Tag: Andrew Tan

CaixaBank & Allianz Grant a €135M Loan to Finance Caleido

20 November 2018 – Expansión

CaixaBank and Allianz have granted a €135 million loan to finance the construction and operational launch of Caleido, a project led by Inmobiliario Espacio, the property developer of the Villar Mir Group, and MegaWorld Corporation, the business conglomerate owned by the Philippine multi-millionaire Andrew Tan.

Caleido, which will constitute the so-called Fifth Tower in Madrid, is going to comprise a vertical 35-storey building, which will contain the facilities of Instituto de Empresa, and a second horizontal building at the base comprising four above ground floors and standing 17 metres tall in which Quirón Salud is going to manage an advanced medical centre. Moreover, Caleido is going to include an extensive commercial and services area, as well as lots of green space for Madrid and its citizens.

The loan, which has a 10-year term, will finance the construction period until the hand over of the property, in the final quarter of 2020, as well as seven years of operation.

The property developers have explained that the aforementioned agreement will cover the financing needs of Caleido, with a total estimated investment of approximately €300 million.

“This operation strengthens the confidence that financial institutions have in the project and the great expectations that are being generated around its construction. In this way, the technical solvency of the project is clear, as is its future management and operation”, said the property developers.

Caleido – designed by the architecture studios Fenwick & Iribarren and Serrano Suñer Arquitectos – will be located in the epicentre of the new financial district of Madrid and will serve to eliminate a scar from the north of the Spanish capital, connecting Paseo de la Castellana and Anida de Monforte de Lemos, as well as revitalising the current business complex.

The project is being built on some plots owned by the Town Hall of Madrid, granted to Espacio Caleido through a concession arrangement for the construction and operation of the project for the next 75 years. In exchange, Espacio Caleido will pay an annual fee of €4 million. The launch of Project Caleido will generate around 2,400 jobs during the construction period and another 3,992 jobs once it is operational.

Original story: Expansión (by R.A.)

Translation: Carmel Drake

Major Real Estate Projects in Madrid to Attract €10.5 Billion in Investments

21 August 2018

Some of the outsized projects for the coming years include the northern Madrid construction, the expansion of the Barajas airport and the Canalejas project.

Madrid will soon be the target of multi-billion euro investments in major real estate and urban development projects, upgrading the Spanish capital’s image in the coming years. The investments will lead to the construction of housing, skyscrapers, hotels, shopping centres, university campuses while also renovating some football stadiums and demolishing others.

Madrid Nuevo Norte, under development by DCN; Aena’s real estate project for Barajas; the Canalejas and Caleido project, along with the renovation of the Bernabeú stadium and the Mahou-Calderón development will involve total investments of €10.5 billion.

Four new skyscrapers

Madrid Nuevo Norte is the most ambitious project and the one that has been the longest in the making. Formerly known as Operation Chamartín, the project involves the construction of 365 new buildings in Madrid, including 10,500 flats and three skyscrapers in the vicinity of the Chamartín train station, in the north of the capital.

Construction of the project, which had been paralysed for a quarter of a century, is expected to begin in 2019. If the developer manages to keep to the announced deadlines, reparcelling and development will start by the end of next year or early 2020, and the first homes will be ready by 2021 or 2022.

Considering the sheer magnitude of the project, which will have a buildable area of 2.66 million square meters, construction is expected to last for more than two decades. Madrid Nuevo Norte will require €6 billion in investments and should create roughly 120,000 jobs during the construction phase and 94,000 posts after its completion.

A building known as the fifth tower will be erected in the area surrounding Madrid Nuevo Norte. The Caleido project will involve investments of €300 million and should be ready by the end of next year. Inmobiliaria Espacio, of the Villar Mir Group, was awarded the development and operationalisation of the project on public land in 2014 and is leading the development together with Megaworld, a conglomerate held by the Filipino billionaire Andrew Tan.

The project will include a 36-floor, 165-meter tower, which will house IE’s new, vertical campus, and a second building, 280 meters long and 60 meters wide, that will host a sports medicine centre operated by Quirónsalud.

Aena’s planned project for the land adjacent to the Barajas airport also stands out. The airport manager is forecasting a total investment of €2.997 billion over the next 40 years.

The project, with 2.7 million buildable square meters, will have logistics warehouses, offices, hotels and even a shopping centre. The company chaired by Maurici Lucena is searching for partners to develop its plans and, for now, the Blackstone fund and other major investors have demonstrated interest.

