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Renta & Kennedy To Buy & Renovate Building Nr Callao

12 June 2015 – Expansión

The US investment fund Kennedy Wilson and the Spanish real estate company Renta Corporación will invest €11 million in the purchase and renovation of a residential building in the centre of Madrid.

The property is located at number 3 on the pedestrianized street, Calle Póstigo de San Martín, in the area between Puerta del Sol, Plaza Callao and Plaza de Isabel II. It has a surface area of 4,083 m2, spread over five floors, plus an attic and a basement.

In total, the building contains 19 apartments and 2 shops (which each have a basement) and it is partially occupied. The buyers intend to try to free up as much of the property as possible, so that they can completely renovate it and then sell it as separate units.

According to the agreement signed last year between Kennedy Wilson and Renta, the US fund will contribute 90% of the capital and the real estate company, chaired by Luis Hernández de Cabanyes, will finance the rest. Moreover, Renta will also be responsible for negotiating the departure of the current tenants and for renovating and marketing the building, which has always been its traditional business.

The owner of the property on Póstigo de San Martín was a local individual. It is expected that the number of homes will be retained but their distribution will vary. The property will continue to be used for residential purposes, although it may (legally) be converted for other uses, such as for public services or as a hotel.

Renta Corporación, which overcame a corporate bankruptcy last year to return to the stock exchange, has resumed its traditional business involving the purchase, renovation and sale of residential buildings.

Last year, the real estate company generated income of €79 million, compared with €10 million a year earlier and it turned its back on the losses of €13 million it had recorded in 2013, to generate a profit of 5.2 million. Its shares are trading at around €1.50 per share.

Original story: Expansión (by Marisa Anglés)

Transaction: Carmel Drake