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Madrid Gov’t Wants To Sell Its Land Next To The Cuatro Torres

24 March 2015 – Expansión

Plans / Tomorrow (Wednesday) is the deadline for bidders to submit alternative plans to the Town Hall for the land where a convention centre was initially proposed.

The Town Hall of Madrid has decided to take advantage of the momentum in the Spanish real estate sector and make a profit from the plot of land it owns next to the Cuatro Torres, land that was severely hit by the crisis.

The site, located just behind the four skyscrapers owned by Bankia, Sacyr, Mutua Madrileña and Grupo Villar Mir, was designed to house Madrid’s International Convention Centre. However, in 2010, once construction work had already begun, Madrid’s Government got into financial difficulties, which put a stop to the project that was going to cost €300 million.

Five years later, the Town Hall of Madrid has launched a tender for the development of this plot and the transfer of the right to use this land for a 75-year period. The deadline for the receipt of offers ends tomorrow, according to the initial plan. However, sources in the real estate sector believe that this date may be extended, since interested parties have barely had a month to evaluate the land’s characteristics and its possible uses.

The land measures 33,325 square metres, with a maximum buildable area of 70,000 square metres. Around 53,000 m2 of this space must be devoted to public use. The remainder, around 17,500 square metres, may be used as a commercial area, but not a large shopping centre. “The special plan classifies the land as a single premises and, as an alternative use, it includes the possibility of devoting the land to the public administrations. Moreover, it establishes a regime of compatible uses, such as recreation and leisure, small and medium sized shops and other tertiary uses besides offices”, say sources at the Town Hall.

The possibilities include the construction of a large educational centre or a hospital. To this end, several investment funds have made contact with companies, Spanish and international, to offer them a turn-key project. That is, they buy the land and construct a building for a company, which then commits to rent it under a long-term contract.

In its award of the land, the Town Hall will take into account not only the financial offer, but also the requirement for the buildings be energy efficient, both during their construction and their subsequent use, and that the architectural appearance contributes “a singular piece to the urban landscape”. The successful bidder will pay an annual fee of €1.935 million.

KPMG

KPMG’s recent move to the Cuatro Torres makes it the latest tenant to occupy offices in the complex. Opened between 2008 and 2009, the Madrid skyscrapers suffered when the (real estate) bubble burst, as its rate of uptake slowed down. Following KPMG’s move, Mutua’s property (Torre de Cristal), which until now had the most space available, will reach an occupancy rate of 70%. Torre Foster, owned by Bankia, is mostly occupied by Cepsa, although the bank itself also uses several floors. Sacyr’s skyscraper is entirely rented out to PwC and the Eurostars hotel, whilst the Torre Espacio has an occupancy rate of close to 90%.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake