Month: January 2015

Bami Newco Files For Voluntary Liquidation

30 January 2015 – Inmodiario

Bami Newco, the real estate company controlled by Joaquín Rivero, which filed for bankruptcy in mid-2013, has now filed for liquidation, according to a ruling issued by the Commercial Court number 2 in Madrid. The company, which has debts of €652 million, proposed its liquidation under the Bankruptcy Law, after it was unable to reach a refinancing agreement with its lender banks.

Bami holds assets amounting to €726 million to meet its liabilities, according to a report published by the insolvency administrator in mid-2014.

The company was founded in 2007 after exiting Metrovacesa’s share capital, a real estate company in which Bami become the controlling shareholder following the takeover it launched in 2004.

The new real estate company voluntarily filed for bankruptcy after, at the end of 2012, Rivero and the Soler family also declared bankrupt the companies through which they channelled the stakes (16.6% and 15.6%, respectively) they then held in the French real estate company Gecina. In 2013, they sold the debt linked to those investments, which were guaranteed by Gecina’s own shares, to the funds Blackstone and Ivanhoé Cambridge.

The company voluntarily filed for bankruptcy after failing to reach a long-term refinancing agreement with its bank syndicate that would have given it the financial stability necessary to continue its activity.

The company has a portfolio of office buildings located in the North of Madrid, totalling 127,500 square metres, with an average occupancy rate of 90%, backed by long-term contracts with highly solvent clients, including several Ibex 35 companies. Moreover, the company had plans to construct two buildings in the “Adequa” business park, which would have resulted in an additional 27,000 sqm.

Bami closed 2012 with a loss of €15 million, as a result of the cancelation of its derivative hedges and the impairment loss it recorded on buildings that had not yet become operational.

Despite having paid the interest on its debt on a timely basis since its constitution, and although most of its debts were due to mature this year, the real estate company decided that filing for bankruptcy was essential, since without long-term, stable financing, the business will be unable to develop its property portfolio and carry out its projects.

Original story: Inmodiario

Translation: Carmel Drake

Joe Lewis Acquires 3% Of Colonial

30 January 2015 – El Economista

Lewis teamed up with George Soros in 1992 to speculate on the pound sterling

The English businessman Joseph Charles Lewis has invested in the share capital of the real estate company Colonial, acquiring a 3% stake worth around €58.3 million, based on current market prices.

The business tycoon, who lives in the Bahamas, thus becomes a shareholder of the property management company, whose primary shareholder is the Grupo Villar Mir.

96 million shares

According to records of the National Securities Market Commission (CNMV), Joe Lewis has acquired a pack of 96 million shares in Colonial, which represents 3.02% of the company’s share capital.

Lewis’s investment comes almost a year after the real estate company, led by Juan José Bruguera, concluded a three-pronged restructuring, recapitalisation and debt refinancing process.

Soros’s partner

Joseph Charles Lewis began currency trading in the 1980s and 1990s. In 1992, he teamed up with George Soros to bet against the pound. Together, they forced the devaluation of the British currency, flooding the markets through the sale of more than 10,000 million pounds. The movement, for which they (reportedly) pocketed 1,000 million dollars, rendered the Bank of England powerless at the time.

Original story: El Economista

Translation: Carmel Drake

Engel & Völkers’ Business Grows By 60.7% In Spain

30 January 2015 – La Vanguardia

E&V brokered property sales worth €699.25 million in 2014 compared with €435.1 million in 2013.

The luxury real estate agent Engel & Völker increased its business in Spain by 60.7% in 2014, when it brokered property sales worth €699.25 million, compared with €435.1 million in the previous year.

During 2014, it closed 1,071 sales, an increase of 77.6% on the 603 transactions completed in 2013. Nevertheless, the average sales price decreased by 9%, from €719,759 to €652,894, said the firm.

As for the rental market, the number of homes handled by the firm in Spain increased by 66.4% in 2014 with respect to the previous year, as it closed 724 transactions.

As with house sales, the average price of rental accommodation also decreased, by 7.6%, in line with the trend in the market to amount to €2,305 (per month).

During the course of last year, Engel & Völkers opened 14 new offices in Spain: its Market Centers in Madrid and Valencia; and 12 offices located in San Sebastián, Vigo, Tarragona, Benidorm, Calpe, Denia and in several parts of Madrid, including Conde de Orgaz, Majadahonda, Las Rozas, Alameda, Sanchinarro and Aravaca, amongst others. In addition, 16 new licences were sold.

