24/06/2014 – Pere News
In order to revive the real estate sector Spain seeks capital, no matter if it is national or foreign. Moreover, attracting attention of investors fuels gradual shedding the REO property load in banks.
One of the hottest targets in the market are the Socimis – Spanish REITs – that offer truly interesting advantages, especially when it comes to taxation and dividend split. Over one week ago, Merlin Properties announced it was going to aim at raising €1.5 billion in funds at the initial public offering. The amount will be spent on lucrative commercial real estate.
The once crippled banking sector needs capital from many sources and the REITs is one of them. As private equity, hedge funds or credit funds have been unwanted before, now they are welcome as well.
Often, the people responsible for Socimis are ex-executives of private equity firms (e.g. Ismael Clemente who set up Magic Real Estate that manages Merlin´s flotation) or hedge funds in case of already listed Hispania Activos (Quantum Group of Funds, a fund hedge funds owned by Soros Fund Management).
Moreover, the directors prefer to launch a Socimi to establishing a private equity fund. Despite the high risk such IPOs cast, they are the shortest way to the market.
This all makes Spain the most in-demand market in the world right now. Although some may complain about such comptetition, the Spanish Government certainly does not.
Original article: Pere News
Summary: AURA REE