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New Sundsberg coming to Kirkkonummi?

Länsiväylä 10.2.2024

– Having avoided becoming a victim of the construction sector crash, this family-run company is now creating two new residential areas near Espoo

The construction and property sector has weathered some tough times, with sales of owner-occupied apartments and investment apartments grinding to an almost complete halt in 2023, when interest rates fluctuated radically. Inflation struck and construction costs rose rapidly. Thanks to all of this, the number of new construction projects launched collapsed by as much as 70% in Espoo and Helsinki alone.

CEO Tea Ekengren of EKE-Rakennus Oy, which has long operated in Espoo and Kirkkonummi, states that in the sensitive construction sector, the turbulence has been particularly bad. “But it still feels like the recession of the 1990s was even worse,” Ekengren notes when interviewed by newspaper Länsiväylä.

According to Ekengren, the boom in the construction and property sector had been going on for too long – until it ground to a complete stop. The force of the downturn surprised even this experienced director. “Plot prices were sky-high and the markets overheated, but I didn’t expect the whole system to grind to a halt quite like that,” says Ekengren. She does concede that during the boom period, the entire construction sector was plagued by unnecessary greed.

“Lots of companies wanted to expand and do all kinds of things. That involved growth that was just too rapid for some,” comments Ekengren on where her colleagues tripped up.

The headwinds that affected the industry also struck EKE-Rakennus, but the company has succeeded in adapting its operations to the changing market situation.

“We try to stick to our own concept. We know that we’re capable of creating commercial premises, apartments and residential areas. We’re not about to start doing something else.”

“It’s something we have thought about, having had the opportunity available to us. The company has a strong balance sheet and we are satisfied with our turnover, which averages €100 million.”

EKE-Rakennus Oy was founded by Bertel Ekengren in 1961. The company actively develops and builds residential and commercial areas in the Helsinki metropolitan area. Last year, the company’s turnover was around €70 million and its profit more than €10 million. During 2023, the company produced around 300 apartments in Espoo and Helsinki, of which half were self-developed. Self-developed housing production means that the construction firm is responsible for the whole housing production process. However, last year was exceptional, as EKE-Rakennus Oy launched the construction of just one housing site. Ekengren states that the solution was unavoidable without taking unnecessary risks.

“We’re currently preparing to launch projects and developing plans with cities with the objective of getting projects underway quickly, once the market situation improves. We are training our staff and developing our operations for new growth.”

The company’s largest project is currently the development of the residential and commercial entity in Kirkkonummi’s Sundsberg and Sarvvik areas. An area known as West 51 is already under construction close to the Kehä III ring road and Länsiväylä motorway, and is set to be home to the likes of a Microsoft data centre and Fortum heat pump plant.

“Fortum’s heat pump plant will be able to use the waste heat produced by the data centre and produce emissions-free district heat for the area,” explains Ekengren.

Another major project for the company is on the shore of Lake Finnträsk, close to Sarfvik Golf, where the new residential area of Kurkiranta is being built. A construction permit for the first small apartment blocks is expected to be granted in the spring. EKE-Rakennus Oy is also playing a major role in reviving the heart of the Municipality of Kirkkonummi. The Tallinmäki mini town block is set to take shape in the very heart of the town, in front of the church, offering homes for approximately 500 residents. The plan change for the area was approved last year, and construction will start with the demolition of old office buildings. And this is not all. In a larger area with no land use plans currently in place, located between Espoonlahti and Sundsbergintie, the company plans to build a residential area centred around flexible mobility.

“The aim is to build a new climate-smart, maritime residential area at the gateway to Kirkkonummi,” Ekengren reveals.

Preparation of the component master plan for the area is scheduled to start this year.

EKE-Rakennus Oy has plenty of experience, including in the construction phase of the legendary Sibelius Monument. The company is proud of its history and this is clear to see in its office building in Matinkylä, where the conference room bears the composer’s name. EKE-Rakennus Oy has also sought to leave its own personal handprint on Finland’s housing stock, launching the EKE-Loft concept, the roots of which extend back to 2015.

“We wanted to set ourselves apart as an apartment block creator, so that was where the Loft came in,” Ekengren explains.

However, construction does not always go smoothly. This is demonstrated by the diligently created Sundsberg residential area, known affectionately as the ‘village of happiness.’This communal village has been being planned since the 1980s, but the start of construction has been delayed by countless appeals. Appeals always slow down the work of construction sector operators, but operators must be prepared for this.

“Without exception, appeals will slow down projects, and you can never know how much they will delay the project by. We do an enormous amount of planning work and try to guarantee our employees work when projects end up unreasonably delayed by appeals.”

Ekengren feels that over the years they have also learned to take other opinions and needs into account. Openness and communication are key, along with clear communications and dialogue.

“We try to inform people of things as early as we can. Of course they (appeals) have changed our operating practices too.”

Some experts monitoring the housing market fear that the sharp drop in construction could result in a lack of homes and a rise in house prices. Ekengren views the current situation from a number of angles.

“A volatile and difficult-to-predict market will bring challenges in preparing for the coming years. In an unstable housing purchase situation, renting can become an option, and as demand increases rents rise. This is then likely to increase housing investors’ interest in investing in new sites,” Ekengren ponders.

At the same time, she is keen to point out that the need for housing has not gone anywhere.

“If housing production doesn’t recover until 2025, then there will not be sufficient provision on the market until 2027. Abundance will be replaced by scarcity, which may lead to prices rising.”

Sundsberg’s Kartanoranta residential area is referred to as the ‘village of happiness.’In the CEO’s view, it has been a success overall. Sundsberg has an identity, of which Ekengren is proud.

“We wanted residents to feel that they can make the area their own, while at the same time being involved in continuing the history of Sundsberg Manor.”

“When a substantial number of new residents all move into an area at the same time, it creates a particular sense of community, and that was something we wanted to support.”

The idea of a village of happiness that supports this sense of communality is expected to continue. EKE-Rakennus Oy hopes that this kind of success story will be repeated at Sarvvik’s Kurkiranta – but with its own twist.

Ekengren looks to the future with a sense of calm confidence. She believes in the power and ability of the company, even amidst challenging market situations.

“We will continue to develop inspiring environments for living and working,” she concludes.

EKE-Rakennuksen toimitusjohtaja Tea Ekengren
CEO of EKE-Rakennus Tea Ekengren