Solid balance sheet allows for speculative starts
One of the key takeaways from the Q3 report is that Aros started three projects (67 units) with its own balance sheet. Management argues that selling units early would likely result in lower prices (and margins), so Aros is using its balance sheet to start projects without starting the sales processes. External financing will be granted during the construction phase once the required pre-sale ratios have been met. Not only does this support estimates, it also allows Aros to keep a high share of ongoing production and keep key employees when peers are laying off staff. Moreover, it should result in increased market shares with available supply once the market rebounds.
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