The Listed Real Estate Investment Companies Shake Up The Property Market With €1.500 Million of Purchases

06/08/2014 – El Economista

The influx of the real estate investment companies onto the Spanish stock markets so far this year has caused a flurry of transactions in the real estate sector, particularly intense in recent weeks, with purchases amounting to 1,533.2 million and which inject life into a market which is beginning to show signs of a change.

The listed real estate investment companies (known as “socimis”) have become a very tax-appealing vehicle for taking advantage of the opportunities which the Spanish real estate sector offers, in which prices have experienced a significant decline since the “boom” years, considerably more so than that experienced in neighbouring countries.

This situation is benefitting from a context marked by the market’s high liquidity, fundamentally thanks to foreign investment funds.

The first to debut on the stock market was Lar España Real Estate Socimi, which did so on 5 March with an initial share capital of 400 million.

The real estate investment entity of the Lar Group has announced acquisitions of 171.7 million, mostly shopping centres.

It has purchased the Las Huertas shopping centres in Palencia and Txingudi shopping centre in Irún from Corio for 39.4 million; Albacenter’s shopping centre from Unibail Rodamco for 28.4 million; the Anec Blau shopping centre in Castelldefells (Barcelona) for 80 million and another commercial building in Villaverde occupied by Media Markt for 9 million.

Furthermore, it has acquired an office building in Madrid’s Arturo Soria street for 24.2 million and another 14 floors situated inside the M-30 building for 19 million.

The next company in the sector to make the leap onto the stock market was Hispania, the listed company controlled by fund management group Azora and which is also part-owned by the multi-millionaire George Soros, who subsequently created his own Socimi with which he has made several purchases.

Hispania has taken 90% of the share capital of Oncisa, the real estate company of Once, for 80.2 million; it has purchased 213 homes in Barcelona’s Diagonal Mar park and 237 parking spaces from Banif for 63.8 million; 18,500 m2 of offices in Barcelona’s Glòries shopping centre for 40 million; 4 office blocks and 2 NH hotels in Madrid for 42 million and 199 homes in Majadahonda and the district of San Sebastián de los Reyes for 30 million.

IT has also acquired an office building in the district of Chamartín for 15 million and Marbella’s Guadalmina Hotel for 21.5 million. In total, Hispania has accumulated 292.5 million in purchases.

The socimi Merlin Properties, for its part, on 30 June made the largest listing on the stock market since 2011 with a valuation of 1,250 million.

Since its debut, it has accounted for purchases of almost 1,000 million: the purchase of Bosque y Tree Inversiones (which comprised 880 bank branches and 5 buildings leased to BBVA) for 739.5 million and the Marineda City shopping centre in La Coruña, partly owned by Manuel Jove, for 260 million.

Also making a listing on the stock exchange was Axia, with a valuation of 360 million and which has already purchased 6 properties for 70 million, and Mercal.

The Portuguese management company Norfin, Urbas y Quabit have also shown their intention to go public by launching a socimi.

Original article: El Economista (by Cora Serrano)
Translation: Aura REE

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