Deals happen instead before the farm gets built. Of the 18 farms completed since 2024, 16 sold a stake during development or construction, and none has sold one since. A stake sold during construction is a different thing from a stake sold once the farm is running. The developer shares the capex bill and gives up some of the developer premium it would have earned by carrying the build to the end. The partner takes on a share of the construction risk, the delays, the grid, the things that can go wrong, and the price and terms are set to reflect how much.
An operating farm is priced like a long bond, and long interets rates are at a 15-year high, above 5% in some markets. The owners of today's new farms built their business cases at pre-2022 rates, so its hard to match with new buyers today. If their returns are already thin when they were bid, there is little or no value pickup left once the buyer's required return goes up.
Today, pre-completion deals is the only market for newer wind farms.
Farms from the old regime, with long government-supported offtake still to run, are still changing hands, but that market has an expiry date as support runs out.
What does this do to returns and capital recycling ability for the next round of projects?
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