Vivenio Partners With Áurea Homes to Build Rental Housing

24 October 2019 – Áurea Homes, the developer owned by the construction company ACR, has reached an agreement with Vivenio to build a turnkey project with 150 homes in Móstoles. Áurea had initially owned the land, but it sold it to Vivenio after having completed the first phase.

This operation will be Áurea second in the rental housing segment. The developer is also about to finalise an agreement to build another 400 rental rent homes in four new developments, including two in Madrid, one in Pamplona and one in Sabadell.

With this operation, Vivenio’s property portfolio will total nearly 5,000 homes.

Original Story: Cinco Días – Alfonso Simón Ruiz

Adaptation/Translation: Richard D. K. Turner

Neinor & Vía Célere Lead the Ranking of Forecast House Deliveries for 2019

28 January 2019 – Cinco Días

Year after year, the new major players in the house construction sector are seeing the numbers in their growth plans increase. During 2019, the largest property developers created since 2015, and some of those reborn from the ashes during this latest upwards cycle, are expected to approach their cruising speed, above all, the listed companies Neinor, Aedas and Metrovacesa, which have been called to lead the residential construction sector together with Vía Célere. Even so, the sector is still very fragmented with lots of small companies.

Neinor Homes and Vía Célere have become the two entities with the largest number of home deliveries this year. In both cases, 2,000 clients will receive the keys to their homes, according to figures provided to Cinco Días by around twenty property developers. In these forecasts, the companies have detailed three concepts for their plans for 2019: homes that they will launch onto the market, homes that they will start work on and forecast deliveries.

Neinor Homes, created in 2015, and led by Juan Velayos (…) expects to start work on 3,000 homes this year, coming close to the cruising speed that it defined during its IPO, and it will start to market another 2,000 units.

Meanwhile, Vía Célere, controlled by the US fund Värde Partners, is in the middle of integrating the assets of Aelca, the other property developer owned by Värde, which has now emptied its portfolio (…). It is the only one of the large players that is not yet listed on the stock market; its plans in that regard were postponed last year.

The listed firm Aedas, also created in 2017 with land from another US fund, in that case, Castlelake, is also perceiving an upwards turn in its numbers. This year, it will hand over 1,055 homes, start marketing 2,500 homes and start building 3,000 homes, just two years after first appearing on the stage, with David Martínez as its CEO.

Meanwhile, Metrovacesa, the other large listed company, controlled by Santander (and in which BBVA holds a minority stake), clearly leads the business plans, with up to 4,500 homes to be newly marketed and whose construction will be launched. This one-hundred-year-old real estate company, which was cleaned up by the banks following the crisis, launched its new project in 2017 with Jorge Pérez de Leza, from Grupo Lar, as the CEO.

In terms of those entities backed by funds, the rescued firm Habitat also stands out, reactivated last year by Bain Capital, and which is planning to market 3,000 homes this year. Similarly, Cerberus took control of Inmoglacier in 2017 (…). That firm declined to provide its forecasts to this newspaper, but it is also set to play a significant role, given that it has become one of the real estate arms of the US fund, one of the most active in the purchase of assets from the banks and which also owns Haya Real Estate as its servicer.

The group of twenty-odd companies consulted will hand over almost 16,000 homes this year, will start work on 34,000 units and will begin marketing another 30,000 properties. These figures reflect the enormous fragmentation in the sector, which in the last 12 months has started 103,000 homes in total, according to figures from the Ministry of Development as at October 2018.

Small specialist property developers still carry a lot of weight, unlike in other countries where large players exist. Moreover, even though the rate of residential construction has taken off since 2014, it is still well below the peak of 2006 when 865,000 building permits were granted.

In terms of the new players also boosted by the international funds, they include other developers with a high rate of house sales: AQ Acentor (owned by the German fund Aquila), which is going to put 1,700 homes up for sale; Kronos Homes (backed by several European and US investors), which will market another 1,600 homes; and ASG Homes (backed by the British firm ActivumSG), which plans to add another 1,000 homes.

In terms of the survivors of the crisis, Amenabar stands out, the Gipuzkoan company, which expects to start work on 3,608 homes next year and to hand over 1,245 units. Another of the stalwarts is the Madrilenian firm Pryconsa, owned by the Colomer family, which has already reached a high number in terms of house starts: 1,285. In more modest terms, other important firms include the Basque entity Inbisa and the new entity Áurea Homes, the residential subsidiary of the Navarran construction group ACR (…).

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

ACR: Construction Costs Rise by 10.3% in 2018

28 November 2018 – Eje Prime

Construction, at the price of gold. The costs relating to residential construction increased by 10.3% in 2018, according to the second edition of the Direct Construction Costs Index published by the ACR group.

In this way, the upward trend that started in 2015 is continuing, mainly due to the exponential rise in the cost of labour and the slight upturn in the price of materials. The data provided by the property developer reflects significant growth in the most representative items of buildings such as, for example, the façades, internal divisions and structure.

For Michel Elizalde, CEO of the ACR Group, “the sector must react to this reality and look for solutions that help to alleviate the effects of such a volatile scenario”. According to the executive, the solution involves “finding more collaborative contractual formulae with clients; seeking more stable relationship frameworks; embarking on training so that professionals are prepared; and taking determined steps towards the industrialisation of components and processes”.

Original story: Eje Prime 

Translation: Carmel Drake

ACR Acquires Land in Sevilla for €5M to Build 157 Homes

29 May 2018 – Eje Prime

ACR is launching operations in Andalucía. The real estate group has invested €5 million in the purchase of a plot land in Sevilla, its first project in the autonomous region. Spread over three developments, the company is going to build 157 private family and cluster homes.

ACR’s property developer division has acquired a plot measuring 22,000 m2 in the municipality of Mairena del Aljarafe, very close to the Sevillan capital. In that town, the real estate group is going to build family homes with four bedrooms, two garages each and a private garden, as well as a communal swimming pool. Meanwhile, the apartments will be distributed over two six-storey blocks and will have between two and four bedrooms, according to explanations provided by the company.

The first development will comprise 48 homes; the second 69 homes; and the third will be the smallest with 40 homes up for sale. The project in Sevilla will serve as the launch pad for ACR in Andalucía, and the firm is already considering new purchases as part of its national expansion objective. Levante is another “established market”, which is of interest to the group. Currently, ACR has 2,000 homes in its development portfolio.

Original story: Eje Prime

Translation: Carmel Drake

Arrasate & Ibosa: Favourites in the Bid to Build Bilbao’s Star Residential Project

28 May 2018 – Eje Prime

Up to eight property developers are willing to pay between €30 million and €50 million to build residential properties in Bilbao. The two favourites in the battle are Arrasate and Grupo Ibosa, which have submitted two of the highest offers for this housing plan, which forms part of Project Garellano and which is being managed by Bilbao Ría 2000.

One of the key factors behind Arrasate and Ibosa’s strong chances of winning the tender is that both have the architect Richard Rogers in their project, which gives them an extra 5% in their scores. The vast majority of the score (75%) in the auction corresponds to the economic offer, and the remaining 20% relates to the assessment of the business plan and the construction, according to El Confidencial.

The future tower will be 119 m tall and will comprise 36 storeys in which 200 homes will be constructed. The location of the residential property will be prime, given that it is being built right in the heart of the city.

The plot that the public company Bilbao Ría 2000 has put up for sale has a surface area of 2,247 m2 and a buildability of more than 25,000 m2. The building will also have five underground floors with 235 parking spaces and storerooms for its future inhabitants.

In addition to Arrasate, a Basque cooperative manager (…) and Ibosa, the company led by Juan José Perucho, other companies participating in the auction for this development include the listed company Neinor Homes, ACR and a JV between the Madrid-based property developer Pryconsa and the local firm Amenabar.

Original story: Eje Prime

Translation: Carmel Drake

ACR: Residential Construction Costs Rose by 12.1% YoY in 2017

25 January 2018 – Cinco Días

The rate of inflation in the house building sector is causing concern. That has been reflected in recent months not only by the trade association but also by companies in the sector and other entities such as Sociedad de Tasación. On Thursday, some of the first data evidencing this phenomenon was published. Over the last year, to December 2017, the cost of residential construction rose by 12.1%. That is reflected in the recently created Index of Direct Construction Costs, prepared by the Navarran construction group ACR.

The index also shows that the increase has amounted to 17.5% over the last two years. The figure indicates that in 2017, these costs grew dramatically and that they accelerated. “Costs mainly grow for two reasons, a shortage of labour and a lack of manufacturing capacity in trades such as structures and façades”, said Michel Elizalde, CEO of the ACR Group.

The company has obtained this data from its construction sites in Madrid and is convinced that the inflationary figures can be extrapolated to other companies in the sector and to other regions such as Barcelona, Málaga, País Vasco and Zaragoza, where the housing market has reactivated.

Nevertheless, at the level of the general Spanish market, that rise is not being reflected in the most active areas. The statistics from the Ministry of Development indicate that in October 2017 (latest available figures), the cost of residential constructions had risen by 5.5 points since 2010. Sources at ACR report that the minimums were recorded in 2012 and 2013 after prices had been contained and have only been starting to rise since 2016.

“There is more tension when it comes to labour costs”, acknowledged Elizalde, basically due to the lack of qualified professionals in certain trades such as framers and rebar workers, according to ACR, as well as those involved with bricklaying, experts in partition walls, façades, flooring, tiling and carpenters. That causes teams and subcontractors to change construction site in the middle of house building projects if another company offers to pay them more.

