Oslo-listed real estate company KMC Properties has agreed to acquire seven industrial properties from BEWI ASA for NOK 625 mln (€55.6 mln), at a gross yield of 8.75%.
The transaction will be funded by a new bank loan from Nordea Denmark and equity from Nordika, a Swedish unlisted real estate company owned by Nordic pension funds and institutions.
The deal includes NOK 290 mln (€26 mln) in bank debt with 1.25% interest, NOK 275 mln (€24 mln) in new equity, and NOK 60 mln (€5 mln) in available liquidity.
After the acquisition, KMC Properties' overall interest margin will be reduced to from 3.32% to 3.15%.
Liv Malvik, CEO of KMC Properties, said: ‘We are thrilled to continue our accretive growth, and to bring a new strategic investor on-board. In addition, attractive new bank debt shows that we receive continued support from banks in times of increased macro uncertainty. This is a testament to our strong portfolio and the work laid down over the past years. The transaction further improves all our KPIs and brings us closer to our vision of becoming the preferred real estate partner for logistic and industrial companies.’
Jonas Grandér, CEO of Nordika, added: ‘KMC Properties has been on our radar for some time, and we are happy to finally get the opportunity to invest in the company. It is a well operated light industrial and logistics real estate company that provides us with attractive exposure in defensive market segment with several global mega trends supporting the case.’
Long-term triple net rental agreements will be entered into for the properties, located in Belgium, Germany, and Poland, with a WAULT of 17 years and 100% CPI adjustments.
Upon completion of the private placement, Nordika can exercise a call option for additional new shares in KMC Properties for NOK 130 mln (€11.6 mln). The call option may be exercised within four months and would see Nordika increase its shareholding to around 17.4%.
This acquisition is the last part of an agreement announced in June to acquire an industrial real estate portfolio of up to NOK 2 bn (€178 mln) from BEWI ASA.
It also marks the company's entry into new markets, as the acquired properties are located outside of Norway and Sweden.
The acquisition is expected to be accretive to KMC Properties' earnings and cash flow, and it will also improve the company's overall portfolio quality.
The new bank loan and equity investment from Nordika will allow KMC Properties to continue its growth strategy in the sector of logistic assets and industrial companies.