Swedish property group Samhallsbyggnadsbolaget i Norden AB (SBB) is exploring options to raise equity from its portfolio of community properties in a bid to manage its maturing bond debt. The company’s CEO, Leiv Synnes, emphasised that while the company is not ruling out any options, including an initial public offering (IPO), efforts to tackle its debt will intensify going forward.
SBB, which became a focal point in Sweden’s real estate funding crisis two years ago, has been working to stabilise its finances. The company’s strategy includes splitting its portfolio into three separate entities: residential, education, and community properties. The first spin-off involved its education portfolio, Nordiqus AB, in which Canadian investor Brookfield Asset Management took a majority stake. Following that, the group sold 44% of its residential unit, Sveafastigheter AB, via an IPO in Stockholm.
To further strengthen its balance sheet, SBB identified 10 billion kronor ($933 million) in non-strategic assets for divestment. These moves are expected to improve the company’s debt ratios and help generate the necessary funds to address maturing debt, which is due in the second half of 2026. Synnes highlighted that residential properties from old joint ventures would be a focus of divestitures, with potential external buyers being sought for these assets.
Additionally, the company is looking to reclaim funds through discussions related to a promissory note tied to its education unit, Nordiqus. SBB recently saw a positive development when hedge fund Fir Tree Partners dropped its legal challenge concerning a disputed debt term. This came after bondholders agreed to swap existing securities for €2.8 billion in new notes with an amended covenant at the heart of the dispute.
Synnes also acknowledged that SBB’s loan-to-value ratio of 61% is high and emphasised that the company will continue to work on asset divestitures and potentially raising equity in subsidiaries to improve its financial position. SBB’s stock has gained 14% this year after a decline of 11% in 2024.
