Month: July 2013

Sareb puts five new lots of assets on sale.

It is possible that some international investors interested in the Spanish market do not take any holidays in August, because Sareb has just placed five new real estate lots in the market. The funds have the possibility of analyzing simultaneously seven great packages of very heterogeneous assets.

These lots include shopping malls, tourist complexes, offices to rent, finished properties and under construction ones, and rural land, as advanced yesterday by Expansión Directo Banca. The company presided over by Belen Romana has just opened the sale process of its first package of shopping malls, named, Runner, while the package of tourist complexes has received the name Blue. It has also place in the market, under the name of Harvest, a package of rural land that includes 22 assets scattered in 5200 hectares. For the moment, Bankia Habitat is in charge of this disinvestment, although Sareb has just started the selection to hire another broker that participates in the operation.

Apart from these three disinvestment processes, Sareb offers another four lots of assets with a nominal value of around 2000 million Euros. The operation Corona includes offices to rent located in seven of the best buildings in Madrid, with a market price of around 450 million Euros. An important real estate consulting company is in charge of finding investors interested in the buildings, which originated from the portfolios of Bankia and Catalunya Banc and which are located northeast from the city, like Campo de las Naciones, Montecarmelo and Manoteras. Sareb hopes to receive the first offers in September so as to close the sale in October or November. The project Teide is also open, which includes finished apartments and under construction ones, with a market value of 150 million Euros.

Apart from trying to seduce the investors with its real estate assets, Sareb is also trying to do so with the financial ones, that make up 80% of its balance. Several weeks ago, it started the project Bermuda, made up of credits to developers from Metrovacesa, Realia and Colonial, with a joint nominal price of 1200 million Euros. At the same time it advances in the sale of its first lot of assets for wholesale investors, the project Bull. The negotiators of the bad bank are in contact with the international funds that have presented offers, among them Lone Start and Centerbridge. Their target is to finish the disinvestment in the next few weeks.

Officials sources from Sareb avoided any comments on these operations, but insisted that their activity “will be intense in the second half of 2013”, after a first half devoted to the opening of different sale channels and the classification of assets, which has still not finished. They specified that the operations of Sareb are not common sales, as they will be channeled through investment vehicles, either through joint risk companies or Socimis, among others.

Source: Expansion

Bankia sells the hotel Westin in Valencia to the German company Seaside.

One of the most luxurious hotels in Valencia, the Westin, which opened during the touristic development of the city for the hosting of the Americas Cup, has changed hands. Bankia has transferred Hotel Alameda, the company owning the rights to the concession during 75 years of an old modernist building, to the German hotel chain Seaside Hotels, in the hands of the Gerlach family.

The new owner of the Westin Valencia was already present in Spain, although in the sector of holiday hotels. The German group owns four tourist resorts on the Canary Islands with the hotels Grand Hotel, Palm Beach and Sandy Beach on Gran Canaria and Los Jameos Playa on Lanzarote. Also the chain has a line of business for urban hotels, which until now had concentrated in Germany with four establishments in emblematic buildings in Hamburg, Leipzig and Chemnitz.

The operation is included in the sale of participations by Bankia so as to comply with the conditions established by Brussels for its rescue. In the case of the Hotel Alameda, this ownership had been inherited from Bancaja. The former Valencian savings bank assumed the hotel in 2003 when it was still a project, after its initial awardee, a subsidiary of The Saudi European Projects, did not comply with the deadlines to start the works that would create a hotel full of glamour in the city.

The five star hotel and grand luxury qualification has 135 rooms and suites and employs 100 workers. It was opened in 2006 after an investment of 30 million Euros that allowed the conservation of the façade of the old factory La Lanera. Since its opening, the management has been in the hands of the chain Starwood, owner of some other brands such as Sheraton.

Source: Expansión

Blackstone pays 128 million Euros for the properties in Madrid.

The sale is a consequence of the process of reduction of the debt of the Council of the capital, as explained by sources of the Town Hall in Madrid last Tuesday. Through a public bidding, the Council of Madrid started the sale process on the 6th May. Since then, it has received offers from different funds for this lot of properties classified as subsidized homes and with rental agreements. Among those interested there were important firms such as Cerberus, Morgan Stanley and LoneStar.

