BMO Acquires Building in Madrid for €20MM

28 June 2019

BMO Real Estate Partners finalized its acquisition of the building located at 30 Calle Serrano, in Madrid. The firm bought the asset for approximately 20 million euros from Bankia.

BMO acquired the asset through its Best Value Europe I fund (BVE I), which owns a total of 13 high-street assets throughout Europe, worth than 700 million euros. The real estate consultancy Ascana brokered the deal.

The building is currently leased to Matarranz, a luxury linens store, and is located in Madrid’s wealthy golden mile. The 1000-m2 store was the subject of interest by a number of potential buyers.

Original Story: Idealista – Custodio Pareja

Commercial Premises on Calle Serrano & Paseo de Gracia are More Expensive Than Ever

28 March 2019 – Expansión

The “golden miles” of Madrid and Barcelona seem to be immune to the consumer crisis and the boom in e-commerce that is negatively affecting other high streets across the country, for the time being at least. In fact, business is booming on Calle Serrano and Paseo de Gracia, driven by demand from large international luxury brands, which are only willing to open their flagship stores on those two streets.

Recent arrivals on Calle Serrano include Salvatore Ferragamo, Bottega Veneta, Saint Laurent and Bang & Olufsen. Meanwhile, the newest tenants on Paseo de Gracia include Moncler, Loro Piana (LVWH), Isabel Marant, Antropologie and Christian Louboutin.

Moreover, demand is driving up rents on those streets. In Barcelona, prices on the golden mile rose by between 5% and 6% in 2018, to €275/m2/month, according to Ascana. In Madrid, the price increase was less marked, up by just 1%, but nevertheless, the average price amounted to €284/m2/month, a new historical record.

Original story: Expansión (by Marisa Anglés)

Translation/Summary: Carmel Drake

Luxury Brands Compete For Space On Spain’s Golden Miles

19 November 2015 – Expansión

The war between the major brands for shops on the golden miles of Madrid and Barcelona is intensifying and it is becoming increasingly difficult to secure premises on these streets, where rents cost more than €230/m2/month.

Calle Serrano and Paseo de Gràcia have become the exclusive territory of the large fashion houses. In recent years, big names in fashion, accessories and jewellery have been taking over the best premises on the golden miles of Madrid and Barcelona and in 2015, boosted by the economic recovery, they have completely taken over these shopping streets, where average rents now cost €230/m2/month.

This year, more than half of the operations recorded in the commercial districts of Madrid and Barcelona have involved fashion houses and jewellery firms. Eleven operations have been completed on Madrid’s golden mile, compared with fifteen in Barcelona, which has welcomed 12 new brands to the city, according to the latest report by Ascana.

Polarisation

“Desirable streets are getting increasingly better, whilst the worst streets are still suffering from the crisis”, says the founding partner of Ascana, Eduardo Rivero. The growth in tourism and the beginning of the recovery for local consumers has spurred on the large brands to position themselves in the best locations.

According to Rivero, the arrival of Prada, Louis Vuitton and Versace, and the expansion of Gucci, on Calle Serrano, is enticing the other luxury brands to follow suit. “We are talking about more affordable luxury” says the consultant – “the high-end luxury firms, such as Chanel and Hermés, are staying put on Calle Ortega y Gasset”.

Increasingly, the Paseo de Grácia is being split into three sections: luxury brands at the top (of the street), mid-range brands in the middle section and more affordable brands at the bottom end (closest to Plaza Cataluña).

Original story: Expansión (by Marisa Anglés)

Translation: Carmel Drake

Massimo Dutti, H&M & Uniqlo Seek Premises On Passeig De Gracia

22 June 2015 – Expansión

Rental prices are soaring on Barcelona’s Golden Mile / The three fashion chains have been negotiating with the owners of premises on the street for months to open mega-stores.

Barcelona’s Passeig de Gracia is one Spain’s most important retail streets, and store rental prices there have increased significantly in recent years. The luxury boulevard of the Catalan capital was the Spanish street where prices rose the most in 2014 (by 6.4%) to €215/m2/month, according to data from the retail-specialist consulting firm Ascana.

