OLD GREENWICH, Conn., Jan. 25, 2024 (GLOBE NEWSWIRE) — Star Equity Holdings, Inc. (Nasdaq: STRR; STRRP), a diversified holding company, announced today that Star Real Estate Holdings USA, Inc., the real estate arm of the Company’s Investments division, has entered into a sale-leaseback agreement for its South Paris, Maine facility. This facility will continue to be used by KBS Builders, Inc., Star’s wholly owned modular manufacturing business. The transaction is subject to customary due diligence and is expected to close in the first quarter of 2024.
Under the terms of the transaction, SRE will sell its South Paris facility for $5.935 million and, simultaneously, a Company wholly owned subsidiary will enter into a 20-year lease agreement, with the right to extend for up to an additional 20 years. Following the closing of the transaction, KBS will continue to operate the South Paris facility pursuant to the lease, and the transaction will have no impact on KBS’s operations.
“We are excited to announce this value-unlocking transaction for Star,” said David Noble, Star’s CFO. “Market conditions presented us the opportunity to realize an attractive value for our South Paris facility at a reasonable cost of capital. Due to our strong balance sheet and healthy cash position, we are well positioned to fund our growth strategy and redeploy our available cash into EBITDA-generating assets, including acquisitions. Over time, we may pursue similar transactions as we look to optimize Star’s asset portfolio and cost of capital.”
About Star Equity Holdings, Inc.
Star Equity Holdings, Inc. is a diversified holding company currently composed of two divisions: Construction and Investments.