 1–39, 10–36 1963/1965 Residential 486 105 38 33,525 2 34,156 193
Västerås Klockarkärleken 2 Rönnbergagatan 4–8 1962 Residential 120 5,778 5,898 33
Västerås Rödklinten 2 Bangatan 15–19 1957 Residential 110 160 0 7,003 7,273 40
Västerås Vallmon 6 Bangatan 1 A–11 B 1968/1979 Residential 32 13,914 13,946 78
Åtvidaberg Edberga 1 Åkervägen 5–7, Bondegatan 8 1966 Residential 155 57 5,360 5,572 21
Totalt East 22,261 28,440 1,884 328,017 8,323 388,925 1 905
North Region
Gävle Holmsund 11:1 mfl Korsnäsvägen 108 m fl 1958 Residential 1,200 260 1,460 3
Gävle Holmsund 7:6 Holmsundsvägen 7, 17–29 1900 Residential 2,948 2,948 10
Gävle Kastet 8:1, 12:1 m fl Forskarvägen 27 m fl 1929 Residential 1,271 104 12,467 1,781 15,623 45
Gävle Lillhagen 5:3 Torkarvägen 2–14 1958 Residential 0 0 2,871 2,871 10
Gävle Norr 18:6 Nygatan 37–39 m fl 1900 Residential 42 408 2,641 385 3,476 30
Gävle Norr 27:2 Stora Esplanadgatan 9 m fl 1920 Residential 127 480 2,185 40 2,832 23
Gävle Söder 58:7 Södra Kungsgatan 44 m fl 1969 Residential 289 941 252 2,004 3,486 23
Gävle Sörby 10:9 Falkvägen 5 A–B 1994 Residential 512 512 4
Karlstad Anden 9 Åttkantslunden 1 A–B, 3 A–B 1983 Residential 1,472 20 1,492 13
Karlstad Braxen 34 Östra Kanalgatan 8 m fl 1944 Residential 321 1,198 521 2,040 13
Karlstad Druvan 1 Drottninggatan 22 m fl 1929 Residential 459 1,443 681 2,583 30
Karlstad Ekorren 9 Sandbäcksgatan 5 m fl 1929 Residential 715 46 1,811 2,572 18
Karlstad Furan 5 Gillbergsgatan 3 A–D 1951 Residential 119 1,710 1,829 16
Karlstad Furan 7 Jössegatan 3 A–B 1968 Residential 925 97 1,022 9
Karlstad Granatkastaren 4 Artillerigatan 1–5 1945 Residential 748 748 6
Karlstad Gruvan 12 Västra Kanalgatan 3 1991 Residential 126 2,525 2,651 25
Karlstad Gruvan 2 Östra Kyrkogatan 4 1929 Residential 1,064 102 1,166 10
Karlstad Grävlingen 3 Sundbergsgatan 20 m fl 1929 Residential 138 1,030 1,168 10
Karlstad Pilbågen 1 Sandelsgatan 2, 4, 6, 8 1942 Residential 2,184 2,184 16
Karlstad Registratorn 1 Norra Allén 26 A–B 1900 Residential 502 56 558 4
Karlstad Registratorn 8 Norra Allén 30 A–B 1900 Residential 456 61 517 4
Karlstad Registratorn 9 Norra Allén 28 1900 Residential 100 466 29 595 4
Karlstad Spiran 1-6 Lignellsgatan 1 m fl 1940 Residential 95 4,456 59 4,610 40
Karlstad Trätälja 11 Drottninggatan 37 m fl 1959 Residential 259 4,567 35 4,861 42
Karlstad Tusenskönan 1 Älvdalsgatan 8 A–C 1950 Residential Yes 69 1,288 1,357 12
Karlstad Väduren 3 Rudsvägen 1 A–D 1942 Residential 1,344 24 1,368 12
Sundsvall Aeolus 1 Nybrogatan 19 m fl 1900 Residential 89 501 872 1,462 8
Sundsvall Bredsand 1:13 Appelbergsvägen 3 Other
Sundsvall Bredsand 1:14 Appelbergsvägen 4 Other
Sundsvall Bredsand 1:3 mfl Appelbergsvägen 1 A–B 1900 Residential 7,127 82 7,209 21
Sundsvall Bredsand 1:4 mfl Appelbergsvägen 14–18 1900 Residential 4,479 4,479 12
Sundsvall Dingersjö 28:27 mfl Appelbergsvägen 26–32 m fl 1900 Residential 9,464 50 9,514 27
Sundsvall Dingersjö 3:131 m fl Bergsvägen 3 A–J 1900 Residential 20,176 5,077 25,253 52
Sundsvall Dingersjö 3:135 Bergsvägen 1 m fl 1954 Other 286 1,391 1,677 2
Sundsvall Fliten 10 Skolhusallén 9 1900 Office 3,125 36 3,161 25
Sundsvall Fliten 11 Rådhusgatan 39 A–B m fl 1900 Residential 272 3,371 3,643 29
Sundsvall Kvissle 2:53 & 2:43 Affärsgatan 26 A–D 1900 Residential 1,468 1,468 3
Sundsvall Kvissle 22:2 & 39:1 Affärsgatan 22–24 m fl 1900 Residential 192 137 6,311 45 6,685 15
Sundsvall Lagmannen 10 Esplanaden 18–22 m fl 1900 Residential 757 240 70 3,980 1,099 6,146 32
Nolby 1:48, 40:1,
Sundsvall 1:108 Skolgatan 4 1900 Residential 1,070 4,079 766 5,915 15
Sundsvall Nolby 3:268 Brovägen 9 1900 Residential 997 997 3
Sundsvall Nolby 40:2 Affärsgatan 18 A–C 1900 Residential 866 2,166 207 3,239 8
Sundsvall Nolby 41:3 & 37:1 Affärsgatan 14 A–H, 16 A–N 1900 Residential 1,006 5,328 43 6,377 16
Total North 8,049 6,601 322 125,835 12,947 153,754 700
Total Fastighets AB Balder 399,932 175,897 84,251 49,946 60,977 1,120,096 77,561 1,968,660 13,768

Acquisitions via Bovista during 2013

Definitions

FINANCIAL

Return on equity, ordinary share, %

Profit after tax reduced by preference share dividend for the period in relation to average equity after deduction of the preference capital. The values were converted to a full-year basis in the interim accounts without taking account of seasonal variations that normally arise in the operations with the exception of changes in value.

Return on total assets, %

Profit before tax with addition of net financial items in relation to the average balance sheet total. The values were converted to a full-year basis in the interim accounts without taking account of seasonal variations that normally arise in the operations with the exception of changes in value.

Loan-to-value ratio, %

Interest-bearing liabilities at the end of the period in relation to total assets at the end of the period.

Loan-to-value ratio properties, %

Interest-bearing liabilities with direct or indirect collateral in properties in relation to the fair value of the properties.

Profit from property management before tax, SEKm

Profit before tax with reversal of changes in value and other income/expenses. Reversal of changes in value and tax as regards participation in profits of associated companies also takes place.

Risk-free interest

Annual average of a five-year government bond.

Interest coverage ratio, times

Profit before tax with reversal of net financial items, changes in value and changes in value and tax as regards participation in profits of associated companies, in relation to net financial items.

Debt/equity ratio, times

Interest-bearing liabilities in relation to shareholders' equity.

Equity/assets ratio, %

Shareholders' equity including minority in relation to the balance sheet total at the end of the period.

Share-related

Equity per ordinary share, SEK Shareholders' equity in relation to the number of outstanding ordinary shares at the end of the period after deduction of the preference capital.

Equity per preference share, SEK

Equity per preference share is equivalent to the average issue price of the preference share of SEK 287.70 per share.

Profit from property management per ordinary share, SEK

Profit from property management reduced by preference share dividend for the period divided by the average number of outstanding ordinary shares.

Average number of shares

The number of outstanding shares at the start of the period, adjusted by the number of shares issued during the period weighted by the number of days that the shares have been outstanding in relation to the total number of days during the period.

