Tag: affordable housing

Basque Government Invested €50.1 Million in New Social Housing Rental Units

6 January 2020 – The Basque Government acquired a total of 506 flats over the past year for use in public housing. The regional government acquired the properties using public funds, budgetary surpluses and the Sustainable Financial Investments financial instrument used by Spanish local authorities. The properties are now under management by the Basque public company Alokabide.

The government invested a total of 50.1 million euros in the acquisitions. Specifically, the government acquired 70 VPO flats in the neighbourhood of Donostiarra in Morlans (€4.9 million), 32 VPOs in Santurtzi (€4.5 million), an advance on 84 social housing units in Ortuella (€2.4 million), 52 VPOs in Sestao (€7.6 million), 26 VPOs in Mungia and 52 VPOs in Amorebieta (€9.5 million), nine free homes owned by SAREB in several locations (742,000 euros), 36 VPOs in Legutio (€3.8 million), three homes in Bermeo (345,635 euros), 91 social housing units in the neighbourhood of Iturribarri in Getxo (€8.2 million) and 51 VPOs in the neighbourhood of Zerrajera in Arrasate (€7.8 million).

El Gobierno Vasco adquirió un total de 506 pisos durante el año pasado para uso como viviendas públicas. El gobierno regional adquirió las propiedades utilizando fondos públicos, excedentes presupuestarios y el instrumento financiero de inversiones financieras sostenibles utilizado por las autoridades locales españolas. Las propiedades están ahora bajo la gestión de la empresa pública vasca Alokabide.

El gobierno invirtió un total de 50,1 millones de euros en las adquisiciones. Específicamente, el gobierno adquirió 70 pisos VPO en el barrio de Donostiarra en Morlans (€ 4.9 millones), 32 VPO en Santurtzi (€ 4.5 millones), un anticipo de 84 unidades de vivienda social en Ortuella (€ 2.4 millones), 52 VPO en Sestao (7,6 millones de euros), 26 VPO en Mungia y 52 VPO en Amorebieta (9,5 millones de euros), nueve viviendas gratuitas propiedad de SAREB en varias ubicaciones (742.000 euros), 36 VPO en Legutio (3,8 millones de euros), tres viviendas en Bermeo ( 345.635 euros), 91 unidades de vivienda social en el barrio de Iturribarri en Getxo (8,2 millones de euros) y 51 VPO en el barrio de Zerrajera en Arrasate (7,8 millones de euros).

Original Story: La Vanguardia – P. R. D.

Translation/Summary: Richard D. Turner

Sareb to Sell Portfolio of 140 Flats in Catalonia

5 January 2020 – Sareb announced that it would sell 140 flats, plus another thirty parking spaces and storerooms, in Catalonia. Many of the flats are currently occupied illegally by squatters and may now have to deal with a possible new owner, likely vulture fund. The sale follows a similar divestment of 400 properties late last year.

The bad bank has already evaluated the squatters using local social services and determined that they must be evicted.  In cases where the people living in the flats are determined to be vulnerable families, Sareb looks to arrange alternate living quarters. That was not considered to be the case in these circumstances.

Investment funds generally acquire portfolios such as this with significant discounts of up to 70-80% on the initial value. The new owners will have to incur legal expenses to remove any occupants and to subsequently renovate the homes, which are generally in rather poor condition.

The regional government of Catalonia, for its part, has the right of first refusal for all properties sold in portfolios, by banks or by Sareb.

En español

Sareb anunció que venderá 140 pisos, más otros treinta estacionamientos y almacenes. Muchos de los pisos están ocupados ilegalmente y ahora pueden tener que tratar con un posible nuevo propietario, probablemente un fondo de buitres. La venta sigue a una desinversión similar de 400 propiedades a fines del año pasado.

El banco malo ya evaluó a los ocupantes ilegales utilizando los servicios sociales locales y determinó que deben ser desalojados. En los casos en que se determina que las personas que viven en los apartamentos son familias vulnerables, Sareb busca organizar viviendas alternativas. Ese no fue el caso en estas circunstancias.