Finally, Blackstone has acquired this lot of 18 developments located in Carabanchel, Centro, Vallecas and Villaverde for 125,5 million Euros. 1208 properties included in 12 developments are properties on rental agreements and the rest, located in six buildings, are for rental with a purchase option.

Blackstone has taken part in the bidding along with Magic Real Estate, a firm with experience in the management of properties in Spain and in areas of Northern Africa. The fund will not manage the lot of properties as Blackstone, but through a subsidiary called Fidere.

The awardees have paid three million Euros more to acquire 51 parking spaces, 25 trade premises and 2 storage rooms. The new owners have assured that they will maintain the conditions of the agreements with the current tenants, as the purchase agreement included the substitution in the current rental agreements.

Blackstone is present in the sector since 1991. It is currently the world leader in real estate investment of venture capital, with an invested capital of 60.000 million Dollars. The portfolio of Blackstone includes hotels, offices, shopping malls, industrial units and homes in the United States, Europe and Asia. Among its most important assets there are the Worldwide Hilton hotel chain, the Brixmor shopping malls, and the office complex Broadgate, in London. In Spain, they are the owners of the packaging manufacturer Mivisa.

Source: Expansión

Sareb puts its first two portfolios of rural land.

Sareb intends to make its real estate assets, its land and credits related to the developing sector profitable as soon as possible. It is now preparing the sale of two portfolios of rural land, initially in the hands of Bankia, made of 22 assets with a surface of 5700 hectares, although this number could be increased. This is the so called Harvest project, which will be commercialized through Bankia Habitat and two real estate companies.

A complete challenge. Sareb has decided to accelerate so that its shareholders, included the State with 49% of its capital, may obtain a profit from their investment and thus end the critics not only from the market, but also from the troika and mainly from the International Monetary Fund (IMF). Sareb wishes to reached its cruising speed in the second half of this year, as explained by the firm to its shareholders.

After promoting the sale of home to retailers, and while it finishes its first great sale of real estate assets to international funds – known as project Bull -, and the sale of a package of credits to developers for 1200 million Euros – under the name of operation Bermuda – the firm presided over by Belén Romana has created the project Harvest. It is the first package of rural land it places on the market.

The project Harvest is made of 22 assets divided into two portfolios with a total of 5700 hectares, although this is an initial figure and could be increased once Sareb ends the classification of all its portfolio of rural assets.

The first of these two portfolios will be commercialized by Bankia Habitat, as most of its assets have been transferred by BFA, the parent company of Bankia. This package is made of eight groups of estates located in Cordoba, Murcia, Teruel, Madrid, Valencia and Navarra. The second portfolio will be commercialized by two important real estate brokers whose agreement is being finalized. These firms will sell rural land to the rest  of institutions that have transferred is toxic assets to Sareb, which is located in Badajoz, Caceres, Tarragona, Murcia, Alicante, Ciudad Real and Soria.

Sareb´s technicians have detected transferred rural land which is located in natural settings with a high value. Among them Cabo Cope, Sierra de Irta or Sierra Tivissa stand out. Arrangements are being made to proceed with the immediate disinvestment of this land.

There are, in fact, offers for land in Cabo Cope with a surface of 200 hectares.

These real estate firms have agreed to reinforce their web sites and carry out aggressive commercial actions with rural unions, as well as with real estate agents specialized in the areas where these plots are located. Initially Sareb studied more than 200 rural plots, with a surface of 9700 hectares, although in the end 22 assets have been selected, as these ones can be commercialized “right away”, as explained by sources related to the bad bank.

The land put on sale will not be for building purposes, although some plots could be finally change their land use, the same sources explain.

The sale of rural land is one of the main pending issues within the sector, and mainly within the nationalized institutions, the main sources of transfer of rural assets to Sareb.

One of the most important problems for their sale is that they do not have the appropriate channels for their commercialization. And also that the transferring institutions have not carried out active disinvestment strategies.

Source: Cinco Dias

Bantierra sells an unpaid credit portfolio to H.I.G. Capital.

