Pareto Securities has lowered its recommendation for real estate company Corem to Hold from Buy and slashed its price target to SEK 3.50 (4.30), according to a research note.

Telecom equipment provider Ericsson announced yesterday that it is moving its headquarters and Stockholm operations from Kista to Hagastaden. The company has signed extensive lease agreements there with Atrium Ljungberg and Castellum.

The research house believes that yesterday's announcement from Ericsson weakens the long-term outlook for the Kista area and underscores the difficulties in attracting tenants to the district. At the same time, Pareto highlights Corem's capital allocation, including its exit from New York and ongoing share buybacks, as positive factors.

'However, we find it difficult to identify any short-term catalysts for a rerating and do not consider the current valuation attractive given the operational headwinds and subdued interest in office space in decentralized submarkets', Pareto writes.