While the oil prices in June 2014 cost USD 110 a barrel, it has since been a free fall. The low oil price accelerates the need for restructuring in the oil driven Norwegian economy.
 
“The private sector is being restructured, and according to Siva the real estate business is more important than ever. Physical infrastructure is essential for developing business activities” says property director Lise Bartnes Aalberg at Siva SF.
 
Siva is owned by the Industry and Fisheries Ministry and is co-owners of over 100 small and large innovative companies. The state enterprise is an active owner that will make sure the companies reach their full potential.
 
In addition Siva invests in properties and commercial properties to decrease the risks of new establishments. These could be industrial buildings, where Siva relieves capital for businesses in transition.
 
“We contribute with competence in entry and management of buildings. There is a very high demand for such projects” says Aalberg.
 
The construction of the production for Lofotsprodukt in Leknes is an example of such a project. The initial inquiry Siva received from the company was regarding a cold storage. This was rejected because Siva said that the project was not innovative enough.
 
The second inquiry needed a new factory due to the premises blowing up. In this case it was envisaged an innovative production process and marketing, which contribute to Siva now wanting to invest in a construction company.
 
Siva invested NOK 75 million in the 6,000 sqm modern production. In one year it has proven to be a good investment, since fish now is becoming Norway’s new oil.
 
A third of Siva’s total property portfolio of 600,000 sqm consists of industry properties. The rest is office building affiliated with research and development environments, among other universities, as well as strong business communities.
 
For example Siva has been a part of the construction of Oslo Cancer Cluster Innovasjonspark, that Prime Minister Erna Solberg opened in August last year. The main goal with the innovation park is to shorten the time that it takes to develop new medicines and treatment times for cancer.
 
“Oslo Cancer Cluster Innovasjonspark is an example of Siva as an organization playing a comprehensive role, where both property and innovation activity contributed to realizing the innovation park” consulting company Menon Business Economics writes in a review of Sivas estate business.
 
The project was in danger of not being completed, but not mainly because of a lack of capital. The project needed an investor that could be a serious partner within the innovation area and in addition would create a safety for the conduction of the project facing a public investor.
 
“It is unlikely that Siva could have helped in the same way in this project without Siva Property’s ownership” Menon Business Economics writes.
 
At the time where Siva entered the project there was a conflict between the private medias and Oslo municipality regarding the purpose of implementing the project.
 
“Siva contributed greatly to this project being realized according to the time table that had been set up. Siva did not only contribute through the implementation capacity, but also gave the City of Oslo safety through their expertise and the fact that they are a state actor.
 
Siva’s real estate activity is mainly organized under Siva Eiendom Holding AS, which currently owns 40 property companies. The annual rental income is approximately NOK 200 million and the lease rate in Siva’s management part of the portfolio is 85 percent.
 
“It is in our nature to take large risks and be a patient owner. At the same time we have the same yield requirements as the rest of the real estate business” says Aalberg.
 
Basically all properties are for sale – Siva is dependent on a certain turnover to get capital for new investments.