Azora´s Real Estate Vehicle Starts Off With 62% Capital Lockup

4/03/2014 – Cinco Dias

George Soros and John Paulson, both among the world´s most important fund managers, are going to inject €92 million each in Hispania Activos Inmobiliarios, established by Azora fund in order to invest in the Spanish property market. Each businessman will hold about 18% of the stake and by so become its main shareholders. The company´s objective is to raise €500 million, out of which 62% (€314 million) capital lockup is already pledged by investors.

The CNMV has approved the booklet of Hispania´s flotation and the company is going to be launched on March 19th. Azora Gestión will manage and hold 2.28% of the capital. Strikingly, the idea of creating a Socimi has been abandoned, as confirm the words of its founder, Fernando Gumuzio: “we seek flexibility to buy various types of assets” and a Socimi requires at least 80% of assets intended for rent.

Goal: 15% Yield

Hispania aspires to create “a quality portfolio consisting of residential, office and hotel property all over Spain”. The target is to benefit from the cycle reversal and the cash flow generated by wide asset range including debt backed by the real estate or stakes at companies. To begin with, the listed firm is said to be set up for 6 years and bring 15% yield.

Therefore, Azora´s vehicle would exceed the 12.5% profitability foreseen for the Socimi set upon by the Lar Group, supported by Pimco and to be floated this week.

Withal, Azora does not deny having a Socimi as an affiliate. “Hispania weights up creation of Socimi Filial in order to make profits from the tax advantages offered by such sort of listed firms, not sooner than on September 30th, though”. (…).

Soros and Paulson will channel their investment through Quantum Strategic Partners and Paulson & Co. respectively. Other anchor investors worth mentioning that contribute to the €314 million amount are: Moore Capital Management, APG, Cohen & Steers and Canepa. Free float will constitute the rest of the capital (35%).

Hispania Activos Inmobiliarios´s administrative board will be led by ex-executive of Endesa, Rafael Miranda. Other members are ex-director of Ferrovial, Joaquín Ayuso, José Pedro Pérez Llorca and Luis Mañas. Hispania named Goldman Sachs and UBS as the offer coordinators and placers.



Original article: Cinco Días (David M. Pérez)

Translation: AURA REE