A hidden gem in the Group

Most people probably know that Lantmännen is strongly associated with Swedish agriculture and products from the farmland. The fact that the Group also includes one of Sweden's largest real estate companies is not as well known. In fact, Lantmännen Real Estate owns and manages a total of 1.1 million square meters in over 80 different locations around the country.

"Most companies and authorities have some form of service organisation that takes care of their properties. This was also the case at Lantmännen until 2009, when Lantmännen Fastigheter AB was founded. In addition to maintenance and repairs of properties, we saw a business opportunity in renting out premises to external parties instead of selling off properties," says Joachim Haas, Managing Director of Lantmännen Real Estate for the past six years.

LANTMÄNNEN REAL ESTATE's main mission is to help the Group's operations find the right properties, at the right cost. A secondary objective includes management, development of properties and leasing to external tenants.

Just like all companies within Lantmännen, our mission is to contribute to the profitability of our members' farms. By forming a company within the Group, we developed from a service organisation into a real estate company.

RUNNING A REAL ESTATE COMPANY is about management, maintenance and securing rental income. But it's also about keeping an eye on the world around us and talking to various stakeholders such as municipal politicians, construction companies and businesses in the area.

"We have a lot of discussions, often lengthy ones, with various stakeholders in connection with changes at our facilities where the development of the local area might place new demands on our operations," Joachim explains and continues:

"Gathering information and conducting risk analyses helps us in our dialogues with all stakeholders and facilitates our work. Negotiations and contract discussions take time because they are often complex. Our grain facilities located at ports is one example, where the port company often owns the land closest to the water. That means that you need one agreement to use the dockside, and another one to be able to unload.”

One of Real Estate's important tasks is to be up to date on detailed development plans to be involved in discussions at an early stage, taking into account Lantmännen's operations in the area – which often involve both dusty conditions and heavy transport.

"It is important for us to be involved and monitor this so that developments in our local area don’t affect our operations and production. That's a big reason why we need a professional team managing the properties. We want to create the right conditions, and view ourselves as enablers – both for farmers and for Lantmännen's various operations," says Joachim.

ANOTHER IMPORTANT focus area is the development of land where Lantmännen previously has had production facilities. The city of Örebro is one example, where a detailed development plan has been drawn up on a previous industrial property, where apartment buildings, a school and a small shopping center will instead be built.

"It's just like in agriculture: the more you refine your products, the more you can charge. It's the same with real estate. If you sell raw land, you get one coin. If you have developed a detailed plan, you will receive two coins – and if you complete entire projects, you will receive even more.

Another type of development is Lanthem, which is jointly owned with property company Hemsö and has a focus on community service properties – primarily nursing homes, sheltered housing and schools.

"Lantmännen has a lot of good locations in small towns that we can develop for this type of business. The advantage of community service properties is that they are usually municipal tenants with long-term leases of 15–25 years, which contributes to financial stability over time," explains Joachim.

A PART OF THE DEVELOPMENT is also to make acquisitions to have access to suitable premises, or to secure interests in future development.

We hear on the news that the real estate market is shaky, how does this affect Lantmännen Real Estate?

"We see it as an opportunity to identify and carry out acquisitions. This would involve complementary acquisitions where we already own properties, or purely commercial acquisitions with good potential for return on investment.”

Lantmännen is at the forefront of environmental and sustainability issues, with Real Estate having its own agenda to contribute to the goals of the Group. The plan includes material use and energy savings, where major investments in photovoltaic systems have already been made. The goal is to install a total of 500–700 kW of solar power in 2023 and in 2024–2026 an additional six to eight installations per year, all located on rooftops.

This year, Joachim celebrates ten years at Lantmännen and if he gets to choose, he will remain for a long time.

"As an employee at Lantmännen, you are part of a Group that is constantly evolving, dedicated to working for a sustainable future – and to promote Swedish agriculture. To be involved and contribute to all of that - that is a feeling that’s hard to beat, Joachim concludes.

The text, written by Henrik Emilson, was first published in Lantmännen's member magazine Grodden.