Half Year 2026 Lumo Homes PLC Earnings Call

August 13, 2026

Niina Saarto: Good morning all, and welcome to Lumo Homes' half-year results webcast. I am Niina Saarto. I am Treasury and Investor Relations Director. Soon we will hear the Q2 results. Our CEO, Reima Rytsölä, starts, giving also an update on the markets as well as on the acquired portfolios leasing and how the integration to our platform has started. Then Interim CFO Antti Syvänen continues with financial development and outlook. Q&A follows the presentation, and there we welcome both live questions and chat questions. Now we can start with the presentation.

Speaker #1: Our CEO, Reima Rytsola, will also provide an update on the market, as well as on the acquired portfolio leasing and how the integration to our platform has started.

Speaker #1: Then, interim CFO Antti Syvänen continues with financial development and outlook. Q&A follows the presentation, and there we welcome both live questions and chat questions.

Speaker #1: So now we can start with the presentation.

Speaker #2: A very good morning on behalf of myself as well, and welcome to this Lumo Q2 earnings release webcast. We actually had a strong quarter behind us, and our total revenue, net rental income, and FFO grew strongly in the second quarter.

Reima Rytsölä: Very good morning on behalf of myself as well, and welcome to this Lumo Q2 earnings release webcast. We had actually a strong quarter behind us, and all the total revenue, net rental income, and FFO grew strongly in Q2. All in all, the market conditions seem to improve, and I come back on later stage a little bit more detailed on the market conditions. Our occupancy rate grew from last year's comparison point, even though we acquired on 1 April the portfolio of 4,761 apartments, which occupancy was much lower, 83%, on the date of 1 April. But already during Q2, we managed to raise the occupancy from 83% to 89% on this acquired portfolio, and it was truly a success. The development has continued in very favorable terms since the end of June also.

Speaker #2: All in all, the kind of market conditions seemed to improve. And I’ll come back on the latest dates with a little bit more detail on the market conditions.

Speaker #2: Our occupancy rate grew from last year's comparison point, even though we acquired, on the 1st of April, the portfolio of 4,761 apartments, which occupancy was much lower—83% on the date of 1st of April.

Speaker #2: But already during Q2, we managed to raise the occupancy from 83 to 89 on this acquired portfolio, and it was truly a success. The development has continued on very favorable terms since the end of June as well.

Speaker #2: We also refinanced €300 million of our acquisition financing with the bond issue in May. And all in all, our financial position remains stable. In June, we also signed a €500 million backstop facility agreement, which is on very favorable terms and cost-effective for us, and enables us to refinance the maturing bond, but not earlier than next spring.

Reima Rytsölä: We also refinanced EUR 300 million of our acquisition financing with the bond issue in May, and all in all, our financial position remains stable. In June, we also signed EUR 500 million backstop facility agreement, which is very favorable terms in cost effective-wise to us and enables us to refinance the maturing bond not earlier than next spring. If I then start with the operating environment. All in all, I think the H1 for Finnish economy has been very good. It is glad to see that finally Finnish economy is leading the pack also in European context on growth terms in H1. Both the Q1 and the Q2 preliminary GDP figures are 0.9% growth in each quarter, which is strong compared to what it has been in previous muted years.

Speaker #2: If I then start with the operating environment, so all in all, I think the first half of the year for the Finnish economy has been very, very good.

Speaker #2: And it's glad to see that finally the Finnish economy is leading the pack also in the European context on growth terms. In the first half, both the first quarter and the second quarter preliminary GDP figures are 0.9% growth in each quarter, which is strong compared to what it has been in previous muted years.

Speaker #2: So of course, the kind of geopolitical tensions and somewhat rising interest rates are giving some kind of clouds for the development. But so far, so good on the Finnish economy-wise.

Reima Rytsölä: So, of course the geopolitical tensions and somewhat rising interest rates are giving some kind of a cloud for the development, but so far so good on Finnish economy-wise. Also the supply-demand balance seem to finally start balancing out, especially if we look at the supplied rental apartments, which especially in Helsinki the amounts of offered apartments have declined meaningfully, close to 20% from last year's comparison point or last 12 months time. Year to date, the decline of supplied apartments have been even higher, but then we need to bear in mind that we always have a seasonal effect from beginning of the year when we coming to summertime, which is the seasonally best time for landlords. But also, as I said, that for example, Helsinki it's roughly 20% decline in apartments that are offered for rental.

Reima Rytsölä: So, of course the geopolitical tensions and somewhat rising interest rates are giving some kind of a cloud for the development, but so far so good on Finnish economy-wise. Also the supply-demand balance seem to finally start balancing out, especially if we look at the supplied rental apartments, which especially in Helsinki the amounts of offered apartments have declined meaningfully, close to 20% from last year's comparison point or last 12 months time. Year-to-date, the decline of supplied apartments have been even higher, but then we need to bear in mind that we always have a seasonal effect from beginning of the year when we coming to summertime, which is the seasonally best time for landlords.

Speaker #2: And also, the kind of supply-demand balance seemed to finally start balancing out, especially if we look at the supply of rental apartments, particularly in the Helsinki area. In Helsinki, the number of apartments offered has declined meaningfully, close to 20% from last year's comparison point, or the last 12 months.

Speaker #2: Year to date, the decline of supplied apartments has been even higher, but then we need to bear in mind that we always have a kind of seasonal effect from the beginning of the year when we're coming to summertime, which is kind of the seasonally best time for landlords.

Speaker #2: But also, as I said, for example in Helsinki, there's roughly a 20% decline in apartments that are offered for rental, so it's meaningful in that sense.

Reima Rytsölä: But also, as I said, that for example, Helsinki it's roughly 20% decline in apartments that are offered for rental. It's meaningful in that sense. Also, the construction has been very muted this year, and even some of the forecasts seem to be that also the next year for residential construction will be even lower than this year. At the moment, the latest forecast is 15,000 apartments. Still, especially the growth triangle, so to say, so Helsinki area, Tampere, Turku area, is growing on population terms and even the household terms. Even though the number of households haven't grown as fast as population, and that has been probably the one thing that has postponed the recovery of rental market.

Reima Rytsölä: It's meaningful in that sense. Also, the construction has been very muted this year, and even some of the forecasts seem to be that also the next year for residential construction will be even lower than this year. At the moment, the latest forecast is 15,000 apartments. Still, especially the growth triangle, so to say, so Helsinki area, Tampere, Turku area, is growing on population terms and even the household terms. Even though the number of households haven't grown as fast as population, and that has been probably the one thing that has postponed the recovery of rental market. But now it seems that it has started from Helsinki area, and it's, of course, the most important area for us, especially Helsinki as a city, but Helsinki area overall. So, 76% of our portfolio value is in Helsinki area.

Speaker #2: Also, the construction has been very muted this year, and even some of the forecasts seem to be that also next year, residential construction will be even lower than this year.

Speaker #2: And at the moment, the latest forecast is 15,000 apartments. Still, especially the growth triangle, so to say, so the Helsinki area, Tampere, and Turku area, is growing in population terms and even in household terms.

Speaker #2: Even though the number of households hasn't grown as fast as the population, and that has probably been the one thing that has kind of postponed the recovery of the rental market.

