npl-reo Market News: Portuguese Real Estate Intelligence

BCP to Sell Another €110 Million in NPLs and Real Estate
October 27, 2021 – Ana Custódio The Lucia Project comprises NPLs (€60 million) and real estate assets (€50 million). The Portuguese daily newspaper ECO reported that the bank led by Miguel Maya will sell a portfolio of non-performing loans and real estate totalling more than 100 million euros. The Lucia Project comprises NPLs (Non-Performing Loans) worth 60 million euros and real estate assets totalling 50 million euros. Millennium bcp is looking to reduce its NPL ratio to 2.5%, and this is not the only portfolio that the institution has on the market. The bank is also looking to sell the Green Project, which consists of NPLs and REOs in the Algarve luxury resorts Castro Marim and Monte Rei. Assets pertaining to the Castro Marim resort were excluded from the portfolio, apparently due to the low values offered by investors, while the Monte Rei assets were kept. The sale of the Lúcia Project, which includes around 60 million euros in NPL and 50 million euros in REO (real estate owned), is being conducted by KPMG. Translation: Richard D K Turner
The State of the Portugal Real Estate Market in September
In the month that wraps up the summer and the third quarter of the year, investment was robust, mainly in the residential sector. Housing saw the lion’s share of activity throughout the month of September. In parallel with August, which witnessed significant transactions at the beginning of September, with a clear focus on tourism, the Quinta do Lago Sul Golf Course reopened after a 7-million-euro investment. The largest luxury resort in the Algarve, which has been at the forefront of elite golf destinations, has finally reopened to the public after a thorough modernisation. Near the end of September, Fercopor announced that it would launch nine projects in a 190-million-euro investment. The luxury real estate company expects to complete the projects by the end of 2022. Plans include more than 200 luxury homes and a 17-storey office building, focusing on Avenida da Boavista (Porto), Vila do Conde and Lisbon.  Two projects are under construction, and another seven will begin marketing between this year and next. Residential It was just at the beginning of the month when Mexto announced that it would invest €20 million in the Portuguese market by the end of the year. The Swiss real estate developer intends to strengthen its presence in Portugal by investing in second-home projects on the coast south of the capital. Mexto, a specialist in luxury rehabilitation, continues to bet heavily on the Portuguese residential market and plans to invest another €20 million next year. Rio Capital also announced an investment of 8 million euros in the interior of the country. The developer is betting on projects outside Lisbon and Porto and recently announced a new real estate investment. Details of the project in Portalegre will be announced in the coming months. Relying on the agility of the local city council for the necessary approvals, Rio Capital expects to start construction and pre-sales early next year, with completion expected by mid-2023. Meanwhile, INVARIA announced that it had boosted its housing stock by acquiring a PIP-approved plot of land in Lisbon. The deal will allow the Spanish group to bring another 220 flats to the residential market. INVARIA has a developed plot located in Ameixoeira for residential use for sale.  The project also has the approval to convert one of the plots into a student residence. The project, with no revealed values, will consist of 6 distinct plots. With the end of September in sight, the real estate investment fund Maya Capital announced its entry in Portugal via a 65-million-euro investment in residential assets. This is the fund’s Iberian platform’s first deal. The assets include seven buildings located in prime areas of Lisbon, which the company plans to redevelop. The mainly residential portfolio is located in four parishes of Lisbon: Misericórdia, Santo António, Santa Maria Maior and Avenidas Novas. Retirement Homes During the second half of the month, Thor Spain announced that it had begun operations in Portugal, with plans to develop three retirement homes in an investment of more than 30 million euros. The residences, which have 120 beds each, will be located in Setúbal, Guimarães and Algarve. Each project involves an investment of between 10 million and 14 million euros. Thor had previously announced its intention to expand its operations to the Portuguese market. Logistics CORUM announced its acquisition of Nobre’s logistics centre in Rio Maior for an undisclosed amount. The asset has around 9,500 square metres and is the centre of operations for the storage, logistics and distribution of Nobre’s production for Portugal and international markets. Hotels On the last day of the month, Mercan Properties announced the inauguration of the “Casa das Lérias” Hotel after an investment of 7 million euros. Located at the beginning of one of the main thoroughfares in the centre of Amarante, the new hotel offers comfort and elegance on the banks of the river Tâmega. The avant-garde building provides an ample exterior space and a harmonious and relaxed interior, ideal for those looking for a service with modern amenities. Casa das Lérias has 23 rooms, including Deluxe, Duplex, Single and Superior. Alternative Assets The pan-Mediterranean real estate development and investment management company, OptylonKrea, has launched a €150 million fund. OptylonKrea was named General Partner of the venture capital firm Stag Fund Management to launch the new fund. The Prima Europe Fund is aimed at investors seeking to benefit from the Residence Permit for Investment Activity (ARI) regime, the so-called ‘Gold Visas’, by investing in Prima Collection branded residences.
DK and Bain Offer Up to €900m for ECS Portfolio
September 15, 2021 Davidson Kempner Partners and the Bain/Cerberus consortium have already submitted binding proposals to acquire a package of 30 assets from ECS. The sale process, known as Project Crow, involves the disposal of two recovery funds that own hotel properties across Portugal, as well as some land developments and other commercial assets, managed by ECS - Sociedade Gestora de Fundos de Capital de Risco. Davidson Kempner offered €900 million, while Bain offered €850 million to acquire the portfolio. In the negotiations that will follow, the banks will try to get DK Partners and Bain/Cerberus to revise the prices of the assets upwards, or exclude some of these assets, where the price offered is considered insufficient by the banks, says Jornal Económico. Novo Banco wants the sale of all of its assets, which accounted for most of the losses, amounting to 260 million euros. Millennium bcp wants the withdrawal of assets with a value below its balance sheet. Caixa Geral de Depósitos is exposed to the ECS restructuring funds. Santander and Oitante also hold investment units in these funds. The newspaper also reported that the list of assets for sale that make up the Crow project includes the Governor's Palace and nine other NAU hotels in the Algarve and Alentejo. The funds' portfolio also includes other assets such as the La Vie shopping centres in Funchal, Guarda, Porto and Caldas da Rainha. The funds' hotel units that are for sale are all managed by NAU, an operator created by ECS in 2018 to manage the assets and include, in addition to the Governor's Palace, the "Lago Montargil & Villas" in the Alentejo, but also several assets in the Algarve, such as São Rafael Atlântico, Salema Beach Village, Salgados Vila das Lagoas, Salgados Palace, Morgado Golf & Country Club, Salgados Palm Village Apartments & Suites, Salgados Dunas Suites and São Rafael Suites. The submitted bids are valid until October, a deadline that can be extended. The idea is that the decision is taken by the end of the year so that the operation can be closed in early 2022. Translation: Richard D K Turner