Tag: Adequa business park

Which Players Will Shape The RE Sector In 2017?

5 December 2016 – Expansión

The end of 2016 will mark not only a new record in terms of real estate investment in Spain, but also the start of a new phase in the sector, after three years of recovery.

“In mid-2013, funds like Blackstone started to close operations, at a time when the market was completely paralysed. That prompted a magnet effect, which, together with the creation of Socimis and the reorganisation of the banking sector, launched the recovery of the sector”, said Adolfo Ramírez-Escudero, President of CBRE.

Thus, after closing last year with an investment volume of €12,884 million, the expectation is that the figure will reach €13,900 million by year end 2016. “We may reach record investment figures by year end, as new property owners, with a more institutional profile, enter the market, such as German investment funds, insurance companies, etc.”, he said.

The investment figure may be maintained next year if corporate operations continue, say sources at the consultancy firm. “We are living in a different Spain, with GDP growth of 3.2% this year and forecast GDP growth of 2.5% next year. That has a direct correlation with employment and, therefore, with real estate”, said Ramírez-Escudero.

For this new phase, one of the most important players will be the large Socimis, which have continued to close operations this year, but in a more measured way as they have been more focused on managing their properties; as well as German funds, such as Invesco Real Estate and the real estate division of Deutsche Bank.

Nevertheless, these more risk-averse investors will share the stage with another kind of player in the Spanish real estate sector in 2017. “We are pretty convinced that there is going to be a new property developer cycle, given that the real estate companies have now been established, with new capital. Next year, the property developers will be building new products”, said the Head of CBRE.

Residential segment

These new players will include Neinor Homes. The real estate company, created by the fund LoneStar with the former subsidiary of Kutxabank, has become a key player in the property development sector, with projects underway across Spain. In 2017, the company led by Juan Velayos will debut on the stock market, whereby restoring the profile of property developers, such as Martinsa Fadesa and Reyal Urbis, which fell from grace following the burst of the bubble.

Another player in the residential sector will be Avantespacia. The new real estate company, in which Inveravante (Manuel Jove’s company) owns a 70% stake and Anida (BBVA’s real estate arm) owns a 30% stake, will promote almost one thousand homes during its first phase of development. Its first project in Málaga, with 135 properties, is already being sold, whilst in Madrid, the new company is preparing a development in the Francisco Silvela area.

But development will not only be happening in the residential segment, major projects are also planned for the office and shopping centre segments. In the former, Merlin Properties is expected to play an important role. Spain’s largest Socimi is currently working on the development of an office building in the Isla Chamartín area, in the north east of Madrid.

In addition, it has just completed the purchase of the Adequa business park, a complex that comprises four office buildings and a shopping area, with space for the construction of a 24-storey skyscraper, with a total surface area of 29,000 m2.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Merlin Given Green Light To Build Skyscraper In Las Tablas

11 November 2016 – Cinco Días

The Socimi Merlin Properties has been given the green light to add an important office complex to its already gigantic portfolio of real estate assets. The company has just completed an operation to purchase the Adequa business park in Madrid, in a transaction agreed over the summer with the fund Lone Star, for which it will pay €380 million.

According to sources in the market, the one outstanding item on the Socimi’s to do list was to obtain a construction permit to allow it to build an office block, measuring more than 100m tall, in the Adequa business park, which currently comprises six buildings.

As soon as the Socimi led by Ismael Clemente (CEO) obtained the permit, it paid €310 million to the fund plus another €70 million to complete that milestone, explain sources in the sector.

The US fund Lone Star put the business park up for sale in the spring of 2016. It was awarded the asset after agreeing to take on the debt of the now inactive company Bami Newco. That real estate company, created by the late Joaquín Rivero, filed for liquidation last year after going bankrupt with debt amounting to €652 million.

The former property developer had already drawn up plans to build the tower, which will require an investment of between €70 million and €75 million from the Socimi. The skyscraper will add office space of around 29,000 m2 to the business park. In addition, another adjacent building will be built, with a surface area of around 15,000 m2. Construction work is expected to begin in 2018 and terminate at the end of 2019.

Adequa currently has a surface area of 121,000m2, spread over six office buildings, as well as a centre for services and commerce (5,000 m2), which houses a gym, restaurants, a nursery and three padel courts.

The business park is located on Avenida de Burgos, at the entrance to the Las Tablas neighbourhood and is very close to BBVA’s new headquarters. It is home to the offices of Renault España, Técnicas Reuidas and Costa Cruceros, amongst others.

This is the first major operation undertaken by Merlin Properties since it completed the absorption of the historical Metrovacesa last month. The Socimi, created in 2014, now owns assets worth €9,600 million, which make it one of the top 10 Socimis in Europe. (…).

