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ECS Capital Hopes to Reap €1 Billion with the Sale of Assets by 2018

11 October 2017

ECS Capital will now sell the real estate and tourist assets it acquired at the height of the financial crisis.

According to the CEO of the venture capital firm, Fernando Esmeraldo, in an interview with the Jornal de Negócios, the aim to raise a total of €1 billion by the end of 2018, taking advantage of the advantageous conditions that are currently prevalent in the Portuguese real estate and tourism market.

The divestment is already underway, and according to the same source, sold ECS about 310 million euros worth of real estate assets and tourism over the last year. Some examples of the recent sales are the Golden Residence (Funchal), Vintage House Douro and Vintage Lisboa hotels, a logistics platform in Azambuja with 50,000 m² of area and the VivaMarinha complex in Cascais.

The pace of sales will intensify from now on, explained the CEO of ECS Capital, whose goal is to raise an additional €700 million by the end of next year. The Herdade dos Salgados (Algarve), the Colombos Resort (Porto Santo), the Governor’s Palace (Lisbon) and three office buildings in the Towers of Lisbon may be among the next assets to exit ECS’s portfolio, though its CEO preferred not to comment on the matter.

Supporting this decision, says Fernando Esmeraldo, is the “improvement in the valuation of assets,” which currently account for 80% of ECS Capital’s portfolio, and “the opportunity to take advantage of the favourable cycle in tourism and real estate.” Also, according to Esmeraldo, the fund needs to “attend to the wishes of our investors,” in this case mainly banking institutions. The fund’s primary investors are Novo Banco (35%), Millennium BCP (35%) and CGD (13%) with the remaining capital dispersed among other financial institutions. The Recovery Fund also has another key investor: the Portuguese Treasury (6%).

Tourism worth almost 1.1 billion in assets

Accounting for roughly €1.1 billion in assets, and about 44% of the €2.5 billion under management, tourism is the sector to which ECS is most exposed and in which it still has a broad set of assets for sale. The assets include 19 hotels, with 2,000 rooms and about 8,000 beds.

Among other assets that include the Colombos Resort and the Conrad Algarve, ECS Capital acquired the portfolio of hotels from the ex-CS group, of Carlos Saraiva, and later created a brand of its own – the NAU Group – under which has grouped several of the hotels it owns.

750 million euros in real estate assets

With an estimated value of 750 million euros, ECS’s real estate portfolio extends over 200,000 m² of gross floor area in residential buildings, 90,000 m² of gross office space and industrial space, and a million square meters of undeveloped area. In the office sector, ECS’s portfolio includes several benchmark assets in the Portuguese capital, such as three of the office towers of the Torres de Lisboa complex, and the new office tower under construction at Avenida Fontes Pereira de Melo, which will provide almost 20,000 m² of ABL, most of which has already been allocated, according to various sources.

Original Story: Vida Imobiliária – Susana Correia

Translation: Richard Turner