The Canalejas project, under development by OHL and Mohari Limited, a company owned by the Israeli executive Mark Scheinberg, is located in central Madrid. The venture, which will link seven historic buildings, will host Spain’s first Four Seasons hotel, along with luxury homes and a shopping area. The project is expected to involve €300 million in investments and is expected to be ready by 2019.

Madrid’s real estate and urban development plans will also affect the iconic Santiago Bernabéu stadium. In April, the city council gave the green light to a plan for reparcelling land for the new stadium, which will involve an investment of about €400 million.d

Housing at the Calderón

1,300 homes will be built on the grounds of another stadium, the Calderón, the former home of Atlético de Madrid. The sale of the land is expected to raise about €175 million in investments from any future buyers (developers), in addition to the more than €42 million stemming from the reparcelling project for the stadium and the grounds of the old Mahou factory.

Original Story: Expansion – Rebecca Arroyo

Translation: Richard Turner

 

Torre Caleido: Construction Begins of Madrid’s Fifth Tower

1 February 2018 – Expansión

After five months of preparations underground, the construction phase of the 35-storey skyscraper has finally begun. The 180 m tall tower is going to house the IE campus, as well as a horizontal building that will be home to sports facilities, a shopping centre and parking areas.

The starting gun has been fired for the above-ground work on what will become the fifth tower in Madrid. The future skyscraper, measuring 180 m2 tall and comprising 35 storeys, is going to house the new vertical IE campus, which will emerge from a second building, with a base that is going to be 280 m long and 60 m wide, which will form an inverted T-shaped complex, known as Project Caleido.

Inmobiliaria Espacio, the subsidiary of Grupo Villar Mir and Megaworld Corporation, the business conglomerate owned by the Philippine multimillionaire Andrew Tan, are the owners of the company responsible for the construction and operation of the project, with a planned investment of €300 million and which will result in the generation of more than 5,000 jobs during the construction and operation phases (…).

Caleido –designed by the architecture studios Fenwick & Iribarren and Serrano Suñer Arquitectos– will be located in the epicentre of the new financial district in Madrid and will serve to eliminate a blot on the landscape in the north of the capital by connecting Paseo de la Castellana and Avenida de Monforte de Lemos, as well as to revitalise the existing business complex, explains Fernando Serrano-Suñer, one of the architects behind the project (…).

“To date, we have completed the first two phases, involving the demolition work and the construction of the foundations, which are now complete. This week, we will award the construction work, which has been tendered for through a very transparent process, audited by Dypsa”, says José Antonio Fernández Gallar, Director General of Inmobiliaria Espacio.

Third phase

Now, the third phase of construction is going to be launched, involving the building of the tower and the base (…), where the campus sports facilities, a 600-seater auditorium, an indoor swimming pool, libraries, a dining room, a complete shopping floor and a hospital centre specialising in sports medicine run by Quirón will all live alongside 7,000 m2 of green space (…).

Leisure will also play an important role in the complex, with sports areas and events spaces. “We are studying the possibility of including a cinema of some kind, but it would not conform with the traditional style, it would include an e-gaming and e-sport element, something that doesn’t exist in Spain at the moment”.

Moreover, the base will include parking for students and professors, as well as parking for the retail space and another public parking lot, with a total surface area of 42,100 m2 spread over several floors and with capacity for 1,900 parking spaces (…).

In terms of the skyscraper, the 180 m tall building will house 70 classrooms, work and rest areas, as well as double-height spaces to replicate meeting places in traditional campuses (…).

“The project is progressing at a good pace. We have completed the first phase and we are moving forward with the idea that the work will be finished by 2020”, he said.

Original story: Expansión (by R. Arroyo and R. Ruiz)

Translation: Carmel Drake

Hines & Emperador Bid For Edificio España

2 March 2016 – El Confidencial

Two of the largest real estate investors in the world want to buy Edificio España. The US giant Hines and the Philippine group Emperador, which has just acquired Torre Espacio, have already taken up their positions in the sales process launched by the Wanda Group for the skyscraper, according to several sources close to the operation.

The Chinese group has engaged the consultancy firm JLL to find a new owner for the property, which it has decided to sell after failing to reach an agreement with the Town Hall of Madrid regarding the handling of the renovation.