“Contractors are suffering from this situation,” said the Head of ACR, given that property developers are contracting turnkey projects with fixed costs and the construction companies are, in turn, those who are suffering from a lack of professionals.

“There is a shortage of trained professionals because many of those who left during the crisis are not coming back or have now retired”, said the director.

In YoY terms, prices have increased by the most in glass making (25.2%), façades (15.4%), earth moving (15.6%) and structures (13.4%).

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Stoneweg Still Has €200M To Invest In Spain

10 November 2017 – El Economista

The Swedish real estate investment platform Stoneweg, founded at the beginning of 2015 by the Spaniards Joaquín Castellví (pictured below, left) and Jaume Sabater (pictured below, right) in Geneva, has an investment plan for Spain amounting to €750 million. “So far, we have spent €550 million and our intention is to continue looking for opportunities in Madrid, Barcelona and along the coast, to spend the remaining balance that we have left of the €200 million”, explains Castellví.

Both partners left the bank Edmond de Rothschild to embark on this new venture, which, in just two years has established a presence in Italy, the USA and Switzerland, as well as in Spain. In the latter, its strategy is based on property development, including both new build and renovation projects, primarily residential, which currently account for 89.5% of its portfolio. In this way, the firm is currently working on the construction of 1,600 homes and “between October and November, we will be delivering the first units”, said the Director. He added that in the case of Madrid, the firm is looking for opportunities in the centre, in neighbourhoods such as Moncloa and Arguelles, “where there is a latent demand for a type of product that has not been built for many years”.

Stoneweg’s latest project in the centre of the Spanish capital is in the former Provincial Court building in Madrid, located on Calle Ferraz, where it is going to build 25 homes. “We have already started to market the homes and in the first week alone we have sold five units”, said the Director, who points out that the prices in other neighbourhoods, such as Salamanca and Chamberí, do not fit with their strategy, since they are looking for average returns of between 15% and 20%.

In its residential business, Stoneweg is also working by means of one-off partnerships with other property developers. Such is the case of its largest operation in Móstoles, where it has purchased a plot land for 300 homes together with ACR.

Also positioned in offices

The firm also holds positions in the office sector. In Barcelona, in fact, it is working on the largest business development in the city, the Luxa complex, comprising two buildings, which have already been pre-leased to Amazon and WeWork. “We sold those two properties to Catalana Occidente and we are now searching for a tenant for the WIP building, also located in 22@, measuring 4,500 m2. Once it has been leased, we will put it up for sale”.

The Director is optimistic because he acknowledges that “clearly, all the noise and uncertainty that we are currently seeing in Cataluña is not having any effect; we continue to have faith in the fundamentals of the city (…)”.

Original story: El Economista (by Alba Brualla)

Translation: Carmel Drake

Allegra & ACR Invest €130M To Construct 600+ Homes

27 September 2017 – Expansión

The construction and real estate group ACR and its partner Allegra Holding, the investment arm of the Losantos family (former owners of Riofisa) have expanded their alliance in the Spanish real estate sector, with three new operations.

The partners have recently acquired three new plots of land, one in Madrid and the other two in Pamplona, with a combined surface area of 45,000 m2. In the case of the first, the plot of land is located in Vallecas, measuring 10,000 m2, where they plan to build 100 private homes, with an estimated investment of around €19 million.

In the case of Pamplona, it represents the first operation outside of the Community of Madrid. Specifically, ACR and Allegra have acquired two plots of land in the El Ensanche area, where they plan to construct between 120 and 140 2-, 3- and 4-bedroom homes.

These latest operations follow others undertaken just a few months ago, when the joint venture between ACR and the firm led by Mario Losantos invested more than €29 million in land, also in Madrid, specifically, in the El Cañaveral district.

In total, both companies have invested €130 million to build more than 600 homes, under the brand Nature. “It is a successful alliance that is continuing to make progress and it demonstrates the strong performance of both companies in the market, which is allowing us to continue evaluating new investment alternatives in Madrid, but also in other locations such as Barcelona, Málaga and Levante”, explains David Botín, Director General of Real Estate Development at ACR Grupo.

After years focusing on international real estate markets such as London and New York, the family office led by Mario Losantos returned to Spain three years ago, to invest in plots of land for residential use and to build homes on them. In its first operation, in February 2014, and in partnership with ACR Grupo, they invested around €19 million in the construction of 96 homes on a plot in the north of Madrid. A year later, they started work on 42 exclusive homes in the Puerta de Hierro area.

Beyond the residential segment, Allegra has also invested in office buildings, logistics platforms, as well as commercial premises in Castellana.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

The RE Kings Are Building Thousands Of Homes In Spain

18 September 2017 – El País

The house building sector in Spain is back after a decade adrift during which many of the large firms went to the wall (…).

