Seguros Pelayo Acquires Office Building in Alcobendas from Hispania

18 November 2019 – Seguros Pelayo has acquired the office building located at Avenida Bruselas 15, Alcobendas, for more than 11 million euros from Hispania.

The building, which is fully occupied, has an approximate surface area of 3,500 m2 and recently underwent a renovation. Alcobendas, a city on the outskirts of Madrid, has an array of established firm operating in the area. The area also has good transport links, with easy access to the A-1 and the M-30 and M-40 ring roads, a few minutes from the centre of Madrid and the Barajas International Airport.

Original Story: Idealista – Custodio Pareja

Adaptation/Translation: Richard D. K. Turner

Grupo Pinar & Baupost Agree Purchase of Levitt & Create New Property Developer Giant

19 February 2018 – El Confidencial

The most coveted property developer of recent times may change hands within the next few days. Levitt is holding advanced talks with Q21 Real Estate, a company created by the joining of forces between the former Grupo Pinar and the US fund Baupost, to close its sale this week and, in any case, before the end of February, according to several sources familiar with the operation.

The agreement will put an end to almost two years of to-ing and fro-ing with different interested parties in acquiring the property developer, a reference player in the market for premium homes, and will also create a new giant in the sector within the convulsive Spanish residential market.

As El Confidencial revealed, it was in 2016 when Levitt first started to listen to offers as a formula for dealing with its problem of generational succession, following the death of the group’s founder and alma mater, José María Bosch Aymerich, without any direct descendants.

Owner of one of the best land portfolios in Madrid, with land in locations such as Alcobendas, Las Rozas, Pozuelo and Boadilla del Monte, Levitt has proved tempting over the past two years for giants such as Goldman Sachs, Apollo, Värde and even the fund Baupost itself, which was on the verge of acquiring the property developer last year.

But on the home straight, those negotiations were called off due to differences over price, as well as over the continuity of the project and Levitt’s team. After closing that door, the fund found another window open through Q21, the property developer that has placed a better offer on the table than the one put forward by the US fund, and one that ensures the survival of Levitt.

Who is Q21?

Constituted in July 2014, Q21 Real Estate has a brand that is still new and a workforce of just 17 employees – both features have facilitated its agreement with Levitt, with which it shares its vision of high-quality developments.

Currently, Q21 has nine developments underway, mostly in the Community of Madrid (Boadilla del Monte, Valdebebas, Getafe and Mostoles), but also in Málaga and Valencia. Altogether, the firm is working on 1,500 homes.

With assets worth €6.3 million and net equity of €3.58 million in 2016 (the last year for which audited figures are available), Q21 generated revenues of €5.27 million, an operating profit of €3.5 million and a profit of €2.76 million.

Its numbers are well below those recorded by Levitt, whose turnover amounted to €62 million and net profit €6.3 million. Moreover, Levitt owns a portfolio worth €200 million, its brand is recognised in the market and its history spans almost fifty years in Spain after it arrived in 1971 to introduce the US residential urbanisation model.

Original story: El Confidencial (by R. Ugalde)

Translation: Carmel Drake

Alibaba Signs Lease for its New HQ in Spain

14 December 2017 – Eje Prime

The Chinese giant Alibaba is shaking up the office market in Madrid as the year-end approaches. The Asian e-commerce group has been negotiating for several months to open offices in Madrid from where to lead its operations in the Spanish market. In the end, it has signed a rental agreement for its Spanish headquarters at number 4 Avenida Europa, in Alcobendas, a building owned by the real estate group Gosa. Until now, the technology firm Paypal also had its headquarters in the building (…).

Alibaba will move its Spanish team to the new offices in Alcobendas, which measure approximately 1,000 m2, in the middle of February, according to sources close to the operation. At the moment, the Asian giant’s employees are managing the firm’s Spanish operations from a co-working office. Alibaba has declined to comment on the planned move.

Alibaba’s arrival at number 4 Avenida Europa comes just months after Paypal’s departure from the same building. Currently, that US firm shares offices with Google and Intel in Torre Picasso, as revealed by Eje Prime.

The property that will house Alibaba’s new offices is also home to the headquarters of the cosmetics group Clarins and the Chinese firm Ansteel. Commscope is another company that had its headquarters located in the building until the middle of 2017, but in July it decided to move to number 19 on the same street.

Alcobendas has become one of the hubs of business excellence in Madrid. Indra, VASS, Emerson, Televent, Acciona, Bankinter, Europcar, Canon and Toyota are just some of the multinational companies that have chosen to locate their offices in the Madrilenian town.