According to Philipp Neimann, the CEO of Engel & Völker in Europe, the Middle East and Africa, the market in Spain is a key priority for the company at the international level.

Having opened its Market Centers in Madrid and Valencia last year, with a total investment of €4.5 million, the prestigious property firm considers that there are still many business opportunities in the country.

Globally, the Engel & Völkers group increased total income from commissions by 10.1%, to €300.3 million, the highest amount the company has ever recorded in its 35-year history.

In 2015, it plans to employ 2,000 new real estate agents around the world, with Spain and the USA earmarked as the priority markets for the firm.

Original story: La Vanguardia

Translation: Carmel Drake

Construction To Resume In Valdebebas

30 January 2015 – Cinco Días

The Governing Board of Madrid’s City Council has finally approved the “Project for the Economic Redistribution of Plots in Valdebebas”, once all of the necessary administrative processes have been completed. “This is a particularly important milestone for Valdebebas, since it will allow not only for new building permits to be granted once more, but also for a return to normality for the first occupancy licences and building permits that have been already granted; the latter have been affected by litigation claims”, said the team responsible for the complex, located to the North of central Madrid.

Following the administrative decision, construction of almost 1,000 new homes (mostly non-subsidised dwellings) will begin in the next few months, adding to the stock of more than 4,000 homes that have already been built. “In terms of social housing, and once the existing supply of land has been used up, around 350 of the 1,000 new homes will be subsidised”. In addition to this new supply of housing, the urban restructuring will be completed with a shopping centre, comprising 56,000 constructible square metres, and a plot of land destined for private educational use, where the Joyfe Valdebebas College will be built. The parks in the area, which will occupy 1,000 hectares, are due to be opened between March and April.

The plans permit the construction of 12,500 homes, of which almost 4,200 have already been build and a further 800 are in the final phase of construction. Around 5,000 people currently live in Valdebebas, but it is estimated that the neighbourhood will have a residential population of between 30,000 and 40,000 people once the project has been completed. If we add the people that are expected to work in the nearby offices and shops, then estimates indicate that more than 100,000 people will pass through Valdebebas on a daily basis. The average price of non-subsidised housing in the new neighbourhood amounts to around €2,550 per square metre.

Original story: Cinco Días (by Alberto Ortín Ramón)

Translation: Carmel Drake

Wanda’s Plans For Edificio España Get Green Light

30 January 2015 – Expansión

Yesterday, the Governing Board of the Community of Madrid gave the green light to the refurbishment of the Edificio España, owned by the Chinese group Wanda, controlled by the magnate Wang Jianlin.

The businessman, who also owns 20% of the football club Atlético de Madrid, will invest €114 million in the renovation of the property, located in Madrid’s Plaza de España, which it purchased from the Santander Group for €265 million. Inside the Madrid skyscraper, he will create a luxury hotel, more than 300 homes and a retail space, which he plans to expand to 15,000 sqm.

The permission to refurbish the Edificio España has been granted in parallel to the negotiations that the Wanda Group’s team is conducting with the Madrid and central Governments to create a macro-complex on the site of the old barracks in Campamento, in Madrid.

To this end, the Secretary of State for Defence, Pedro Argüelles, met yesterday with the CEO of the Wanda Group, Laurent Fischler, to discuss the purchase of that land, which covers around 200 hectares, and where Jianlin plans to invest €3,000 million in the development of a residential, housing and leisure complex.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Sareb Will Issue €10,189m In Senior Notes On 9 Feb

30 January 2015 – Expansión

On 9 February, the Asset Management Company for Bank Restructurings (Sareb) will issue two sets of senior bonds amounting to €10,188.8 million in total, according to the Official Bulletin of the Commercial Registry (BORME) published today.

In its first appeal to the market this year, Sareb will make two issues, one amounting to €4,084.7 million and the other amounting to €6,104.1 million.

In both cases, the nominal value of the bonds will be €100,000 each and the interest rate will be three-month Euribor plus a spread.

The subscription period, for both issues, will run from 12:00 until 14:00 on 13 February and will terminate on 28 February.

Original story: Expansión

Translation: Carmel Drake

Arcano Hires Fernández Cuesta, Former Chairman Of CBRE

29 January 2015 – Real Estate Press

Arcano, an independent financial advisory firm, has hired Eduardo Fernández Cuesta (pictured above) as a new partner of the Group, as it aims to fully launch itself into the real estate market showing clear signs of recovery.

