The Länsförsäkringar Fastighetsfond A fund rose 2.66 percent in April, outperforming its benchmark index which gained 2.15 percent. Since the turn of the year, the fund has declined 5.81 percent, trailing the index which has fallen 4.76 percent. This is according to a monthly report from fund managers Johan Henriks and Bence Földi.

The managers initially noted that the real estate sector underperformed the broader equity market during the month.

'Real estate recovered strongly during the first half of April as swap rates fell (to approximately 2.6-2.7% for the 5-year tenor) but later lost ground as negotiations between the US and Iran continued to drag on and no resolution has been reached regarding the Strait of Hormuz', the management duo wrote.

Furthermore, credit risk appetite is described as remaining strong, with several real estate companies issuing bonds at attractive levels amid high investor interest. Meanwhile, the majority of Nordic real estate companies have reported for the first quarter, where results are generally described as having come in line with expectations, albeit with slightly weaker EBITDA due to a cold winter.

The managers stated that Castellum delivered stable figures but without operational improvement. Liquidity in the real estate transaction market is described as remaining good, while yield requirements are expected to remain unchanged for the rest of the year, with a risk of slightly rising yields.

Regarding the month's performance, student housing and retail outperformed the broader sector, while residential and hotels were weaker.

At the same time, the fund saw a positive contribution from its overweight position in CTP and from not holding positions in Wallenstam and PPI.

'CTP delivered a strong Q1 report which confirmed that economic activity has not yet been affected by the Iran war in the CEE region', the managers wrote.

Negative contributions came instead from an underweight in Castellum and an overweight in Pandox.

This occurred as Pandox reported weaker-than-expected results for the first quarter, where the previously communicated contribution from the acquisition in Ireland is expected to be approximately 10 percent lower than previously stated, and where the outlook is described as more cautious and uncertain.

The largest positive weight adjustments were made in Sagax, CTP, and NP3, while the largest negative weight adjustments were made in Fabege, Vonovia, and Atrium Ljungberg, where some divestments were carried out.

'A more sluggish recovery in the Stockholm office market is expected, while German residential stocks, primarily Vonovia, are now trading somewhat as a bond proxy', the managers concluded.

At the end of the month, the fund's three largest equity holdings were Balder, Sagax, and Catena, with portfolio weights of 8.58, 7.96, and 7.09 percent respectively.

Länsförsäkringar Fastighetsfond A, %April, 2026
Fund MTD, percentage change2.66
Index MTD, percentage change2.15
Fund YTD, percentage change-5.81
Index YTD, percentage change-4.76