Share deal
A share deal is a sale of a property where the buyer takes over the shares in the company that owns it, instead of the property itself. Because the title (hjemmel) in grunnboken (the Norwegian land register) does not change, the deal does not appear as a registered change of ownership. You have to read it from the shareholder register (aksjonærregisteret).
This form of sale is also called a company sale (selskapssalg). It is common for commercial property owned through an SPV. We find share deals by comparing the shareholder register from year to year for companies that are the registered owner (hjemmelshaver) of a property. A share deal is recorded when the company gets a new owner with more than 50% of the shares, or when the company that controls the owner changes, for example when the holding company above the SPV is sold. Reorganisations where the ultimate owner in the group is the same before and after count as internal and get no price.
Property value and share price
The price we give for a share deal is the property value: the value the parties agreed for the property. The share price is something else. It is calculated from the property value, minus the company's net interest-bearing debt and a discount for latent tax, and it is adjusted for working capital. An SPV with a property valued at NOK 500 million and NOK 300 million in debt is therefore sold for less than NOK 200 million in shares. Price per m² is calculated on UFA from matrikkelen (the Norwegian cadastre), and it can differ from the area in a sales prospectus.
Three price levels
Every price has a level, and the level always follows the figure:
- Level A, reported: the price comes from a reported transaction in industry databases or the press, linked to the share deal by cadastral number, year and buyer or seller.
- Level B, implied property value from accounts: the buyer used a newly founded company, and the value is calculated from the annual accounts of the buying company and the SPV, for example the cost price of the shares plus the SPV's net debt. The accounts do not show the tax discount, so Level B is often a few percent below a reported price.
- Level C, unknown: there is neither a reported price nor a set of accounts that reveals the price.
If one price covers several properties in a portfolio, it is split by UFA.
Date and precision
The shareholder register shows the owners as of 31 December, so the register on its own gives only the year. The date therefore has a precision: day, week, quarter or year. Reported transactions often give a quarter or a week. Otherwise we use signals from Brønnøysundregistrene and grunnboken: when a new board from the buyer's group is registered in the company, when the company moves to the buyer's address, or when a new mortgage document is registered on the property. The change of board usually marks completion, a few weeks after the deal became known. If there are no signals, the date is set to 31 December and the precision to year.
Limitations
- The tax discount is not in the accounts and cannot be observed.
- Purchases through an existing holding company that owns several properties cannot be priced from accounts. Most share deals therefore have Level C.
- A company that owns property but runs another business is not priced from accounts, because the purchase price then covers the whole business.
The share deals on a property are in a separate tab under Transactions in the Property panel, with the ultimate parent company of each party.
From Placepoint's glossary: Share deal
More information: Skatteetaten: the shareholder register, Brønnøysundregistrene: Regnskapsregisteret (the register of company accounts)
English: share deal (sale of a property through the shares of the company that owns it).
Frequently asked questions
Why is the share price lower than the property value?
Because the buyer takes over the company's debt and a latent tax. The share price is the property value minus net interest-bearing debt and the tax discount, adjusted for working capital.
Why do many share deals have no price?
Most deals are not reported. When the buyer uses an existing holding company with several properties, the accounts do not show what each property cost. These share deals get Level C.
How precise is the date?
The precision tells you: day, week, quarter or year. Without a reported date or signals from Brønnøysundregistrene and grunnboken, only the year is known.