Savills Finalises Purchase Of Aguirre Newman

14 June 2016 – Cinco Días

The large Spanish real estate consultancy firm par excellence, Aguirre Newman, is going to be acquired by its British rival Savills. The two companies are finalising a purchase agreement, according to sources in the market, which could be closed before the summer. The acquisition price amounts to around €80 million.

The Spanish consultancy firm launched a sale process two months ago, in search of an alliance with an international partner. The company, which was founded in 1988 by Santiago Aguirre (pictured above) and Stephen Newman, the current Presidents, employs around 460 people and recorded revenues of €96 million last year.

If the sale is completed, the co-Presidents Aguirre and Newman will remain at the helm for between four and five years. The rest of the management team will also continue to lead the business, according to sources familiar with the process. The Spanish company operates a real estate broker business in the office, hotel and residential segments; it also performs appraisals, town planning activities and corporate operations.

Besides Savills, the owners of Aguirre Newman have received offers from Cushman & Wakefield and Colliers, in a process that has been advised by the financial group Atlas Capital. But only the British consultancy firm has passed through to the final stage, where the finishing touches still need to be agreed.

Savills, which has declined to comment on the operation, is a real estate broker that recorded turnover of €1,645 million last year, up by 13% YoY. It has a market capitalisation of €1,400 million. Despite being one of the largest consultancy firms in the world, it only has limited operations in Spain, falling behind JLL, CBRE and Aguirre Newman itself. Its business in Spain, where Rafael Merry del Val is President, is strong in operations known as off-market deals.

With this acquisition, Savills will become one of the leading players in the domestic market. The company records revenues of around €11 million in Spain, almost nine times less than the Spanish company. Moreover, it is likely that the British consultancy will retain both brands for a period of time, so as to be more recognisable to its customers.

Experts familiar with the operation indicate that Aguirre Newman brings a strong presence and knowledge of the domestic market, compared to Savills, located in London, which will provide its Spanish subsidiary with strong international links.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Aguirre Newman Conditions Sale On Continuation Of Management Team

9 May 2017 – Cinco Días

The future of the real estate consultancy firm Aguirre Newman will be up for debate over the next few weeks, as the current shareholders decide whether to sell the company to one of the three competitors from which it has received proposals. In any case, the founders and presidents Santiago Aguirre (pictured above) and Stephen Newman, as well as the rest of the management team, will continue at the helm, according to market sources.

The owners of Aguirre Newman have received offers that value the company at around €80 million, an operation for which the financial group Atlas Capital has been engaged. The bids come from its rivals in the market: Cushman & WakefieldSavills and Colliers, as revealed by El Confidencial and confirmed by sources in the sector. All three are international firms, with a smaller presence than the Spanish company in the domestic real estate market, but all of whom are strong at the international level.

And that is precisely what was of interest to the owners of the Spanish company: how to how to tackle the international market as an independent consultancy of the calibre of the global firms, as leader of the domestic market, together with JLL and CBRE. In fact, according to these sources, the owners are considering an alternative plan involving alliances overseas if this sale is ruled out in the end.

The three offers involve retaining the two founders as presidents – participating in the management – but, under one of the proposals, the two directors would retain only an institutional role. In all of the cases, the Aguirre Newman brand would disappear, although the Spanish management team would continue to lead the business for a certain period, which in other similar cases, tends to be for between four and five years.

Not all of the offers are for 100% of the company, given that under one of them, the current shareholders and executives would take on a minority stake in the new company, through which the buyer would operate in Spain.

Currently, the company’s shareholders are in the middle of considering the possibilities, and the plan is for them to take a decision over the next few weeks, based on the benefits and drawbacks of each bid. The US firm Cushman & Wakefield is the favourite in the running, given that following its merger at the global level with DTZ last year, it now has plans to debut on the stock market, something that the current owners of Aguirre Newman may find attractive, according to experts in the sector.

In the case of Savills and Colliers, their presence in the Spanish market is somewhat smaller, and so from their offices in London and Toronto, respectively, they are considering a direct investment in Aguirre Newman to promote their growth in Spain.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

C&W, Savills & Colliers Compete To Buy Aguirre Newman

20 April 2017 – El Confidencial

The final round of the sales process for Aguirre Newman has started and three firms are fighting to take home the trophy. The suitors in question are Cushman & Wakefield, Savills and Colliers, the only three players that have submitted bids for the real estate consultancy firm, according to sources in the market.

The winner is expected to be announced in less than a month. Following the first analysis of the proposals submitted, C&W and Savills are the favourites to reach an agreement with Aguirre Newman, to the detriment of Colliers.

As El Confidencial revealed, Aguirre Newman engaged Atlas Capital in February to organise a sales process that could result in a valuation for the company of between €80 million and €100 million, given that the consultancy firm’s turnover amounts to €80 million and its operating profit (EBITDA) stands at €12 million.

Although there was speculation that venture capital funds, such as Cinven and Apax Partners, may be interested in acquiring the real estate consultancy firm, to take advantage of the recovery in the sector, the underlying reasons that caused the company to organise the sales process in the first place rule out a movement of this kind, a priori.

According to the explanation provided by the head of the group to the workforce, the engagement of Atlas forms part of Aguirre Newman’s new Strategic Plan, which seeks to grow in size and importance, at both the domestic and international levels. The idea is that it may be able to handle that leap in magnitude more quickly if it is able to reach some kind of agreement with another firm in the sector.

Aguirre Newman is the only domestic brand of the large companies that operate in the world of real estate consultancy – the market is dominated by multinationals such as CBRE, JLL, Knight Frank, BNP Paribas Real Estate, C&W, Colliers and Savills. The largest eight players account for more than 90% of the turnover in this market in Spain.

With almost 400 professionals, Aguirre Newman stands out due to its good position in the Spanish capital and due to its architecture division, a “rare species” in the sector, which some of the firms that have expressed interest in the sales process have valued as a differential sign when considering the operation,

In addition to the usual work undertaken by these types of firms – advisory, valuations, appraisals, management… – the Spanish firm has tried to pursue new avenues of growth and expansion, like it did in the past with the fund Zaphir and, more recently, with the creation of a specific business unit for the ‘fintech’ world.

Original story: El Confidencial (by R. Ugalde)

Translation: Carmel Drake

RE Broker Aguirre Newman Goes Up For Sale

20 February 2017 – El Confidencial

Spain is experiencing a real estate boom once again and brokers want to take advantage of the situation to make money.

Whilst last year, the private equity fund Cinven acquired Tinsa, the largest appraisal company in the country, and in 2015, Apax Partners took control of Idealista, this year, Santiago Aguirre Gil de Biedma, the brother of Esperanza Aguirre, has decided to put Aguirre Newman, the largest real estate broker in the sector, up for sale.

According to financial sources, Santiago Aguirre has engaged Atlas Capital to sell his majority stake in the consultancy firm. The firm will target both individual and institutional investors, as well as public and private corporations. Aguirre Newman caters for all real estate investment-related matters and offers a complete set of services including valuations, feasibility studies, appraisals, attending compensation boards, leases, property management and technical architectural services.

The company generates annual revenue of around €80 million, with an operating profit of EBITDA of almost €12 million. As such, the financial sources consulted consider that Aguirre Newman could be sold for between €80 million and €100 million. Other sources consider that some of the parties that may be interested in purchasing this real estate broker include the private equity funds Cinven and Apax Partners, which could enlarge the businesses of Tinsa and Idealista, respectively, with this acquisition.

However, the same sources also consider that this could be a good opportunity for some of the main domestic competitors, which would result in a certain degree of concentration in what is a very fragmented sector. In addition to Aguirre Newman, the other large consultancy firms include CBRE, Knight Frank, JLL, BNP Paribas Real Estate, Cushman & Wakefield and Savills. These seven firms account for 90% of the sector’s revenues in Spain and employ 2,200 professionals in total. Almost 400 people work for Santiago Aguirre and his minority shareholder partners.

Low interest rates, the collapse in prices following the crash, the enormous volume of liquidity and the recovery of the Gross Domestic Product (GDP) in Spain have created a cocktail that has led to investment figures not seen since the era of the bubble. According to a report from JLL, non-residential real estate investment (offices, retail, logistics and hotels) amounted to €8,707 million in 2016. That figure represents a decrease of 8% compared to 2015, when operations worth €9,407 million were closed. Nevertheless, the figure recorded in 2016 was still higher than the maximum recorded in 2006 (€7,800 million).

Golden years

Last year, the most active market in terms of investment volume was the retail premises and shopping centre segment (retail), with €2,977 million, down by 3% compared to 2015. (…). Moreover, Aguirre Newman highlights that this figure exceeded the €2,000 million threshold for the third year in a row, which is clear proof of the boom in the real estate sector, especially in retail, which accounts for 35% of all tertiary investment.

Original story: El Confidencial (by Agustín Marco)

Translation: Carmel Drake