Fernández Cuesta will lead Arcano’s commitment to the real estate sector, as it looks to create investment vehicles and launches a dedicated corporate finance team for the real estate sector. The division will offer advisory services for corporate transactions in the sector, company mergers and acquisitions, the restructuring of corporate debt and company valuations, amongst others.

Eduardo Fernández Cuesta has extensive experience in the Spanish real estate sector, having worked for 25 years at CBRE, where he was Chairman from 1998 to 2013. Since 2013, he has also served as the Chairman of the Royal Institution of Chartered Surveyors (RICS).

In October last year, Fernández Cuesta was appointed as an independent director of Aena, a profile that fits perfectly with the real estate initiative that the company intends to carry out (……).

Eduard Fernández Cuesta will become the 13th partner of the group led by Álvara de Remedios, Chairman and Jaime Carvajal, CEO. He said:

“I take on this professional challenge with enormous enthusiasm and confidence. Arcano Real Estate offers a great competitive advantage to the real estate sector in Spain, thanks to our team of professionals, the strong reputation that the firm has in the market, and the extensive knowledge that we have about the sector and its main players”.

Arcano, founded in 2003, is an independent financial advisory and asset management company. It has three main business areas: investment banking, wealth management and alternative asset management. It employs a workforce of almost 80 people in its offices in Madrid, Barcelona and New York, and since its creation has become one of the most important independent firms in the Spanish financial sector.

Original story: Real Estate Press

Translation: Carmel Drake

Housing: Rental Prices Are On The Rise In 7 Autonomous Regions

29 January 2015 – Expansión

Trend/ The rental market is showing signs of improvement, after seven consecutive years of decline. Rental prices are increasing again in seven autonomous regions and are now stable in three.

The trend in rental prices is starting to change. After seven years of uninterrupted decreases, there were signs of stabilisation in the market in 2014. Overall, prices decreased by 1.9%, but that represented the smallest decreased since the golden years of the bubble, in 2007. Moreover, rental prices in 10 autonomous regions are no longer falling (they are increasing in seven and stable in three).

Those are the main conclusions of a report, prepared by Fotocasa.es in collaboration with the IESE Business School, about Rental Housing In 2014. “In the space of a few months, we have gone from seeing decreasing rental prices across almost the whole country, to seeing year-on-year increases in seven autonomous communities; furthermore, the scope for further downward movement is now limited in certain other areas”, says the study.

The Balearic Islands led the return to rental increases, with an annual rise of 6.7%. It was followed by Cataluña (6.5%), Pais Vasco (6.1%), the Canary Islands (1.8%), Madrid (0.6%), Extremadura (0.5%) and Valencia (0.2%).

Moreover, for the first time in seven years, none of the autonomous regions recorded rental price decreases of more than -5%. In fact, the sharpest decline was in Castilla-La Mancha (-3.4%), followed by Asturias (-3.2%), Navarra (-2.9%), Murcia (-2.3%) and La Rioja (-2.1%).

“The year-on-year variation in 2014 (-1.9%) is more than three points lower than the decline recorded at the end of 2013 (-5.2%) and it brings us back to pre-crisis levels”, said Fotocasa.

Rental prices in Spain reached their historical peak in May 2007, at €10.12 per sqm per month. Since then, they have declined by 33.1% overall, with Aragon (-42.5%) and Cantabria (-37%) being hit particularly hard.

The report identifies 86 municipalities that recorded rental price increases last year. The most notable increase was in San Sebastián, the city with the most expensive housing in Spain (12.7%), followed by Sant Pere de Ribes (11.7%) and Calvia (11.5%).

In Spain’s two largest real estate markets, the changing trend is catching on more quickly. In 2014, the rental price per sqm increased in 10 of the 21 districts in Madrid and in 9 of the 10 districts in Barcelona.

Madrid and Barcelona

The most notable increase in the capital was in the Retiro district (5.5%), followed by the Centro (5.3%), Chamberí and Salamanca (4.1% in both). And the most marked decreases were in Vicálvaro (-7%), Puente de Vallecas (-5.7%) and Villaverde (-5%).

Meanwhile, in Barcelona, the largest increase in rental prices was recorded in the district of Les Corts (12.9%), followed by Eixample (9.8%), Ciutat Vella (9.4%), San Martí (8.8%) and Sarria-Sant Gervasi (8.5%). The only district to experience a decrease was Sant Andreu (-1.2%).