Alibaba’s new office, which the company has been anticipating since February, has the capacity to accommodate the almost forty people that make up its Spanish workforce. The team is led by Estela Ye, who was promoted to General Manager of the company in Spain in March.

The office market in Madrid

Leasing of office space during the third quarter of the year in Madrid amounted to 93,173 m2, which represented an increase of 2% with respect to the same period in 2016, although, according to a report from Aguirre Newman, 16 fewer operations were closed (96).

One of the most active areas in the capital was the Other Business District (RDN), which accounted for 31% of the total space leased. Nevertheless, the report highlights that leasing in the Central Business District (27% of the total) and in the OUT area (23%), saw the most significant increases, more than doubling their figures with respect to the same period in 2016.

In terms of rents, the maximum recorded during Q3 was €36/m2/month, whilst the average rent in the CBD area was €28.96/m2/month. In the Decentralised area, the average rent amounted to €12.71/m2/month.

Original story: Eje Prime (by A. Pijuán)

Translation: Carmel Drake

Land Shortage Causes House Prices to Soar in Madrid

5 November 2017 – El Mundo

House prices are on the rise in Madrid, due to the shortage of available buildable land and the high pent-up demand (the Spanish capital is capable of absorbing around 10,000 new homes per year and just as many second-hand homes). That was one of the main conclusions from the meeting organised last week by El Mundo in collaboration with Distrito Castellana Norte (DCN) to analyse the likely impact of the 11,000 new homes that are being planned as part of Madrid Nuevo Norte, the official name for the project more commonly known as Operación Chamartín.

According to Luis Corral, CEO of Foro Consultores, Madrid Nuevo Norte is an “absolutely essential project for that area of Madrid”, because both of the existing urban developments, namely, Valdebebas and Arroyo del Fresno, as well as the neighbouring municipalities, Alcobendas and San Sebastían de los Reyes “have run out of land”. In his opinion, “anything that places this part of Madrid on the market is a good thing, even if it causes price inflation, as seen in Valdebebas, where homes now cost more than €3,000/m2″.

Beyond its importance from a residential perspective, “Madrid Nuevo Norte also involves a major urban regeneration project, which offers a golden opportunity to position Madrid as one of the greatest capital cities in Europe”, according to Carolina Roca, Vice-President of the Association of Property Developers in Madrid (Asprima). In this sense, the final plans – which will probably be approved during the course of next year – include the construction of a large business centre, as well as a major refit of Chamartín station (which will house the future headquarters of Adif and Renfe).

Although this is an ambitious project from every perspective, “the area to the north of Madrid has capacity to absorb much higher figures than the 11,000 homes currently forecast”, says Samuel Población, Head of Residential and Land at the consultancy firm CBRE. “The absorption rate that we have seen in Valdebebas in just five years serves as an example”, he adds.

Moreover, the current rates of house building confirm that demand is continuing to grow right across the Community of Madrid. Based on the number of construction permits granted, the region is currently building 22,000 properties per year, a figure that contrasts with the 80,000 properties that are going to be built in Spain as a whole in 2017. According to Roca, “property development is performing well in Madrid, but the same dynamism is not being replicated across the country and so, we are still a long way off the 150,000 homes per year that need to be built”. That means that the region “has doubled its weight, something that is not positive because Madrid cannot cope with the real estate business of the whole of Spain”.

But the main problem, according to the head of the Madrilenian property developers, is that the municipal authorities are not responding to this increase in demand by offering new plots of land. “The available buildable land will have been used up in three or four years and no one is performing the repositioning that is necessary for after that period”. (…).

The main consequence of the shortage of raw material in the hands of property developers “is a significant rise in the prices of plots, which end up being passed on in the form of more expensive house prices”, explains Población (…).

In this context, Corral also stressed the need to promote new urban developments as “generators of homes for the most disadvantaged households, as shown by the more than 2,200 social housing units included in Madrid Nuevo Norte (…).

Original story: El Mundo (by Rubén G. López)

Translation: Carmel Drake

Ciudadanos Blocks the PP’s House Building Plans for Alcobendas

24 November 2017 – El Confidencial

Ciudadanos has decided to block one of the most important urban planning operations left to be developed in the Community of Madrid, specifically, in the town of Alcobendas (114,000 residents). On Friday, the PP, which has a minority government, submitted a new attempt to the Urban Planning committee to approve the partial plan for Los Carriles, a new neighbourhood where the plan is to build 8,600 homes. The PP, with 12 councillors, who have been trying to get this project off the ground for years, do not have support from the majority opposition parties – PSOE, IU, UPYD and Sí se Puede—, which comprise another 12 councillors.