Los fondos de inversión generalmente adquieren carteras como esta con descuentos de hasta 70-80% sobre el valor inicial. Los nuevos propietarios tendrán que incurrir en gastos legales para desalojar a los ocupantes y posteriormente renovar las viviendas, que generalmente están en malas condiciones.

La Generalitat de Cataluña, por su parte, tiene el derecho un derecho de tanteo para todos inmuebles que vendan a través de carteras, bancos y Sareb.

Original Story: El Confidencial – Jorge Zuloaga

Translation/Summary: Richard D. Turner

Catalonia’s Regional Government Boosts Social Housing

4 January 2020 – The Catalonian regional government approved a decree at the end of 2019 that will oblige people and companies which own more than fifteen properties to offer social housing to groups considered vulnerable. Those groups may include families in eviction proceedings and people who have illegally occupied properties for at least six months since the decree’s approval.

The government will also extend compulsory social rental contracts from three to five or seven years, depending on whether a person or a company owns the property. Additionally, the government will implement a measure whereby buildings with unfinished works will be considered unoccupied after a specific period and liable to coercive fines and the possibility of expropriation.

La Generalitat de Cataluña aprobó un decreto a fines de 2019 que obligará a las personas y empresas que poseen más de quince propiedades a ofrecer viviendas sociales a grupos considerados vulnerables. Esos grupos pueden incluir familias en procesos de desalojo y personas que han ocupado propiedades ilegalmente durante al menos seis meses desde la aprobación del decreto.

El gobierno también extenderá los contratos obligatorios de alquiler social de tres a cinco o siete años, dependiendo de si la propriedad es de una persona o una empresa. Además, la Generalitat implementará una medida por la cual los edificios con obras inacabadas se considerarán desocupadas después de un período específico y susceptibles de multas coercitivas y la posibilidad de expropiación.

Original Story: El Confidencial

Translation/Summary: Richard D. Turner

Spain’s Ministry of Development Looks to Acquire Land from Sareb

25 November 2019 – Spain’s Ministry of Development (Ministerio de Fomento) is looking to create a partnership with the bad bank Sareb to help it achieve its goals under the Plan 20,000 housing policy. The government hopes to build 20,000 affordable rental homes to alleviate a lack of residential housing on the market and is considering buying land for the new developments from Sareb.

Original Story: El Economista – Alba Brualla & Rubén Esteller

Adaptation/Translation: Richard D. K. Turner

Podemos Pushes Increased Social Housing in Pact with PSOE

18 November 2019 – Podemos, the left-wing populist political party led by the political scientist Pablo Iglesias, signed a pre-agreement with the PSOE to create a governing coalition. The accord includes topics that the party, which was created in 2014, has espoused throughout its short life. One of the ten points included in the platform is a constitutional right to housing. Iglesias added that his party had not agreed to enter into a coalition with the centre-left PSOE because they were unable to agree on the subject beforehand.

Podemos is now looking to create a right to housing as a basis of the country’s constitution, with legal guarantees. Some of the proposed measures would directly affect the rental market, with indefinite rental contracts, with transparent grounds for justified termination and automatic extensions where the tenant is especially vulnerable and the landlord a large property owner. The party also supports increasing the stock of social housing by 50,000 flats per year through the compulsory transfer of empty homes held by funds, banks and Sareb, for example, for use in the rental market.

The announcement led to share declines for some of the largest Spanish socimis, including Merlin and Colonial.

Original Story: El Confidencial – Ruth Ugalde

Adaptation/Translation: Richard D. K. Turner

Developers in Spain Need to Build 2.5 Million New Homes to Satisfy Demand

14 October 2019 – Foreign and domestic investors have recently poured a larger and larger amount of money into Spain’s residential rental market. In the last two years, large investment funds and developers like Blackstone, Ares, Greystar, TPG, Aedas, Quabit, Metrovacesa, Vía Célere have invested in the sector, going after the relatively high yields available.

The increasing investment in the sector is due to a series of factors. The last few years have seen major price increases, for both home sales and rentals, in Spain’s biggest cities, particularly in Madrid and Barcelona. The high cost of buying a home is also leading many Spanish families to forgo potentially buying a home, as they would have in the past when prices were more affordable.  Those families are now in the market for rentals.

