Tag: alliance

Santander & Costain End Their RE Partnership In Sotogrande

2 July 2015 – Expansión

The Spanish bank and the British company are sharing out Alcaidesa’s assets – the development is worth around €90 million.

According to the agreement reached between the two partners, Santander will retain the majority of the land owned by Alcaidesa Holding for residential development, whilst Costain will keep two small plots of land and the operational management of golf courses and the marina, which are already in operation.

To complete the transaction, Costain will pay Santander €37.3 million for its 50% stake in Alcaidesa and will take on €8.5 million of the debt that the property developer owes to the bank. The bank, through its subsidiary Altamira, will hold onto the majority of the property developer’s land, worth €45.8 million.

Santander inherited its stake in Alcaidesa from Banesto, which in turn formed an alliance with Costain in the 1990s, to undertake this residential and leisure project in the Cadiz town of La Línea, near Sotogrande. The crisis that began in 2008 caused a slow down in the construction of more homes in Alcaidesa, which left several unbuilt plots of land that will now pass into Santander’s hands.

The parties expect to complete the transaction in September, once all of the administrative and tax formalities have been completed.

At the end of 2014, the funds Cerberus and Orion Capital paid NH Hotels Group €225 million for the assets (for development), golf course and hotels in Sotogrande.

Original story: Expansión (by Roberto Casado)

Translation: Carmel Drake

International Investors Team Up With Local RE Developers

18 June 2015 – Expansión

International investors are forming partnerships with local real estate developers to manage and develop new properties in Spain, whereby leveraging their market knowledge.

Spanish property developers are finding it difficult to access credit and foreign funds are looking for opportunities in the real estate sector, and so, alliances between the two are proliferating. International investors are interested in the high yield on certain Spanish assets and are reactivating the sector together with local companies, by making significant purchases.

There is a clear upwards trend and “it is going to strengthen”, since “it is becoming an alternative to bank financing”, says Jorge Almagro, Commercial Director of Residential, Urban and Land Development at the consultancy firm JLL. “Funds are looking for the expertise of local developers, who know the market well and who provide guarantees and even participate in transactions, by taking a percentage stake. In this way, the risk is minimised”, he adds.

One example is the agreement that was signed between the Socimi Lar España and Pimco. It is a framework agreement for a joint venture whereby the fund holds a 12.5% stake in Lar España, which has increased with the purchase of the plot of land located at Juan Bravo, 3 (Madrid). “Funds are looking for stable companies and the existence of strong, reasonable business projects”, says Miguel Pereda, CEO at Lar España.

Another example is the alliance between the real estate company Renta Corporación and the fund Kennedy Wilson, which began with the purchase and refurbishment of an office building into luxury homes in the neighbourhood of Chamberí in Madrid in December. Their second joint operation was closed in May, after Commercial Court number 3 in Barcelona awarded Kennedy Wilson and Renta Corporación ownership of the building at Puerta del Sol, 9 in Madrid.

Original story: Expansión

Translation: Carmel Drake

Hispania On Verge Of Closing Purchases Worth €200M+

27 April 2015 – Cinco Días

The company managed by Azora informs the CNMV about its “advanced agreements”.

The billionaire George Soros owns a 17% stake in the Socimi.

Socimis have become very important players in the real estate sector in recent months through numerous purchases. And there are many more in the pipeline. On Thursday, Hispania Activos Inmobiliarios announced that it was on the verge of closing purchases worth more than €200 million.

These listed real estate investment companies are listed vehicles, created to undertake the acquisition and development of urban real estate assets for lease. They have tax advantages, for example they pay corporation tax at a rate of 19%, and they are required to distribute dividends.

Hispania has sent the National Stock Exchange Commission information about its updated portfolio, which explains that it has made “advanced agreements” with a value of more than €200 million, and is on the verge of signing the contracts.

Moreover, the Socimi reports that it involved in various deals involving assets worth more than €2,200 million, although it does not specify the negotiation phase. Hispania, which is managed by the company Azora, also updates the value of its current portfolio, to €993 million, held in various properties. In February, it agreed an alliance with Barceló with the aim of launching Bay, the first Socimi dedicated to investing in the hotel sector in Spain. Initially, the vehicle acquired 11 hotels containing 3,946 rooms. Thanks to that transaction, 57% of Hispania’s portfolio is hotel-based; 27% is invested in offices and 16% is residential.

