Our investment thesis
Large projects rarely fail for lack of capital. They fail at bottlenecks: the grid connection, the planning consent and the lead times for transformers and switchgear. That is where the return is made, before the first foundation slab is poured. Our product is the ready-to-build site. It has a binding grid connection commitment and a planning consent that can no longer be challenged. Its long-lead equipment is on order with a fixed delivery date.
For investors, this means you can acquire capacity in Germany without building a development team here. The transmission system operators allocate grid capacity by project maturity, and each round has a cut-off date. We take sites up to that date and hand them over to you as they move into the next phase.
This page sets out what we develop, the phase at which we sell and the risks we do not take. It also explains what a conversation with us covers. We share specific figures in person. The evidence behind them is under Analysis, each item with its source and evidence grade.
What investors acquire
A site passes through six phases. In each one it is an asset that can be sold on its own, with its own pool of buyers. The phases run from origination of land with no grid connection, through site control, planning consent and a binding grid connection, to a powered shell and a leased facility.
Value jumps at two points: planning consent and grid connection. Each takes years, and a buyer who acquires after them saves those years. Taking a site from Phase 1 to Phase 3 costs a fraction of what it later costs to build on it. Our business model rests on that ratio. The evidence on the six phases and their buyers is on the page Where the bottleneck is.
The risks we do not take
We sell at the phase where a buyer wants to take on the residual-value risk. We do not carry that risk ourselves. The reason is lease length. Leases for compute capacity now often run only four to six years, down from ten to fifteen. Where they do, the exit cap rate for a special-purpose property rises, and the gain in value from Phase 3 to Phase 5 shrinks.
A developer that sells grid-connected sites and powered shells to buyers who price in this risk can withstand it. A developer that builds speculatively cannot. Holding sites ourselves is therefore not our business model. We would consider it if a creditworthy tenant committed for the long term.
The second limit is capital discipline. Land options and grid applications expire. A developer that holds six sites and cannot fund any of them to the next phase loses all six. We therefore secure only as many sites as we can fund to the next phase, even when more are available.
What we discuss with you
Phase and exit
The phase at which a project is sold, to whom and at what value. No prices are published for German sites in Phases 1 to 3. We tell you what we know about them when we meet.
Our role
We advise, develop and invest, sometimes in the same project. Before you invest in a site, you know our role in it, and you hear from us if it changes.
What we show you
We show you the map with its layers and confidence grades, and the evidence on grid connection, planning consent and equipment. For a specific site, you receive the assessment we would write for a client. We discuss only in person what the evidence means for our own projects.
Who you will be talking to
Three disciplines, each with its own track record. Moritz Thierfelder is an architect who has led projects from planning consent through construction. Sahand Hagi built up gas sourcing in the Caspian region for E.ON and closed the company's largest long-term gas contract. He was also Chief Asset Investments and Development Officer of an infrastructure group in London. Pavan Yerraboina has led products at Oracle, Yahoo and Verizon. With Sahand Hagi, he is developing a dispatch system for gas transmission networks.