Speaker #2: But now it seems to be stated that it has started from the Helsinki area, and it's of course the most important area for us, especially Helsinki as a city.

Reima Rytsölä: But now it seems that it has started from Helsinki area, and it's, of course, the most important area for us, especially Helsinki as a city, but Helsinki area overall. So, 76% of our portfolio value is in Helsinki area. In that growth triangle, close to 90% of our apartments are located in the growth triangle. So I would say that our portfolio is in good shape to face the recovery that has started from the capital area. Then, as we already announced in February, and the deal was closing on 1 April. So we acquired 4,761 apartments, and I think the only weak spot of the portfolio was that it has a very low occupancy at the time of acquisition or closing, and it was roughly 83%.

Speaker #2: But Helsinki area overall, so 76% of our portfolio value is in the Helsinki area. And in that growth triangle, close to 90% of our apartments are located in the growth triangle.

Reima Rytsölä: In that growth triangle, close to 90% of our apartments are located in the growth triangle. So I would say that our portfolio is in good shape to face the recovery that has started from the capital area. Then, as we already announced in February, and the deal was closing on 1 April. So we acquired 4,761 apartments, and I think the only weak spot of the portfolio was that it has a very low occupancy at the time of acquisition or closing, and it was roughly 83%. But as I said already earlier, so already during Q2, we were able to raise the occupancy from 83% to 89%, and the development has been very favorable since that either. So it looks good.

Speaker #2: So I would say that our portfolio is in good shape to kind of face the recovery that has started from the capital area. Then, as we already announced in February, and the deal was closing on the 1st of April.

Speaker #2: So we acquired 4,761 apartments. And I think the only weak spot of the portfolio was that it had very low occupancy at the time of acquisition or closing.

Speaker #2: And it was roughly 83%. But already during as I said already earlier, so already during the Q2, we were able to raise the occupancy from 83 to 89.

Reima Rytsölä: But as I said already earlier, so already during Q2, we were able to raise the occupancy from 83% to 89%, and the development has been very favorable since that either. So it looks good. On the last Q1 earnings release, I said that we expect to reach with this portfolio the stabilized occupancy rate, which we mean that roughly the same occupancy rate than we have in our legacy portfolio. So we expect to reach that, probably not this year, but latest during next year. But I have to revise that due to favorable development, so that we already expect to reach that stabilized level already in Q3, so by the end of September.

Speaker #2: And the development has been very favorable since then, either. So it looks good. And when we, on the last Q1 earnings release, I said that we expect to reach, with this portfolio, the stabilized occupancy rate, which we mean is roughly the same occupancy rate that we have in our legacy portfolio.

Reima Rytsölä: On the last Q1 earnings release, I said that we expect to reach with this portfolio the stabilized occupancy rate, which we mean that roughly the same occupancy rate than we have in our legacy portfolio. So we expect to reach that, probably not this year, but latest during next year. But I have to revise that due to favorable development, so that we already expect to reach that stabilized level already in Q3, so by the end of September. If this kind of a favorable development carries on like we do believe at the moment. All in all, I would say that we had a strong and solid quarter. We still have plenty of to. It's very promising that the markets seem to finally start recovering.

Speaker #2: So we expect to reach that, probably not this year, but at the latest during next year. But I have to revise that due to favorable development, so that we now already expect to reach that stabilized level already in Q3.

Speaker #2: So, by the end of September, if this kind of favorable development carries on, like we do believe at the moment, all in all, I would say that we had a kind of strong and solid quarter.

Reima Rytsölä: If this kind of a favorable development carries on like we do believe at the moment. All in all, I would say that we had a strong and solid quarter. We still have plenty of to. It's very promising that the markets seem to finally start recovering. Of course, if you think about the pricing power of a landlord, it often comes a bit delayed since the supply-demand balance process, but we expect that we will see latest in the next year or so, a growing pricing power for our landlords as well. For financial targets compared to our strategy, it's of course early days. We have a first six months to go, but all in line, but definitely some work to do still, which is natural.

Speaker #2: We still have plenty of two. It's very, very kind of promising that the market seems to finally start to recover. Of course, there's still, if we think about the kind of pricing power of a landlord.

Reima Rytsölä: Of course, if you think about the pricing power of a landlord, it often comes a bit delayed since the supply-demand balance process, but we expect that we will see latest in the next year or so, a growing pricing power for our landlords as well. For financial targets compared to our strategy, it's of course early days. We have a first six months to go, but all in line, but definitely some work to do still, which is natural. Good time to remind that we, in last spring, on AGM, we revised our dividend policy where we said that we will distribute at least 20% of FFO to our shareholders, and it was optional, either dividend or share buyback. With the current trading of a share, it's probably more likely to do the distribution via buybacks than with the dividend.

Speaker #2: So it often comes a bit delayed since the supply-demand balance process, but we expect that we will see it at the latest next year.

Speaker #2: So, kind of a growing pricing power for our landlords as compared to our strategy. So, it's of course early days; we have a first six months to go.

Speaker #2: But all in line. But definitely some work to do still, which is natural. Good time to remind that we, last spring at the AGM, revised our dividend policy where we said that we will distribute at least 20% of FFO to our shareholders.

Reima Rytsölä: Good time to remind that we, in last spring, on AGM, we revised our dividend policy where we said that we will distribute at least 20% of FFO to our shareholders, and it was optional, either dividend or share buyback. With the current trading of a share, it's probably more likely to do the distribution via buybacks than with the dividend. That's a bit of early days to say, but that's the thinking at the moment. Okay. I would like to hand over the word for Antti, who will carry on the financial development and out.

Speaker #2: And it was optional, either dividend or share buyback. And with the current trading over share, it's probably more likely to do the distribution via buybacks than with the dividend.

Speaker #2: But that's a bit of an early days to say. But that's the thinking at the moment. Okay. And then I would like to hand over the word to Antti, who will carry on with the financial development and outlook.

Reima Rytsölä: That's a bit of early days to say, but that's the thinking at the moment. Okay. I would like to hand over the word for Antti, who will carry on the financial development and out.

Speaker #1: Yes, hello everybody. Also from my side, my name is Antti Syvänen. I'm the interim CFO of Lumo, and I will be giving you the insights into the financials for the next two quarters.

Antti Syvänen: Yes. Hello, everybody, also from my side. My name is Antti Syvänen. I'm the interim CFO of Lumo, and I will be giving you the insights into the financials for over the next two quarters until Tommi Valento, who has been appointed as CFO, will start next January. Let's go through the figures, starting from the top line. The revenue and net rental income both increased. Total revenue up EUR 5.9 million or 2.6%. As Reima mentioned, we have acquired a portfolio that gave us revenue increase of EUR 14 million compared to last year. We have made some disposals in 2025 and 2026, which has had an effect to the net revenue, roughly EUR 12 million. In addition, we have had a higher occupancy rate compared to last year, which gave increase the revenue by EUR 2.8 million. Net rental income up EUR 6.0 million, 4.51%.

Speaker #1: Until Tommi Valento, who has been appointed as CFO and will start next January. But let's go through the figures, starting from the top line. The revenue and net rental income both increased, with total revenue up €5.9 million, or 2.6%.

Speaker #1: It is as Reima mentioned, we have acquired a portfolio that gave us a revenue increase of €14 million compared to last year. We have made some disposals in 2025 and 2026.