Preference capital, SEK

Preference capital amounts to an average issue price of SEK 287.70 per preference share.

Net asset value per ordinary share (EPRA NAV), SEK

Shareholders' equity per ordinary share with reversal of interest rate derivatives and deferred tax according to balance sheet.

Profit after tax per ordinary share, SEK

Profit attributable to the average number of ordinary shares after consideration of the preference share dividend for the period.

PROPERTY-RELATED Yield, %

Estimated net operating income on an annual basis in relation to the fair value of the properties at the end of the period.

Net operating income, SEKm

Rental income less property costs.

Economic occupancy rate, %

Contracted rent for leases which are running at the end of the period in relation to rental value.

Property category

Classified according to the principal use of the property. The break-down is made into office, retail, residential and other properties. Other properties include hotel, education, care, industrial/warehouse and mixed-use properties. The property category is determined by what the largest part of the property is used for.

Property costs, SEKm

This item includes direct property costs, such as operating expenses, media expenses, maintenance, ground rent and property tax.

Rental value, SEKm

Contracted rent and estimated market rent for vacant premises.

Surplus ratio, SEKm %

Net operating income in relation to rental income.

Calendar

Annual General Meeting 7 May 2014

Interim report 7 May 2014
Jan–Mar 2014

Interim report 22 August 2014 Jan–Jun 2014

Jan–Sep 2014

Jan–Dec 2014

Interim report 4 November 2014

Interim report 18 February 2015

Fastighets AB Balder (publ) www.balder.se · [email protected] · Corporate identity no. 556525-6905
Head office Vasagatan 54 · Box 53 121 · 400 15 Gothenburg · Tel +46 31-10 95 70 · Fax +4631-10 95 99
Regional offices
Stockholm
Drottninggatan 108 · 113 60 Stockholm · Tel +468-735 37 70 · Fax +468-735 37 79
Vårby Allé 14 · 143 40 Vårby · Tel +468-721 16 50 · Fax +468-710 22 70
Gothenburg/West Wetterlinsgatan 11G · 521 34 Falköping · Tel +46515-145 15 · Fax +46515-71 12 18
Timmervägen 9A · 541 64 Skövde · Tel +46500-43 64 44 · Fax +46500-42 84 78
Vasagatan 54 · Box 53 121 · 400 15 Gothenburg · Tel +4631-10 95 70 · Fax +4631-10 95 99
East Hospitalsgatan 11 · 602 27 Norrköping · Tel +4611-15 88 90 · Fax +4611-12 53 05
Kapellgatan 29A · 732 45 Arboga · Tel +46589-194 50 · Fax +46589-170 45
Rönnbergagatan 10 · 723 46 Västerås · Tel +4621-14 90 98 · Fax +4621-83 08 38
Stora Allén 24–26 · Box 2025 · 612 02 Finspång · Tel +46122-393 90 · Fax +46122-103 41
Storgatan 51 · 573 32 Tranås · Tel +46140-654 80 · Fax +46140-530 35
Tunadalsgatan 6 · 731 31 Köping · Tel +46221-377 80 · Fax +46221-132 60
Öresund Esplanaden 15 · 265 34 Åstorp · Tel +4642-569 40 · Fax +4642-569 41
Stora Nygatan 29 · 211 37 Malmö · Tel +4640-600 96 50 · Fax +4640-600 96 64
Gustav Adolfs Torg 8 · 252 25 Helsingborg · Tel +4642-17 21 30 · Fax +4642-14 04 34
North Forskarvägen 27 · 804 23 Gävle · Tel +4626-54 55 80 · Fax +4626-51 92 20
Sandbäcksgatan 5 · 653 40 Karlstad · Tel +4654-14 81 80 · Fax +4654-15 42 55
Tallvägen 8 · 854 66 Sundsvall · Tel +4660-55 47 10 · Fax +4660-55 43 38
Letting +4620-151 151
Costumor service +46774-49 49 49

Fastighets AB Balder 2013

Foto: Jesper Orrbeck, Helena Axelsson, Mats Bengtsson, Oscar Ek med flera • Printing: Billes Tryckeri

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