14 October 2016 – Invertia
Over the last year, there has been a steady flow of Socimis debuting on the stock market, but in 2017, we could see a genuine explosion. According to the registered advisor Armabex, at least 35 Socimis will make their stock market debuts next year, including one company worth €2,000 million.
Overnight, the Socimis have become one of the new kings of the Spanish property sector. Although the corporate structure has existed for decades, the sector underwent a real revolution in 2012, when the Tax Authorities started to allow these companies to not pay corporation tax on their real estate revenues and asset sales and purchases, in exchange for publicly listing and distributing high dividends (the minimum pay-out threshold is 80%).
That led to a wave of IPOs, as companies constituted new Socimis to benefit from the tax advantages and overseas fortunes used the vehicles to enter the maligned Spanish real estate market. In less than five years, 29 Socimis have debuted on the Spanish stock market and Alternative Investment Market (the MAB). But, we could see an avalanche of debuts next year, according to Armabex, a MAB registered advisor and firm that specialises in this niche.
The Chairman of the consultancy firm, Antonio Fernández (pictured above), estimates that in 2017, we could see “no less than 35 IPOs” if market conditions allow. His firm is working on the placement of around fifteen Socimis next year, include one worth around €2,000 million. These types of companies tend to debut at a discount with respect to their book values, which means that the final listed share capital (for that company) may be lower, but even so, the company will be sufficiently large to be able to aspire to join the Ibex 35 and become the second largest company in this segment, surpassed only by Merlin Properties (€3,200 million). The total value of the other 14 companies will amount to around €3,500 million.
Although most of the Socimis that will be created next year will debut on the MAB, Fernández expects that at least three will list on the main stock exchange. The first may involve Acciona, which has been evaluating the placement of its real estate assets for some time now. Meanwhile, the expert confirmed that one listed company and one Spanish bank have already taken the decision to list their Socimis directly on the main Madrid stock exchange. (…).
Original story: Invertia (by Aitor Atozqui)
Translation: Carmel Drake