Speaker #1: This has had an effect on the net revenue of roughly €12 million. In addition, we have had a higher occupancy rate compared to last year, which increased revenue by €2.8 million.

Speaker #1: Net rental income is up €6.0 million, or 4.51%. The main explanations are in revenue. In addition, we had slightly higher maintenance expenses, €0.8 million compared to last year.

Antti Syvänen: The main explanations and turning a revenue. In addition, we had a bit higher maintenance expenses, EUR 0.8 million compared to last year. Repair expenses were EUR 0.9 million less compared to last year. On slide 14, profit before taxes and FFO both increased. Profit before taxes came up from a -24 million last year into +62.7 million. If we exclude the changes in value, the increase was EUR 9.6 million. Of course, it was positively affected by the increase in total revenue as I explained. In addition, we had a bit higher admin expenses compared to last year, EUR 2.5 million. The increased salaries and fees were EUR 1.3 million higher compared to last year. Total amount of financial expenses, they were EUR 2.3 million higher compared to last year. FFO up EUR 2.8 million, 4.5% compared to last year. The same explanation standing profit excluding changes in value.

Speaker #1: Repair expenses were €0.9 million less compared to last year. On slide 14, profit before tax and FFO both increased. Profit before taxes came up from negative €24 million last year to positive €62.7 million.

Speaker #1: If we exclude the changes in value, the increase was €9.6 million. And of course, it was positively affected by the increase in total revenue, as I explained.

Speaker #1: In addition, we had a bit higher admin expenses compared to last year, €2.5 million. The increased salaries and fees were €1.3 million higher compared to last year.

Speaker #1: Total amount of financial expenses—they were €2.3 million higher compared to last year. And FFO is up €2.8 million, or 4.5%, compared to last year.

Speaker #1: And the same explanations as in profit excluding changes in value. Next slide, occupancy rate. It has steadily increased, actually, from quarter three '24. It's now stood at 95%.

Antti Syvänen: Next slide, occupancy rate. It has steadily increased, actually from Q3 2024. It now stood at 95%. It was up 1.4% compared to last year, and it was also slightly up 0.2% compared to the year end, even though we acquired the portfolio, which had a relatively low occupancy rate compared to our, so to say, legacy portfolio. Tenant turnover ratio has increased slightly, but it is still on a normal level, 14.5. Nothing special there. Next slide. We have had a positive development in like-for-like rental income. It was up 2.7% compared to last year. Main driver was the impact of occupancy, effect was 3.7%. We have slightly minus from the impacts of rents, especially rents and tenant water charges in total.

Antti Syvänen: Next slide, occupancy rate. It has steadily increased, actually from Q3 2024. It now stood at 95%. It was up 1.4% compared to last year, and it was also slightly up 0.2% compared to the year-end, even though we acquired the portfolio, which had a relatively low occupancy rate compared to our, so to say, legacy portfolio. Tenant turnover ratio has increased slightly, but it is still on a normal level, 14.5. Nothing special there. Next slide. We have had a positive development in like-for-like rental income. It was up 2.7% compared to last year. Main driver was the impact of occupancy, effect was 3.7%. We have slightly minus from the impacts of rents, especially rents and tenant water charges in total.

Speaker #1: It was up 1.4% compared to last year, and it was also slightly up 0.2% compared to the year end, even though we acquired the portfolio, which had a relatively low occupancy rate compared to our, so to say, legacy portfolio.

Speaker #1: Tenant turnover ratio has increased slightly, but it's still at a normal level—14.5. Nothing special there. Next slide. We have had a positive development in like-for-like rental income.

Speaker #1: It was up 2.7% compared to last year. The main driver was the impact of occupancy; the effect was 3.7%. We have a slight minus from the impacts of rents, especially rents.

Speaker #1: And then water charges in total. And just as a reminder, when we calculate this like-for-like rental income, we are comparing past 12 months' figures to previous 12 months' figures.

Antti Syvänen: Just as a reminder, when we calculate this like-for-like rental income, we are comparing past 12 months figures into previous 12 month figures, and it doesn't include the properties that we have acquired or disposed or completed within 2 years. So, it doesn't include the acquired portfolio as such. Next slide, 17. We have had strong progress in investments. That was mainly due to the acquisition of portfolio, which was made in April. That had an effect of roughly 900 million. We have sold 218 apartments. That had an effect of EUR 21.5 million. Gross investments were totally up by roughly 870 million. Maybe one comment here regarding to the accounting treatment of this portfolio acquisition. At the time when we acquired the portfolio, it was recognized as a cost, according to the ruling of IFRS.

Speaker #1: And it doesn't include the properties that we have acquired or disposed of or completed within two years. So, it doesn't include the acquired portfolio as such.

Speaker #1: Next, slide 17. We have had strong progress in investments. That was mainly due to the acquisition of a portfolio which was made in April. That had an effect of roughly €900 million.

Speaker #1: We have sold 218 apartments. That had an effect of €21.5 million. And gross investments were totally up by roughly €870 million. And maybe one comment here regarding the accounting treatment of this portfolio acquisition.

Speaker #1: At the time when we acquired the portfolio, it was recognized as a cost according to the ruling of IFRS, so that's why the figure is slightly below €900 million.

Antti Syvänen: That's why the figure is slightly below 900 million, due to the fact of this booking of the premium of this deal. Later on, this premium that Varma paid, it was subsequently recognized as a profit on fair value of investment properties, roughly EUR 51 million. Modernization investments and repairs were up 6.3% or EUR 1.5 million. Slide number 18, fair value of investment properties. They were EUR 8.5 million, up 7.5%. Once again, the main reason was the acquisition of this Jupiter portfolio, that had an effect of EUR 900 million. On the negative side, we had the disposal last year of residential properties, which had an effect of roughly 240 million. We didn't change any parameters regarding the valuation. They were unchanged. In the second quarter, the change in the fair value of investment properties were EUR 34.1 million. Next slide, equity ratio and loan-to-value.

Speaker #1: Due to the fact of this booking of the premium of this deal, and later on this premium that Varma paid, it was subsequently recognized as a profit.

Speaker #1: Profit on fair value of investment properties: roughly €51 million. Modernization investments and repairs were up 6.3%, or €1.5 million. Slide number 18.

Speaker #1: Fair value of investment properties: they were €8.5 million, up 7.5%. Once again, the main reason was the acquisition of this Jupiter portfolio.

Speaker #1: That had an effect of €900 million. On the negative side, we had the disposal last year of residential properties, which had an effect of roughly €240 million.

Speaker #1: And we didn't change any parameters regarding the valuation; they were unchanged. In the second quarter, the change in the fair value of investment properties was €34.1 million.

Speaker #1: And next slide. Equity ratio and loan to value. They have both remained really strong. Equity ratio 41–45%. Loan to value was a bit above our internal target, which is 45%.

Antti Syvänen: They have both remained really strong. Equity ratio 45%. Loan-to-value was a bit above our internal target, which is 45. Now it was 45.1%. But we see already in the near future that it will go down below 45%. Maybe one comment here that we still have a quite sizable headroom to all the financial agreement covenants. For instance, the Moody's leverage is 50, and European Investment Bank's LTV limit is 60. So there's a sizable buffer into the limits. Our financial position has remained strong. In May, we issued that EUR 300 million unsecured bond, and the proceeds were used to refinance the so-called backstop facility. That was during in April, and we still have a plan to refinance this rest of the EUR 300 million with the long-term debt.

