Tag: Aravaca

Grupo Ibosa Acquires 10,000m2 Plot on Paseo de la Habana for c. €70M

24 July 2018 – El Confidencial

It has undoubtedly become the most expensive land operation since the start of the real estate recovery. Paseo de la Habana, 147 has smashed all records, given that almost €70 million has been put on the table for its 10,000 m2, which represents a repercussion price of between €6,500/m2 and €7,000/m2. That figure is significantly higher than the expectations of the plot’s vendors, which had set a sales price range of between €60 million and €65 million.

Since the real estate bubble burst, no one has paid such a high repercussion price for a plot of land. The figure comfortably exceeds the €5,000/m2 that the builder Rafael Ortiz and the popular shipping entrepreneur Fernando Fernández Tapias paid in 2007, at the height of the boom for a plot located on Juan Bravo 3, where the Spanish capital’s largest luxury development is currently being constructed, Lagasca 99.

Since coming onto the market just three months ago, the plots have passed through the offices of more than a dozen property developers and private investors and, although many of them agree on the high price of the operation, the fact is that the plot has had half a dozen suitors in the end.

The companies that placed an offer on the table include Nozar, Grosvenor, Domo and Pryconsa, although the successful bidder in the end was Grupo Ibosa, according to some of the candidates that have been left out of the process, speaking to El Confidencial. Both JLL, the consultancy firm advising the sales process, and Ibosa declined to comment in this regard.

The plot in question is located in the heart of Madrid, opposite the Cuban consulate, just 700 m from Paseo de la Castellana and 1km away from the Santiago Bernabéu stadium, where the supply of buildable land for sale is very scarce. In fact, the vast majority of the projects in the area are being built in renovated properties.

Five detached homes are currently being constructed on the acquired plot, with surface areas of between 300 m2 and 400 m2 each, which will have to be demolished to make way for the buyer’s future project. All indications are that a luxury apartment development will be built on the plot, which will be added to the high-end projects that Ibosa currently has underway in Valdemarín – on some plots it acquired from Blackstone – and in Aravaca, and marketing of which has just been launched.

The lack of new build product in the area and the high demand explain this pressure on prices. The development will be built in the Chamartín district, which is home to some of the most sought-after residential areas in the centre of the city, such as El Viso, where the Venezuelan investors Miguel Ángel and Áxel Capriles arrived in April last year to purchase Villa San José on Pablo Aranda 3, just opposite Florentino Pérez’s real estate bunker.

In terms of benchmark prices, one example is the 11 homes that are being built on the plots of the former headquarters of RTVE. The Ministry of Finance put that plot up for auction at the end of 2015 and it was awarded to Martell Investment for €10.8 million, which represents a repercussion price of €4,800/m2. Construction of those homes has now begun and the prices fluctuate around €7,000/m2.

Boom in prices

In just two years, the prices in the most sought-after neighbourhoods of the Spanish capital have soared by more than 20% (…).

According to a recent report from Engel & Völkers, maximum prices in this Madrilenian neighbourhood amount to €6,000/m2, although, as sources specialising in the sale of luxury homes at the agency explain, “there are no new build properties in the area, and so the final prices depend a lot on the features of each project”.

In terms of the area, like in the most trendy areas of Madrid, prices have risen sharply over the last year. According to Engel & Völkers, prices have risen by 10% since 2017, “although, at the moment, more operations are being closed than last year because there is greater access to credit, but, nevertheless, prices are barely rising”.

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

APG & Renta Inject Another €253M into their Socimi Vivenio

17 April 2018 – La Vanguardia

The Dutch pension fund APG is going to inject €253 million into the Socimi Vivenio, created together with Renta Corporación, which will contribute another €3 million, after the company already spent around €200 million on the purchase of residential assets in Spain.

Vivenio has recently closed the purchase of three buildings in Madrid – two located in Vallecas and another one in Aravaca – for a combined amount of €76 million, which means that it now has around 1,000 homes under management.

With these operations, the Socimi (Listed Real Estate Investment Company) has invested all of the initial committed share capital, which amounted to €130 million, and is starting a second phase, with a new capital commitment amounting to €253 million, contributed by APG for the most part.

This new capital injection will allow the Socimi to acquire new residential buildings worth up to €400 million, with the focus on Barcelona and Madrid, but without ruling out other Spanish cities, according to a statement issued today.

Vivenio was created less than a year ago and aspires to become a leading Socimi in the residential market in Spain.

The Dutch group is going to continue as the majority shareholder of this vehicle, which will make its stock market debut in 2019, and in which it currently controls around 95% of the share capital.

Renta Corporación holds a 3% stake and the remaining shares are held by minority investors.

Original story: La Vanguardia

Translation: Carmel Drake

Blackstone Sells 19 Plots of Land in NW Madrid to Ibosa

12 March 2018 – El Confidencial

A large-scale operation has been closed in the real estate market in Madrid. Grupo Ibosa has purchased the largest batch of “finalist” land – also known as land that is ready to be built on – in the north of Madrid from the US fund Blackstone for €16 million. The plots are located in one of the areas with the highest purchasing power in the whole Spanish capital, next to La Zarzuela race track, in Valdemarín (Aravaca), where properties, the vast majority of which are family homes, cost upwards of €1 million.

According to various sources, the cooperative manager is working with Gran Roque Capital, the real estate management company owned by the Venezuelan businessman Miguel Ángel Capriles, and the fund Urbania Internacional, with whom it has constructed various projects in the area.

The acquired land is divided into 19 plots – with surface areas ranging between 500 m2 and 750 m2 each (…). They used to belong to Jardines del Hipódromo, a company owned by Inmobiliaria Monteverde, which filed for creditors’ bankruptcy at the end of 2011. At the end of 2016, Mercantile Court nº8 in Madrid convened the auction of the plots – the company’s only asset – which ended up in the hands of Blackstone, one of its creditors after it purchased the debt that the company had taken out with Banco Sabadell and La Caixa (…).

Grupo Ibosa has also purchased land in Aravaca from Blackstone, specifically, on Calle Diplomáticos, where it is going to build eight luxury family homes measuring 700 m2 on plots spanning 1,000 m2. And, it has an agreement with another owner for another plot in Valdemarín to build another dozen houses.

In total, three transactions – which amount to around 24,000 m2 in total – involving a very scarce asset in the capital, which has led to real competition between property developers and investment funds and an important upwards pressure in prices. In total, Grupo Ibosa is going to build almost 40 units from whose sale it expects to obtain revenues of more than €55 million. In all three cases, the developments will be carried out under the cooperative regime (…).

A sought-after neighbourhood

Valdemarín is one of the most sought-after neighbourhoods in Madrid for young directors and Spanish executives. A neighbourhood where homes cost upwards of €1 million and where plots of land – like in the neighbouring El Barrial – are really scarce. New build properties are also in short supply, which has led to significant price increases of 20% (10% per annum) in recent years. According to the sources consulted, everything that comes onto the market is sold very quickly.

“Within Aravaca, Valdemarín has become fashionable thanks to its good schools and access to Madrid,” say sources at Engel & Völkers, which places the maximum price that can be paid in the area at €6,300/m2 (…).

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

Renta & APG Increase Their Socimi’s Share Capital by €40M

28 November 2017 – Eje Prime

In its Socimi with APG, Renta has found a business that needs developing more carefully. The company, which operates in the real estate sector, under the name Rembrandt, has just increased its share capital by €40 million, according to sources at the group, speaking to Eje Prime. This capital injection will be used to purchase new assets, which will be added to the two batches of properties that the group has acquired since its creation.

According to the records at the Mercantile Registry, Rembrandt Activos Residenciales Socimi has increased its share capital by €40 million. The company’s resulting subscribed capital is fixed at €90 million. This is the second capital injection that the company has carried out since its creation in April. The first amounted to €50 million and was completed in July.

Rembrandt carried out the purchase of its first assets in June. The company closed its first investment when it acquired two residential complexes in Navalcarnero and Rivas-Vaciamadrid, both municipalities of Madrid, for €25 million. The two assets have a combined surface area of 20,892 m2 and contain 335 rental homes (…).

Rembrandt carried out its second purchase a month ago when it bought a real estate complex comprising three buildings with a combined surface area of 20,114 m2 in Aravaca in Madrid for €50 million. In that deal, the vehicle managed by Renta Corporación purchased 156 homes with an average surface area of 102 m2 and 168 parking spaces.