The decision lies in the hands of Ciudadanos (three councillors). Previously, those party members supported the PP’s plans (…) but they decided to vote against the project in the meeting on Friday and will do so again in the plenary session on Tuesday. (…). This new block puts in limbo the development of 2,172,909 m2 of land (5% of the surface area of Alcobendas) and business of around €2 billion.

The owners of the affected land include the town hall, the Archdiocese of Madrid and several landowners from the municipality, such as the Serrano Alberca family and the company San José del Taller de Nazaret, which owns 320,691 m2 of land, making it the largest individual landowner in this sought-after development.

A lot of money and a lot of interests have been buried in Los Carriles for 14 years now, waiting for the various political parties to reach an agreement. The initial idea for this development arose under the Socialist Government of José Caballero, who, in 2003, backed by the IU, started the first version of the project, which included 14,000 homes, 50% of which were due to be social housing properties. Nevertheless, that project never received the blessing of the regional Government, led at the time by Esperanza Aguirre.

Four years later, the PP took over the town hall once again and started a new plan, but with 40% fewer homes (8,600 in total). (…). But, even though the PP had an absolute majority in Alcobendas and in the Community of Madrid for many years, the project never ended up being finalised. (…) until September 2016 when the PP found an unexpected ally, the only councillor from Izquierda Unida.

The plenary for this month was called to approve the partial plan, which increased the number of social housing properties to 3,870. But the Madrilenian management of the IU did not support its councillor and he had to back down in the end. It was then that Ciudadanos called the project an “urban planning outrage”. “We do not support it. There is no sufficient demand for 9,000 homes. We do not want to build up Alcobendas to the hilt” (…).

In the face of the block, the PP decided to create a working group to try to reach an agreement, focusing in particular on Ciudadanos, its investiture partner.

In the end, after much too-ing and fro-ing, the agreement was signed between Ciudadanos and PP (…). The PP says that it has started to fulfil the agreement (…) but Ciudadanos does not see it like that (…) and has accused the PP of cheating them. “The matter has reached the Assembly of Madrid this week and, there, the Director General of Urban Planning in the Community of Madrid has explained that the partial plan does not comply with the law (…).

As a result, Los Carriles is going to continue in a dry ditch. Moreover, Sí se Puede and environmental groups say that the planned development is going to harm the ecosystem in Valdelatas, where there are a lot of oak trees and a sizeable population of wild boars. The project includes plans to build 800 luxury homes next to the regional park, a protected space. Without forgetting that the plan’s mobility study reveals that the new neighbourhood will add 156,932 daily journeys to the municipality, of which more than 95,000 would be in private vehicles. That would collapse the area even further (the exit to the north of Madrid from the A-1) which already suffers from serious traffic problems.

Original story: El Confidencial (by David Fernández and Ruth Ugalde)

Translation: Carmel Drake

Baupost Finalises Purchase Of Luxury Property Developer Levitt

19 October 2017 – Expansión

The luxury real estate construction sector is retaining its shine. One of the property developers that survived the previous cycle, Levitt-Bosch Aymerich, is on the verge of changing hands. A consortium of American investors, led by the fund Baupost Group, is holding exclusive negotiations to purchase the property developer that specialises in luxury homes, which has a market capitalisation around €200 million.

Sources in the sector explained to Expansión that the operation is in the due diligence phase (the assets are being audited) and that, although no agreement has been reached yet, the operation may be closed soon if the negotiations continue.

Baupost will team up with a local operating partner, Alpine Grove, for the operation. The advisors on buyer include PwC and the law firm Garrigues, on the legal side. Meanwhile, Deloitte Legal is the legal advisor on the sell-side.

According to the latest available information from the Mercantile Register, Levitt-Bosch Aymerich’s net equity amounted to €162 million at the end of 2016. The company recorded a turnover of €61 million and an attributable net result of almost €6 million. Besides Baupost, several other US investment funds that are very active in Spain also submitted bids for Levitt. In this way, market sources indicate that Lone Star, Värde and Castlelake all expressed their interest in the company over the last 12 months.

Levitt, founded in 1929, with the construction of a luxury residential development in New York, arrived in Spain in 1971 with the help of José María Bosch Aymerich, who died in 2015.

In 1973, the company undertook its first development on the Monteclaro urbanisation on the outskirts of Madrid. Since then, it has constructed several high-end developments in Madrid and Barcelona, as well as some office complexes.

In this regard, in October 2014, the company sold five office buildings in Madrid to Merlin for €130 million in order to focus on its residential business.