Speaker #1: Now it was 45.1%. But we see already, in the near future, that it will go down—down below 45%. And maybe one comment here, that we still have quite a sizable headroom to all the financial agreement covenants.

Speaker #1: And, for instance, the Moody's leverage is 50, and the European investment banks' LTV limit is 60. So there's a sizable buffer into the limits.

Speaker #1: Our financial position has remained strong in May. We issued a €300 million unsecured bond, and the proceeds were used to refinance the so-called bridge loan.

Speaker #1: That was drawn in April. And we still have a plan to refinance the rest of the €300 million with long-term debt and a backstop facility agreement.

Antti Syvänen: In June, we signed a EUR 500 million backstop facility agreement, which can be used if needed to refinance this EUR 500 million bond, which is maturing in spring 2027. Of course, our intention is to refinance it in the debt capital markets. After the review period, we signed a EUR 100 million loan agreement with OP. The liquidity situation is very strong. We have unused committed credit facilities of EUR 275 million, and then this unused backstop facility of EUR 500 million. The distribution of group's loan maturity is very well balanced. Key figures per share, they both slightly came down but didn't change significantly, slightly down. Equity per share now 14.53. EPRA net tangible assets just slightly below 18 per share. The reason was the dilution of shares. Finally to the outlook. We have specified our outlook both for the revenue and for the FFO.

Speaker #1: Which can be used, if needed, to refinance this €500 million bond, which is maturing in spring '27. And, of course, our intention is to refinance it in the debt capital markets.

Speaker #1: After the review period, we signed a €100 million loan agreement with OP. The liquidity situation is very strong. We have unused committed credit facilities of €275 million.

Speaker #1: And then this unused backstop facility of €500 million. And the distribution of the group's loan maturity is very well balanced. Then, key figures per share.

Speaker #1: They both slightly came down, but didn't change significantly—slightly down. Equity per share is now €14.53. EPRA net tangible assets are just slightly below €18.

Speaker #1: Per share. And the reason was the dilution of shares. And finally, to the outlooks. We have specified the outlook both for the revenue.

Speaker #1: And for the FFO, in revenue we have narrowed the guidance by raising the lower end by €4 million and lowering the upper end by €4 million.

Antti Syvänen: In revenue, we have narrowed the guidance by raising the lower end by EUR 4 million and lowering the upper end by EUR 4 million. The guidance now is 488 to 493. Still, the midpoint of this revenue is unchanged, is 490.5 based on our latest estimates. In FFO, we have kept the low guidance limit unchanged, and we have lowered the upper guidance limit by EUR 5 million. The main reason for this is that the finance expenses has been a bit higher than we anticipated in our previous outlook. That's all from me, and now I welcome you here. We have now the Q&A session.

Speaker #1: The guidance now is 488 to 493. Still, the midpoint of this revenue is unchanged, at 490.5. Based on our latest estimates. And in FFO, we have kept the low guidance limit.

Speaker #1: Unchanged. And we have lowered the upper guidance limit by €5 million. The main reason for this is that the finance expenses have been a bit higher than we anticipated in our previous outlook.

Speaker #1: That's all from me. And now, I welcome you here. We will now have the Q&A session.

Speaker #2: Thank you. So we can now start the Q&A. And let's first take the online questions.

Niina Saarto: Thank you. We can now start the Q&A, and let's first take the online questions.

Speaker #3: If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad.

Operator 2: If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Robert Phillips from Green Street. Please go ahead.

Operator: If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Robert Phillips from Green Street. Please go ahead.

Speaker #3: The next question comes from Robert Phillips from Green Street. Please go ahead.

Speaker #1: Thank you very much for the presentation. I just had two questions, and I'll go one at a time. You noted that occupancy in the Varma portfolio moved from 83% to 89% in the second quarter.

Robert Phillips: Thank you very much for the presentation. I just had two questions, I will go one at a time. You noted that occupancy in the Varma portfolio moved from 83% to 89% in Q2 and will be stabilized in the coming year. I was just wondering what kind of occupancy level you are targeting by year end, and also how rents are tracking relative to the rest of the portfolio.

Robert Phillips: Thank you very much for the presentation. I just had two questions, I will go one at a time. You noted that occupancy in the Varma portfolio moved from 83% to 89% in Q2 and will be stabilized in the coming year. I was just wondering what kind of occupancy level you are targeting by year-end, and also how rents are tracking relative to the rest of the portfolio.

Speaker #1: And will be stabilized in the coming year. And I was just wondering what kind of occupancy level you're targeting by year end. And then also how rents are tracking.

Speaker #1: Relative to the rest of the portfolio.

Speaker #4: The line was very bad in the very beginning. So, can you repeat the question? Apologies for that. I didn't get it.

Antti Syvänen: The line was very bad in the very beginning. Can you repeat the question? Apologies for that. I did not get it.

Reima Rytsölä: The line was very bad in the very beginning. Can you repeat the question? Apologies for that. I did not get it.

Speaker #1: Yeah, of course. So, you noted the occupancy in the Varma portfolio moved from 83% to 89%, and it's looking like it will be stabilized in the coming year.

Robert Phillips: Yeah, of course. You noted that occupancy in the Varma portfolio moved from 83% to 89%, and it is looking like it will be stabilized in the coming year. I was just wondering what kind of occupancy level you are targeting by year end.

Speaker #1: And I was just wondering what kind of occupancy level you're targeting by year-end.

Speaker #4: Okay, yeah, thanks. Thanks, well as I said, we talk about the stabilized level for acquired portfolio, and then we talk about kind of our own stabilized level.

Antti Syvänen: Well, as I said that we talk about the stabilized level for acquired portfolio, and then we talk about kind of our own stabilized level. I have earlier said that with the market conditions like this, it is probably somewhere between 96% to 97%, the kind of stabilized level. So round about that. We are not giving any guidance as such for our occupancy.

Reima Rytsölä: Well, as I said that we talk about the stabilized level for acquired portfolio, and then we talk about kind of our own stabilized level. I have earlier said that with the market conditions like this, it is probably somewhere between 96% to 97%, the kind of stabilized level. So round about that. We are not giving any guidance as such for our occupancy.

Speaker #4: I have earlier said that, with the market conditions like this, it's probably somewhere between 96 to 97, the kind of stabilized level.

Speaker #4: So round about that. We're not giving any guidance as such for our occupancy.

Speaker #1: Perfect, thanks. And then you also flagged improvements in renting activity in the quarter, and I was just wondering if you could give a bit more color on what you're seeing in terms of regional performance.

Robert Phillips: Perfect. Thanks. You also flagged improvements in renting activity in the quarter. I was just wondering if you could give a bit more color on what you are seeing in terms of regional performance, and then also just whether that is translating into pricing power.

Speaker #1: And then also, just whether that's translating into pricing power.

Speaker #4: Yeah, I think it has, as I said already earlier. So, of course, we do have a seasonal effect as well in the summertime.

