Habitat Purchase: Bain Looks Set To Pip Apollo & Oaktree At The Post

16 November 2017 – El Confidencial

Provided nothing goes wrong in the next few hours, tomorrow, Bain Capital will be the party chosen to buy Habitat, after the US fund submitted an offer that values the real estate company at around €225 million, according to confirmation from several sources in the know.

Its proposal has been valued as the best by Irea, the firm contracted to lead the sale process. And it is looking likely that, on Friday, the owner funds of Habitat – Capstone, Goldman Sachs, Bank of America, Värde and Marathon, amongst others — will endorse its opinion.

With this step, Bain will create a new real estate giant in Spain and follow in the footsteps already taken by other large investment vehicles such as Lone Star, which created Neinor, Castlelake, owner of Aedas and Värde, owner of Vía Célere.

In fact, Bain was on the verge of acquiring the company founded by Juan Antonio Gómez-Pintado, but a failure to align economic expectations undermined that operation and left the path open for Värde, which had previously acquired San José Desarrollos Inmobiliarios, to purchase the property developer.

Far from throwing in the towel, Bain has continued to insist on its strategy of acquiring a platform on which to build a large real estate company with the assets that it has been acquiring in Spain. It has purchased several non-performing loan and real estate asset portfolios from the banks, amounting to almost €2,600 million in total, although the investment made by the fund, which specialises in opportunistic operations, amounts to just one-third of the nominal value of those portfolios.

Most of the assets and collaterals acquired are residential, although Bain’s portfolio also includes properties dedicated to hotel, industrial and commercial use located all over Spain. The land and developments of Habitat, at the end of 2016, the most recent full financial year, amounted to just over €1,000 million, but its provisions of €848.5 million reduce its net valuation to €238 million.

One example is the recent purchase of €602 million in real estate assets from Liberbank, which it acquired in partnership with Oceanwood, for a discount of 65%. This operation also forms part of Bain’s accelerated plan for growth in Spain, where its objective is to get on the wave of recovery in the Iberian residential market.

Besides Spain, the fund has its sights set on Portugal, where a similar upward movement is expected, similar to that already seen in Spain over the last year and a half. In fact, in the summer, it made its debut in the country with the purchase of a portfolio of non-performing loans and real estate assets from Caixa Geral, an operation that was closed almost in parallel to the purchase of a €489 million portfolio of non-performing loans to property developers from Ibercaja.

Italy is the other market where Bain has now taken some important steps with the acquisition of a portfolio of €385 million in non-performing loans backed by real estate assets, as well as of the bad bank Heta Asset Resolution, with a portfolio of €570 million.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

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