Merlin Acquires Three New Properties In Spain

14 January 2015 – El Mundo

Merlin has acquired an office building in Barcelona and two logistics warehouses in Getafe and Vitoria.

As a result of these transactions, the Socimi’s gross rentable area exceeds 680,000 square metres.

The Socimi Merlin Properties, one of the leading real estate companies listed on the Spanish stock exchange, which specialises in the acquisition and management of tertiary assets in the Iberian peninsular, has announced that it completed the purchase of three new assets in December. It spent €88.4 million on the acquisitions, which will generate rental income of €5.9 million, taking the total annual gross rental income the company generates from its portfolio of assets to more than €128.8 million.

The first acquisition involved an office building in Barcelona, number 8 of the WTCAP, which it bought for €36.5 million. This represents the second purchase made by the company in the landmark business park, following its acquisition of the building at number 6 in August. Number 8 has a gross leasable area of 14,543 square metres, plus 700 sqm of storage and 247 parking spaces.

The building in the WTCAP is partially leased to multi-national companies such as Panasonic, Technip and Colt Telecom. The acquisition price represents an initial gross rental yield of 5.6% (4.8% net) and the property has high growth potential, through the rental of its unoccupied surface area (equivalent to 35% of the total leasable area). If the building were fully occupied, the rental yield of the property would exceed 8%.

Meanwhile, Merlin Properties is continuing its commitment to logistics and industrial assets, where it now has a gross leasable area under management of more than 136,000 square metres. In December 2014, it bought a logistics warehouse measuring 16,242 square metres, located in the CLA in Getafe (Madrid), which is leased to the Galician logistics company Transportes Souto under a 10-year contract. The acquisition price (€12.5 million) represents a gross and net rental yield of 8.4%.

Finally, Merlin has also acquired a logistics warehouse measuring 72,717 square metres in Vitoria, located in the Júndiz business park, which is renowned for its excellent transport connections and for housing the only Mercedes Benz factory in Spain. The park is also home to several other prestigious companies, including Correos, DHL, DB Schenker, Azkar (Dascher) and Adif. The warehouse is leased under a 10-year contract to the well-known multi-national logistics company Norbert Dentressangle. The acquisition price (€28.58 million) represents a gross and net rental yield of 9.6%.

As a result of these three transactions, Merlin Properties’ real estate portfolio now has a total gross leasable area of more than 680,000 square metres and generates gross annual rental income of €128.8 million.

Original story: El Mundo

Translation: Carmel Drake

Adif Hands Over the Castellana Plot to El Corte Inglés Paying €136 Mn

26/11/2014 – E Pais, El Mundo

El Corte Inglés ponders next extension of what it considers its flagship department store in Spain due to its excellent location on the coveted Paseo de la Castellana street in Madrid’s downtown. The chain has acquired a plot situated just in front of its existing store and at few meters from the Nuevos Ministerios light railway and subway station from Adif for more than €136 million.

The piece of land has 13.000 square meters and it is located inside the Azca complex. Adif, a public company managing railway infrastructure in Spain, put the parcel up for sale in September at an asking price of €40 million. It received six offers for the lot, from such known developers and co-ops managers as Monthisa, Allegra, Capriles, Colonial or Grupo Villar Mir.

Newly named president of El Corte Inglés Dimas Gimeno said ‘town planning project for the terrain displays a total buildability of 35.192 square meters, of which 10.176 square meters are intended for construction of three stories above the ground level, of the tertiary use (i.e. commerce, services but no dwellings), and around 25.000 square meters below the ground level which can be used for building four underground parkings’.

The El Corte Inglés store has been growing throughout years. Opened in 1969 with less than 50.000 square meters, it was amplified by a new building, which replaced the old Windsor, in 2011. Currently, it has a 130.000 square meter floor area.