Not even the meeting held yesterday between Manuela Carmena and Laurent Fischler, Wanda’s Global Head of Real Estate, managed to put a stop to JLL’s sales mandate, although the consultancy firm declined to make any comment. This meeting was held at the request of the mayoress, anxious about the earthquake unleashed by the Asian group’s decision to leave Madrid. But the only thing she managed to agree with Wang Jianlin’s envoy was the firm’s willingness to remain in the capital, provided the town hall gives something in return.

Nevertheless, there are only a handful of investors with the capacity to undertake the purchase, which could range between €250 million and €300 million (Wanda paid €265 million two years ago), a quantity to which another €100 million should be added for the subsequent construction work to renovate the property.

And that figure is mounting, because the final cost of the renovation will depend heavily on the agreement that the Town Hall of Madrid approves, and the survival of Norman Foster’s project, who has threatened to take Wanda to court if it breaks the agreement signed to develop the architecture project.

The reality is that Wanda inherited this contract from Banco Santander and in theory, the buyer would also be subrogated to it, according to real estate sources. But that honour has discouraged some of the large international funds from bidding for Edificio España, as they prefer to avoid large firms because they make the construction work more expensive.

Giants in the market

By contrast, the profile of Hines and Emperador fit well, given that their investments typically focus on iconic buildings, located on the main thoroughfares of large capital cities and, in many cases, linked to unique architectural projects. Ingredients which, if the negotiations with the town hall are unblocked, are present in abundance in the case of Edificio España.

The US firm Hines is an expert in this kind of development and is currently involved in a growth plan in Spain, which has led to the signing of two operations – for the Desigual store next to Portal del Ángel in Barcelona and number 44, on Madrid’s Gran Vía – in less than two months, for a combined total of €78 million.

And its future plans are even more ambitious, as shown by the fact that it is actively seeking out large transactions in both Madrid and Barcelona. With $87,000 million (€80,000 million) in assets under management, Hines is the fourth largest real estate investment management company in the world.

Meanwhile, Grupo Emperador is one of many companies that comprise the business empire of the Philippine-born Andrew Tan, one of the richest people in the world according to Forbes. (…).

Despite all of these possessions, Tan was virtually unknown in our country until last November when he acquired Torre Espacio with a bid for €558 million, an amount that he largely financed in cash and with a syndicated loan for €280 million from ING Wholesale Banking.

This operation is just the tip of the iceberg of the group’s plans. Emperador has also set itself the objective of multiplying its investments in Spain, both in the real estate sector, as well as in those markets linked to the world of spirits, where it has worked in conjunction with González-Byass for many years.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

ING Grants €280M Loan To Tan To Finance Torre Espacio

26 February 2016 – Expansión

It was the major real estate transaction of 2015. The sale of Torre Espacio to the Philippine group Emperador, owned by Andrew Tan (pictured above), last November was the grand finale to a year that all of the experts agree was the year during which the real estate sector finally began its recovery.

But the financial arrangements for this great purchase remained to be seen. The price agreed was €558 million, a figure to which almost €200 million of debt linked to the company Torre Espacio Castellana must be added. The company owns the skyscraper and served as the vehicle through which the Asian businessman acquired the building.

ING Wholesale Banking has now granted a syndicated loan amounting to €280 million with a seven year term, which will be used exclusively to finance this operation. The loan perfectly represents how the financial sector has reopened its appetite for high quality real estate assets.

According to sources, the rest of the operation will be financed directly by the Philippine businessman, one of the wealthiest people in the world according to the Forbes list. It ranks him as the 330th richest person on the planet and the third richest in his country, thanks to his fortune, estimated to be worth $3,700 million (equivalent to around €3,300 million at the current exchange rate).

Torre Espacio is one of four skyscrapers that were constructed on land that formerly housed Real Madrid’s Ciudad Deportiva in the North of the Madrid. The building has a gross leasable area of 60,142 m2, spread over 56 floors and 1,173 parking spaces. It is regarded as one of the most important office buildings in Spain and its main tenant is the former owner, Grupo Villar Mir, which occupies more than half of the property.

ING, which has acted as the sole underwriter and agent bank, highlights that this loan is a clear example of “the bank’s commitment to real estate financing in Spain and its significant profile in the Asian markets”, according to a statement made by Íñigo Churruca, CEO of ING Wholesale Banking. The entity is currently working to share the risk with other banks, although it is expected to take on the majority of the financing itself.

