Thank you. I would also welcome you all to this webcast of today. If we go to slide two, please, to see the content. I will lead you through this presentation, starting with highlights, and we will go into results and balance overview. Thereafter, operational review, capitalization, sorry, capital deployment, and some outlook and cases. Slide three. Highlights. The quarter is overall very satisfying, and specifically on the back of several major development projects announced during the quarter. We retain our focus on development projects and acknowledge high demand from existing as well from potential new customers. Despite the forthcoming slow pace in the global economy, and we see some geopolitical uncertainty, we feel comfortable about our business going forward. The fundamentals and structural changes are there to support our further growth.
We see high interest from cross-border capital into the logistics segment, pushing our yields down. Slide three, please. Slide four, sorry. Results and balance overview. Here, I would like to hand over to Peter, going forward to slide five.
Thank you, Benny. Peter Andersson, CFO. Hope you're well out there. We know you, you have a busy day as well as we. I would like to comment something on slide 5 regarding the property expenses. We have, during the quarter, we have focused on improvements on our property, which means that the maintenance cost is about SEK 7 million higher than the previous quarter. This is a normal quarterly variation, but if you look at the whole period of nine months, it's a normal level on that case. We also had a change in property tax values, which has resulted in a one-off effect that the cost of property tax is about SEK 4 million higher in the Q3 quarter, comparing with Q2.
Of this SEK 4 million, we have been able to invoice about SEK 2 million to our tenants, which means that the net operating surplus is about SEK 2 million lower than the quarter comparing with Q2. If you go forward with this one, we can see a higher cost of approximately SEK 0.5 million each quarter, if you compare with the Q2 numbers. Realized changes in value, we have amount of SEK 59 million in the quarter, and this one is related to the release of the option in Staffanstorp. The total change in value during the 9 months period amounts to approximately SEK 663 million. Here you can see a yield compression, project investment, and new leases in regarding this one. We're going forward to slide six.
The balance sheet, I have very few comments. As you can see, it's SEK 17.8 billion, and it's up approximately SEK 2.2 billion since last year, and it's up approximately SEK 670 million since last quarter. Back to Benny.
Slide seven, operational review. I will lead you through part of this, and going forward to slide 8, it's about cash flow. We retain 54% of our income in the company before value changes. The same number is 63 for the quarter, isolated, depending on the things that Peter just mentioned. On an aggregate level, I'm pleased to see how all our hard work is paying off. Slide nine.
Yeah, I could take some one. This is how we are organized. We are organized in five regions, and on this slide, you can find detailed figures for the regions. I don't mention any more regarding this one. If you're going to slide 10, so you can see some key figures on the property portfolio. If you're looking at the middle graph, it shows that approximate 45% of the income comes from the 10 largest tenants, and that the three largest tenants are still DHL, ICA, and PostNord. During the quarter, we extended ICA's three largest rentals in our portfolio, and that area was a little bit more than 100,000 square meters. Back to Benny.
Slide 11. A short introduction to our customers. They represent a mix of well-known and progressive trademarks from a variety of industries. Approximately 21% of our contracted rental value is derived from DHL and PostNord, the two leading logistics service providers on the Swedish market. The rental value arises from several contracts spread among many of our properties throughout our country, and thus they provide stability to our business. As the picture reveals, too, we also have a healthy mix of end user and logistics service provider. Worth mentioning that. Over to Peter.
Yes, slide 12. We have an average EPRA Net Initial Yield of 6.0 in the property portfolio. And, if we are looking on the unrealized change in the quarter, we have SEK 210 million. And as I mentioned before, it's a yield compression. There are projects and investments that's going well, and we have some new leases as well. Back to Benny.
Slide 13, rental markets. The rental market indicates a healthy and sustainable development. The continued structural demand for new modern logistics space in certain key areas supports an incremental development in those areas. The overall letting ratio of 96%, along with the high capacity use from our customer, makes me comfortable, comfortable about the overall rent levels going forward. I foresee moderate rent level growth in urban areas. We continue our focus on raising the quality in our portfolio. A blend of new projects, developments, and developments in existing stock adds to the incremental value. Particularly, our long-term relation with our customers that are leading to repeat business. Taking our customer, Nowaste, as a perfect example of a successful partnership, we are now about to help them establish their third logistics asset in Helsingborg, a prime location for logistics purpose.
Slide 14, leasing activity and contract maturity. The quarter provides for another period of positive leasing activity. SEK 7 million worth of new leases were contracted in Q3 and net SEK 5 million. Year to date, the same number adds up to SEK 47 million worth of new leases and a net SEK 20 million, which is in line with last year. The maturity of our contracts remain well distributed over time, averaging approximately five years. Slide 15, a history of growth. A brief glance at our historical performance, and start with profit from property management. That came in at SEK 1,268 per share, up 30%, on a year-over-year basis. Annually, the compound growth rate has paced about 18% for the last five years. EPRA NAV per share came in at 194, up 18% year-over-year.
The return on equity came in at 15.1% on nine-month basis, up 140 basis points a year ago. The five-year annual average is 17.5%. Peter?
Yeah, capitalization. If you're going to slide 17. On the left chart, you can see we have an average loan-to-value level of 56.5%, and as where all of our finance is still secured through mortgage, as you know. On the right side, you can see the capital structure, that we are all in interest-bearing debt, and out of there, the bonds and equity. Going forward to slide 18. During the quarter, we have signed a couple of new loan agreements, which has led to the extension of our debt maturity from 1.4 years in Q2 to 1.6 years in this quarter. The work on extension will continue to come up to the goal level of 2 years, at least. Back to Benny.
Capital deployment. Please move on to slide 20, capital deployment year to date. During the year, we have acquired a new asset, totaling SEK 82 million. They complement our existing portfolio. Nyttan 6 in Kungälv, Gothenburg, is a great example of our integrated business management. Upon acquisition date, the property had no tenant, and just a couple of months later, we have found a partnership with a new customer signing up for the entire space. The main part, however, has been allocated towards our development portfolio, totaling SEK 505 million. Slide 21, development projects in progress. I'm very glad to announce our project development portfolio is at its highest level ever. At the end of the period, we have an ongoing project totaling approximately SEK 1.5 billion.
The slides also reveal there is a remaining investment of over SEK 900 million to be distributed. They encompass new constructions, redevelopment, extensions, and energy projects. Our most recent added projects regard the air freight warehouse constructed for DHL in Sunnanå, Malmö. The extension of Boozt in E-City Ängelholm, and the extension of Nowaste in Helsingborg. We'll hear more about these later in presentation. Outlook and cases, please go on to slide 23. Sustainability trends in Catena's business. Just want to mention a couple of words about the one of our absolutely prioritized areas, areas going forward. In the first quarter, we hired our sustainability manager, which is aligning with our overall business plan, plan, and ambitions to take action on climate and social responsibility.
Catena have for a long time been successful at reducing the environmental footprint, now we aim to take it further, and among some of our ambitions, we target all new development projects to reach Miljöbyggnad Silver. The certification provided by Sweden Green Building Council. The certification demonstrates our effort to engage in actions towards a better environment. Slide 24, trends in e-commerce, and I would say it's like a recap. Though the global economy signs slowing activity, there are reasons to think about the logistics industry as a bright spot, not least coupled with the e-com and the variety of delivery solution demanded by customers, consumers. The very strong growth in parcel deliveries and flexibility offered to consumer puts pressure on a different logistical setup.
At this slide, we get e-com amount to about 10% of the Swedish market of the total retail sales. As a comparison, the share of e-com in Britain, a much more mature market, is well over 18%. During the second quarter, 2019, e-com growth was up by 13% in Sweden. The brick-and-mortar sale and the e-com will interlink more going forward, making them more difficult to distinguish in the future. The big game changer is about the growing choice of delivery solution, which what this change really is about. Notice that the segment of groceries is experienced the highest growth in e-com. There are evident signs that companies in grocery market is investing big to provide for the next generation of e-fulfillment. It's critical for Catena to understand these trends going forward.
Slide 25. I will show you some examples and updates on locations we are building. And we would like to stress the fact about the speed and leverage that we are creating on those. Looking at the logistics position Sunnanå, it started back in 2015, and we finalized our first building, the DHL Freight in phase I, and that was the starting point for this. And just in two years period, we had phase II, III, and IV, with Svensk Cater, with Chefs Culinar, with a multi-tenant distribution center, and so forth. And in this very short period, we will invest SEK 969 million, and on a gross yield of 7.3%.
That's an excellent example of what we are doing when we are building our own positions. Slide 26. Here we have E-City Ängelholm, where one of our tenants is Boozt and running their e-com business. Also there, we have had a total investment of SEK 572 million, and adds up to a gross yield of 8.2%. That was an order we had in Q3. Slide 27. This is the position of Tostarp outside of Helsingborg. What we're doing right now is building an extension to Nowaste and the e-com warehouse, and we have just finalized automated high bay omni-channel, also for Nowaste.
What's really interesting with this project is that we have a very progressive 3PL player running omni-channel business with multi clients, meaning that the clients of the third-party logistics provider with highly performing automation, and we are very, very proud of taking part on such a project. Also, here, the total investment comes up to SEK 753 million on a gross yield of 7.3%. Slide 28 is energy efficiency project.
...We are running up in Gothenburg in Mölnlycke. There we have a series of smart energy solution, Catena, and the tenant Oriola have together reduced energy cost and developed a logistics facility that is sustainable in the long term. In combination with the geothermal heating facility and photovoltaic cells currently being installed, it's estimated that the measures will have decreased energy consumption by 75%. Slide 29. Potential future development projects. Our land bank is of major importance to us. In conjunction with existing land and ongoing detailed development plans, we maintain discussions with a broad group of stakeholders to ensure the future development of modern logistics position, which is, of course, critical to Catena going forward. Slide 30. Now we are pleased to move into the question and answer session.
Thank you. If you do wish to ask a question, please press zero one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing zero two to cancel. Our first question comes from the line of Markus Henriksson from Pareto Securities. Please go ahead.
Hi, guys. Do you hear me?
Yes. Fine. Hi, Mike.
Perfect. Hi. I have a few questions. First, if you could get some light on the split up of the yield compression, project investment, and new leases, as you talked about, for the unrealized value changes?
Yeah, if I should answer that one first, that we have no, no market on that one. We are doing this evaluation on every single property. So, we have no market information on that one.
Okay. Okay. But, could you, if you, if you compare to the past quarters, is it more yield compression now, or, or is it the same level, or what's your, what's your thoughts on that?
Yeah, well, it's yeah, it's fairly like the Q2 and the Q1 as well. We follow the market on every single real estate. So some of the properties, we have a yield compression that with same as in Q1 and Q2. But we have not communicated the level of the difference. Yeah, if you're talking of the investment or the yield compression, that's not. I think we have gone out with this information tomorrow. So I can't deliver that one to you. We know, but we don't deliver it. But it's so fairly same level as Q1 and Q2.
Okay. Okay, fair enough. And then what was the net leasing in this quarter?
Do you have figures? David. 17. 17, give me a sec.
Okay.
Sorry, sorry, I didn't hear you. 17, and... Yeah, net, net is just about SEK 4 million.
4 million, and SEK 17 million for the full year, or?
No, 17 is the lease, the new lease contract, and then we have some who left off. So the net is somewhere around SEK 4 million.
Okay, perfect. And then lastly, if we look at your all LTV levels now and, and your project pipeline, do you feel confident you can, you can be above SEK 600 million in investments going forward? Or do you think that's going to be pretty tough, or can you share any thoughts on, on your investment level going forward?
Yeah, if we calculate what we have in our profit from the property management, and we take the dividends away, we can do investment around SEK 950 million each year. So we are on the pace that we can continue to have the LTV level at 56, 55, something around there.
And if the market is even stronger, then, if that's even possible, that the market is even stronger, would it be possible to increase that level and have even more projects?
Yes, of course, but then you have to do some other financial structure, maybe. But you have always the equity to work with, and so on as well. So we are on a level that is very good going forward for the company. We are containing the LTV level as well. And the market is around 500,000-600,000 sq m each year. So if we can contain that level that we are in today, I think it's going to be very good.
Okay. And lastly, you mentioned the one up of the property tax. If we adjust for that, do you feel that the Q3 is, like, the underlying costs are in line with your expectations?
Now, we have a little bit more maintenance cost in the Q3. Q2 was very cheap, but Q3 was somewhere a little bit more expensive. So if you look at the whole period of nine months, I think you, if you're taking that and divide it with three, I think you get a fair level of what we should be going forward. Then it's always a variation. We do some investments for the tenants and so on, and then that can come, could come in a separate form. So you have to accept some variation in this one regarding to the maintenance.
Perfect. Hope I can do that math. Thank you for my questions.
Yeah. Yeah. Thank you.
Just as a reminder, if you do wish to ask a question, please press zero one on your telephone keypad now. As there are no further questions, I'll hand it back to the speakers.
Okay. Then, just would like to thank you all for taking part in this webcast, and wish you a very, very nice weekend. Bye.
Bye-bye.
This concludes our conference call. Thank you all for attending. You may now disconnect your line.