Current and planned projects exceed 4,000
units; expected to generate gross revenue in excess of $800
million
Safe & Green Holdings Corp. (NASDAQ: SGBX) (“Safe &
Green Holdings” or the “Company”), a leading developer, designer,
and fabricator of modular structures for residential, commercial,
and point-of-care medicine, today announced its SG Echo subsidiary
has executed a Master Purchase Agreement (MPA) with Safe and Green
Development Corporation (NASDAQ: SGD) (“SG DevCo”), the Company’s
real estate development subsidiary, which recently completed a
spinout as a standalone public company. Under the MPA, SG DevCo has
engaged SG Echo to manufacture modular units for its planned real
estate development projects, including design, engineering,
fabrication, delivery, and installation of the modular systems.
Safe and Green Development Corporation expects the initial value of
the MPA to be in excess of $140 million in net revenue to Safe and
Green Development Corporation over a multi-year period.
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Rendering of the proposed Magnolia
Residential Units (Photo: Business Wire)
Paul Galvin, Chairperson and CEO stated, "We are delighted to
formalize this MPA with SG DevCo to manufacture modular units for
projects that we expect will initially generate in excess of $140
million of steady and predictable manufacturing revenue. Moreover,
we believe this is simply the first of several such agreements to
support SG DevCo’s upcoming development projects, which currently
total approximately 4,000 units and have the potential to generate
in excess of $800 million of gross revenue to Safe & Green
Holdings. We believe this agreement is further validation of our
strategic decision to spin off SG DevCo earlier this year, as it
allows both of our organizations to focus on our core competencies
and is already proving extremely beneficial for our respective
companies.”
Mr. Galvin continued, “In addition to the revenue potential of
this agreement, we see a number of important ancillary benefits.
Specifically, the magnitude of this initial MPA and expected future
expansion of the agreement has the potential to increase our
factory utilization to nearly 100%. Given the fixed cost nature of
our business, we expect to benefit from economies of scale and
increased operating margins as we increase the throughput at our
factories. Importantly, we now have two factories in operation,
with a third in the design phase, and a fourth in the planning
stage. In total, these four facilities are expected to provide us
with over 360,000 square feet of manufacturing space, all within
the U.S., contributing to domestic job growth. In addition to the
SG DevCo projects, our sales pipeline is growing rapidly, which we
expect will support further expansion of our capacity and increased
utilization of our facilities, while allowing us to prioritize the
most lucrative projects.”
David Villarreal, President & CEO of Safe and Development
Corporation, further noted, “Securing a long-term agreement with
Safe & Green Holdings reduces risk and provides us visibility
on pricing and timing, while allowing SG DevCo to focus on other
key elements of the project. Given the modular nature of Safe and
Green Holdings’ units, we are able develop high quality projects in
a standardized, repeatable and cost effective format. In turn, this
should reduce our time-to market, thereby allowing us to begin
generating rental income in nearly half the time it would otherwise
take.”
About Safe and Green Development
Corporation
Safe and Green Development Corporation is a leading real estate
development company. Formed in 2021, it focuses on the development
of sites using purpose-built, prefabricated modules built from both
wood and steel, sourced from one of Safe & Green Holdings
Corp’s factories operated by SG Holdings’ SG Echo subsidiary. More
information about SG DevCo can be found at www.sgdevco.com.
About Safe & Green Holdings
Corp.
Safe & Green Holdings Corp., a leading modular solutions
company, operates under core capabilities which include the
development, design, and fabrication of modular structures, meeting
the demand for safe and green solutions across various industries.
The firm supports third-party and in-house developers, architects,
builders, and owners in achieving faster execution, greener
construction, and buildings of higher value. The Company’s
subsidiary, Safe and Green Development Corporation, is a leading
real estate development company. Formed in 2021, it focuses on the
development of sites using purpose-built, prefabricated modules
built from both wood and steel, sourced from one of SG Holdings’
factories and operated by the SG Echo subsidiary. For more
information, visit https://www.safeandgreenholdings.com/ and follow
us at @SGHcorp on Twitter.
Safe Harbor Statement
Certain statements in this press release constitute
"forward-looking statements" within the meaning of the federal
securities laws. Words such as "may," "might," "will," "should,"
"believe," "expect," "anticipate," "estimate," "continue,"
"predict," "forecast," "project," "plan," "intend" or similar
expressions, or statements regarding intent, belief, or current
expectations, are forward-looking statements. These forward-looking
statements are based upon current estimates and assumptions and
include statements regarding the Company’s market opportunities,
the planned manufacturing expansions for SG Echo, the development
pipeline for the Company’s majority-owned subsidiary, SG DevCo, and
the Master Purchase Agreement executed between SG DevCo and SG Echo
whereby SG DevCo has engaged SG Echo to manufacture modular units
for its planned real estate development projects, including design,
engineering, fabrication, delivery, and installation of the modular
systems. While the Company believes these forward-looking
statements are reasonable, undue reliance should not be placed on
any such forward-looking statements, which are based on information
available to us on the date of this release. These forward-looking
statements are subject to various risks and uncertainties, many of
which are difficult to predict that could cause actual results to
differ materially from current expectations and assumptions from
those set forth or implied by any forward-looking statements.
Important factors that could cause actual results to differ
materially from current expectations include Company’s ability to
complete the construction and expansion of its manufacturing
facilities as planned, SG DevCo’s ability to complete its real
estate development projects, and other factors discussed in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2022, and its subsequent filings with the SEC, including
subsequent periodic reports on Forms 10-Q and 8-K. The information
in this release is provided only as of the date of this release,
and we undertake no obligation to update any forward-looking
statements contained in this release on account of new information,
future events, or otherwise, except as required by law.
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Investor Relations: Crescendo Communications, LLC
212-671-1020 SGBX@crescendo-ir.com
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