The equity partnership and the loan instrument are different investor mandates — not different versions of the same thing. One is a secured creditor position with a fixed return; the other is an ownership position with returns tied to asset performance.
HNordic's commercial property programme offers two investor entry points. Both involve participating in a portfolio of commercial and industrial properties with integrated energy infrastructure. The structures are fundamentally different: different priority at exit, different return profiles, different relationships to asset performance.
The loan instrument is a skuldebrev — a Swedish promissory note — issued by the portfolio holding company, secured by a pantbrev (a registered Swedish property mortgage) over each property in the portfolio, with a corporate guarantee from H Nordic Exergy Limited (Ireland).
Return: 8.75% per annum, simple interest, accruing daily from drawdown. No interim payments — principal and all accrued interest are repaid in a single bullet at exit (property sale or refinancing).
Security: Three layers — a registered pantbrev over each property with Lantmäteriet (the Swedish land registry), a pledge over the shares of each property company, and a floating charge over the energy equipment and revenue contracts.
Nature of return: Fixed and contractually defined. The 8.75% return is an obligation of the borrower, secured by the pantbrev — it is not contingent on energy system performance. The investor knows on the day capital is deployed the exact amount owed on any future date.
Priority: The loan investor is a secured creditor. In a liquidation, the security package provides defined recovery routes senior to any equity position.
Upside: None above the fixed return. If the portfolio exits at a higher-than-projected valuation, the surplus accrues to HNordic and the equity participants — not to the loan investor.
The equity partnership places the investor at portfolio holding company level as an equity participant. Returns are tied to the performance of the underlying assets over the investment horizon and the proceeds at exit.
Return: Variable. Generated from the combined rental and energy income over the hold period, and from the capital gain at exit — the difference between acquisition cost plus improvement investment and the exit valuation. The 30.9% combined return per annum cited for Portfolio SE13 reflects both income streams and projected exit proceeds; it is a projection tied to asset performance, not a contractually fixed obligation.
Security: Equity participants do not hold a registered security interest in the property. Their participation is in the residual value of the portfolio after all senior obligations — including any loan instruments — are discharged.
Priority: Junior to debt. In a liquidation, the equity participant's claim is on what remains after creditors are paid. The equity participant bears the first loss if asset values decline.
Upside: Full participation in the value created above the loan instrument's fixed obligation. This is the mechanism through which the 30.9% projected return is possible.
Loan instrument — fixed return per annum
Loan instrument — pantbrev, share pledge, equipment charge
Loan instrument — priority at exit
Equity partnership — return tied to asset performance
Equity partnership — priority at exit
Equity partnership — participates above fixed obligations
Neither instrument is superior. The loan instrument suits investors seeking a defined, asset-backed fixed return within a defined term. The equity partnership suits investors seeking exposure to the full value creation of the portfolio with variable returns.
This page provides general information only and does not constitute financial, legal, or tax advice. Prospective investors should seek independent professional advice before making any investment decision.
See also: Investors participate at portfolio holding company level — does that make me a shareholder in HNordic? · What is a pantbrev? · Full FAQ