New JV to Expand Battery Storage Solutions in SoCal
- Nov 09, 2020
Voit Real Estate Services signed an exclusive agreement with Tangerine Energy to lease or acquire 50 industrial warehouses or land sites per year over the next five years to house battery storage centers. These facilities would be located in areas with dense population, where energy pricing is highly volatile.
The collaboration marks one of Voit’s first formal expansions into the energy sector and meets the decision Tangerine Energy made more than a year ago to strengthen the battery storage market in California. The joint venture’s arrangement will primarily serve commercial property owners seeking stability, said Todd Holley, senior vice president in Voit’s San Diego office, as each warehouse or land site will be either acquired or fully leased by a credit tenant for a term of up to 15 years.
California has been implementing various strategies to reduce the imported energy, which puts pressure on demand for commercial properties situated near urban centers, as the need for power storage facilities increases. Typically, these buildings are industrial facilities of at least 40,000 square feet, which is significantly smaller compared to solar and wind farms. Because they require less space, power storage farms can be integrated into high-density areas that post high demand for energy. These facilities are anticipated to grow in importance over the next 10 to 15 years, as new legislation and energy goals will further strain the existing infrastructure and energy grid.