The entity also closed a financing agreement with Merlin Properties in January this year, amounting to €67.9 million and with a five year term, to finance the purchase of a portfolio containing seven logistics assets.

In addition, last year, it granted a syndicated loan amounting to €125 million, with a seven year term, to Acciona Inmobiliaria, which the company allocated to Urbanizadora Coto, a subsidiary of the group owned by the Entrecanales family that owns seven residential buildings and two offices, as well as a 50% stake in the Arturo Soria shopping centre, in one of the best areas of Madrid, close to Parque del Conde Orgaz.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

2015: A Record Breaking Year For RE Investment

3 December 2015 – Expansión

Real estate investment in Spain will close 2015 at record breaking levels. According to the consultancy CBRE, the purchase of hotels such as the Ritz in Madrid, shopping centres such as Plenilunio and offices such as Torre Espacio, as well as operations such as the purchase of Testa, have driven up investment volumes in the sector to reach €12,250 million by 1 December. CBRE expects the sector to close the year with volumes of around €13,000 million, a figure never seen before in the Spanish market.

“2014 was a record year in terms of tertiary investment (non-residential assets). This recovery in the market saw investment volumes of more than €10,000 million, which equalled those seen in 2007 – the previous record-breaking year -. 2015 has not only seen a strengthening of this trend, it has also seen growth of 25%”, said Mikel Marco-Gardoqui, Head of Investment at CBRE España. “Moreover, it is worth noting that asset prices are now 30%-40% lower than they were in 2007”, adds Julián Labarra, Director of the real estate consultancy.

This record level has been boosted by the largest operation ever seen, namely the Socimi Merlin Properties’s purchase of the real estate company Testa for €1,800 million. Testa holds a portfolio of assets – mainly offices – worth more than €3,000 million. Nevertheless, even excluding that transaction, investment is growing at “an exponential rate”, with increases in the purchase of all types of assets. (…).

Offices, which continue to be investors’ preferred asset, have now reached an investment volume of €5,600 million, thanks to purchases such as Torre Espacio, by the Philippine businessman Andrew Tan for €558 million, and Castellana 89, by Corporación Financiera Alba for €144 million.

Currently, these properties in Spain offer investors minimum yields of between 3% and 3.75% in the case of well-located commercial premises and maximum yields of 6.5% in the case of specific logistics assets.

Hotels

Hotels, in particular, have experienced a significant boost this year. “In 2014, hotel investment volumes amounted to around €1,100 million and so far this year, that figure has already surpassed €1,900 million, which means that we expect to close the year with an investment volume of €2,000 million”, says Marco-Gardoqui.

The boost from investors has not only been felt in the purchase of non-residential assets, interest has also increased in the acquisition of land and property developments for joint promotion with local property developers. (…).

Looking ahead to next year, the experts at the consultancy firm expect that interest from the funds will continue. “We think that investment will amount to around €10,000 million in 2016, because although there will be fewer operations, prices will increase. Many funds are still raising funds, with specific amounts earmarked for Spain”, says Heriberto Terual, Director of Corporate Finance at CBRE.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Testa & International Funds Have Driven RE Inv’t In 2015

3 December 2015 – Expansión

According to the consultancy firm CBRE, investment in offices, commercial assets, hotels and logistics warehouses will amount to €13,000 million by the end of this year.

Real estate investment will close 2015 at record breaking levels. The arrival of international funds and the launch of the Socimis have driven the purchase of assets to levels exceeding even those seen at the height of the boom in 2007, and are expected to close the year with a total volume of €13,000 million. “2015 has not only seen a strengthening of the recovery that started in 2014, it has also seen growth of 25%, resulting in record levels (of investment)”, explains Mikel Marco-Gardoqui, Head of Investment at the real estate consultancy firm CBRE.

By type of asset, offices continue to be the preferred asset, but all of the sectors have experienced growth in 2015, according to the experts at CBRE. “All of the sectors, including offices and shopping centres, as well as hotels, have grown significantly this year and are now at record levels”, says Lola Martínez, Director of Market Analysis at CBRE.

By type of investor, 70% of the investment volumes have come from overseas investors, including those who have entered Spain by acquiring shares in Socimis.

Some the operations that have most boosted volumes include: the purchase of Testa by the Socimi Merlin Properties for €1,800 million, the acquisition of Torre Espacio by the Philippine businessman Andrew Tan for €558 million and the purchase of Gran Vía 32 by Amancio Ortega for €400 million.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake