26 January 2016 – Expansión
Shopping centres are once again the most desirable assets for real estate investors, together with offices. The decrease in the price of all assets in general and the outlook for the recovery in consumption have placed shopping centres at the top of the list for funds and Socimis once again.
Although the final operations from last year have not been formalised yet, Deloitte calculates that investment in shopping centres amounted to €1,500 million in 2015, a figure than may increase by a further €100 million as a result of the transactions currently being closed, according to a study by its Financial Advisory team.
“29 operations were closed in 2015 and two or three more deals may be added to the list, once the final numbers have been formalised, which would increase total investment by around €130 million”, says Javier García-Mateo, Partner in the Financial Advisory team at Deloitte.
During the 10 months to October, investment in shopping centres in Spain amounted to €1,196 million, which fell below the figure recorded during the same period in 2014 (€2,247 million), but was higher than the amount spent in 2013 (in €867 million). Over the last three years, purchases of shopping centres accounted for around 25% of total investment volumes.
Highlights in this segment in 2015 include: the acquisition of the Plenilunio shopping centre in Madrid, for which the French group Klépierre paid the fund Orion €375 million. Lar España’s purchase of the Megapark in Bilbao, which also came in above the €100 million mark – the Socimi paid €170 million for that shopping centre. “The types of investor are very varied. Socimis and private equity funds are dominating the stage, but private investors are also making sizeable acquisitions in light of the ever lower yields being offered in the market for high street premises”, says García-Mateo.
The progressive increase in the interest for shopping centres has resulted in a decrease in the yield on these operations, which has fallen by 100 points in the last year, to reach 4.75%. As such it is now in line with the yields seen in other large European real estate markets such as Belgium (4.75%) and the UK (4.5%).
Another consequence has been the revaluation of this type of property. In less than two years, some shopping centres have experienced revaluations of more than 20%, says Deloitte.
Another key is the return of bank financing for the purchase of these assets. “The Spanish banks are positioning themselves strongly as financing sources against the funds of debt that have been financing shopping centre purchases until now”, added García-Mateo.
Original story: Expansión (by R. Ruiz)
Translation: Carmel Drake