The firm is currently working on some developments in Valdemarín (Aravaca), in one of the most exclusive areas of Madrid as well as on the El Juncal urbanisation in Alcobendas, amongst others.

Shopping fever

If this deal is closed in the end, it will join the fever of property developer sales that has been happening in Spain in recent years. Examples include Lone Star, which purchased Kutxabank’s real estate subsidiary Neinor in 2014 for €930 million. Also, in February, Värde acquired Vía Célere for €90 million and merged it with DosPuntos – the former real estate subsidiary of the SanJosé group -. In addition, that same fund purchased Aelca from Grupo Avintia for €50 million in June 2016.

Meanwhile, Castlelake, which started to back the Spanish housing market back in 2013 with the purchase of land, launched Aedas Homes just a year ago. Other investors are also backing the market through agreements with local groups to build homes, such as the case of Morgan Stanley and Gestilar, and Green Oak and Ibosa, amongst others.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Amazon To Open 15,000 m2 Logistics Station In Alcobendas

22 September 2017 – Mis Naves

Amazon is continuing to strengthen its distribution network in Spain. With this new facility (to the north of Madrid), the e-commerce giant is hoping that the logistics companies that it works with will be able to shorten order delivery times.

Currently, Amazon’s logistics network in Spain includes a logistics centre in San Fernando de Henares (Madrid) and another centre in Castellbisbal (Barcelona) dedicated to Amazon Pantry (the food and drugstore segment).

This autumn will see the opening of new logistics centres in El Prat (Barcelona), Martorelles (Barcelona) and Getafe.

Moreover, the company owns two urban warehouses in Madrid and Barcelona to provide ultra-fast deliveries to its Prime clients in those cities through the Prime Now service.

Original story: Mis Naves

Translation: Carmel Drake

AEW Europe Buys Mercado Fuencarral For €50M

15 August 2017 – Mis Locales

The real estate asset manager, AEW, has purchased the property from the fund ASG for €50 million. It is the company’s fourth operation in Madrid after it purchased commercial premises and offices on Calle Serrano. It closed the other operation in Alcobendas, with the purchase of the Amura building.

The operation has been advised by ASG Iberia Advisors, CBRE and Uría Menéndez on the sell-side, whilst Herbert Smith Freehills has advised AEW Europe.

The company says that its strategy is focused on creating a portfolio of high-quality, profitable retail assets, which are well-located within Europe’s main urban centres.

The property in question will have a new tenant, the sports clothing and accessories firm Decathlon. As such, Decathlon will have two stores on Calle Fuencarral, given that last year, it opened a shop at number 147, near Quevedo, with a surface area of 145 m2.

Original story: Mis Locales

Translation: Carmel Drake

 

FREO Completes Second Purchase In Spain

22 May 2017 – Freo Group

FREO has made its second acquisition in Spain, this time in conjunction with a large American investment fund. Together they have purchased a value-add office portfolio comprising 14 assets distributed between Madrid, Barcelona and Valencia. The portfolio was purchased from BBVA (one of Spain’s largest banks).

The majority of the portfolio consists of good quality office assets in the major sub-markets of Madrid and Barcelona – namely Julian Camarillo, Manoteras and Alcobendas in Madrid and 22@ in Barcelona.

FREO will be responsible for the asset management of the portfolio and will execute a variety of asset specific business plans due to the heterogeneity of the portfolio, ranging from small amounts of capex and leasing/lease renegotiation, through to total asset refurbishment and repositioning projects.

Original story: Freo Group

Edited by: Carmel Drake

Intu Wants To Open Europe’s Largest Shopping Centre In Alcobendas

23 February 2017 – Mis Locales

The Spanish capital could soon become home to the largest shopping centre in Europe. The company Intu is working on a new mega-project.

The goal of the British company is to construct the largest shopping centre in Europe. The exact location will be in the Escobares I sector of Alcobendas and it will cover a surface area of 500,000 m2. It will be larger than all of the shopping and leisure centres constructed to date and will take over from Puerto Venecia (located in Zaragoza) as the largest shopping centre on the continent (it has a surface area of 206,000 m2).

Intu is currently engaged in tough negotiations with the owners of the land, including Sareb, and in turn, with the property developer, Levitt-Bosch Aymerich. The multi-national is demanding that ownership of the site be transferred, but it is only intending to make the payment once the property has been constructed. This proposal is causing problems and no agreement has yet been reached regarding the form of payment or the sales price.

Intu is one of the largest shopping centre managers in Europe. In Spain, besides Puerto Venecia, it also operates Intu Asturia in Oviedo and four others, in conjunction with Eurofunds.

Original story: Mis Locales

Translation: Carmel Drake