Employment pension company Varma sells all its residential properties to Lumo

Työeläke­vakuutusyhtiö Varma is selling its residential property to housing company Lumo Kodit oy, the company says in a press release.

The purchase price is approximately EUR 900 million. It will be paid in cash and in new shares issued by Lumo’s parent company Kojamo.

The deal includes 60 residential properties with a total of 4,761 apartments. The sites are mainly located in the capital region.

Varma becomes a significant shareholder of Kojamo. Kojamo is one of the largest rental housing companies in Finland. In the first half of last year Kojamo had a total of nearly 41,000 rental apartments.

Lumo rental homes on the other hand, there are a total of more than 39,000 in Finland’s largest cities.

Varman vice president Markus Aho says that the background of the decision is influenced by the future pension reform.

“We have evaluated our investment portfolio and what is the best way for us to invest in the Finnish housing market, taking into account the upcoming pension reform. In the future, we will be about as much attached to the Finnish housing market and its income opportunities as before, but less capital is tied up,” says Aho in the press release.

The deal still requires the approval of the competition authority.

The services of tenants living in Varma apartments will continue unchanged until the sale is completed. Lease agreements and their terms remain in effect as they are when the housing stock is transferred to a new landlord.

Kojamon managing director Reima Rytsölä regards the trade as a unique opportunity.

“This deal offers Kojamo a unique opportunity to get back on the path to growth by acquiring a portfolio of significant size and excellent fit for our strategy. The properties are located in the best areas, with a strong emphasis on growth centers, and they are of high quality and in good condition,” says Rytsölä in the press release.