Why invest in Denmark?

  • Low transaction costs
  • High degree of market transparency and stability
  • Solid key economic indicators

We have vast experience in both dealing with and representing international investors when investing in the Danish market. We can set up the best team with regards to financial, taxation, legal and market issues.

Low transaction costs
As buyer

  • Registration of deed: 0,6% of purchase price + € 190
  • Mortgage: 1,5% of the mortgages principal + € 190
  • Costs for own advisor, lawyer, agent etc. are typically very low

As seller

  • Agent, lawyer etc. varies, but typically between 1 - 4% of purchase price depending on deal size

Denmark is known to have some of the lowest round-trip property transactions costs.

High degree of market transparency and stability
Denmark is among the most transparent markets in Europe and worldwide. The transparent Danish market provides the investor with a secure and low risk environment for foreign direct investment.

Investments in Denmark are conducted in a market which benefits from a highly transparent and stable legal and regulatory framework coupled with a simple transaction process.

In the recent 2012 version of the Jones Lang LaSalle Global Real Estate Transparency Index ®, Denmark was rated a tier 1 market and was among the top 14 markets worldwide, when it comes to market transparency.

Low financing rates of your commercial property investment in Denmark

  • Low origination costs
  • Low APR compared to the majority of European markets
  • Highly transparent, stable and liquid mortgage bond market
  • Flexible loans
  • Low financing rate: Bond yield plus a small markup for the mortgage bank
  • Debt/value ratio: Financing through the Mortgage institutions available up to 60% of valuation
  • Loan maturity: Min. 1 year (yearly refinancing), max 20 years
  • Payment structure: Floating or fixed rates, with or without quarterly principal repayments
  • APR, example:

    - 60% debt to value for an office property, floating rate mortgage including mark-up

    - Yearly APR: 3,8% including a ~ 1,85% markup for the mortgage institution

    - Depending on the client and investment in question the mark up can range from as little as 0,5% - 2%

  • The Danish mortgage institutions fund their loans to investors by selling covered bonds in the capital market
  • The Danish mortgage institutions have existed since 1850 and are considered very strong and very low risk financial instruments
  • In terms of volume outstanding, Denmark has the second largest share of the mortgage bond market in Europe/li>
  • There has never been an incidence of default on a Danish mortgage bond

Leases

  • Rent adjustment
  • Normally adjusted yearly with the rate of inflation
  • Rent review
  • Every fourth year. Terms are flexible
  • It is possible to agree on a threshold for the rent. Eg. the rent cannot drop further than the rent in force at the start of the tenancy
  • The landlord and the tenant can freely agree on the rent amount as long as the rent is not unreasonable or contrary to sound business practices
  • Lease length: There are no statutory restrictions on the duration of a commercial lease agreement. It is normal to have interminable leases in place
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