KKH Property Investors JV Born to Invest €500 Mn in Madrid & Barcelona Buildings

4/07/2014 – Expansion

International investment funds continue their poach in the Spanish real estate market. Perella Weinberg, a private equity fund from the United States, has just created a joint venture with Spanish firm KKH in order to do a building shopping for €500 million in Madrid, Barcelona and Lisboa. The vehicle received a name of KKH Property Investors, gathering €200 million in own funds supplemented by a €300 million loan.

The New York – based equity manager will inject the amount through its European RE investment arm Perella Weinberg Real Estate Fund II. The vehicle disposes of €1.3 billion in committed funds and has repeatedly acquired property in the other Old Continent countries. It is supported by institutional investors from all around the world, as well as most active sovereign wealth funds and public and private pension funds.

Perella Weinberg will be the majority stakeholder at KKH Property Investors, whereas KKH will hold a small stake in it but will manage the joint venture.

The new company “will initially give priority to development of hotel and high-end residential projects which are most demanded by the international buyers.”

KKH Capital & Property was founded by ex-CEO of Renta Corporación, Josep Maria Farré, in 2012. It is based in Luxembourg and has got an expert delegation team in Barcelona. He assures “the fear and doubts among the foreign investors have disappeared and now they believe in the turning point in the Spanish market.”

At present, KKH Property Investors has assigned €250 million to several ongoing projects. The first three buildings were purchased with an aim of converting them into hotels. One of the properties is situated in downtown neighbourhood Born in Barcelona, very close to the Santa Caterina market.

According to Farré, Perella Weinberg targets buildings which might gain some value in 5-7 year term.


Original article: Expansión (by Marisa Anglés)

Translation: AURA REE