Considering that the rising prices are due to an imbalance between supply and demand, common sense would suggest that a relatively easy solution would be to great increase the supply of homes for sale and rent. The total number of homes for rent in Spain is equivalent to 23% of the total housing stock, 9% lower than the European average of 34%.

To reach the European average, therefore, developers would have to build another 2.5 million homes, taking the total for Spain to 8.5 million homes. Building that many homes in the next fifteen years would require that developers construct approximately 167,000 houses per year during that period. That amount of development would require a total investment of roughly €300 billion, or 25% of Spain’s current GDP.

The need for that kind of investment in affordable rental homes to help curb rising prices is beginning to be addressed in a series of measures by some political parties, such as the PSOE. One of the proposals includes a law that would facilitate the transfer of the surface rights for public lands to developers which agree to building affordable housing, a measure that developers have demanded for years.

One of the biggest obstacles to such large-scale development is the complexity of managing and aligning interests between the municipal, regional and central governments. Market sources recommend common regulatory frameworks to facilitate the creation of greater legal certainty and the agility to obtain the necessary licensing and permits.

Original Story: El Confidencial – Elena Sanz

Adaptation/Translation: Richard D. K. Turner

Locare & Tectum to Launch New Fund as Rental Market Heats Up

14 October 2019 – Locare RE and Tectum Real Estate Investments are preparing to launch a new €240-million fund aimed at the affordable rental housing market. The new fund, Tectum II, comes hot on the heels of a similar, €120-million fund the two firms launched just a few months ago. The investments come at a time when foreign investment and rising real estate prices, especially in Spain’s major cities, are driving families further out of city centres.

The first fund allowed the two firms to acquire seven plots of land, enough to build 1,000 affordably priced rental homes in the Community of Madrid. The plots of land are located in Torrelodones, Villalba, Móstoles, Arroyomolinos, Valdemoro (two plots) and Alcalá de Henares. The fund expects monthly rents to cost between 500 and 900 euros per month.

Short-term plans for Tectum II aim to start advertising approximately 1,500 new rental homes already in 2020.

Original Story: El Confidencial – E. Sanz / C. Hernanz

Photo: Locare

Adaptation/Translation: Richard D. K. Turner

Málaga Leads the Construction Sector in Andalucía with an Occupancy Rate of 88%

10 May 2019 – Expansión

Málaga is leading the ranking of house sales in Andalucía with 32,438 transactions and a market share of 32%, almost doubling that of its nearest rival, Sevilla (17.4%).

According to the participants of the round table organised by the Association of Property Developers and Construction Companies in Málaga (pictured above), the province is currently the driving force behind the construction sector and is home to some of the highest employment rates in the country (88.5%). That means that the sector now employs 62,700 people of the 70,200 surveyed in the Active Population Survey (EPA) when just five years ago, that figure amounted to just 57%.

In terms of the challenges facing the sector, the most important ones are rising rental prices and the generation of buildable land. In this context, the General Secretary for Housing at the Junta de Andalucía, Alicia Martínez, took advantage of the round table event to announce a new housing plan called ‘Plan Vive Andalucía’, which includes a greater commitment to affordable housing, the reactivation of obsolete urban areas and the promotion of R&D in the sector, amongst other initiatives.

Original story: Expansión (by Juan A. Gómez)

Translation: Carmel Drake

Carmena’s New Housing Plan: Rezoning in Exchange for Subsidised Housing

8 February 2019

The Madrid City Council is offering to rezone an industrial plot as land to residential in exchange for “30%, 50% or 70%” use as social housing.

Madrid is now following in Ada Colau’s footsteps, asking for investments in social housing from private developers. The Madrid City Council will offer to rezone an industrial site on the condition that part of it is converted into subsidised housing (VPO). José Manuel Calvo, the Councillor for Sustainable Urban Development, announced the decision in an interview with EjePrime. The initiative is a reflection of the Madrid City Council’s desire to invest in social housing.