Thanks to the purchase and the planned extension, the Castellana store will become the biggest in Spain. Right now the honour belongs to the center in the El Bercial neighbourhood in Getafe which covers 180.000  square meters. In any way, it will be much smaller than other departments stores said to be largest in the world and even in Spain, as the Marineda City retail park in A Coruña offers a 500.000 square meter built area and a GLA of 200.000 square meters.

This acquisition adds to the latest three November land purchases in the center of the Spanish capital amounting to €370 million in total.

Two other plots, curiously enough situated in the same area, were tendered publicly earlier this month and fell into hands of cooperatives managers Domo Gestora and Grupo Ibosa. First piece of land, situated at 50 Raimundo Fernandez Villaverde street, was bought for €111.05 million on the 5th. A week later, the other carrying Madrid Metro’s depots in the Cuatro Caminos zone was sold for €88.3 million. Finally, Pryconsa acquired the old Buñuel studio of Spanish TV RTVE for €35.27 million.

 

Original article: El País (by Cristina Delgado), El Mundo (by Jorge Salido Cobo)

Translation: AURA REE

El Corte Inglés Offers €136 Mn For Adif’s Nuevos Ministerios Plot

25/11/2014 – Expansion

El Corte Inglés is ready to come down to history of real estate investments carried out in Madrid. After spending €480 million on now non-existent Torre Windsor tower (replaced by the Torre Titania), the department store group has submitted a €136.48 million offer for a 10.700 square meter plot situated on the Paseo de la Castellana street in Madrid.

The piece of land, stretching adjacently to one of its stores (pictured), would allow the chain to build a new shopping mall in downtown Madrid, just next to the Nuevos Ministerios Cercanias (the light railway of the capital) station.

Except for El Corte Inglés, the tender of the plot was attended by five other bidders. The second-best offer came from Madrid-based property manager Monthisa (€77.04 million), followed by developer Pryconsa teamed up with one investor more (€62.57 million), Mario Losantos’s holding Allegra (€55.1 million) and Colonial (€52 million). Venezuelan Capriles bidded the lowest with €46 million.

Owned by Adif, the desirable piece of land currently offers 72 parking lots with 22.000 spaces. The public railway manager put the plot up for sale as a part of its non-core assets divestment plan including 16 activities, like awarding commercial spaces and renovation of some stations.

The terrain’s use is tertiary (meaning no dwellings allowed thereon) and it is suitable for constuction of a five-floor building. According to experts, the price may oscillate between €70 million and €100 million, or between €6.200 and €9.000 euros per square meter. El Corte Inglés’s bid reaches 12.775 €/m2.

If the clear bet accepted, the Spanish department store king would extend its 86-large store, 42-hipermarket and over 250-convenience shop (Opencor and Supercor Express) portfolio valued at €18 billion, as Tinsa estimates.

 

Original article: Expansión (by R. Ruiz & A. Polo)

Translation: AURA REE

Most Fashionable Plot in Madrid Available From €40 Mn

30/09/2014 – El Confidencial

This is the most wanted retail plot in Madrid. Located in the middle of the Paseo de la Castellana avenue, between the tower of BBVA and the Nuevos Ministerios stop of the Cercanias light railway and just in front of a El Corte Ingles department store, the spot is perfect for grand commercial brands, above all the fashion ones.

Current owner of the property, public railway firm Adif, has been granted a permission from the Government to sell the piece of land. The sale process is expected to conclude in November.

With an asking price of €40 million, an excellent location at few minutes walk from the Santiago Bernabeu stadium, the 10.200 square meter plot may become the battlefield for textile giants.

Moreover, the land includes 25.000 square meters more underground, which may be converted into a huge parking in the Azca Complex in the heart of the capital, adjacently to such iconic skyscrapers as the Torre Picasso tower (also known as the Torre BBVA, although the bank had sold it before moving to the Las Tablas neighborhood), the Torre Europa tower or the Edificio Mahou building.

‘The location is unbeatable for any fashion retailer. All the more that, according to a survey carried out by portal Modaes.es, 90% of clothing brands declared an intention of increasing sales in Spain’, says Patricio Palomar, research and investment strategy director at CBRE España.

Real estate market points at Inditex, Mango or H&M as the sure competitors for the plot. El Corte Ingles already has got an enormous establishment at the location and the odds are almost null that it will submit any bid.

Mango, owned by Isak Andic, has lately purchased another extremely attractive property in Madrid, at the corner of the Orense and the Raimundo Fernandez Villaverde streets. When it comes to Zara and H&M, they have also dominated the Golden Mile (the Orense st.).

The Buyer Profile

So, what kind of buyers will attend the tender? Basically, there are two options. Firstly, the purchaser will directly develop the real estate project with their own funds or with external financing provided by a bank or an investment fund. Secondly, the developer will be also the owner of the project and they will rent the building to an interested operator in exchange for a share in profits.

However, also a forward funding project strategy could work out in this case. One one hand, there would be an agreement between the developer and the retailer. The first would implement a turn-key project for the latter. Simultanously, there would be a settlement between the investor and the developer to buy the project once finished and occupied by the retailer. Then, the investor would acquire the property bringing sure return and they could participate in the operation financing.

Nowadays, there are operators like H&M, Primark or Fnac which could be interested in purchasing the plot but land and developing are not their core business. Almost none of them owns the property they rent, except for singular units. Unlike Mango or Inditex, they have no family office to buy assets.

Potential Lenders

Who could finance the operation? Well, only several investment funds are presently able to assume the developer risk: AXA REIM, Meyer Bergman, LGSI, British Land, Rodamco, Redevco, ING Real Estate, etc. Also, Adif as a Public Private Partnership (PPP) could do that. Together with Riofisa and under the name of Vialia, the railway firm has developed many shopping centers at various train stations.

However, it is highly likely that Amancio Ortega himself will attend the bidding. Reasons are few. Firstly, because the Nuevos Ministerios spot has been the must for a Zara shop for long. Secondly, because the future property fits in Inditex’s stretegy to invest in major buildings. Thirdly, because the plot is situated on the other side of the Paseo de la Castellana avenue, on the Paseo de la Habana avenue, where the group’s Massimo Dutti clothing brand already exists. Furthermore, the purchase would mean a knock-off to El Corte Ingles, standing just next to the terrain. And finally, because Azca has become one of the favorites of Pontegadea, the investment arm of Mr. Ortega which bought the Torre Picasso tower and is the landlord of Fnac, having a store in front of the plot on sale.

 

Original article: El Confidencial (by R. Ugalde & E. Sanz)

Translation: AURA REE

Spanish Government to Auction a 13.000 SQ M Plot in Madrid Center Asking €90.3 Mn

8/09/2014 – Expansion, El Confidencial

Adif, a state-owned railway infrastructure manager, has received a permission to award a lucrative developable piece of land located inside the Azca complex in Madrid via a public tender.

The plot spreads over 12.919,19 square meters and is situated adjacently to the Nuevos Ministerios station. More precisely, in the intersection of the Paseo de la Castellana and the Raimundo Fernandez Villaverde streets. The plot is of urban and residential type but it is not fully consolidated. As a consequence, any demolishment works will need an approval from Madrids City Hall. The process could last up to one year since the deal is sealed, say consulted experts.

The land belongs to Adif and currently it is occupied by a public parking lot. Several housing co-ops, as well as various operators and funds sought development of a new commercial space in the financial district of the capital and are quite eager to acquire the plot.

Aforementioned the co-ops are planning to construct over there dwellings at between €3.200 – €3.300 per square meter. The price is unimaginable in the city center with an average of €4.400 a sq m  and the enormous interest of the citizens evoked around the houses allowed such companies as Domo or Ibosa to set up co-ops within few days only.

Minimum asking price has been fixed at €90.278.264,98 and those who want to bid are obliged to lodge a 5% security equalling to €4.5 million. The deadline for the bids submitting passes on 22nd October 2014. They will be reviewed on November 5th.