€1 billion spending spree

Renta and APG have the aim of spending around €1 billion to fatten up their Socimi. Although 80% of the purchases that Rembrandt is going to carry out will involve residential assets, it does not rule out spending the remaining 20% on other opportunities. (…).

Moreover, Renta and APG’s plans for Rembrandt include debuting the company on the stock market within the next two years; they have their sights set on the main exchange. The company has its offices on Calle Velázquez in Madrid, in the same building as the headquarters of Renta Corporación in the Spanish capital. Although for the time being, Rembrandt’s team comprises exclusively Daniel Loureda, the former executive of Testa, the firm wishes to expand its structure over the next few months.

The first step has been to create a Board of Directors. Renta Corporación will put José María Cervera, the Director General of the Group, at the helm, whilst APG has reserved three seats for Martijn Vos, Raphael Villalba and Johannus Hans, all of whom are directors of the pension fund. Daniel Loureda, who is currently combining his role as the leader of Rembrandt with his position as CEO of the property developer Nidom Homes, also has a seat on the board.

In this way, Rembrandt will be one of the financial lungs of Renta Corporación over the next few years. So much so that it will help it to fulfil one of its short-term goals, which is to generate a net profit of €13 million by the end of this financial year, compared with the €4 million that the group recorded last year.

According to the latest available data, Renta is on track to achieve its objective. The group closed the third quarter with a net profit of €10.3 million, multiplying by five the €2.1 million of profit that it obtained during the same period in 2016.

Renta Corporación currently has a portfolio of assets worth €215 million, but that figure may increase to €250 million before the end of 2017, which the company considers would be “optimal” for normal operations.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Iese Invests €24M In New Campus In Madrid

17 November 2017 – Eje Prime

The Universidad de Navarra is going to expand its presence in Madrid. Iese, the entity’s business school, is going to start construction work in 2018 on a new campus with a surface area of 16,000 m2. The University will invest €24 million in the project. With the future building, which will be located next to the current faculty, the university will double its space in the town of Aravaca.

In addition to the new campus, Iese will build a car park with 300 parking spaces. The aim of the Universidad de Navarra is to triple the capacity of its business school in the Spanish capital, according to El Confidencial.

The design of the campus comprises four classrooms, one of which will be equipped with the latest technology, as well as an auditorium with capacity for more than 500 people. For the financing, the University de Navarra ‘s business school has launched a fundraising campaign, which aims to secure 70% of the investment from employer companies and the network of Iese former students, with the remaining funds being provided by the budgets of the institution itself.

Original story: Eje Prime

Translation: Carmel Drake

Renta Corporación’s Socimi Will Soon Own Almost 1,000 Homes

26 October 2017 – Expansión

€170 million / The vehicle has acquired three buildings already and is currently finalising the acquisition of another three, all in the Madrid area.

Renta Corporación’s Socimi, created in April together with the Dutch pension fund APG, has already invested €75 million in the purchase of residential buildings and is preparing to spend another €95 million on three operations that it plans to close within the next month, in the areas of Aravaca, Vallecas and Alcorcón (Madrid). In total, in just over six months, the entity will have purchased six buildings, all in the Madrid area, containing 986 homes and with an occupancy rate of 90%.

The aim of the Socimi, which has been baptised with the temporary name Rembrandt and which will be renamed over the next few months, is to acquire residential buildings located primarily in Madrid and Barcelona, but, occasionally, in other Spanish cities. “All of the operations have been closed in Madrid so far, but that is down to chance, not design”, said the CEO of Renta Corporación, David Vila, yesterday, who assured the market that “(its choice of investment location to date) has nothing to do with the political conflict”, but rather with the smaller size of the market in Barcelona and the greater complexity involved in finding assets for sale.

The Socimi, in which APG owns a 97% stake and Renta Corporación holds the remaining 3% stake, is managed by the latter. The vehicle has committed capital of €130 million and plans to undertake acquisitions in the short term amounting to €250 million. Within two years, when the Socimi plans to make its stock market debut, it expects to have invested more than €1,000 million in properties.

The assets that it has already acquired include a complex of 156 homes in Aravaca (Madrid). The Socimi spent €50 million on the asset, which had an occupancy rate of 51%, with the intention of placing it at full capacity over the next few months.

