HCP Group’s annual general meeting elected a new board of directors for the company on September 28th, 2020. The new chairman of the board is HCP’s partner and board member Timo Vertala, and the new vice-chairman is HCP’s newest partner, Cobbleyard Real Estate CEO Christoffer Sundberg.
Timo Vertala, you were elected as HCP Group’s new chairman of the board at the board’s inaugural meeting 29.9.2020. Congratulations! Tell us about yourself and how you are doing.
Thank you. Firstly I would like to thank my predecessor Elias Koski and I would like to wish him continued success in his role as chairman of the board of Helsinki Capital Partners fund management company.
I have worked in various executive positions and been a partner at HCP since 2010 and a board member since 2011. Chairmanship of the HCP Group board was the next natural step for me, and I am grateful for the trust shown by the other partners towards me and the rest of the new board.
Could you tell us more about the new board?
Work within a board of directors is teamwork, and I am convinced that we will achieve results with the board of directors we have elected. Other elected board directors in addition to myself were HCP’s founding partner and CEO Tommi Kemppainen, compliance officer and partner Juhani Halminen as well as our strategic investor, Cobbleyard Real Estate CEO Christoffer Sundberg.
The board members complement and support each other with their backgrounds, experience, and professional expertise.
The year 2020 has unarguably been a year of change in the world and in financial services. What particularly will you stress in the work of the board?
The world is changing radically and quickly. As a smaller company, HCP has the resources and expertise to react to things much more quickly than bigger asset managers. When the environment changes, you have to change – and this is why companies need to actively renew in order to survive and to thrive.
I will in particular focus on transparency in decision-making and ensure that HCP’s strategy is implemented appropriately and with measurable results by operating personnel.
You mentioned the importance of active renewal. Can you explain in more detail what this means for HCP’s strategic development in the current market?
Our funds are managed by our four-person investment team, so areas of responsibility are clearly defined and the group works constructively together. As to the firm’s development, we as a company have 13 years of growth experience, and we will continue actively furthering our sales and marketing by using this experience.
In addition to this, we are open to other market opportunities. HCP has historically very strongly focused on publically listed securities and alternative investments. Interest rates are historically low and inflation predictions are unclear, so Finnish institutional investor rightfully seek out also other opportunities in alternative investments.
Christoffer Sundberg, you became an HCP partner in summer 2020 and were now elected as a board member and vice-chairman. Could you tell us about yourself and about how you ended up investing in HCP?
I am a professional investor and have been an investor in HCP’s funds for several years now. First, HCP’s story of how to manage external assets and invest responsibly awoke my interest. I got to follow the company quite closely for a few years and my interest only grew. When an opportunity opened up to further intensify our cooperation, I immediately took it.
You have a long career in real-estate investing and in managing real-estate funds. How would you describe the current market situation in Finland and the Nordics for real estate?
In Finland, real-estate investing is only approximately 15 years old, when the first institutions-facing investment funds were launched and asset purchases began to be financed through debt in addition to equity. Then or a little bit before, international property investors arrived in the Nordics and in Finland. At the time of writing this, the supply of real-estate funds in Finland or generally opportunities to invest in real estate indirectly has grown quickly. This means that demand has raised property prices to record levels, and often these are justified by an upside in rents (cash-flow). This driver can be questioned, and for example in Stockholm we are seeing a market correction. The same market correction is now arriving in Finland and will be probably be seen in valuations towards the end of the year. It’s hard to predict how big this correction is especially if and when the number of transactions decreases and market-based appraisals do not have the market data they need. Different sectors of real estate (office, commercial, residential, care homes, logistics, hotels, etc.) suffer in their own ways, as the global pandemic has restricted mobility. Big trends in the use of spaces seem to be strengthening.
How can Nordic asset managers best compete with international companies? Where do you see the most interesting opportunities for growth?
Generally real-estate investing is the ”odd bird” of asset classes. Returns are relatively low and many investors sell so-called active asset management, which means that value is created locally at the level of the object. This requires local expertise and a local team. These are important elements in implementing active strategies. The downside is that this can give rise to an expensive fee structure, which taxes the immediate return promised to investors. This can create a mismatch that forces the portfolio manager to raise the properties’ risk profile. There is much talk about liquidity risk, which is one of the easiest ways to improve properties’ net returns. Location risk is one of the biggest factors in liquidity risk. How properties are utilized in the future will change in the post-corona world. This creates opportunities for local active asset management. In the short term, listed securities of real-estate companies seem attractive and in the medium term, Nordic direct properties. We still see value in the office and logistics sectors, especially for those implementing active asset management.
HCP Group owns the Helsinki Capital Partners fund management company, whose funds are open to subscriptions until 31st of December 2020. Book a virtual meeting or make a subscription by clicking one of the buttons below.Book a virtual meeting Make a subscription