Reima Rytsölä: Yeah, I think as I said already earlier, it is of course

Reima Rytsölä: Yeah, I think as I said already earlier, it is of course we do have a seasonal effect as well on the summertime. It is always more active on renting activities. But definitely this year has been encouraging in a way that the activity has been probably even higher so far. Of course, we had a kind of extra vacant apartments in our portfolio as well due to the fact that we acquired a significant portfolio with relatively low occupancy. But like we said already when we released the deal, we said that we are confident that actually our leasing operations are capable of renting these apartments, and it appears to be so. Your question of pricing power.

Reima Rytsölä: We do have a seasonal effect as well on the summertime. It is always more active on renting activities. But definitely this year has been encouraging in a way that the activity has been probably even higher so far. Of course, we had a kind of extra vacant apartments in our portfolio as well due to the fact that we acquired a significant portfolio with relatively low occupancy. But like we said already when we released the deal, we said that we are confident that actually our leasing operations are capable of renting these apartments, and it appears to be so. Your question of pricing power. As I said earlier, we have not seen that much yet of a pricing power. It definitely has not gone worse, but no significant improvement yet.

Speaker #4: It's always more active on renting activities. But definitely, this year has been encouraging in a way that the activity has been probably even higher.

Speaker #4: So far, and of course, we had a kind of extra, extra vacant apartments in our portfolio as well, due to the fact that we acquired a significant portfolio with relatively low occupancy.

Speaker #4: So, but like we said already when we released the deal, we said that we are confident that actually our leasing operations are capable of renting these apartments.

Speaker #4: And it appears to be so. Then, your question of pricing power. So, as I said earlier, we haven't seen that much yet of pricing power.

Reima Rytsölä: As I said earlier, we have not seen that much yet of a pricing power. It definitely has not gone worse, but no significant improvement yet. It is natural that first comes the supply and demand balance, and then you will see the pricing power. We expect that the pricing power will improve either end of this year or beginning of next year.

Speaker #4: It definitely hasn't gotten worse, but there's no significant improvement yet. It's natural that first comes the supply—supply and demand balance—and then you will see the pricing power.

Reima Rytsölä: It is natural that first comes the supply and demand balance, and then you will see the pricing power. We expect that the pricing power will improve either end of this year or beginning of next year.

Speaker #4: So, we expect that the pricing power will improve either at the end of this year or at the beginning of next year.

Speaker #1: Thank you. And then, just on the regional performance, could you elaborate a bit more on what you're seeing on the ground?

Robert Phillips: Thank you. Then just on the regional performance, can you just elaborate a bit more on what you are seeing on the ground?

Speaker #4: On a regional basis, Helsinki is definitely leading the pack at the moment. So, and I think it's natural that the majority of the new jobs are being created in Helsinki.

Reima Rytsölä: On regional wise, Helsinki has definitely leading the pack at the moment. I think it is natural, the majority of the new jobs are creating in Helsinki and in Helsinki area. Inside the Helsinki area, Espoo is kind of following the Helsinki trend. Vantaa is more of on a stable. The situation hasn't improved as much as in Helsinki and Espoo, and that is, I think, mainly due to fact that there have been quite a lot of foreign construction workers living in Vantaa traditionally, and construction market hasn't improved that much. At least not in Helsinki area. There are some data center projects, but they are more of outside of a capital area. The amount of construction workers hasn't grown up so far. That is why I think Vantaa is lacking Helsinki and Espoo, but the main volumes are obviously in Helsinki.

Speaker #4: And in the Helsinki area, in Helsinki, inside the Helsinki area, Espoo is kind of following the Helsinki trend. Vantaa is more on a stable.

Speaker #4: So the situation hasn't improved as much as in Helsinki and Espoo, and that's, I think, mainly due to the fact that there have traditionally been quite a lot of foreign construction workers living in Vantaa.

Speaker #4: And the construction market hasn't improved that much, at least not in the Helsinki area. There are some data center projects, but they are mostly outside of the capital area.

Speaker #4: So, the construction work amount of construction workers hasn't grown up so far. So that's why I think Vantaa is lacking behind Helsinki and Espoo.

Speaker #4: But the main volumes are obviously in Helsinki.

Speaker #1: Perfect. Thanks.

Robert Phillips: Perfect. Thanks.

Operator 2: The next question comes from Anssi Raussi from SEB. Please go ahead.

Operator: The next question comes from Anssi Raussi from SEB. Please go ahead.

Speaker #3: The next question comes from Anssi Raussi from SEB. Please go ahead.

Speaker #4: Yes. Hi all, it's Anssi Raussi from SEB. Thank you for the presentation. A couple of questions left from me. First, about your campaigns: could you talk about the impact of these campaigns on your reported financial occupancy rate and also average monthly rents? Did your campaigns affect these lines?

Anssi Raussi: Yes. Hi, all. It's Anssi Raussi from SEB. Thank you for the presentation. A couple of questions left from me. First, about your campaigns, could you talk about the impact of these campaigns on your reported financial occupancy rate and also average monthly rent, like did your campaigns affect these lines? That's the first one.

Speaker #4: That's the first one. I would say that of course there have been some boosts for our campaigns in Q2 figures as well. But so far, I think especially the acquired portfolio...

Reima Rytsölä: I would say that, of course, there have been some boost for campaigns in Q2 figures as well. But so far, I think, especially the acquired portfolio, we haven't had to kind of boost them with the campaigns. In that respect, of course, campaigns have played some kind of a role, but I would say that not that meaningful.

Speaker #4: So we haven't had to kind of boost them with the campaigns. So in that respect, of course, the campaigns have played some kind of a role.

Speaker #4: But I would say that it's not that meaningful, okay. And if I continue on your reported financial occupancy, do you have some apartments which are not listed on your website, or is there something else that explains maybe a slight difference compared to the reported financial occupancy and the absolute occupancy?

Anssi Raussi: Okay, and if I continue on your reported financial occupancy, do you have some apartments which are not listed on your website, or is there something else which explains maybe a slight difference compared to the reported financial occupancy and the absolute occupancy?

Speaker #4: Yeah. We do have, we do have apartments that are not in a listing. So they are under kind of a major renovation, for example.

Reima Rytsölä: Yeah, we do have apartments that are not listed. So they are under kind of a major renovation, for example. So they are not listed there.

Speaker #4: So, they are not listed there. Okay, that's clear. And finally, on your refinancing, you mentioned—and of course, you have this backstop financing in place—which is kind of an optionality right now.

Anssi Raussi: Okay, that is clear. Finally, on your refinancing, you mentioned, and of course, you have this backstop financing in place, which is kind of an optionality right now, but you said that you still aim to use or tap the bond market at some point. Was it so that now your timetable is early next year, or are you already planning to use bond financing this year?

Speaker #4: But you said that you still aim to use or tap the bond market at some point. But was it so that now your timing may be early next year, or are you already planning to use bond financing this year?

Speaker #4: Yeah. The backstop facility was basically taken to cover a bond that is maturing next spring. And according to Moody's rules, or how Moody's assesses companies...

Reima Rytsölä: Yep. The backstop facility was basically taken to secure the refinancing of a bond that is maturing next spring. According to Moody's rules or how Moody's assess companies, we should have refinanced that bond already this year. Now that we took the backstop facility, we are actually able to carry until the next spring, and still it is a long-term finance. That is why I said that, and given the fact that actually the maturing bond is- if the coupon is less than 2%, so the combination of cost of a backstop facility and the bond that is maturing on next spring, the combined cost is cost-effective in these market conditions.

Speaker #4: So, we should have refinanced that bond already this year. But now that we took the backstop facility, we're actually able to carry it until next spring, and still, it's a long-term finance.

Speaker #4: So that's why I said that, and given the fact that actually the maturing bond, the coupon is less than 2%. So, the combination of the cost of a backstop facility and the bond that is maturing next spring.

Speaker #4: So the combined cost is cost-effective in these market conditions. Got it. That's helpful. Thank you.

Anssi Raussi: Got it. That is helpful. Thank you.

Speaker #3: The next question comes from John Vuong from Van Lanschot Kempen. Please go ahead.

Operator 2: The next question comes from John Vuong from Van Lanschot Kempen. Please go ahead.

Operator: The next question comes from John Vuong from Van Lanschot Kempen. Please go ahead.

Speaker #4: Hi, good morning. Thanks for taking my questions. Just following up on the warm-up portfolio—it sounds like you're ahead of underwriting in terms of occupancy.

John Vuong: Hi. Good morning. Thanks for taking my questions. Just following up on the Varma portfolio. It sounds like you are ahead of underwriting in terms of occupancy gains, but could you provide a bit more color on the incentives that you are providing and to what extent these net effective rents are in line with your underwriting?

Speaker #4: Gains. But could you provide a bit more color on the incentives that you're providing? And to what extent are these net effective rents in line with your underwriting?

Speaker #4: Yeah, I think they are very much in line in underwriting. So that's why I think we are well in line with the business case on pricing terms.

Reima Rytsölä: Yeah, I think they are very much in line in underwriting. That is why I think we are well in line with the business case on pricing terms and then well ahead with the occupancy as such. All in all, I would say that the integration of Varma portfolio has gone really well, even better than our own expectations.

Speaker #4: And then well ahead with the occupancy as such. So, all in all, I would say that the integration of a Varma portfolio has gone really well.

Speaker #4: Even better than our own expectations.

Speaker #1: Okay, that's clear. And just on your LTV: you mentioned that it's a bit ahead of your target. How do you see the trajectory towards a lower leverage from here?

John Vuong: That is clear. Just on your LTV, you mentioned that it is a bit ahead of your target. How do you see the trajectory towards a lower leverage from here?

Speaker #4: Yeah. We don't give that much detail in the future, but it was only slightly above our internal target, so we expect that to come lower.

Antti Syvänen: Yeah, we do not give that much of details in the future, but it was only slightly up of our internal target, so we expect that to come lower, but we do not give too detailed numbers as such.

Speaker #4: But we don't give too detailed numbers as such.

Speaker #1: Are you able to provide insight on how you see this 45.1 going towards, say, the mid-40s or around that level, basically? Okay.

John Vuong: You can't provide on how you see that this 45.1 goes towards, say, mid-40s or around that level, basically?

Speaker #4: Yeah. Well we as Anssi said that we have a we're not willing to give a kind of a detailed path for that. But we expect it to come underneath that 45.

Reima Rytsölä: Yeah, as Antti said that we're not willing to give a detailed path for that, but we expect it to come underneath that 45. That's why we are relatively confident for that.

Speaker #4: So that's, and that's why we are relatively confident about that.

Antti Syvänen: As I mentioned, it's our internal target to have it below 45. So we have a sizable buffer to all the leverage from Moody's and also from European Investment Bank.

Speaker #2: And also, as I mentioned, it's our internal target to have it below 45. So we have a sizable buffer to all the leverage from Moody's and also from the European Investment Bank.

Antti Syvänen: As I mentioned, it's our internal target to have it below 45. So we have a sizable buffer to all the leverage from Moody's and also from European Investment Bank.

Speaker #1: Okay. There’s a lot on the campaigns. Just to confirm, are these just campaigns? So the incentives that you’re providing—are these reflected in your ERVs, in financial occupancy, or are parts of it in other lines, like costs?

John Vuong: Okay. Just a lot from Van Lanschot Kempen. Just to confirm, are these campaigns, so the incentives that you're providing, are these reflected in your ERVs in financial occupancy or parts of it in other lines like costs?

John Vuong: Okay. *Just a lot from Van Lanschot Kempen. Just to confirm, are these campaigns, so the incentives that you're providing, are these reflected in your ERVs in financial occupancy or parts of it in other lines like costs?

Speaker #4: Sorry, John. The line was very bad at the beginning of your question. Can you repeat that again?

Reima Rytsölä: Sorry, John, the line was very bad in the beginning of your question. Can you repeat that again?

Speaker #1: Oh yeah, sorry. Just following up on the campaigns or incentives—are these reflected in the ERVs in your financial occupancy, or are there also parts of it reflected in other lines like costs?

John Vuong: Oh, yeah, sorry. Just following up on the campaigns or incentives. Are these reflected in the ERVs in your financial occupancy, or are there also parts of it reflected in other lines, like costs?

Antti Syvänen: They don't affect our occupancy as such, but they, of course, affected the revenue that we present.

Speaker #4: They don't affect our occupancy as such, but they, of course, affected the revenue that we present.

Speaker #1: Okay. So it's netted in your gross rental income.

John Vuong: Okay, so it's netted in your gross rental income.

Speaker #4: Yeah.

Antti Syvänen: Yeah.

Speaker #1: Okay. Thank you.

John Vuong: Great. Thank you.

Speaker #3: As a reminder, if you wish to ask a question, please dial the pound key (5) on your telephone keypad. The next question comes from Svante Krogfors from Nordea.

Operator 2: As a reminder, if you wish to ask a question, please dial pound key 5 on your telephone keypad. The next question comes from Svante Krokfors from Nordea. Please go ahead.

Operator: As a reminder, if you wish to ask a question, please dial pound key 5 on your telephone keypad. The next question comes from Svante Krokfors from Nordea. Please go ahead.

Speaker #3: Please go ahead.

Speaker #4: Thank you, Reima, Antti, and Niina, for the presentation. A couple of questions left from me. Could you elaborate a bit on rental increases in existing contracts?

Svante Krokfors: Thank you, Reima, Antti, and Niina for the presentation. A couple of questions left from me. Could you elaborate a bit on rental increases in existing contracts? I think you earlier have mentioned that in the capital region, you basically don't try to push for higher rents on existing portfolios, whereas, for example, in Tampere, you could increase rents by 2%. Has there been any change to that?

Speaker #4: I think you mentioned earlier that in the capital region, you basically don't try to push for higher rents on existing portfolios, whereas, for example, in Tampere, you could increase rents by 2%.

Speaker #4: Have you—has there been any change to that?

Speaker #2: Well, we have a kind of, in general now, portfolio. I think averaging around about 1.3 to 1.5% of rental increases for existing customers.

Reima Rytsölä: Well, we have in general now a portfolio, I think averaging roundabout 1.3% to 1.5% of rental increases for existing customers, and we have keep on doing that. As you said, Svante, we need to be mindful for what's kind of a micro market for particular apartments or real estate or area. That's why it differs quite a lot. As I said, that also in a capital area, the market seems to improve now.