The tourism boom in Barcelona is continuing to drive demand in this street, and it is still one of the areas where international brands “must” have a presence. And the shortage of available stores means that prices are continuing to rise. All of this, despite the fact that the retail surface area on Passeig de Gracia has increased in recent years, since the first floors of many buildings have been incorporated into the stores. “And despite the fact that large premises mean lower average rental prices”, explains Eduardo Rivero, Managing Partner at Ascana.

Negotiations

As a result, rental agreements are taking longer to finalise. That is the case of the three mega-deals that have been under negotiation for months and which have not yet been agreed. The Japanese firm Uniqlo has been trying to lease premises on Passeig de Gracia for several years and has been negotiating with the owners of number 18 for months.

Massimo Dutti’s negotiations to lease the store that Vinçon will vacate, at number 96, have also been going on for months. And the other mega-store, created by sacrificing office space at number 11, is where H&M has been trying to open its flagship store since last year.

The volume of transactions on Passeig de Gracia, both in terms of investment and rental, has slowed down in recent months. According to Rivero, the number of retail property purchases has decreased for two reasons: the fall in profitability for the purchaser and, above all, the shortage of assets for sale. (…). The same is happening in the rental market. (…).

New brands are still arriving on the street, although to a lesser extent than a few years ago. In 2014, a total of 23 transactions were signed and 15 new brands arrived, most of them fashion industry names.

New stores

The upper end of the Paseo de Gracia is the real golden mile of the city. There, twelve deals were closed last year, all of them involving luxury brands such as Dior, Versace, Rabat, Frey Wille, Carmina Shoemaker and Wolford.

The extension of the time to close operations has driven the proliferation of temporary shops, known as pop-up stores, such as those run by Brandy Melville, Levi’s and Twin-Set. According to Ascana, these temporary incursions allow companies to verify the degree of consumer interest in a brand and evaluate the success of any possible permanent facilities. And whilst they all continue to look for space, rental prices continue to rise.

Original story: Expansión (by Marisa Anglés)

Translation: Carmel Drake

Foot Locker To Open A Megastore On c/Preciados

16 April 2015 – Expansión

The sports equipment company is going to lease the building located at number 6 on the Madrid street, which has a surface area of 2,000 square metres.

Changes are afoot on Spain’s most sought after shopping street. In a few weeks time, the building located at number six Calle Preciados in Madrid will house a new tenant: the American company Foot Locker. The firm, which specialises in sports equipment will replace H&M, which vacated the property at the end of March to open its flagship store in Spain.

Foot Locker – which until now leased a smaller property at number 17 (on the same street) – will incorporate its signature brand the “House of Hoops” into its new premises in Preciados; the brand was created by the American company in conjunction with the sports brand Nike. The decision to open a flagship store, which will include this new concept, comes after Foot Locker has been testing its new brand, which specialises in basketball-related products, in a pop-up store in other premises on Gran Vía, 36, just a stone’s throw from Preciados.

The building, which is owned by a Spanish family office, has a surface area of 1,960 square metres, distributed over six floors. CBRE advised on the transaction.

The move represents the largest rental transaction involving retail premises on the Spanish high street in 2015. There have not been any major changes of tenants on Preciados for almost two years; the Madrid street competes with Portal del Ángel in Barcelona as the most expensive shopping street in Spain.

“It is a highly sought-after retail area that is very popular with large brands, and so it is rare for property to become available”, says the consultancy firm Ascana.

Last year, only four stores had a change of tenants and only one of those affected premises larger than 100 square metres. Specifically, a store measuring 110 square metres, which is now leased by the make-up firm Mac, after Bijou Brigitte vacated the property. Numerous offers are now expected for the premises at number 17, which Foot Locker has left empty.

Rental prices

This scarce supply has meant that rental prices on Preciados have not been hit by the decreases experienced on properties in the rest of the Spanish market. There, rental prices reach €248/month per square metre for the smallest premises (those measuring between 100m2 and 200m2), according to real estate sources.

Rental prices in the larger stores, such as the one leased by Foot Locker, are lower, amounting to around €100 per square metre per month.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake