Savills IM: Inv’t of €500M per Year Until 2022 Following Purchase of Aguirre Newman

26 June 2018 – Eje Prime

Savills Investment Management (Savills IM) is getting its chequebook out in Spain. The fund manager of the real estate consultancy firm is looking for new investments in the country six months after integrating Zaphir Asset Management into its structure under the framework of the acquisition of Aguirre Newman by Savills. Savills IM’s plans involve investing €500 million per year in Spain until 2022.

According to explanations provided by Fernando Ramírez de Haro, Director of the Savills IM office in Spain, speaking to Eje Prime, the fund manager forecasts building an asset portfolio on the Iberian Peninsula worth €2 billion, up from its current value of €480 million.

The company is now starting an ambitious positioning strategy in Spain, “having completed the integration of Zaphir”. Ramírez de Haro, who leads Savills IM’s office following the corporate operation, served as the Director General of Zaphir since 2007. Savills announced the acquisition of Aguirre Newman in July last year, but the operation was not completed until December when Savills IM integrated Zaphir.

The company is currently analysing investments worth €750 million in Spain, although the group is also considering entering the Portuguese market. Even though in 2017, the company’s most active markets were the United Kingdom, Italy and Japan, the forecasts of Ramírez de Haro indicate that Spain will become the fourth most important European market for the group, behind the United Kingdom, Italy and Germany.

Savills IM’s current portfolio in Spain comprises thirteen assets or projects. Half of them correspond to investments in offices, 25% to retail, 17% to residential and 7% to logistics, according to Ramírez de Haro. One of the most recent operations signed by the group was the purchase, in May, of a hypermarket operated by Eroski in San Sebastián for €48 million.

The executive maintains that the company is looking for opportunities across the four segments, especially in retail and offices. “I do not want to say that logistics is not important, it is and very much so, but it is the segment that is suffering from the most acute shortage in terms of supply”, he said. “In terms of retail, a negative vision is coming from the USA, but for us, that is not the case, provided you look for assets that are not so dependent on online sales, such as retail parks, high street stores, outlets and shopping centres linked to food”, he maintains.

Savills IM combines three types of operations: the first is the management of funds raised in Europe (especially in Germany): the second involves the mandates of global investors; and the third is to support value-added funds in their investments in Europe. Whilst in the first case, the average investment in terms of own funds is between €20 million and €80 million, international mandates tend to be upwards of €100 million and value-added operations typically range between €15 million and €100 million.

The fund manager has a workforce of sixteen people in Spain, fifteen of whom come from the former Zaphir structure and one from Savills IM. The group expects to have 22 employees in five years time.

On the global stage, Savills IM has a workforce of 300 employees and eighteen offices. In 2017, the group recorded transactions worth €5.5 billion: €4.5 billion in Europe and €1 billion in Asia. The company plans to spend €1 billion in own funds in 2018 for the acquisition of new assets in Europe and Asia.

Original story: Eje Prime (by J. Izquierdo & P. Riaño)

Translation: Carmel Drake

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