Speaker #2: And we have to keep on doing that. But as you said, Svante, we need to be mindful of what kind of micro market we're in for particular apartments, real estate, or area.

Speaker #2: So that's why it differs quite a lot. But as I said, also in the capital area, the market seems to be improving now.

Speaker #4: Okay, thank you. And then coming back to the Varma portfolio, could you give some color on what the reason has been that the occupancy rate was so low on that?

Svante Krokfors: Okay, thank you. Coming back to the Varma portfolio, could you give some color on what the reason has been that the occupancy rate was so low on that? Have you introduced significant or have you lowered rents significantly on vacant apartments in the Varma portfolio?

Speaker #4: I mean, have you introduced significant—or have you lowered rents significantly—on vacant apartments in the Varma portfolio?

Speaker #2: Well, first of all, it's difficult to say why it was so low. We have somewhat decreased the rents of vacant apartments as we planned already in our underwriting.

Reima Rytsölä: Well, first of all, it is difficult to say why it was so low. We have somewhat decreased the rents of vacant apartments as we planned already in our underwriting. Not meaningful, of course they are meaningful, but not outstanding declines of a rent. I would say that the biggest contribution has been the very active rental operation and leasing operation that we have. It differs a lot from a third-party model that Varma used to have in their renting operations.

Speaker #2: But not kind of a—not kind of a meaning in a way. Of course, they are meaningful, but not kind of outstanding declines of rent.

Speaker #2: So it has, I would say, that the biggest contribution has been kind of a very active rental operation and kind of a leasing operation that we have.

Speaker #2: So, it differs a lot from the kind of third-party model that Varma used to have in the renting operations.

Speaker #4: Thank you. And then, coming back to Anssi's question about apartments taken off the market, could you give some color on what kind of numbers we're talking about?

Svante Krokfors: Thank you. Coming back to Anssi's question about apartments taken off the market, could you give some color on what kind of numbers we talk about? I think you have earlier mentioned that it could be something like 40, 50 apartments max normally, but what kind of numbers are we talking about this time?

Speaker #4: I think you have earlier mentioned that it could be something like 40, 50 apartments max, normally. But what kind of numbers are we talking about this time?

Reima Rytsölä: Actually, I do not have and neither seems to have, Antti, the exact figure. We can come back to that on what is the round, not probably the exact figure, but the roundabout figure that we have currently.

Speaker #2: Actually, I don't have that, and I need to seem to have until the exact figure. So we can come back to that. What is the kind of a—what is the kind of a round—not probably the exact figure, but the roundabout figure that we have currently?

Speaker #4: Okay, thank you. And last question: you sold 218 apartments in Q2. Could you give some details on that? Were any from the acquirer portfolio, or were these some non-core assets that you have had in your legacy portfolio?

Svante Krokfors: Okay. Thank you. Last question. You sold 218 apartments in Q2. Could you give some details on what that was? Were there any from the acquired portfolio or was it some non-core assets that you have in your legacy portfolio?

Speaker #2: Well it was more of a not from an acquired portfolio but it was more of a related to kind of a heavy capex spend and the trade off between the capex and capex usage and or divestment and we come to conclusion that it's more profitable for us to dispose those assets.

Reima Rytsölä: Well, it was not from acquired portfolio, but it was more related to kind of a heavy CapEx spend and the trade-off between the CapEx usage or divestment. We come to conclusion that it is more profitable for us to dispose those assets.

Speaker #4: Okay, thank you. That is all from me.

Svante Krokfors: Okay. Thank you. That is all from me.

Speaker #3: There are no more questions at this time, so I hand the conference back to the speakers.

Operator 2: There are no more questions at this time, so I hand the conference back to the speakers.

Operator: There are no more questions at this time, so I hand the conference back to the speakers.

Speaker #5: Okay, thanks, staff. We have some questions here in the chat—let me see. There are some questions about the guidance, and the acquisition progressed ahead of expectations.

Niina Saarto: Okay. Seems that we have some questions here in the chat. Let me see. There are some questions about the guidance and the acquisition progressed ahead of expectations, but why did you narrow the revenue guidance instead of upgrading it?

Speaker #5: But why did you narrow the revenue guidance instead of upgrading it?

Speaker #2: Well it's a good question. And it links to the it links to the more of a pricing power that we have already discussed that even though the kind of a market seems to improve and especially when talking about the acquired portfolios.

Reima Rytsölä: Well, it is a good question, and it links to the more of a pricing power that we have already discussed. Even though the kind of market seems to improve and especially when talking about the acquired portfolio. The occupancy has performed, and leasing operations have performed really well. Given the fact that overall the pricing power in the market has not improved that much. That is why we kept that guidance as a midpoint unchanged. It is good to bear in mind that it is still roughly 12% of our portfolio, the acquired portfolio. There is a lot of apartments or revenue creators as such outside of the acquired portfolio.

Speaker #2: So, the occupancy has performed, and leasing operations have performed really well. But given the fact that overall, the pricing power in the market hasn't improved that much.

Speaker #2: So that's why we kept that guidance in as a midpoint unchanged. And it's good to bear in mind that it's still that it's still roughly 12% of our portfolio the acquired portfolio.

Speaker #2: So there’s a lot of apartments and revenue creators as such outside of the acquired portfolio.

Speaker #5: Then there's another question. Could you please elaborate more on the €2 million higher other operating income?

Niina Saarto: Then there is another question. Could you please elaborate more on the EUR 2 million higher other operating income?

Speaker #2: Yeah. The other operating income actually came from one disposal—that was a company in which we had less than 50% ownership. So it came from that disposal.

Reima Rytsölä: Yeah. The other operating income actually come from one disposal that was a company which we had less than 50% ownership, so it came from that disposal.

Speaker #5: Okay, coming back to the guidance, and now FFO guidance that was cut by €5 million. What is the reason for setting the stronger operational run rate?

Niina Saarto: Okay. Coming back to the guidance and FFO guidance, that was cut by EUR 5 million. What is the reason of setting the strong operational run rate? Can you comment?

Speaker #5: Can you comment?

Speaker #4: Well, I think the FFO guidance—the main reason that we brought down the kind of upper limit or upper band of our guidance was the higher financial costs that have been involved since last February, when we originally gave the guidance.

Reima Rytsölä: Well, I think the FFO guidance main reason that we brought down the kind of upper limit or upper band of a guidance was the higher financial costs that are involved since last February than we were given the guidance.

Niina Saarto: Okay. Then about rent increases. Average rent per square meter increased both quarter-on-quarter and year-on-year. Is there any split between what was the effect from the new apartments versus like-for-like, if we compare to, let's say, Q1?

Speaker #5: Okay. Then about rent increases. Average rent per square meter increased both quarter on quarter and year on year. Is there any split between what was the effect from the new apartments versus like for like?

Speaker #5: If we compare to, let's say, Q1.

Reima Rytsölä: I do not know. We probably do not have an exact split, but it is fair to say that the average rent for acquired portfolio, given the location of those assets that we acquired is higher and increased the kind of average rent in our portfolio. And like in Antti's presentation, there was a like-for-like, so rents and water charges was in like-for-like calculations was -1%.

