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Metrovacesa Incorporates €1,000M Of Assets From Its S/H Banks

16 March 2016 – Expansión

Operation / Santander, BBVA and Banco Popular transfer nine office buildings in Madrid and Barcelona to their investee. The real estate company’s real estate portfolio will expand by 25% as a result of the deal.

Metrovacesa is fattening up its asset portfolio thanks to its shareholders. Santander, BBVA and Banco Popular have transferred nine office buildings in Madrid and Barcelona worth €1,000 million to the real estate company. Santander is the major shareholder in Metrovacesa, with a 72% stake, followed by BBVA (19.4%) and Banco Popular (8%).

The operation, performed through a non-monetary capital increase, forms part of the process launched by the company at the end of last year to restructure its debt. In particular, the maturity date of debt linked to its property development business, which falls during in Q3 2016.

By virtue of this process, Metrovacesa created a new company to take possession of its land and property development businesses. Meanwhile, the existing company has oriented itself towards with property sector, in other words, towards offices, shopping centres and homes that generate rental income. When the operation was signed, Metrovacesa held a portfolio covering 1.1 million m2.

Now, its asset book has been strengthened with additional office space covering 130,000 m2, which means that its portfolio in that segment has grown by 25%, to 650,000 m2 of gross leasable area. The nine office buildings include: the Ática XIX Business Park in Pozuelo de Alarcón, covering a surface area of 15,411 m2; the Cerro de los Gamos building, also in Pozuelo, which measures 35,473 m2; and the Trianon Business Park in Vía de los Poblados. Madrid is home to seven of the nine assets; the other two are in Barcelona.

Metrovacesa plans to launch the marketing of the properties in the short-term and whereby take advantage of the changing cycle currently happening in the office market. (…).

Investment

Madrid and Barcelona as the two major focuses for activity. Last year, the capital accounted for 83% of total investment, whilst the remaining 17% was spent in the Catalan capital.

The incorporation of these assets into Metrovacesa’s perimeter represents the completion of the first phase of the operation to carve-out the company into two entities. In this first non-monetary capital increase, the shareholding banks have contributed assets. Subsequently, the entities will capitalise debt and exchange it for shares in the company through another increase. Finally, the third operation, which will be of a monetary nature, will give Metrovacesa’s minority shareholders, who still hold 0.073% of the share capital, the option to sell their stakes. Once that process has been completed, the carve-out will be executed.

Metrovacesa’s property portfolio, which is worth around €4,100 million, includes not only office buildings, but also other assets such as shopping centres – including, the TresAguas centre in Alcorcón, Madrid – and several hotels, such as Barceló’s project in Torre Madrid.

Original story: Expansión

Translation: Carmel Drake