Wanda, Merlin & KKR Drive the RE Investment Up to €10.4 Bn

15/10/2014 – Expansion

All the evidence is that the year 2014 will conclude for the real estate sector at the pre-recession levels. During the first nine months of the year, €10.4 billion was invested in assets and companies, reports advisor Aguirre Newman. ‘All kinds of buyers, from vulture funds, through institutional investors, private equity, insurance firms, up to new Socimis (Reits), have been interested in acquiring Spanish property over the last year’, enumerates Alejandro Campoy, Investment director for Aguirre Newman.

Splitting the total amount, more than €4.9 billion corresponds to sale of non-commercial property. ‘In 2013, the total investment amounted to €9 billion, to which €5 billion was deriving from tertiary assets sales (i.e. offices, retails, hotels and industrial/logistic warehouses). By the end of September, the 2013 score has been beaten and we predict that the year will end at the 2006 level as the time on the market was extraordinary’, highlights Mr. Campoy.

Retail Parks

When it comes to the commercial real estate, Socimis like Lar España or Merlin Properties, as well as international funds like Baupost or KKR, altogether invested €1.15 billion in 21 shopping malls. Moreover, Spanish family offices strived at retails putting up €360 million in total (elevated to €1.1 billion if the branches of BBVA bought by Merlin taken into account). Furthermore, there has been €366 million amount spent on logistic warehouses and industrial platforms, while on hotels, €800 million.

Apart from the traditional deals, 2014 saw a great return of products that have been avoided like the plague since the real estate bubble burst: land and residential projects. Thus, €1 billion was injected in land portfolios, as well as in rehabilitation and debt-related assets.

Widely known sales of real-estate-owned property managers of banks (the servicers) have attracted big-name investors. ‘Financial transactions with underlying property (i. e. real estate-backed loan portfolios) revived the market. In total, €4.4 billion was disembursed in debt portfolios and €112 million spent on the servicers, adds Alejandro Campoy.


Original article: Expansión (by Rocío Ruiz)

Translation: AURA REE