28 December 2015 – Expansión
International funds are starting to invest in the residential market. Whilst their first acquisitions (in Spain) involved offices and shopping centres, now many investors are interested in purchasing homes and land for development. Such is the case of GreenOak. This US fund has just completed the purchase of the building at number 77 on Calle Fuencarral in Madrid. The property, measuring around 8,000 m2 in total, contains homes and offices covering a surface area of around 6,000 m2; the ground and first floors are occupied by a shopping arcade measuring more than 2,000 m2.
The aim is to completely renovate this property to convert it into homes. “Our aim is to offer a quality asset at an attractive market price. We do not know the details of the project yet, but it will be high quality, in keeping with the neighbourhood and bearing in mind the (needs of the) residents of Chueca and Malasaña”, explains Javier Zarrabeitia, partner at GreenOak in Spain.
The fund, which opened its office in Madrid this summer, having channelled all of its investments until then from London, has invested €21 million on the purchase of this building. “It is the first time that we are developing a property in Spain, but we have already undertaken similar projects in Los Ángeles, New York and London. We are a team of 60 people and we all get involved in these types of projects”.
This is GreenOak’s first residential project in Spain, a market in which it has been particularly active in recent months. “We have invested more than €400 million this year and we have the capacity to invest €700 million”, says Zarrabeitia. “We have closed 18 operations this year, and have been heavily focused on the logistics segment, where we now own 350,000 m2 of surface area, primarily in Madrid, but also in Bilbao. We have also purchased four buildings in the Avalon de Madrid complex, another one in La Moraleja and one in Barcelona, as well as the Sevilla Factory shopping centre, with a surface area of more than 16,000 m2”.
The key to this investment whirlwind is the fund’s capacity to invest in operations of different sizes, explains its CEO. “Our smallest investment in Spain amounted to €8 million and the largest will amount to around €40 million, but our capacity is unlimited, and we invest in volumes where the Socimis and other funds do not operate, which gives us a niche to be competitive”.
Next year, the fund will continue closing operations in Spain. “We believe that it will continue to be possible to raise capital for Spain: with very low interest rates, a significant decrease in prices, sellers with needs and growth in the country thanks to the low euro, we expect to see the restructuring of the labour market and banking sector, as well as a recovery in tourism”.
Original story: Expansión (by Rocío Ruiz)
Translation: Carmel Drake