Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Skanska says to invest record $476 million in US office development project

EconomyMay 12, 2021 05:15AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: Workers walk past a Skanska logo seen on a fence at a construction site In Warsaw, Poland June 1, 2017. REUTERS/Kacper Pempel

By Anna Ringstrom

STOCKHOLM (Reuters) - Sweden's Skanska is gearing up for its biggest commercial property development project to date, an office building near Seattle in the United States.

The Nordic region's biggest builder, and one of the biggest in the United States, said on Wednesday it would invest $476 million in the project in the tech-company heavy Bellevue area east of Seattle.

"This is the biggest commercial development project in terms of invested capital," Claes Larsson, head of Skanska's property development operations, told Reuters.

Larsson said that with more limited offerings, the office rental market was stronger currently in Bellevue than in Seattle, with occupancy rates for completed commercial properties in Skanska's segment close to 100%.

"It's a very strong rental market despite the pandemic," he said in an interview. "Bellevue actually has lower vacancy rates than Seattle, which is also a good market."

In many other of Skanska's markets, leasing has slowed amid uncertainty caused by COVID-19, and developers are bracing for longer-term changes in demand in office markets as more people are expected to work more from home after the pandemic.

Skanska said in a statement the construction contract for the 25-story, 50,300 square meter project in Bellevue - which is adjacent to Redmond, home to Microsoft (NASDAQ:MSFT) - was worth $270 million.

Skanska's property development operations have grown fast in recent years to account for roughly half of group profits, although the traditional construction division books the bulk of sales.

Larsson said Skanska had not yet signed any lease contracts for the building, which was scheduled to be completed in 2023.

He said investor demand to buy commercial properties remained strong, helped by low interest rates.

"(Investor) demand in all our markets is red hot. We see no particular slowdowns, there is a lot of capital around so you can sell at very good prices if you have fully let properties."

The new project is Skanska’s sixth in the greater Seattle area.

Skanska says to invest record $476 million in US office development project
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email