The other two operations undertaken by Rembrandt correspond to two residential complexes in Navalcarnero and Rivas-Vaciamadrid, involving 335 rental homes, where it has spent €25 million in total.

Original story: Expansión (by Marisa Anglés)

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

Foro Consultores: Land Prices Soar In Certain Pockets Of Madrid

13 February 2017 – El Confidencial

Land prices are soaring, house prices are rising, the buying frenzy is gaining momentum in some areas and in certain developments…Is history repeating itself? Are we witnessing the gestation of a new real estate bubble, albeit not on a national scale, but nevertheless in certain areas of the country. That is what seems to be happening in some neighbourhoods of Madrid. But, the answer, for the time being at least, seems unanimous: not yet.

Buildable land, in other words, land that is ready to be built upon, is running out and, across Spain, there is barely enough land left upon which to construct the 1.5 million homes estimated to be required to supply the market for the next 8.6 years. In Madrid, the land will run out in just over 6 years, according to the latest report from the appraisal company Tinsa. It identifies a worrying shortage of this type of land in areas of expansion to the north of Madrid, as well as in certain specific points of the metropolitan area, such as Pozuelo, Villanueva de la Cañada, Coslada and Rivas. In some of these areas, according to warnings from Tinsa, there will be no buildable land left within 12-24 months. This situation has, unsurprisingly, led to sharp increases in land prices in certain areas. And these rises are concerning the sector. Where are these first warning signs starting to sound?

Valdebebas

The large real estate development in the north of Madrid, which was launched at the height of the crisis and which has fallen victim to numerous legal setbacks, has become, in the eyes of the residential sector, a clear example of the extent to which land can become a very sought-after, as well as a very dangerous, asset.

“Without doubt, it is one of the areas where land prices have grown significantly. In 2014, they ranged between €750/m2 and €900/m2, whereas nowadays operations are being closed for more than €1,200/m2 and €1,300/m2, and the perception in the market is that land can no longer be sold for less than €1,400/m2”, explained Vicente Quintanilla, Director of the department for Investment and Land at Foro Consultores. According to this expert, “this trend generates significant tension in terms of the prices of new builds, which are being sold for €3,000/m2 in certain developments”. (…).

Pozuelo, Aravaca…

Another market where prices have also risen significantly is the municipality of Pozuelo de Alarcón, where Sareb sold land for around €1,000/m2. (…).

Indeed, the supply of land in Pozuelo has completely run out and families in need of homes are heading to other markets, such as in Boadilla del Monte, a cheaper alternative. According to data from Foro Consultores, the gap in prices is very significant. “To give you an idea, a family home or chalet in Boadilla costs around €450,000 on average, compared with between €700,000 and €1 million in Pozuelo.

Scarce and sought-after plots of land have also seen sharp price increases in recent years. “In El Camino de Barrial, in Aravaca, land prices have risen from €1,200/m2 in 2014 to around €2,000/m2 now. (….).

Boadilla del Monte, at boiling point

Boadilla del Monte is another one of the markets that has experienced a huge boom over the last two years. And there, it has not been due to the scarcity of land, but rather because of the strong demand from families who, as described above, cannot find homes in Pozuelo de Alarcón.

“For family home plots, land prices have increased from €400-500/m2 in 2014 to €800-900/m2 in2016, say Foro Consultores. (…).

Euphoria in Méndez Álvaro and rises in El Cañaveral

In the heart of the capital, where land is noteworthy due to its absence, land prices have increased considerably. In 2014, buyers paid €1,000/m2 and in a recent operation, whereby Adif and Renfe sold a plot to Vía Célere, the price paid amounted to around €1,900/m2. (…).

This increase in land prices is not exclusive to the area to the north of Madrid (…). The price of more affordable land and cheaper homes has also risen significantly in recent months.

Such is the case of El Cañaveral, in the east of Madrid, where “last summer, land prices amounted to around €360-370/m2 and now plots are going for €450-500/m2” (…).

Finally, all of the experts lament the fact that during the crisis, no agreement was reached to manage land, which has resulted in this significant shortage and in the inevitable increase in prices. They advocate greater agility in terms of urban planning, especially where the shortage is leading to a bottleneck in the market.

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake