One commercial developer is banking on industrial real estate’s hot streak by harnessing the power of the hottest thing around: the sun.
Trammell Crow has agreed to a $600 million partnership with solar company Altus Power to install solar panels across its industrial real estate development pipeline, the Wall Street Journal reported. The panels will be installed on 35 million square feet of industrial property.
In addition to the solar panels, Altus will also invest in battery storage capacity, electric vehicle charging stations and other environmental technology. The Connecticut-based company will sell the clean power it generates back to Trammell tenants at a discount. Trammell will collect rent on the panels, which will be installed in 19 markets, the Journal reported.
Trammell told the outlet its interest in the partnership stems from a desire to reduce reliance on the power grid, as well as lure in tenants and investors wishing to lower their carbon footprint.
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Altus told the Journal its goal is to install 300 megawatts of solar-generating capacity at Trammell’s industrial properties by 2026.
Altus was founded in 2009. In December, the company merged with a special-purpose acquisition company sponsored by CBRE, valuing the renewable energy company at $1.58 billion. Trammell is a CBRE client, operating as an independent subsidiary of the real estate giant.
Commercial real estate still has a ways to go to keep up with residential real estate in the solar power race. According to Wood Mackenzie, only about 4 percent of commercial buildings with at least 10,000 square feet of roof space have solar installations, compared to almost 5 percent of owner-occupied, single-family homes. The share of commercial properties with solar installations is expected to hit 11.1 percent by 2030.
[WSJ] — Holden Walter-Warner