Juan Pepa Leaves Lone Star For Pastures New

7 November 2017 – El Confidencial

Juan Pepa was the first person to seriously back the Spanish property development market and, having reaped the rewards, the Argentinian director has decided that now is time for a change of scenery. Mr Pepa (pictured below left), leader of Lone Star in Spain, will hand over control of the US fund next month, to undertake new projects in the country from January onwards, according to sources familiar with his decision. The man himself declined to comment on the news.

With Mr Pepa’s departure, a cycle closes in the real estate market. Having starred in many of the large property-related operations in the Spanish market in recent years, the jewel in his crown was the creation of the property developer Neinor. It was the first firm of its kind to debut on the stock market in almost a decade, and it has seen its share price appreciate by 9% since it first listed in March.

Lone Star created that housing giant after acquiring Kutxabank’s real estate business, in December 2014, for €930 million, an operation that represented the largest sale of a real estate company in Spain since 2007. A year later, the company debuted on the stock market with a capitalisation of €1,300 million.

Mr Pepa’s commitment to the Iberian peninsula has allowed Lone Star to become one of the major players in the economic recovery, a prize that came after it had dared to buy assets at the height of the crisis when most other funds were withdrawing.

Project Octopus

It was in this context that Mr Pepa managed to secure another one of his key milestones, the purchase of Eurohypo’s Spanish real estate together with JP Morgan. Baptised as Project Octopus, this portfolio comprised more than €4,000 million real estate loans in Spain and Portugal.

One of the assets that the firm ended up controlling as a result of this purchase was the Adequa office complex, which was owned by Bami until Lone Star executed the debt that it held and opened a process to sell the property. The buyer was another one of the main players that has turned the sector around, Merlin, with an offer of €380 million.

In Portugal, Lone Star has just completed the purchase of 75% of Novo Banco, another one of the legacies that Mr Pepa will leave behind. Many investors expect to soon see a recovery in Portugal similar to the one already being enjoyed in Spain.

In fact, in addition to the assets from Octopus, in recent years, the fund has taken other positions in the neighbouring country, such as a 2,000-hectare plot of land that it acquired from Catalunya Banca in the Algarve for €200 million.

Despite all of these achievements, Juan Pepa leaves Lone Star with the bitter taste after he was unable to win his last big battle: the €30,000-million portfolio of toxic assets from Banco Popular that Santander sold in the summer. His fund had featured amongst the favourites but the portfolio ended up being awarded to another investment giant: Blackstone.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Socimi Ores Buys Portimão Shopping Centre In Portugal

7 April 2017 – Idealista

(…) After completing its first purchases last week, Ores, the Socimi backed by Bankinter and the Portuguese real estate company Sonae Sierra, has now made its debut in the Portuguese market with the acquisition of the company Portitail, which owns the Portimão shopping centre, located in Portimão (in the Algarve region), although the operation still needs to be approved by the competition authorities in Portugal.

Olimpo Real Estate, whose commercial name is Ores, has been trading on the ever-growing Socimi segment of the Alternative Investment Market (MAB) for just over a month. It debuted on the MAB on 22 February without any assets in its portfolio and with a market value of €200 million. Currently, its market capitalisation amounts to €202.6 million, after a slight increase in its share price in recent weeks.

The company came to the market with a very clear objective: to invest around €400 million in high street commercial premises, supermarkets and hypermarkets, retail park spaces (less than 20,000 m2), bank branches and unitary assets with long-lasting lease contracts and solvent tenants.

In fact, its intention is to look for commercial assets in good locations, in the main cities in Spain and Portugal. The domestic market will account for around 65% of the portfolio, whilst the remaining 35% will be invested in Portugal. The investment plan is due to be completed by the end of 2018.

According to the IPO document, Olimpo Real Estate has a period of five years (specifically, until 29 December 2021) to liquidate its entire portfolio of assets, otherwise, it must retain them for another five years. In this case, and once 10 years have elapsed since its launch, a shareholders’ meeting will be called to decide whether to continue the company’s activity or liquidate it.

Original story: Idealista (by Ana P. Alarcos)

Translation: Carmel Drake