But the same crisis (that harmed so many) has also given rise to a new, more institutionalised house building sector, which claims to have learnt from the mistakes of its predecessors (…).

In this new industry, there are some familiar faces, such as Realia, Quabit, Amenabar, Pryconsa, Ferrocarril, and ACR, amongst others (…). But the market now is dominated by new firms. They are the new generation of property developers, or rather, they are real estate giants, and their names include Neinor Homes, Vía Célere, Aelca, Aedas Homes and Kronos, poised to ride the new wave in the residential sector. Ahead, they face some major challenges, such as facilitating housing for young people, cutting costs, the industrialisation of the sector, putting clients first to avoid the errors of the past, and improving the image of the sector by being intolerant to all forms of corruption.

At the helm of these giants are overseas investment funds, which have chosen to back the Spanish residential market, with the economic cycle in full swing – new build permits rose by 29% in 2016. These foreign players are investing thousands of millions of euros in the purchase of large portfolios of land, at still low prices, in strategic locations and they are benefitting from low construction costs, at least for the time being. In this way, the funds have engaged managers with extensive experience in the traditional property developers to lead these firms, such as Juan Antonio Gómez-Pintado (Vía Célere) and David Martínez (Aedas Homes), amongst others (…).

The firms themselves talk about reaching a cruising speed of between 3,000 and 4,000 new homes per year (per firm) over the next three years (…). The largest 50 property developers and managers by volume of homes sold (based on completions due from 2018) “plan to build around 45,000 homes over the next three years”, according to Raúl Templado, at Alimarket Construcción. This figure is low if we consider that various trade associations, such as APCE and CEOE, calculate that Spain needs 150,000 new homes per year to ensure a healthy residential market.

That is why international funds are so interested in doing business in a sector that, despite its sharp decline – the number of housing permits represents less than 10% of the level in 2007 – “continues to carry significant weight: 15% of domestic GDP” (…).

Foreign capital

The arrival of foreign funds, such as Värde Partners, Lone Star and Castlelake, has been like a breath of fresh air. “They have provided strategic vision and they made the decision to invest when we were still in a bearish cycle, identifying opportunities and giving credibility to a sector that was and still is attractive for investment, when nobody else was interested. On the other hand, their way of working with a more financial vision has resulted in structural and organisational changes that before were not considered”, says Gómez-Pintado (…).

The result is a sector in full transformation, where movements are happening non-stop, and so it is hard to know who is leading the market. The Institute of Governance and Applied Economics, an independent research centre, calculates that the largest 20 property developers in the country will build 80,000 homes between now and 2020. Their ranking is led by Metrovacesa, Neinor Homes and Aedas Homes, although family groups, local businesses and cooperative managers also feature (…).

Original story: El País (by Sandra López Letón)

Translation: Carmel Drake

ACR Emerges From The Crisis Thanks To RE Recovery

20 May 2016 – Expansión

After the slump of 2013 and 2014, the Spanish construction company ACR, which specialises in the construction and development of residential housing, has experienced significant growth thanks to the recovery of the real estate market in Spain. “The residential construction segment has clearly improved”, said Michel Elizalde (pictured above), the CEO of the company, which saw its turnover soar by 45% in 2016, to reach €130 million.

The fruits of 2015 (€100 million in new contracts) have contributed to increase the size of the portfolio to €125 million, of which only 10% comes from abroad. Spain, unlike the trend in other construction companies, has offset the irregular nature of the business overseas. ACR is withdrawing from France and is analysing Colombia very carefully, where it is starting to feel the lack of projects due to the difficult economic situation, driven by the unfavourable exchange rate versus the euro, the decrease in the price of oil and in fall in prices of raw materials. “Our international expansion is costing us more than we expected it would when we launched the initiative in 2011”, acknowledges Elizalde. ACR will continue to analyse opportunities in Colombia, but it will abandon the French market, due to the barriers to entry against foreign groups and the different culture there in terms of contracting suppliers.

ACR performs most of its work for third parties, and the remainder relates to developments in different cities, primarily, in Madrid and Barcelona. Currently, the group has around 1,900 homes under construction. According to ACR, the factor that has most contributed to the mobilisation of the Spanish residential market has been the entry of new investors, primarily investment funds, which require the support of groups with experience in construction to develop their projects. “In addition, there was pent-up demand, which is now flourishing, although we are still a long way off the production speeds of 100,000 homes per year”.

ACR, with a controlled debt of €26 million, expects its turnover to reach €140 million this year, on the basis of its performance during the first four months of the year. “We are evolving from a real estate construction firm into a project management partner”, said the CEO of ACR.

Elizalde gave the example of his firm’s agreement with the fund Allegra to develop two housing complexes in Madrid.

Original story: Expansión (by C.Morán)

Translation: Carmel Drake