The most expensive area to rent a home in Barcelona is Ciutat Vella, with a average price per sqm per month of €13.60, followed by Sarria-Sant Gervasi (€13.04). Meanwhile, the most expensive district in Madrid is Salamanca, with an average price of €13.04 per sqm per month, followed by Chamberí (€12.96).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Jianlin Presents His Plans For Edificio España

29 January 2015 – Expansión

The Wanda Group, controlled by the Chinese magnate Wang Jianlin, will invest €114 million on the refurbishment of the Edificio España in Madrid and a further €30 million on the project to regenerate the surrounding area.

The plans of the Chinese businessman Wang Jianlin, owner of the Wanda Group holding company, to convert the Edificio España in Madrid into a luxury hotel, residential and retail complex, take an important step forwards today. The Executive of the Community of Madrid will discuss the modification to the General Urban Development Plan at their Government Board meeting. Following approval by the Town Hall of Madrid, it is expected that the Government of Ignacio González will also vote favourably.

The proposal, presented by the Santander Group (which owned the building until last summer, when it sold it to Wang Jianlin for €265 million) and supported by Wanda Madrid Development (which formalised the purchase of the building before a notary of 30 July) will result in changes not only to the historical building in the capital, but also to the area surrounding it.

Jianlin has committed, together with other businesses, such as the VP Group, controlled by Vicente Pérez, to finance some of costs of the area’s regeneration, which includes the expansion of the pedestrian area (by 12,500 sqm) and the construction of an underground walkway between Calle Ferraz and Calle Bailén. Jianlin will contribute around €30 million of the total €79.5 million to be invested, according to sources close to proceedings. 51% will be borne by the concessionary companies to be awarded the new car park in the area, according to the Town Hall.

In addition to the €265 million Wanda paid Santander to acquire the property and the €30 million it will invest in the regeneration of the plaza, the Chinese group will invest a further €114.085 million in the renovation of the building, designed by the architectural firms Foster and Lamela, which have worked together before on other projects, such as the construction of Terminal T4 at Madrid’s Barajas airport.

Comprehensive renovation

The Edificio España will be fully refurbished on the inside (the building will be completely gutted), whilst on the outside, only the main façade will remain, together with part of the sides and the existing chamfer on the rear façade (located between Calle los Reyes and Calle Maestro Guerrero).

The new project will put an end to the rear façade, designed as a “comb”, which creates five interim patios and provides access to the San Marcos church and the neighbourhood of San Bernardo from Plaza de España.

In addition, the new Edificio de España will have almost 10,000 sqm of underground space, which will be used to expand the parking area, increasing it from its current size of 2,473 sqm to 12,000 sqm, which will result in 318 more parking spaces.

In exchange for the extension of the car park, Wanda must grant 10% of this space to the Town Hall for public use or pay for that space separately. According to the proposal presented to the town hall, the Chinese investor will choose the second option.

The size of the residential area, which will include around 380 homes, and the hotel space will barely change: decreasing from 40,883 sqm to 37,916 sqm in the case of the former and from 22,720 sqm to 22,000 sqm in the case of the hotel.

The main change proposed by Wanda will affect the retail area, whose space will be increased from 3,687 sqm to almost 15,000 sqm. The aim is to create a “large retail space” between the ground floor and the third floor. “We expect to house a variety of retail activity, primarily clothing and accessory stores”, they say in the proposal.

The building work will take place between 2016 and 2020 and it is expected that the homes will be completed between 2019 and 2021. The construction work is expected to create almost 4,000 jobs, between direct and indirect roles. Once completed, 185 people will work in the hotel and retail space in the Edificio España.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Neinver Joins Forces With Colony To Buy 16 Logistics Centres

29 January 2015 – Expansión

The Spanish real estate company Neinver, which specialises in the development and management of outlet centres in Europe, has signed an agreement with Colony Capital to buy 16 logistics platforms mainly located in Spain plus two in Portugal.

The purchase will form part of a joint venture created by both companies to invest a budget of €200 million in the Spanish and Portuguese real estate sectors. According to market sources, Neinver and Colony will have invested around €50 million on their first purchase.

The transaction was performed as a sale & leaseback arrangement, whereby the existing owner transfers ownership and remains as the tenant. These platforms are mainly located in Madrid, Zaragoza, Sevilla, Valencia and Lisbon.

Original story: Expansión

Translation: Carmel Drake