Government & Podemos Agree to Allow Town Halls to Regulate Rental Prices

11 October 2018 – Eje Prime

The Government has said yes to public control of the rental market in Spain. The Executive led by Pedro Sánchez (below left) has agreed to the regulation of rental prices by Town Halls, according to explanations provided in a Budget agreement reached on Thursday by the PSOE and Unidos Podemos. The measure is established provided its application is “temporary and exceptional” and is carried out only in those urban areas where there has previously been an “abusive increase” in rents.

Rent has formed the focus of the new Government’s action plan in terms of housing. In parallel to the regulation of prices, the Executive has announced that it will advocate the extension of the minimum term of lease contracts from three years to five, and, in those cases where the owner is a legal entity, the lengthening of the commitment between landlords and tenants to seven years. Moreover, the tacit renewal of contracts will be increased from one year to three, provided the intention to not renew the agreement is communicated by either of the two parties at least six months before it is due to terminate.

In addition, the PSOE and Unidos Podemos have agreed that damage deposits (fianzas) to enter rental flats will be capped at a maximum of two months and that the signing of bank guarantees will no longer be demandable by landlords. In the event that an owner wants to recover his home before the term agreed with the tenant, then that scenario must be formally explained in the contract in force.

More funding for the development of rental housing

The agreement, which will now have to be approved by Congress, includes a measure that supports the development of public housing. In the event that it receives the green light from the chamber, the Government will increase the housing budget for next year to €630 million. In 2020, it will increase that pot further still to €700 million and in 2021, to €1 billion. According to the text, in ten years, Spain will invest between 1% and 1.5% of its Gross Domestic Product (GDP) in public housing.

One of the objectives of the public housing plan is “to avoid “homes” from being sold to vulture funds or sold for a profit”, so as to ensure that “particularly vulnerable people” have the possibility of accessing a rental home.

Original story: Eje Prime

Translation: Carmel Drake

Alpha Pyrenees Sells Alcalá Plaza & Las Torres Shopping Centres

4 January 2018 – ABC Sevilla

Alpha Pyrenees Trust Limited, an investment fund listed on the London Stock Exchange, has sold the Alcalá Plaza and Las Torres shopping centres, located in the Sevillan towns of Alcalá de Guadaíra and Écija, respectively, and with a combined surface area of more than 11,000 m2, through the Andalucían consultancy Realtis Real Estate. The properties were auctioned on 13 November 2017 in Madrid, but the offers presented did not reach the asking price of €1,150,000 for Alcalá Plaza and €850,000 for Las Torres.

Thereafter, a period of negotiations was opened with the interested companies, culminating recently in the Andalucían real estate consultancy Realtis Real Estate completing the sale of the Alcalá Plaza commercial and leisure building, as well as the 39 premises that comprise most of the surface area of the Las Torres shopping centre in Écija. The investment fund has sold the Alcalá Plaza shopping and leisure centre for €655,000 to an Andalucían family business group, whilst the majority of the stores in the Las Torres shopping centre in Écija have been acquired by another real estate group for €500,000.

Both properties were acquired from the Detea group (Bogaris) a decade ago by the fund Alpha Pyrenees, which decided to sell them in the end as part of a divestment process that it has been carrying out with some of its assets in Spain during 2017.

For Gabriel Álvarez and Álvaro Rojas, partners at Realtis Real Estate, “this has been a very complex process due to the particular characteristics of both assets, which means that they could not be treated like the typical real estate investment rental projects that local investors and families are accustomed to. In any case, we are convinced of their real estate potential and possibilities in the future if they are managed efficiently and with an innovative approach”.

Before the auction, Realtis Real Estate drew up an action plan to improve the image and occupancy rates of the shopping centres. As a result, the German multi-national distribution company Tedi and the Domino’s Pizza chain opened their doors in the Alcalá Plaza shopping centre. In terms of the Las Torres shopping centre, as a result of the improvement plan, the toy and homeware company MGI opened its doors in that centre, along with a new store for books and musical instruments.

Original story: ABC Sevilla (by M. J. Pereira)

Translation: Carmel Drake