Half Year Report


Leaders in socially beneficial and essential property.

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Overview from the CEO

Navigating through a volatile real estate market

The real estate market has continued where it left off around Christmas last year, characterized by few property transactions and a significant gap in valuation between buyer and seller. As a result our main focus in the first half of the year has been on operational management. We are closely monitoring transaction opportunities, but expect the market to remain cautious throughout 2023.
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PPI has a clear strategy to be a driving force within sustainable property management. Our aim is to be a responsible owner, operator and developer of real estate, with the Norwegian government and local municipalities as tenants.

It is of huge importance that major property owners like ourselves prioritize and allocate resources towards making our existing building stock more sustainable. If we achieve that, we will simultaneously reduce the need for large new constructions. Fact of the matter is that new construction is among the “worst offenders” when it comes to sustainability, including the so-called “green buildings.” On average, compared to upgrading existing building stock, it actually takes 50 years longer for brand new buildings to become climate positive. The reality is that the CO2 footprint generated through new construction is more than twice the size of that caused by rehabilitation. This is why it makes sense both economically and environmentally to focus on reuse, which is what we predominantly do at PPI.

During the first half of 2023 PPI has initiated the process of certifying the company as a “Miljøfyrtårn” (Environmental lighthouse). We believe it is important for PPI to be run according to recognized industry standards, including this certification which is acknowledged by both public and private tenants. “Miljøfyrtårn” offers a tangible certification tool and an effective environmental management system, which will help the company reduce its environmental impact, promote green transition and enhance competitiveness.

This summer PPI took out what is Norway’s largest sustainability-linked loan in the real estate industry, with Nordea and Danske Bank as lenders. The loan agreement is conditioned by strict requirements in terms of sustainable operation and development of the property portfolio over the coming five-year period. Measures relate to energy consumption and associated measurements in line with the company’s ESG (Environmental, Social and Governance) strategy, as part of the company’s long-term efforts to achieve its climate goals by 2030. The agreement provides PPI with refinancing and credit facilities totaling NOK 3.322 billion, at highly competitive rates in today’s market.
The company’s debt ratio has been monitored closely over the last year. With a highly challenging credit market the board has chosen to pay off nearly half a billion kroner in loans rather than pay dividends. This is to reduce risk and ensure the company’s responsible financing and operation.

Selling properties has not been considered necessary, and as things stand there are no plans to do so. The strategy remains to further develop the properties in our portfolio and acquire new properties when the timing is right, with a view to increasing the company’s future value. The company’s strategic period extends until 2026, during which our aim is to realize the company’s potential in order to make strategic decisions for the road ahead.

June marked PPI’s second anniversary. Even if we still have much to accomplish before realizing the company’s potential, I am incredibly proud of everything we have achieved in such a short time. We have acquired 48 properties and become a major real estate company in Norway with more than 110 public tenants in 25 cities. With 15 police stations and other essential public service tenants in our portfolio, many of the properties are operational 24/7. Every day, hundreds of subcontractors work to ensure that our tenants can fulfill their important societal missions.

This places significant demands on our team in terms of both professionalism and 24/7 availability. The PPI team is made up of 15-20 highly competent resources who deliver with quality and intrinsic motivation to create value for the environment, our tenants and our owners. On this note, I would like to extend a special thank you to the team at Arctic and Arctic Real Estate Management for their incredible efforts.
Morten signatur
Morten Kjeldby | CEO

June 30th 2023

Key Figures

Gross Area (sqm)
Value / sqm (NOK)
Gross Rent / sqm (NOK)
CPI Adjustment
Public Tenants
Loan to Value (LTV)
Net Rental Income (MNOK)
WALT (years)
Property Value (MNOK)
Rental Agreements
MG 5870
Bryggeriveien 2-4, Fredrikstad
  • Financing - Bonds

    Matured bonds in 2023
    The bond loan in Public Property Sub-Holding 6 AS NOKm 425 was partially repaid the 12th july 2023 with NOKm 76.4. In the consolidated balance sheet the repaid amount is classified as other current liabilities, and the remaining amount refinanced is presented in Bonds
    Hedged interest rate of total bank debt

    NOK 3 323m bank debt

  • Financing - Debt

    Debt maturity structure
    The bank loan has an annual installment profile between 0 percent and 6 percent paid semiyearly, depending on the loan to value of the structure.
    Bank vs. bond

    NOK 5 596m total debt

Video from Gjerpensgate, Skien
  • Shutterstock 767497198


    Work on sustainability during the first half of 2023:
  • MG 5917

    Sustainability work in first half year

    • Sustainability is an intrinsic part of all processes involving the business.

    • Development of plans and sustainability goals for the property portfolio until 2030 is in progress.

    • The entire portfolio has been surveyed and evaluated through a technical review (technical facilities, climate shell, EOS, SD systems, space management, field equipment, etc.).
  • MG 5888

    Sustainability work in May

    • Immediate measures have been put in place to optimize energy consumption throughout the summer of 2023, by shutting down systems in areas not in use and adjusting operating hours based on actual needs.

    • Our suppliers Entro and Energima have been engaged to actively optimize energy consumption for the majority of the portfolio (92%).

    • The process of certifying the company as a “Miljøfyrtårn” (Environmental Lighthouse) has begun and will be completed in 2023.
  • MG 5727

    Sustainability work in June

    • In the summer of 2023, the company successfully negotiated what is Norway’s largest sustainability-linked loan in the real estate

    • Efforts are being made to document the impact of energy saving measures already implemented in the portfolio this year, as well as measures that will be completed before the new winter season.
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