 

Original article: Expansión, El Confidencial (by Elena Sanz)

Translation: AURA REE

Adif & Riofisa Sell AVE´s Shopping Mall in Malaga

19/05/2014 – Expansion

The railway operator and the shopping mall developer join the real estate sales frenzy. Adif and Riofisa came to an agreement with a consortium of Brazilian businessmen and transferred to them the Vialia shopping mall, situated at the Benito Zambrano train station in Malaga.

The center was opened in 2006 and it is one of the two largest train station business parks in Spain. Its total area oscilates around 64.000 square meters with trading area of 45.456 meters. In 2013, over 14.4 million people visited the complex.

The new owners conducted the transaction through Global Phobos and paid about €65 million for the property, assisted at the sale by Banco Santander, Deloitte Real Estate and the Uría Menéndez lawyers office.

Vialia was held in 40% by Adif and in 60% by Nuevos Espacios Comerciales (Necsa), controlled by Riofisa.

Within Adif´s plan of streamlining assets in its balance, the operator put up for sale 1.500 houses, as well as several plots, trading premises and parking lots. By the end of the ongoing year, Adif will have put for an auction almost 600 properties.

Apart from the houses, Adif sold train stations in Bilbao and in Navarra. The first, La Naja, was acquired for €65.150, whilst the other, Corrella y Cascante, for €1.35 million. Also, Adif shed the old station of Príncipe Pío in Madrid.

During the first quarter of the year, the total investment in Spain hit €988 million, out of which €614 million corresponded to shopping center purchases.

 

Original article: Expansión (by R. Ruiz & C. Morán)

Translation: AURA REE

Adif Puts on Auction Príncipe Pío Station in Madrid

Adif put on bidding 50-year lease of Madrid´s Príncipe Pío Station historic building, protected by urban planning and dating back to the beginning of the 20th century, as well as its free space attached, together with a shopping mall.

Currently there are no development works within the building, so the tenant will be obliged to carry out comprehensive renovation and rehabilitation of the unit, with focus on its façades and roofing.

(…) The total space auctioned covers 9.475 m2.

(…) In order to facilitate the tenderers participation in the auction, rental price reductions have been fixed for the first few years, when expenses bore for the restoration will be the highest, with minimum rent guaranteed of 150.000 Euros per year.

(…) The building is one of the best examples of Spanish railway architecture, situated in the historical and touristic zone of Madrid, surrounded by green areas – points out Adif.

Construction of the shopping mall in 2004 allowed renovation of a considerable part of the station unit, leaving historical the Head Building´s restoration pending.

The deadline for submission of tenders is March 24th, 2014.

 

Source: Cinco Días

The great real estate auction by Adif

Adif has decided to get rid of its properties. The railway infrastructure managing company will celebrate three public auctions in Madrid on the 22nd, 23rd and 24th October. In order to have access to those auctions, which will take place in the hotel Velázquez (Madrid), the deposit will be of 1000, 2000 or 6000 Euros depending on the lot. (…)

The starting price for these properties ranges between 1020 Euros for a storage room to 765.000 Euros for trade premises. As for homes, the average price reaches 100.000 Euros. There are 77 homes, 170 garages, 80 storage rooms and 46 trade premises.

With these auctions, Adif plans to put on sale nearly 1500 properties before the end of the year: 800 through public auctions and another 700, which will be offered first to its current tenants.

The sale of properties is included in the rationalization plan carried out by Adif in order to improve the efficiency in the management of these assets, to generate earnings and reduce costs. (…)

ADIF auctions 373 properties following its asset rationalization plan.

The Administrator of Rail Infrastructures has put on sale, through a public auction, 373 properties in 231 lots scattered around different provinces that include homes, trade premises, garage spots and storage rooms.

The operation is part of the asset rationalization plan carried out by the company, through which it plans to sell 1.500 properties until the end of the year. It also auctions several unused stations. The starting price ranges between 1.020 Euros for a storage room and 765.000 Euros for a trade premises.