Transaction / Assets Seller Buyer € MM
Corestate Buys Old Hall Of Residence In Madrid For €14M
16 November 2016 – Expansión
A new investor has made its debut in the Spanish real estate market. The investor is Corestate Capital Holding, a large investment fund headquartered in Luxembourg, which owns a broad portfolio of assets, mainly located in Germany and Austria. Corteste has combined forces with an investment partner to acquire a former halls of residence, located at number 42 on Calle Juan XXIII, in the Moncloa district, the heart of Madrid’s university area.
Corestate arrived in Spain last year when it teamed up with Inmobiliaria Espacio – part of the Villar Mir group – to launch a jointly owned company called Iberian Corestate Capital Advisors. In September 2015, that company announced that it is going to construct a fifth tower in the Cuatro Torres office complex in Madrid, on Paseo de la Castellana.
The owner of OHL was awarded the plot that runs alongside the four Madrilenian skyscrapers back in April, after the city’s Town Hall decided against building a Conference Centre on the site. The company controlled by Juan Miguel Villar Mir was awarded the concession, which gives it the right to operate on the land for 75 years, after it submitted the highest offer. Specifically, OHL agreed to pay an annual fee of €4 million, outbidding the second-best bid, led by Hispania and Ferrovial, who offered around €2.6 million. The Town Hall had asked candidates to submit bids for an annual fee of at least €1.9 million.
In September last year, Corestate announced that it was going to join the project through the company Iberian Corestate.
It is expected that Iberian Corestate will invest €240 million in the fifth tower project, which will involve the construction of a skyscraper that will house an IE Business School campus and a Quiron group medical centre. Corestate declined to comment on the plans for the Castellana project, but did confirm that it has purchased the Madrilenian hall of residence. According to sources in the sector, Corestate paid around €14 million for the property.
Until now, the asset acquired has housed a Spanish-Mexican secondary school – Santiago Galas de Arce. The building, which has been operating for almost half a century (44 years), will undergo a profound transformation with its new owner, given that Corestate is preparing an ambitious plan to restore the property and renovate the 4,022 m2 space, which will house 260 rooms and 302 beds.
Corestate’s idea is to demolish the existing complex and construct a new building that seeks to be one of the best equipped halls of residence in Madrid. The project will include several services such as a reception and concierge, common areas, such as a restaurant, gym and laundry facilities, as well as recreation areas in the form of patios and terraces.
Original story: Expansión (by Rocío Ruiz)
Translation: Carmel Drake