Santander, which used to be the largest shareholder of the former Metrovacesa, now controls 22.3% of Merlin; meanwhile, BBVA owns a 6.4% stake. The Socimi’s original shareholders include the fund Principal Financial Group, which retains a 3% stake.

Merlin, which is now chaired by Rodrigo Echenique – Vice-President at Santander – is also working on the development of another office building in Madrid, on the so-called Isla Chamartín, very close to Adequa, by the junction of the A-1 and M-11 motorways.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

CBRE: RE Inv’t Amounted To €6,191M In YTD Sept 2016

3 October 2016 – Expansión

After two years of record breaking figures, the Spanish real estate sector is heading into the final stretch of the year with more modest forecasts. According to a report prepared by the real estate consultancy CBRE, investors spent €6,191 million buying real estate assets during the first nine months of 2016. That figure represents a 21% decrease compared to last year and is 11% lower than the level recorded during the same period in 2014.

Nevertheless, the amount has been very well received in the sector, given that the last two years have been regarded as “exceptional”. “The trend is still very strong, investors are still putting their faith in the Spanish real estate sector, given the lack of other types of alternative investment options and because real estate in the rest of Europe is very expensive”, said Lola Martínez, Director of Research at CBRE.

This optimism is reflected in the forecasts for the year end close, which are expected to amount to between €8,500 million and €9,000 million. “If we exclude the value of Metrovacesa’s assets to be included in the upcoming merger with Merlin, the year will close in line with the forecasts, thanks to several large-scale operations that are expected to be signed during the last quarter”, said sources at the consultancy firm.

Operations in the pipeline

In this sense, they highlighted Amancio Ortega’s purchase of Torre Cepsa on Friday for €490 million; the sale of the Adequa business park in Las Tablas (Madrid), which the Socimi Merlin will acquire in December for €380 million; and the sale of Edificio España, which the Murcian group Baraka, led by Trinitario Casanova, is due to sign on 15 October, for around €272 million.

Alongside them, experts expect El Corte Inglés to close the sale of its logistics portfolio for between €250 million and €300 million and for Gas Natural to sell several corporate buildings and remain as the tenant (in an operation known as sale & leaseback) for another €200 million.

These five operations alone amount to more than €1,500 million. “If we add up only the transactions that have already been announced, then we reach the forecast figure; and other deals may come up – there is always activity during the final quarter of the year”, said Martínez.

By type of property, commercial assets have taken over the number 1 spot from offices, which traditionally accounted for most of the investment in Spain. “The sales of Adequa and Torre Cepsa mean that the office market is going to make a come back. Nevertheless, we have just had two years of madness, with the Socimis proving themselves to be particularly active in 2015; now, there are fewer products, and prices are not as attractive for the experts”.

In the case of shopping centres, forecast indicate a slightly lower volume than recorded in 2015, despite the signing of major operations such as the purchase of Diagonal Mar in Barcelona, for around €500 million by Deutsche Bank and the acquisition by the Socimi Lar of Gran Vía de Vigo for €141 million.

In the case of the logistics business, “until the first half of the year, it was the best performing segment compared with 2015, but, it lost strength to the commercial segment during the third quarter. Nevertheless, operations such as the sale by El Corte Inglés will help it recover”.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Lone Star Puts Adequa Business Park Up For Sale

6 May 2016 – Cinco Días

The US fund Lone Star is going to put the Adequa business park up for sale, which it acquired after taking on the debt of the inactive real estate company Bami Newco. Adequa will be put on the market within the next few weeks and will be marketed by the brokers Knight Frank and JLL.

These consultancy firms received the exclusive joint-mandate to handle the sales process, which will be presented to a small group of investors only.

Adequa is one of the largest business parks in Spain. It has a total surface area of 120,813 sqm and contains six office buildings, as well as a service centre with commercial space measuring 5,013 sqm, including a gym, restaurants, a pharmacy, a nursery and three padel courts. The park is located next to the A-1 highway, in the new neighbourhood of Las Tablas.

This business park is home to the headquarters of Renault in Spain, for xample. Moreover, construction is on-going at the site, to build a new space, measuring 44,885 sqm, which will be divided into two buildings, one of which will be a central tower with office space covering 29,095 sqm.

Bami Newco, the real estate company controlled by Joaquín Rivero following his departure from Metrovacesa, filed for liquidation last year, at the company’s own request under the Bankruptcy Law, with debts amounting to €652 million. At that time, the assets, basically the business park itself, were worth €726 million.

Original story: Cinco Días (by A.S.)

Translation: Carmel Drake