Jonas Björkman, CEO of Tessin.
In our series "Tips from the Expert", Jonas Björkman, CEO of one of Europe's hottest startups, continues to explain the specifics of real estate investments. In just a few short years, Tessin has grown to become the Nordic region's largest real estate investment platform, with over 3,500 active investors.
What are the benefits of working with a platform like Tessin when investing in real estate?
– The greatest advantage is that you, as an investor, lend your capital directly to real estate companies without any intermediaries and that we, via the platform, give everyone an opportunity to invest in the real estate market. With our portal you can create and develop a diversified credit portfolio by entering into several projects with different property types, maturities, and levels of return.
What are the different kind of property types normally listed and what distinguishes them from each other?
– There is a difference between rent/tenant-ownership projects and commercial properties, but they are relatively easy to understand. In order to succeed with a rental project, the majority of the rented apartments need to be rented out when the property is ready and a long-term manager is confirmed. For a tenant-owner project, it is important to ensure that there is enough interest in selling all of the apartments, which then leads to the tenant-owner association buying out the property upon the project’s completion. Success with a commercial project is influenced by the appearance of the rental project, whether there are one or more companies that are tenants, and the extent of the respective companies’ long-term creditworthiness.
What else do you think is important to think about when it comes to real estate investment?
– That the project’s area determines whether or not a property becomes a successful investment. When evaluating a project it’s helpful to think of several levels. The first level concerns the region. For example, is the region expansive, are there a lot of building projects or construction in the region? Level two is concerned with the property’s immediate area and what the competition looks like for the specific property type in that given area. For example, has there been a number of sales in the area and is there a great demand? Level three relates to the specific property project in relation to its neighboring properties. A property may have poorer transportation possibilities to a greater extent than the property just beside it, or a residential property may receive more direct sunlight than a neighboring property, which can consequently affect both valuation and interest.
There are several exciting investment opportunities, like centrally located condominiums or holiday cottages, currently available on our platform and many more to come. So keep an eye out!