Overview – September
The residential sector stole the show in September, with multiple land purchases, the on-going construction of hundreds of new homes and the announcement of an upcoming stock market debut further exciting an already buoyant market. The banking sector also featured heavily in the headlines, as all of the major financial institutions pushed ahead with their preparations and negotiations to clean up their balance sheets. Finally, retail assets and offices vied for readers’ attention, with the signing of several high-profile transactions in both sectors; and Amazon strengthened its commitment to the Spanish logistics sector, with its plans to open two new logistics stations in Sevilla and Alcobendas.
Land was flavour of the month in September as Neinor Homes, Quabit and Vía Célere all went on major shopping sprees. Neinor acquired a portfolio of 6 plots of land in Málaga for €68 million and a set of 3 plots in Valencia and Tarragona for €22.6 million; Quabit bought land in Málaga (2 separate purchases) and Corredor del Henares for €52 million, €23.7 million and €30.1 million, respectively; and Vía Célere purchased land in Madrid, Sevilla and Valladolid for €36.1 million. All three property developers plan to build hundreds of homes on their respective newly acquired plots. Meanwhile, Aedas Homes announced its plan to make its debut on the stock market before the end of the year, which will make it only the second real estate company to undertake an IPO in almost a decade (after Neinor, which listed in March).
Also in the residential sector, Chilean group Osim announced its arrival in Spain, where it plans to invest around €480 million building homes on the Costa del Sol over the next four years; ACR and Allegra, the investment arm of the Losantos family, revealed that they are investing €130 million in the construction of more than 600 homes in Madrid and Pamplona, under the brand Nature; and Ibosa and GreenOak published their plans to invest €86 million on the construction of a luxury housing tower containing 208 homes in Isla de Chamartín in Madrid.
In the rental sector, Testa continued to expand its portfolio, as planned, by approving its merger with Acciona’s rental home business, which will see it incorporate 1,058 rental homes into its portfolio, and Acciona will receive 21% of the Socimi’s share capital in return. The Socimi also acquired 135 homes from BuildingCenter during the month.
Meanwhile, in the banking sector, Spain’s main financial institutions pushed ahead with efforts to reduce their collective real estate exposure; they currently have specific plans in place to divest portfolios worth €6,000 million between them: Santander is selling a portfolio dubbed Project Titán; BBVA has put Project Sena on the market, along with its RE arm Anida, regarding which it is holding exclusive negotiations with Cerberus; CaixaBank is preparing two portfolios (Tribeca and Egeo); Sabadell is launching the sale of a follow-up portfolio to Traveller, in the form of Voyager; Liberbank is negotiating with Bain and KKR to sell Invictus; and Sareb is creating an online portal through which it plans to sell off €3,000 million in loans within one year.
In other news, in the retail sector, the Israeli fund MDSR Investments purchased a portfolio of Carrefour and Eroski hypermarkets from Tristan Capital for €150 million; Europa Capital acquired the Gran Vía de Alicante shopping centre from Rreef (Deutsche Bank’s RE subsidiary) for €52 million; and Hispavima bought the Puma store on c/Fuencarral in Madrid for €13 million. Meanwhile, Decathlon announced that it is going to open 3 new stores in the centre of Madrid, in line with its strategy to bring traditional out-of-town stores to the heart of cities; this innovative move is being echoed by Ikea, Media Markt, Leroy Merlin and Kiabi, amongst others.
In the office sector, Catalana Occidente purchased the Luxa office complex (where Amazon and WeWork are going to open offices in 2018) in the 22@ district of Barcelona from Castellví, Stoneweg and 1810 Capital Investments for €90 million; El Corte Inglés sold its remaining 40% stake in Torre Serrano (Madrid) to Infinorsa for €50 million; Lar España sold the office building on c/Arturo Soria 336 to Colonial for €32.5 million; and AEW Europe acquired the office building on c/Francisco Silvela 106 for €30 million. Meanwhile, the co-working giant WeWork arrived in Spain, with the inauguration of its first office in the centre of Madrid (on Paseo de la Castellana, 43); it plans to open a second space, in Barcelona, as soon as possible (see above).
Finally, interest continued in the alternative asset segment (which includes all non-mainstream assets, ranging from student halls to co-working spaces to data centres). AXA IM and CBRE Global Investment Partners joined forces to buy the Resa Group, the largest student hall company in Spain (and Continental Europe), with 9,309 beds across 19 cities; and the French RE fund manager, Primonial Reim, made its first purchase in Spain, spending €20 million on the acquisition of the 300-bed Sant Antoni nursing home and clinic in Barcelona.
Outlook for Q4 2017
With one quarter left to go, all indications are that 2017 is going to be another record-breaking year for real estate investment. JLL has just reported provisional figures for the first nine months of the year, showing that investment between January and September amounted to €8,697 million, which is already very close to the full-year figure for 2016 (€9,508 million).