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BBVA Sells 3,500 Properties To Blackstone For c. €300M

20 February 2017 – El Confidencial 

BBVA has started the year with the sale of the largest real estate portfolio in its history: Project Buffalo. The portfolio contains 3,500 assets, the vast majority of which are finished homes, but it also includes storerooms, garages and retail premises, worth around €300 million in total. The whole package has been acquired by Blackstone.

All of these properties had been foreclosed and so the bank was holding them on its balance sheet. They are located mainly in Cataluña (28%), Andalucía (20%) the Community of Valencia (18%), Madrid (6%), the Canary Islands (6%) and Castilla-La Mancha (6%).

With this move, the entity has fired the starting gun on a year in which experts hope that the financial sector as a whole will accelerate its real estate divestments, not only of loans with collateral linked to properties, but also in the placement of large blocks of finished assets, like in this case.

The new regulatory requirements have represented a genuine revolution for bringing these types of portfolios onto the market. And BBVA has dealt with this change in the rules by engaging its Strategy and M&A team, led by Javier Rodríguez Soler, to be responsible for closing this kind of transaction.

Two-thirds of the more than €20,000 million real estate-related assets on BBVA’s balance sheet are foreclosed assets, whilst the remainder are loans, a clear indication of the importance for the bank of undoing these positions.

In addition to portfolio sales, the entity chaired by Francisco González (pictured above) has committed itself to joining other players in the market as a way of deconsolidating these assets. On the one hand, it is taking advantage of the merger between Merlin and Metrovacesa, by transferring thousands of homes to Testa; on the other hand, it is working with Santander and Popular to create a large bad land bank, which will allow it to also start divesting its land.

Original story: El Confidencial (by R.U.)

Translation: Carmel Drake