Kaldalón's Capital Triumph: Secures ISK 1B in Oversubscribed Auction

REYKJAVIK, ICELAND – February 24, 2026 – Icelandic real estate investment firm Kaldalón hf. has successfully raised ISK 1,040 million through a heavily oversubscribed auction of unsecured six-month bills, a move that underscores strong investor confidence in the company's aggressive growth trajectory. The sale, managed by Landsbankinn hf., attracted total offers of ISK 1,340 million, signaling robust market appetite for the company's debt instruments.

The bills, part of the series KALD 26 0901, were sold at a flat interest rate of 8.04% per annum. The company has announced that the payment and settlement date is set for March 1, 2026, and an application will be filed to have the bills admitted for trading on the Nasdaq Iceland Main Market.

A Strong Vote of Confidence from the Market

The oversubscription of the auction by nearly 30% is a significant indicator of the market's positive perception of Kaldalón's financial stability and strategic vision. In a competitive financial environment, attracting such strong demand for unsecured debt—which is not backed by specific collateral—demonstrates a high level of trust from the investment community. This confidence is built on the company's solid performance and clear strategic direction.

Kaldalón, which transitioned to the Nasdaq Iceland Main Market from the First North growth market in November 2023, has established itself as a formidable player in the Greater Reykjavik commercial real estate sector. The company's financial health is robust, with its latest management accounts for 2025 showing a healthy equity ratio of 32.5% and a loan-to-value (LTV) ratio of 56.6%. These metrics provide investors with assurance regarding the company's balance sheet management, even as it pursues expansion. The strong demand for the recent bills suggests that investors are comfortable with Kaldalón's risk profile and believe in its ability to generate returns sufficient to service its debt obligations.

Navigating Iceland's Financial Landscape

The accepted interest rate of 8.04% for the six-month bills provides a clear snapshot of the current short-term borrowing costs for a well-regarded corporate issuer in Iceland. The rate reflects the broader macroeconomic context, including the prevailing high-interest-rate environment maintained by the Central Bank of Iceland to manage inflation. For Kaldalón, this issuance is a key part of a sophisticated and diversified financing strategy.

This strategy is not limited to short-term instruments. The company has actively utilized the capital markets for various forms of funding. For instance, in late 2025, Kaldalón issued a 14-year, CPI-indexed green bond series (KALD 100240 GB) for ISK 3,000 million at a much lower yield of 3.90%, reflecting the different risk and duration profiles of secured, long-term, inflation-linked debt. By blending short-term unsecured bills with long-term secured and inflation-linked bonds, Kaldalón can optimize its cost of capital, manage its debt maturity profile, and maintain financial flexibility. This latest auction aligns with its stated policy to be a regular and predictable issuer, enhancing its reputation and access to capital.

Fueling an Ambitious Growth Strategy

The ISK 1,040 million in new capital is expected to directly fuel Kaldalón's ambitious growth plans. The company has publicly stated its goal of expanding its property portfolio to ISK 100 billion by 2026, a target that requires substantial and continuous investment. The proceeds from the bill auction are likely to be deployed towards acquiring new properties, funding ongoing development projects, or strategically refinancing existing debt to improve operating cash flow.

Kaldalón's recent performance validates this growth-oriented strategy. The company reported a 24% year-on-year increase in rental income and operating profit in its 2025 management accounts, with virtually no vacant rental space at the end of 2024. Its portfolio, characterized by long-term leases with a weighted average term of approximately 10 years, provides a stable, inflation-indexed revenue stream. With total investments reaching ISK 11.6 billion in 2024 and approximately ISK 8 billion in 2025, the company has a proven track record of deploying capital effectively. The new funds will enable it to continue capitalizing on opportunities in the robust Icelandic commercial real estate market, particularly in the sought-after Greater Reykjavik area.

A Consistent Presence in Capital Markets

This bill auction is not an isolated event but rather the latest step in Kaldalón's deliberate strategy to increase its reliance on market-based financing. Since 2024, the company has successfully issued a total of ISK 9 billion in listed bonds and an additional ISK 6.7 billion in bonds and commercial papers in the first half of 2025. As of mid-2025, listed debt constituted 31% of its interest-bearing liabilities, a figure that demonstrates a clear strategic shift away from traditional bank loans towards a more diversified funding base.

The management of the sale by Landsbankinn hf., one of Iceland's largest financial institutions, adds another layer of credibility to the issuance. Leveraging the bank's extensive network and expertise in debt capital markets ensures a smooth and efficient process, further cementing Kaldalón's standing among institutional investors. By maintaining a regular and transparent presence in the bond market, Kaldalón not only secures necessary financing but also enhances its corporate profile and strengthens investor relations. This consistent approach ensures that the company is well-positioned to access capital swiftly as it continues to execute its strategy to become a dominant force in Iceland's real estate development landscape.