The property, located at Storemyra, is composed of a 10,734 sqm BTA industrial plant constructed in 2019, and 62,091 sqm BTA of land, strategically located at the Mongstad industrial site, on the west coast of Norway. Mongstad has for over 40 years been a hub for traditional energy industry and is expanding to encompass new green industry such as land-based fish farming, hydrogen, and battery production.
The property comes with a triple-net bare house agreement with the tenant, PSW Technology AS, and an initial lease term of 12 years, with the option of a ten-year extension. PSW Technology is part of the PSW Group AS, an international provider of products, systems, and services to the energy industry, 98 per cent-owned by Hercules Private Equity Fund IV.
The total consideration for the property is approximately NOK 285 million, with a yield of 7.7 per cent of the total investment cost.
"We continue to execute on our ambitious growth strategy. This acquisition ticks all the boxes in terms of our acquisition criteria: it is a modern facility, strategically located amidst a thriving industrial cluster, with a solid counterparty on a long-term lease agreement, on triple-net bare house terms. The property comprises a large area that can be developed, which opens for further opportunities in a growing industrial zone currently hosting more than 100 companies and 3,000 workers," says Liv Malvik, CEO of KMC Properties.
With its 1,200 solar panels over 3,500 sqm on its roof, PSW's facility at Mongstad is the tenth largest solar cell plant in Norway. The building generates approximately 350,000 kWh per year, making PSW Group self-supplied with solar energy and able to export electricity back to the grid in the event of over-production.
"To operate in a sustainable manner is important to KMC Properties and is seen as a prerequisite for the company's long-term results and value creation. Therefore, the strong environmental profile of PSW's plant at Storemyra carried a lot of weight in our investment decision," says Malvik.
The acquisition will be financed through a combination of bank loan and equity.