Bantierra (Caja Rural de Aragón) and the U.S. fund Bayside Capital, an affiliate of H.I.G. Capital, have undersigned the first default credit portfolio in Spain. The portfolio, valued at €150 million, consists mostly of the SMEs´and individual customer credits.
Due to scarcerity of such operations, Bantierra leaves behind its competitors, showing itself as dynamic and innovatory.
“A long list of domestic and foreign investors expressed interest in the portfolio”, finally financed by Analistas Financieros Internacionales (AFI), MaC Group and advised by De Castro Morenilla. On the part of H.I.G., the assesory has been carried out by Pérez-Llorca office.
 
Source: EuropaPress

The regional governments will issue a census of empty subsidized homes.

Yesterday, the minister of Infrastructure, Ana Pastor, announced the creation of a census of empty subsidized homes with the information of the regional governments that should be ready at the end of the year. “In a few weeks we will start the bilateral meetings with the regional governments and the register should be ready in September or October”, the secretary of State for Infrastructures, Transport and Housing, Rafael Catalá, explains.

Some regions, such as Castilla-La Mancha, already have a registry of empty subsidized homes, according to the minister Marta García. Others, such as Asturias, indicate that the only problem could be in the private developments which have already been sold and that later have become empty.

Once the registry is finished, it will join the registry of active rentals. The Government will then have the possibility of assigning these properties to social rentals. The Government will assign 2421 million Euros to the National Plan for the promotion of rentals, refurbishments, urban renovation and regeneration, for the period 2013-2016, which includes aid for rentals of subsidized homes and grants for the refurbishment of private homes. 1500 million Euros will go to rentals and 620 to refurbishments.

The Government will also pay a maximum of 200 Euros per month for the rent of low income families that rent properties for less than 600 Euros per month. Apart from the 2421 million Euros granted by the government, who assumes 70% of the total cost, the regional governments will contribute with 3460 million Euros, that will divided into the four years of duration of the plan.

According to the Ministry, this expense would help to boost the employment, as most of it will subsidize refurbishment activities, very intensive in labor. During this period, and according to the official calculations offered by the minister yesterday, this aid would help create 32000 direct jobs, which would reach 105.000 indirect ones.

One of the novelties of the plan is that the rental subsidized properties and the grants will be maintained even if the affected party moves to another region “in order to facilitate the labor mobility”, as declared by the minister Pastor. However, the granting of aids will not be changed, as they will be granted in the same proportion as in the last plan.

Source: Expansión

Housing prices reach the same level as ten years ago.

According to the information published by the Ministry of Infrastructure housing prices reached in June 1.481,7 Euros per square meter, figures which show a decrease of 7,8% in reference to the figures of 2012. But this downward tendency has been a reality in the last years, so that housing prices now reach level of 2003. In the first quarter of 2004, the average price per square meter reached 1456,2 Euros.

The price of the square meter accumulates a descent of 29,5% since its maximum level, reached in the first quarter of 2008, when prices were over 2000 Euros per square meter.

As for the tendency on the short term, most experts assume that prices will continue their moderation until 2014. Fotocasa.es calculates that currently owners are applying discounts of 25% on the initial offer in order to be able to sell their homes.

 

Source: Fotocasa

The properties of El Corte Inglés are worth 18.000 million Euros.

The restructuring process of the debt of 5070 million Euros of El Corte Inglés is on the right path. The group has already received the valuation of its real estate assets which was ordered from the valuation firm Tinsa, a condition agreed with its banks in order to renovate the credit.

Therefore, according to Tinsa´s estimations, the value of the real estate assets of the group exceeds 18.000 million Euros, that is, it is more than three times the debt it has with 25 creditors.

The report has taken into account the millions of square meters that make up the real estate patrimony of El Corte Inglés that, according to the last official figures dated 29th February 2012, include 86 department stores (two of them in Portugal), 42 hypermarkets, more than 250 convenience stores under the brands Supercor and Opencor, as well as the logistic platforms and warehouses, and its historic headquarters at Hermosilla Street in Madrid and its latest investment: Torre Titania, in Madrid.

A real estate patrimony created during more than five decades and whose portfolio increased substantially in 1995 with the acquisition of Galerias Preciados, which meant the purchase of thirty buildings at one time and the entrance in thirteen cities.

Years later, in 2001, El Corte Inglés closed the purchase of nine more stores, which had been managed by the British firm Marks & Spencer, among them one on Serrano Street, within the Salamance quarter in Madrid.

Tinsa´s valuation is fairly higher than the only one existing until now, which is the one included in the accounting books, that reached 7578,78 million Euros. When the financial restructuring was announced, El Corte Inglés pointed out that its real estate patrimony was like a “portfolio of assets, located at unique locations, which had a fairly higher market value than the amount of the refinancing”.

Tinsa´s report confirms this declaration. “One of the main features of this portfolio is that these buildings are symbols in their environment and commerce icons in those cities where they are located, mainly due to their location”.

Tinsa´s valuation has not been finished yet. The firm has just finished the total valuation of 80% of the property, whose value reaches 16.000 million Euros. With the rest of the valuation pending, it is estimated that it should add 2000 additional million Euros, which would give out a total sum of 18.000 million Euros.

Once the total valuation has been completed, EL Corte Inglés will share the information with its 25 creditors in order the close the refinancing process of its debt, which reaches 5070 million Euros. The main creditor is Banco Santander, with 1275 million Euros or 25% of the total, although it would have paid off 100 million Euros. CaixaBank follows, with a debt of 754 milion Euros; BBVA, with 705 million Euros and Banco Popular with around 444 million Euros.

The negotiations seem to be on the right path, and according to sources close to the process, the financial institutions see El Corte Inglés as a “perfectly sustainable company” that is carrying out a very important restructuring process as well as the updating of its structure, in order to have a “more solid and well kept” balance. The group presided over by Isidoro Alvarez intends to unify all credits it has with the 25 creditors into one only syndicated loan.

The restructuring process continues its normal procedure and it is expected that a first agreement will be signed in the next few weeks.

With these measures, the company will improve its financing structure regarding costs, deadlines and diversification of financing sources which will allow it to continue its development nationally and internationally.

The financing debt of the group on the short term reaches 2268 million Euros, according to the last accounts, 499 million of which expire this year and 1175 million Euros, in 2014.

El Corte Inglés has also sold non strategic shares which have also contributed with some profit: 1,8% of the air transport group IAG (where Iberia, British Airways and Vueling are integrated) for around 100 million Euros and the 9,9% it had in Inversis for around 20 million Euros. Another great disinvestment  has been the sale of its department store in Plaza de Cataluna, in Barcelona, for 100 million Euros.

Source: Expansion

Casaktua offers 600 properties in the hands of banks with discounts of 75%.

The company specialized in properties in the hands of financial institutions Casaktua has launched a special offer of nearly 600 properties with an average discount of 75% on their initial price, as informed by the company in a statement.

The price for the square meter in this promotion reaches levels of beginning of the 90s. The properties are scattered around Spain and have an average of three bedrooms and a surface of 95 square meters.

Casaktua has put 593 new and second hand properties on sale for a fourth of their initial price, with an average price per square meter of 638 Euros.

 

Source: El Economista

The acquisition of a property is reserved these days to buyers with cash.

 The acquisition of a property can only be achieved these days by very solvent buyers. According to the last figures of the General Council of Notaries Public, only 29,2% of those acquiring a property in May required financing. A percentage that establishes a historic minimum. Also, the financed percentage on the value of the property is reduced to 75,9%.

The number of mortgages destined to the acquisition of a property registered a fall of 30,3% in May and a reduction in its average amount of 10,1% (down to 105.233 Euros), according to the figures of the notaries. In general, the number of mortgages (113.918) decreased by 27,6% annually and the average amount decreased by 11,8% (107.035 Euros).

A contraction in the financing has its effect in the number of purchases of properties (28659 operations) that returned to the red in May (-1,2%) after the increase in April (+12,8%). Although, as indicated by notaries, there is a softening in the pace of contraction that had accelerated last year.

There is also a very diverse behavior between the new properties (-45%) and the second hand ones (+21,7%). The sale of one family houses registered an annual increase of 3,3%

In reference to prices, they seem to moderate their decrease in May with an annual reduction of 7,9%, down to 1218 Euros per square meter. The adjustment of the first five months of the year is of 12,6% in reference to the same period in 2012 and below the 15,2% registered in the last quarter of 2012.

In the case of flats, the price reached 1345 Euros per square meter, experiencing an adjustment of 8%. Those with free prices showed a reduction of 7,9% in the cost per square meter, down to 1364 Euros – the second hand ones decreased by 9,9% while the new ones increased their prices by 11,2%.

Source: Expansión