5 September 2017 – El Confidencial
House building is continuing to spark a great deal of interest amongst international investment funds. With a positive outlook for future increases in sales – according to BBVA, this year, we can expect to break the threshold of half a million units sold – and prices over the next few years, the sector is under the spotlight. The latest player to try its luck with residential property development is the US firm GreenOak, which has just created a joint venture with the cooperative manager Grupo Ibosa, one of the most active in the sector in Madrid in recent years.
According to sources close to the negotiations, both companies have decided to join forces – their capital and their construction know-how, respectively – to launch a vehicle that will invest primarily in the Spanish residential market, in the main cities in Spain.
Its first project is a residential skyscraper in Isla Chamartín, (…) a small real estate triangle bounded by the M-11, the A-1 and Avenida de Manoteras, in Madrid, where in September last year, Grupo Ibosa purchased a plot of land from Oncisa for just over €30 million. The project will require a total investment of more than €80 million (…) and will involve the construction of a 75m tall tower with 20 floors and two blocks of flats, which will house more than 200 homes. Prices will range between €200,000 and €1 million.
GreenOak is the latest in a long line of large international funds to enter the house building sector. The first to officially make the leap was Lone Star, which purchased Kutxabank’s real estate arm Neinor at the end of 2014 with the aim of turning it into the largest house builder in Spain. The company now has 4,300 homes under construction and owns more than 1 million m2 of land. (…). Another player that stands out is Aedas Homes, the heir of Vallehermoso, which is backed by the Socimi Merlin Properties and the fund Castlelake, and which owns one of the largest land portfolios in Spain (…).
Valdemarín, in the spotlight
According to the sources consulted, Ibosa and GreenOak are on the verge of closing their next joint operation. They are looking at purchasing several plots of land that Blackstone is about to sell in Valdemarín, one of the most exclusive neighbourhoods on the outskirts of Madrid, where detached family homes go for no less than €1 million and prices are experiencing double digit rises.
The plots of land in question, which have been put up for action (…) are divided into 19 lots measuring 450 m2 each (just over 8,500 m2 in total) with auction values ranging between €730,000 and just over €1.1 million. The plots used to belong to Jardines del Hipódromo, a company owned by Inmobiliaria Monteverde, which filed for creditor bankruptcy at the end of 2011.
Grupo Ibosa knows the Valdemarín area like the back of its hand, since it has already managed two projects there. Alhena Valdemarín, comprising 36 detached family homes, which were sold in their entirety in a matter of months last year; and Mirach Valdemarín, a development of 14 detached homes measuring 200 m2 each and costing upwards of €893,000, also constructed under the cooperative regime.
GreenOak, a very active fund in Spain
In addition, before this agreement with Ibosa, GreenOak had already made a small foray into the Spanish residential market, given that in September 2015, it teamed up with the German fund Activum ASG Iberia to purchase c/ Fuencarral, 77, located next to Tribunal metro, from the General Treasury Social Security. That building will house high standing homes and a large retail space. (…).
Original story: El Confidencial (by E. Sanz)
Translation: Carmel Drake