LONDON (Reuters Breakingviews) - Norwegian offices have become the surprise must-have asset. That at least is what two Swedish companies have signalled this week by launching a bidding war for real estate firm Entra, valuing the Oslo-based company at more than $3.3 billion. Steady cash flows from reliable public sector tenants may be alluring, but the Norwegian company’s shareholders stand to benefit the most. Frenzied interest in Oslo offices appears counterintuitive. Norway, like many countries hit by the coronavirus pandemic, has ordered workers to stay at home. And although vaccines may allow a partial return to normal, a remote-working boom could prompt companies to rethink the space they need. This would knock the value of office owners like Entra, whose assets include the 26-story Posthuset, Oslo’s second-tallest building. Entra’s tenants offer it some protection. Over 60% of the company’s office space is leased to the public sector on contracts that last for an average of 30 years. Norway’s oil-rich economy helps insulate its public finances from the Covid-19 downturn. On the face of it, the twin bids are hardly generous. The cash-and-share proposal from SBB, a $4.2 billion company which owns police stations and schools in Sweden, is a modest 15% above Entra’s closing share price on Monday. Larger rival Castellum’s counter-offer, launched on Thursday, is only slightly higher. However, both bidders are stretching financial logic. SBB reckons it can squeeze 260 million Swedish crowns ($29 million) a year in synergies out of the combination. Taxed at 20% and capitalised, those are worth $238 million, little more than half the value of the premium SBB has offered to Entra shareholders. Castellum’s initial estimate of annual savings is an even more modest 150 million Swedish crowns. In the absence of other benefits, each bidder looks set to earn a return on its investment of little more than 3%, according to Breakingviews calculations using Entra’s expected 2020 operating profit of 1.8 billion Norwegian crowns and net debt of 20 billion Norwegian crowns. Entra says it wants to remain independent. Its shares on Thursday were trading at 176 Norwegian crowns, nearly 5 crowns above the implied value of Castellum’s offer, suggesting investors are hoping for a bidding war. That would require its suitors to hand over even more value to secure Oslo office space.