Significant need for homes and community buildings

Operations in business area Construction are run via some 150 local offices all over the Nordic region, organized in thirteen regions in Sweden, three in Norway and two in Finland. There are specialized housing production units in Stockholm, Gothenburg and the Öresund region. Construction maintenance operations are run in a nationwide organization in Sweden. Other regions are responsible for all types of construction projects in their geographic area.

The Business 2020

In 2020 building construction in the private and public sectors continued to grow while housing construction continued to contract, particularly in Sweden. The trend has continued of more and more customers requesting sustainable products in which buildings are environmentally and climate certified. Operations have not been noticeably affected by COVID-19.

Housing shortage

Housing represents a substantial part of net sales in the business area. During the year business area Construction has received a number of housing projects all over the Nordic region. Peab is building 144 apartments for AB Bostäder in Borås in the Regementstaden area. The project has a clear environmental profile that includes solar panel installation and individual measurement and billing of water and electricity consumption. This allows tenants to take an active part in their housing costs and help the environment. In Ängelholm Peab has been commissioned to build 65 new apartments for Backahill Bostäder AB. The project is being constructed according to Miljöbyggnad Silver and will be complemented with solar panels. In Karlstad Peab is building 132 apartments and premises for Karlstads Bostad AB with 250 m² solar panels on the roof. During the year several apartment renovation projects were initiated in Helsinki. All in all around 400 apartments will become more energy efficiency. Peab’s own developed project on Carl Berner Square in Oslo with over 100 homes, shops and restaurants was completed during the year. The project will be environmentally certified according to BREEAM Very Good and has district heating, green roofs, rain beds, climate walls and more.

Climate smart office buildings

Several climate smart office buildings have been under construction in 2020. The office building Gårda Vesta for Platzer will be Gothenburg’s highest when it is ready in the summer of 2021. The building will be certified according to BREEAM and the American standard Well Building. Peab is also building the big office block Platinan in Gothenburg for Vasakronan according to LEED certification with the goal of achieving the highest level, Platinum. In Linköping Peab is building LINK Business Center, a meeting place for business, according to LEED Green Building, level Gold. During the year Peab’s own developed office building Peab Center in Malmö opened and was certified according to Miljöbyggnad Silver.

Public investments in community buildings

Peab is Sweden’s largest school constructor and has also built a number of schools in Norway and Finland. In 2020 we reinforced this position in Sweden through a nationwide framework contract with The Swedish Association of Local Authorities and Regions for concept pre-schools made of wood. Peab’s concept pre-schools are designed to be flexible and prioritize the children and activities they house. One example of locally produced building is Södra School in Grums where the wooden frame comes from the local factory. In Helsinki Peab is renovating Etu-Töölo High School sections of which are from the 1930s. At the end of the year Peab was commissioned to build New Vaksdal School in Bergen, which is the first construction project in the region for Peab.

The need for new public buildings continues to be considerable. Peab is participating in developing the new Kiruna City center, building a new culture house, a new police station and public pool facility. Peab is building a new courthouse according to Miljöbyggnad Gold in Malmö. Peab is participating in a number of construction projects in healthcare and nursing, a product category which is essential for communities. New psychiatric premises are being built in Kalmar for Region Kalmar County. Together with Västfastigheter Peab is rebuilding and extending Södra Älvsborg Hospital in Borås including a new infection unit, a new psychiatric ward and laboratories. Peab is also building an assisted living center in Borlänge that will gather municipal services such as a senior activity center, home care offices and a pre-school under one roof. In Northern Norway Peab has been commissioned to build a hospital and nursing home in Hamnvik in Ibestad Municipality in Troms. During the year we completed the construction of a new 5,000 m² hospital wing at Martina Hansen Hospital in Oslo and we turned the Alta Assisted Living Center over in Northern Norway. Peab continued construction on the next hospital in Seinäjoki for the real estate company Seinäjoen Terveysteknologiakeskus and it is expected to be completed in 2021.

There is a substantial need for new swimming facilities in Sweden and during the year Peab signed contracts to build a number of new ones. One is being built for Solna City and Peab completed a new indoor pool and sports facility commissioned by Köping Municipality. Arena Älvhögsborg in Trollhättan is a pool and sports facility owned jointly by Peab and Trollhättan City and in the autumn of 2020 a new 25 meter pool, relaxation section and play and adventure areas were opened.

Other projects

Peab began construction in Nurmijärvi of what will be one of the largest S-Market stores in Finland. S-Market is Finland’s biggest grocery store chain and the new store will be two stories with a gross area of 10,600 m². In Northern Norway Peab has been commissioned in Senja to build a new land-based fish farm. The facility will be 16,000 m² in total and includes the construction of a warehouse, workshops, laboratories, dining room and personnel housing.

During the year business area Construction has received a number of housing projects all over the Nordic region.

Net sales and profit

Net sales for 2020 decreased by eight percent and amounted to SEK 26,989 million (29,416). The decrease is attributable to Sweden while net sales in operations in Norway and Finland increased. The proportion of housing continues to contract while other building construction for the public sector has grown.

Operating profit for the year amounted to SEK 663 million (711) and the operating margin amounted to 2.5 percent (2.4).

Orders received and order backlog

Orders received during 2020 increased slightly to SEK 26,597 million (26,155). The orders received are relatively well spread regarding products and location. Order backlog on December 31, 2020 was SEK 26,558 million compared to SEK 26,928 million at the end of December 2019.