EU REAL ESTATE: Property: Week in Review
Real Estate was the top performing sector this week, albeit with less than 1bp tightening on average.
- CPI Property launched a tender for up to €100m of CPIPGR 7% 29 in conjunction with a new €500m 5yr green. We used the recently issued 6% 32 and 7% 29 to compute the fair-value rather than expensive off-the-run isins. The deal came at 5.25% yield. The recent 7.5% NC31 was increased by €118.75m.
- Prologis reported 2Q and managed to avoid an occupancy fall. Core FFO ex guidance rose slightly.
- Castellum had lower occupancy and is still blaming “conflict” for a challenging economy. Property valuations fell slightly. Nevertheless, bonds tightened 3bps.
- Balder reported 2Q rent up 7% and earnings up 8%. The company will make a distribution of its Norion stake when credit ratios allow.
- Sato Oyj still sees oversupply in Finnish residential so has halted new construction.
- Sagax is growing in Spain and Benelux so is down to just 50% Finland and Sweden. French and Swedish rents are increasing. 2025 outlook unchanged.
- In distressed, Heimstaden AB invoked a clean-up call on the 27s with more than the 80% threshold achieved.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
STIR FUTURES: BLOCK: 1M SOFR vs. Fed Funds Spread/Spread
- Oct'25/Feb'26 spreads Block/crossed at 0744:54ET:
- 10,000 SERV5/SERG6, 0.345 vs.
- 10,000 FFV5/FFG6, 0.355
UK: Gov't Expects Deal w/US On Car & Aerospace Tariffs In Force By End-June
Reuters reports that the UK gov't expects tariff arrangements with the US on cars and aerospace to come into force by the end of the month. This follows the signing of an order by US President Donald Trump and British PM Sir Keir Starmer at the G7 summit in Canada. The order will bring into force the agreement reached between the two last month, and see a reduction in tariffs for UK cars being exported to the US. The deal includes the 10% baseline tariff on almost all UK goods (including cars, down from 27.5%), but did not include any reduction in tariffs on steel (a move that was expected). A deal on steel is required by 9 July if the UK is not to see its tariff rate increase from 25% to 50% in line with other countries.
- As the BBC reports, "Ministers have hailed the US deal alongside trade deals with the European Union and India. But the US agreement is much more limited than the full-fat trade deal that has long been discussed on Downing Street. The scope of what was signed on Monday also appeared more restricted than the general terms of the deal as outlined last month. Trump has previously declared the pact on tariffs is a "major trade deal", but it is not. The US president does not have the authority to sign free-trade agreements without the approval of Congress."
OPTIONS: Larger FX Option Pipeline
- EUR/USD: Jun19 $1.1415-25(E2.4bln), $1.1545-50(E1.2bln), $1.1585-00(E3.1bln); Jun20 $1.1600(E1.0bln), $1.1615-25(E1.1bln), $1.1700(E1.1bln)
- USD/JPY: Jun20 Y143.00-15($1.9bln), Y146.00($1.9bln)
- EUR/JPY: Jun20 Y162.10-20(E1.3bln)
- AUD/USD: Jun19 $0.6600(A$1.1bln)
- USD/CNY: Jun20 Cny7.3000($1.4bln)