George Soros owns a 17% stake

The fund Soros Management, managed by the billionaire investor George Soros, controls 16.7% of the listed company, according to the information provided to the CNMV. Furthermore, the manager Paulson & Co, owned by the investor John Paulson, holds an equal stake and so is another important shareholder.

Hispania also has several other hotels in its portfolio, including the Vincci Málaga, the Hesperia Ramblas (Barclona) and the Guadalmina (Marbella).

Original story: Cinco Días (by Alfonso Simón)

Translation: Carmel Drake

Slim Negotiates A Deal With Hispania To Take Control Of Realia

6 March 2015 – Expansión

ALLIANCE / The businessman is building bridges with the Socimi, which has an agreement in place with the group’s creditors to restructure its debt. Slim may transfer some assets or engage the management of the real estate company to his rival.

The takeover war being fought between Hispania Real and Carlos Slim’s real estate company Carso, for the control of Realia may end with the waving of a white flag. On Wednesday, the Mexican businessman announced his acquisition of a 24.953% stake in Realia’s share capital from Bankia and “in addition” that he would be launching a takeover bid for 100% of the company’s shares at a price of €0.58/share.

The businessman’s offer exceeded the one made by the Socimi in November for €0.49 per share, by 18%. That takeover bid is still pending approval by the CNMV.

In his favour, Slim’s offer does not only win on price. The Mexican businessman is also the largest shareholder in FCC, which in turn owns a 36.9% stake in Realia. After Slim joined the construction group, FCC announced in February that it would be suspending the sale of its stake.

Agreement

Nevertheless, Hispania still has an ace up its sleeve. The Socimi created by Azora’s managers, Fernando Gumuzio and Concha Osácar made an agreement with Fortress, King Street and Goldman Sachs before launching the takeover bid. The three funds have lent €793 million of the total debt (€1,097 million) held by Realia. Those loans, sold by Sareb, Santander and CaixaBank last year, are due to mature soon: on 30 June 2016. Moreover, when the funds agreed to purchase the debt, they also agreed with Realia that, in the event of a change in more than 30% of the shareholders, then the whole debt amount would have to be repaid “immediately”.

On 21 November, Hispania made an agreement with the creditors in which the funds agreed not to exercise their shares and not to demand the full repayment of the financing that would result from the application of the change of control clause. In exchange, Hispania purchased 50% of the receivables that each one of the funds possessed, at a discount of 21%. This partnership makes Slim’s assault on the real estate company more difficult, and so the Mexican has not wasted any time building bridges with his competitor.

The main obstacle facing Slim is that Hispania and the funds agreed an exclusivity period of seven months for the execution of the agreements, extendable up to ten months if a competing offer were presented. “During that exclusivity period, neither of the parties may initiate, encourage, lead, trigger, conduct or respond to any offer, proposal, contact, conversation, negotiation or approximation of any kind, with or from any third party, regarding the implementation of any operation that may be similar or incompatible with the execution of transfer of the loans resulting from the financing to Hispania Real”, says the agreement. This means that Slim and the funds may not make any agreement until 21 September without taking Hispania into account.

Against this background, the Mexican businessman has chosen to forge an alliance with his rival, to reduce this period. In exchange, according to close sources, Slim is offering the Socimi some capital, some assets to increase its own equity or the opportunity to participate in Realia as its manager. Inmobiliaria Carso, the vehicle that Slim wants to use to acquire Realia, does not have either the structure or the knowledge of the Spanish market held by Hispania’s managers, and therefore a deal between the two cannot be ruled out.

Consideration

The prior agreement with Hispania places the creditor funds in an advantageous situation in the context of the new offer. In the event that the Socimi does decide to raise the price of its takeover bid, Fortress, King Street and Goldman Sachs would receive €38.25 million more for 50% of their debt. If, on the other hand, the Socimi decides to withdraw from the process, the funds shall pay Hispania €5 million “provided that the rights of creditors’ loans have satisfied the nominal”.

Original story: Expansión (by R. Ruiz, D. Badía and C. Morán)

Translation: Carmel Drake

Remax Forms Alliance With BBVA To Supply Mortgages

26 February 2015 – ABC

The estate agent Remax and BBVA have signed a collaboration agreement, whereby the bank will provide specialist financial services for mortgage opportunities generated by the realtor, according to a statement made by the agent.

Through this agreement, the two companies seek to coordinate to provide “the best financial services” to clients in the estate agent’s network.

For Remax, the greater ease of access to home ownership “adds value” to the estate agent’s services.

At BBVA, they believe that this alliance will help the entity become a “benchmark within Remax”.

Original story: ABC

Translation: Carmel Drake