Speaker #2: I don't know. We probably don't have an exact split, but it's fair to say that the average rent for the acquired portfolio, given the location of those assets that we acquired...

Speaker #2: So is higher and increased the kind of a rent average rent in our portfolio. And like in Anssi's presentation there was a like for like.

Speaker #2: So rents and water charges in like-for-like calculations was minus 1%.

Speaker #5: Okay. So we discussed already existing agreements and their rent increases. But how about new lease agreements? There are some Statistics Finland data, for example in the Helsinki area—the figures seem to be quite flat.

Niina Saarto: Okay. So we discussed already existing agreement and the rent increases, but how about new lease agreements? There are some Statistics Finland data, for example, in Helsinki area, the figures seem to be quite flat, and then again in some smaller cities, quite a lot positive. So what is our comment? Is it the same as our rent increases for new agreements?

Speaker #5: And then again, in some smaller cities, quite a lot positive. So, what is our kind of comment to that? Is it the same as our rent increases for new agreements?

Speaker #2: Well, it definitely differs by rents. But we do have some new leases, or some new tenants, that we need to still kind of decline the rent.

Reima Rytsölä: Well, it definitely differs by range, and we do have some new leases or some new tenants that we need to still decline the rent, but it's growing amount that we can raise the rent as well. But all in all, it has been so far year to date, slightly negative. But as I said already a couple of times, we expect that this pricing power, especially in Helsinki and Capital area, will come back for landlords in some undefined timetable.

Reima Rytsölä: Well, it definitely differs by range, and we do have some new leases or some new tenants that we need to still decline the rent, but it's growing amount that we can raise the rent as well. But all in all, it has been so far year-to-date, slightly negative. But as I said already a couple of times, we expect that this pricing power, especially in Helsinki and Capital area, will come back for landlords in some undefined timetable.

Speaker #2: But it's a growing amount that we can raise the rent as well. So, but all in all, it has been so far year to date slightly negative.

Speaker #2: But as I said already a couple of times, we expect that this pricing power, especially in Helsinki and the capital area, will come back for landlords in some undefined timetable.

Speaker #5: The acquired portfolio occupancy has been moving up very nicely. Has it been affecting the legacy portfolio negatively somehow?

Niina Saarto: Then as the acquired portfolio occupancy has been moving up very nicely, has it been affecting negatively the legacy portfolio somehow?

Speaker #4: Well this is a question that we have discussed a lot internally as well. And there's a kind of a common understanding that it hasn't affected negatively but all in all all in all it's fair to say that the kind of a major component or contribution of increased occupancy has come from acquired portfolio.

Reima Rytsölä: Well, this is a question that we have discussed a lot internally as well, and there's a kind of a common understanding that it hasn't affected negatively. But all in all, it's fair to say that the major component or contribution of increased occupancy has come from acquired portfolio. Of course, there was plenty of room, and as we have said since the February of releasing the deal, that we see that actually the asset quality in acquired portfolio is really good, and there was plenty of vacant apartments. So it's kind of natural as well that in very good quality portfolio and relatively high vacancy, it's easier to raise the occupancy in those assets.

Speaker #4: Of course, there was plenty of room, and as we have said since February, after releasing the deal, we see that actually the asset quality in the acquired portfolio is really good.

Speaker #4: And there were plenty of vacant apartments. So, it's kind of natural as well that in a very good quality portfolio, there's relatively high vacancy.

Speaker #4: So it's easier to raise the occupancy in those assets.

Speaker #5: Okay. And continuing with the acquisition. So, what annualized net operating income contribution do you expect once stabilized versus your original acquisition underwriting?

Niina Saarto: Okay. Continuing with the acquisition, what annualized net operating income contribution do you expect once stabilized versus your original acquisition underwriting?

Speaker #4: Anssi do you have?

Reima Rytsölä: Antti, do you have-

Speaker #2: Well, I don't have any numbers to present here, but it should be maybe a bit higher than our legacy portfolio, since the locations are a bit better in that portfolio compared to our whole legacy portfolio.

Antti Syvänen: Well, I don't have any numbers to present here, but it should be maybe a bit higher than our legacy portfolio, since the locations are a bit better in that portfolio compared to our whole legacy portfolio.

Speaker #5: Okay. And then a different type of question. So, what is more important: to maximize asset book value or cash flows?

Niina Saarto: Okay. Then different type of question. What is more important to maximize asset book value or cash flows?

Speaker #4: I think it's more of a cash flow, all in all. I think that as you look at our financial targets as well, we aim to have growth in FFO per share.

Reima Rytsölä: I think it is more of a cash flow. All in all, I think as you look at our financial targets as well, we aim to have a growth in FFO per share. So contributing and creating cash flow is in top of our list.

Speaker #4: So, kind of contributing and creating cash flow is at the top of our list.

Speaker #5: Okay. And this may be the last question. So, it’s about guidance again, and refinancing the bond next year. What refinancing cost or timing is included in guidance?

Niina Saarto: Okay. This may be the last question. So, it is about guidance again and refinancing the bond next year. So, what refinancing cost or timing is included in guidance, and how should investors assess if the bond coupon will be between 3.7% to 4.0%?

Speaker #5: And how should investors assess if the bond coupon will be between 3.7% to 4.0%?

Speaker #2: What was the question about the bond that is maturing next spring?

Reima Rytsölä: Was the question about the bond that is maturing next spring?

Speaker #5: Yes. Or, what kind of refinancing expectations are in the guidance?

Niina Saarto: Yeah. Yes. Or it is what kind of refinancing expectations are in the guidance.

Speaker #2: Shall I take it? Yeah. So, I think that, first of all, as we said, we have kind of more or less locked in the cost of the bond maturing next spring.

Reima Rytsölä: Shall I take it?

Antti Syvänen: Yes.

Reima Rytsölä: Yeah. First of all, I think as we said, that we have more or less locked in the cost of a bond maturing next spring, and we have said that we still have EUR 300 million to take on acquisition financing on the capital markets transaction. It is round about the market level of refinancing the acquisition finance. Then, of course, it depends on what kind of instruments do you use. But all in all, I would say that given the fact that it is the time of this year, the financing cost as such doesn't have any more at this stage of the year, as big significance for the guidance as it would have in beginning of the year.

Speaker #2: And we have said that we still have €300 million to take on acquisition financing on the capital markets transactions. So it's around about the market level of refinancing the acquisition finance.

Speaker #2: And then of course it depends on what kind of instruments you use. But all in all, I would say that, given the fact that it's this time of year...

Speaker #2: So the financing cost, as such, doesn't have any more at this stage of the year as big a significance for the guidance as it would have at the beginning of the year.

Speaker #5: Okay, that concludes the Q&A. Thank you very much for the questions. Lumo's Q3 report will be published on the 5th of November. Thank you all for joining us today.

Niina Saarto: Okay. That concludes the Q&A. Thank you very much for the questions. Lumo's Q3 report will be published on 5 November. Thank you all for joining us today. Let's meet in November.

Speaker #5: Let's meet in November.

Speaker #4: Thank you very much.

Reima Rytsölä: Thank you very much.

Speaker #2: Thanks.

Antti Syvänen: Thanks.

Operator: The host has ended this call. Goodbye.

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Half Year 2026 Lumo Homes PLC Earnings Call

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