Since the public stock of homes began falling in 2010, the government in Madrid has been unable to return to the levels seen before the crisis. When Manuela Carmena arrived at City Hall, the municipality had less than 6,000 public housing units. The mayor committed to adding another 4,000, half of which has been achieved four months before the end of her term.

The City Council of Madrid is now offering to work with private developers to increase the public stock of housing during the next government mandate. The idea is to rezone industrial lands so that developers can build homes, a percentage of which would have to be allocated to subsidised housing.

Carmena’s government requires any plots of land for subsidised housing to be independent

“I can tell developers that I will rezone the land as residential and then ask for 30%, 50% or 70% [for subsidised housing],” says Mr Calvo. While the exact figures have yet to be determined, the City Council believes that the developers’ investments must be “profitable” while the “municipality wants to receive the greatest possible number of homes.”

Carmena also insists that any plots used for subsidised homes be independent to avoid the Ada Colau’s situation in Barcelona. Ms Colau wants to oblige developers to set aside 30% for social housing buy her “proposal has run into legal difficulties because the homes are owned ‘proindiviso’,” meaning that the City Council jointly runs the residential associations with the developers.

In such cases, “as an administration, maybe you need the housing for needy families and the community can deny it,” says Calvo. “The proposal in Barcelona does not work,” he concludes.

The councillor is suggesting an alternative to Ada Colau’s proposal

Colau’s proposal was approved in a plenary session of the Barcelona City Council last September, with favourable votes by all political parties except the Ciudadanos (Citizens) who abstained, and the PP, which voted against. According to the municipality’s forecasts, the monthly rent for social housing of about 80 square meters should be 512 euros or €136,000 to buy. Taking into account that 1,114 apartments are built each year, the City is planning on 334 new homes per year.

The City Council’s proposal was not well received by developers, who met that same week in a commission to study the measure. The Catalan Association of Developers (APCE) questioned the legality of the proposal and warned that it could mean an end to new developments.

Original Story: EjePrime – Marta Casado Pla

Translation: Richard Turner

30% of the New Builds in Barcelona’s 22@ District will be Social Housing Units

19 November 2018 – La Vanguardia

The mayor of Barcelona, Ada Colau, neighbourhood organisations and economic and social change agents have signed an agreement to modify the 22@ district, to provide it with more social housing and public transport and to avoid the gentrification of the neighbourhood. In this way, the main transformation will be that the percentage of land reserved for social housing in the northern area of the Catalan capital will increase from 10% to 30%. And most of that will be rental housing, although the plan is to also grant some land to cooperatives and social entities so that they can build protected flats in another form. Similarly, The Town Hall wants the 22@ district to be a space for trials and experimentation in the search for solutions to issues relating to housing and mobility.

The 22@ district comprises 200 hectares in Barcelona, which started to be transformed in the year 2000 and which has turned Poblenou into a hub for small and large technological companies. It is a model for long-term success that is now going to change its strategy to obtain a mixture of uses between tertiary and residential. For that reason, on the 80 hectares that are still left to be developed – above La Diagonal – the surface area dedicated to public housing is going to be increased. In total, between 5,000 and 6,000 new flats will be constructed in the space.

Ada Colau has highlighted the critical efforts that many players have made to be able to sign the document that reviews the 22@ district after 18 years of development. “It is a transcendental agreement for the city. Technological innovation is not enough to make a city”, said the mayor. In this sense, she highlighted the importance of building more housing to bring life to the neighbourhood.

The agreement that has been signed this morning establishes two areas within the technological district that will require Modifications to the General Metropolitan Plan in order to carry out the new transformation. On the one hand, the neighbourhoods of Provençals del Poblenou and Maresme, and on the other hand, the areas of Bogatell, Trullàs and Plata del Poblenou. Whilst in the first spaces, the idea is to obtain an equilibrium between offices and housing, increasing the land available for the construction of public homes, in the second, the plan is to declassify the whole area to preserve the old fabric of Poblenou. The experts understand that these buildings, due to their morphology, are not ideal for housing technological activities (…).

Original story: La Vanguardia (by Silvia Angulo)

Translation: Carmel Drake