Nordic Modular Leasing

Nordic Modular Leasing offers Flexator’s customers operational leasing as an alternative to buying. The customers are often given the opportunity to buy the buildings once the leasing agreement expires. The customers consist mainly of Swedish municipalities.

Nordic Modular - Relocatable buildings for professional customers

Business Concept

Flexator markets operational leasing as an alternative to buying. In such cases, Nordic Modular Leasing first buys the building from Flexator and then leases it to the customer. The customer pays all construction costs apart from the rental, while dismantling is charged separately. The rent is paid yearly in advance. Contracts are normally signed for five years, but many are extended. Once buildings are returned by the customers, they are sold in turnkey condition or are rented out to new customers with the help of Flexator and Temporent.

Business Conditions

At present, Nordic Modular Leasing works primarily through Flexator's market organisation. Operational leasing presumes considerable residual value, which to a certain degree requires standardisation and predictable demand on the second-hand market.

Focus:

  • Customers who are solvent.
  • Customer needs that are estimated to last longer than the contract term.
  • Buildings for professional purposes that meet a stable demand over time.
  • Focus on premises for schools and preschools.
  • Own sales or rental of returned buildings.

Operational Leasing

Operational leasing presumes that the ownership function in all essentials lies with the lessor. This includes assuming a financial risk for the residual value. Hedging such a risk requires long-term experience, individual evaluation of each deal and an organisation for sales of returned buildings.

Nordic Modular’s leasing operation started back in 1978 and those who assess the deals have a good understanding of the market. Buildings that can be assumed to be facing uncertain demand in the future are given a low residual value. Second-hand sales are made with the help of Temporent’s and Flexator’s organisations as well as through advertising on its own website, modultorget.se.

Rental of Small Flats

The rental of temporary residences in small flats is run via the subsidiary, Hagtornet Modul AB, and the associated company, Ungabostäder Haninge AB.

Contact

Kim Viitanen

Nordic Modular Leasing
Managing Director
Tel: +46 8 590 994 42

Developments during 2016

The investments in new leasing units increased to SEK 27 million (18) as a consequence of Flexator increasing the sales of catalogue buildings. Orders were also signed with a total investment value of SEK 51 million for delivery during 2017.

The holding in the Ungabostäder Haninge AB joint venture company is recognised according to the capital share method. The building works have been completed and the 180 flats were successively occupied during the first quarter. Since then, the fleet has been completely rented out. The share of the company’s profit after tax contributed SEK 192,000 to financial items.

The rental revenues dropped to SEK 47 million (50) and EBITDA dropped to SEK 44 million (59). The sales of used rental units decreased and the profits from this business reduced to SEK 2 million (12).

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