Tag: banco sabadell

Intrum Acquires Ibercaja’s €600M NPL Portfolio

19 December 2018 – Eje Prime

Intrum is continuing its shopping spree in the Spanish banking sector. The Nordic fund is finalising the purchase from Ibercaja of a portfolio of €600 million in foreclosed assets, which the bank put on the market in November.

The sale of Project Cierzo, which is what the portfolio is called, forms part of Ibercaja’s strategy ahead of its debut on the stock market next year, through which it plans to preserve its independence. Intrum is going to close the operation within the next few days after ending up as the only finalist in the process, according to El Confidencial. With that portfolio sold, Ibercaja will have divested 1.14% of its foreclosed assets.

This new operation from Intrum follows another deal closed just five days ago by the Nordic fund with Banco Sabadell, from which it purchased 80% of Solvia for more than €300 million. Thanks to that sale, the Catalan financial institution generated profits of €138 million.

Since the summer of 2017, when Santander signed the largest property sale operation to date with Blackstone, involving €30 billion in assets, the financial sector has sold portfolios worth €82 million in total and has reduced its exposure to the real estate market to less than €100 billion.

Original story: Eje Prime 

Translation: Carmel Drake

Grupo El Castillo Buys the ‘Villa Universitaria’ Hall of Residence in Alicante for €19.7M

17 December 2018 – Eje Prime

The Villa Universitaria hall of residence in Alicante has been awarded to Grupo El Castillo. The Alicante-based company has won the bid for this university complex with an offer amounting to €19.7 million. The Valencian consultancy firm VEO Comunicación has also participated in the process.

The asset has a surface area of 17,000 m2 and contains 400 rooms. It is the largest hall of residence for students in Alicante and it was initially valued at €19.6 million, according to reports from Expansión.

After three years on the market and initial offers that barely amounted to €8 million, the property was owned by the Santa Anna real estate group, a company that filed for liquidation in 2016, and from which a portfolio of 450 properties was auctioned in November for €32 million.

In the first public sales process to be conducted online, closed without success, the parties interested in Villa Universitaria included Sabadell, Sareb and the Reciprocal Guarantee Company of the Community of Valencia.

Original story: Eje Prime 

Translation: Carmel Drake

Banco Sabadell Sells 80% of Solvia to Intrum for €300M

14 December 2018 – Diario Financiero

Banco Sabadell announced today that it has agreed the sale of 80% of its real estate manager Solvia to the Nordic fund Intrum, in an operation that is going to generate €138 million of profits for the bank, which will go some way to strengthening its capital.

The real estate management platform has been valued for the operation at €300 million, and that amount may increase by a second amount of up to €40 million if the conditions established for the evolution of certain lines of business are met, according to a report filed by the bank today with Spain’s National Securities and Markets Commission (CNMV).

The transaction will strengthen the bank’s most demanding capital ratio (the fully loaded CET 1) by 15 basis points, due to the generation of the aforementioned profits of €138 million.

The Intrum group has been awarded the manager through its company Lindorff Holding, fighting off competition from the Arab fund Centricus and Haya Real Estate, the platform owned by Cerberus.

Solvia manages the divestment of non-performing assets by Sabadell, together with portfolios of the bad bank or Sareb.

Original story: Diario Financiero

Translation: Carmel Drake

Xeresa Golf Completes a €4.7M Capital Increase

12 December 2018 – Alicante Plaza

The company that owns the Villaitana hotel complex in Benidorm, Xeresa Golf, has completed the capital increase that it launched in August, after emerging from creditor bankruptcy by fulfilling the agreement and acquiring the plot on which the resort was constructed, which was initially occupied on a concession basis. Thus, as reflected in the Official Bulletin of the Mercantile Registry (Borme) of Alicante on Tuesday, the company has subscribed a €4.7 million capital increase (the total amount), and so the resulting subscribed share capital amounts to €9.2 million, more than twice the figure before the operation.

It is not the first capital increase that Xeresa Golf has undertaken in its checkered history. In recent years, the firm founded at the time by the entrepreneurial Cremades family from Gandía, has resorted to “accordion operations” to wipe its debt, and to add or expel shareholders (the firm was created with several representatives of the jet set amongst its minority shareholders), and, on the penultimate occasion, to articulate the entry of its current majority shareholder, the hotel management company HI Partners, which owns 80% of its share capital.

Nevertheless, this new increase has basically been covered by its current shareholders (the hotel company owned 80% and the Cremades held onto 20%), according to sources. In fact, the shareholders of Xeresa Golf had preferential subscription rights, which, according to the same sources, they exercised. HI Partners acquired the majority of the company in 2017 (…) by offsetting the loan that the firm owned by the Cremades family held with Banco Sabadell, which was the owner of the hotel management platform at the time (and which was created specifically to manage the hotel assets that the entity had had to assume).

Just a year ago, the bank sold its hotel division to the US fund Blackstone, which is the ultimate owner of the 17 hotels that comprise the portfolio of HI Partners, including the asset in Benidorm (…).

Owner of the plot

This new capital increase comes shortly after Xeresa Golf has become the owner of the plot on which Hotel Villaitana stands (two four- and five-star hotels and several golf courses) in the PEDUI of Terra Mítica. Xeresa Golf submitted the best offer in the auction for the plots convened by the Consell, although in reality only two bids were made and the other one came from HI Partners. In fact, the capital increase was carried out for a similar amount to the price offered by the hotel owner to acquire the land on which it stands: €4.8 million plus taxes.

Similarly, the company that owns the hotel complex managed by the chain Meliá has overcome another milestone in the last year, that of definitively emerging from the creditor bankruptcy that it entered in 2012 (…).

Original story: Alicante Plaza (by David Martínez)

Translation: Carmel Drake

Savills Values Solvia’s Property Developer Land at €1.3bn

12 December 2018 – El Confidencial

The banks are starting to benefit from the recovery in the real estate sector. Such is the case of Banco Sabadell, which has seen its portfolio of prime land appreciate by €300 million, or 30%, in recent months, ahead of its firing of the starting gun for the sale of its property developer, Solvia Desarrollos Inmobiliarios.

That is the result of an appraisal of the land that the consultancy firm Savills Aguirre Newman has performed for Sabadell. Initially, the plots were valued at €1 billion. They are the best quality plots of land that Sabadell has left since the outbreak of the crisis, and many of them are in areas with high demand in Madrid and Barcelona. For Savills, the chosen plots are now worth almost €1.3 billion, according to financial sources consulted by this newspaper.

Now that the appraisal has been performed, Sabadell and its chosen advisor for this operation, Rothschild, will launch the sale of the property developer SDI and the plots worth €1.3 billion, imminently.

This operation will result in the creation of one of the largest real estate companies in Spain. It will be even larger than Neinor when it was purchased by Lone Star.

The bank does not expect to close the sale of Solvia Desarrollos Inmobiliarios before the end of the first quarter of 2019. By contrast, Sabadell has also launched the sale of Solvia Servicios Inmobiliarios (the management platform), which is on the market for €300 million and whose sale it hopes to close in 2018. According to Expansión, Haya Real Estate (Cerberus), Intrum and Centricus are participating in that process.

Candidates

There are several funds amongst the candidates to acquire the property developer SDI including: Cerberus, Oaktree, Blackstone, Apollo and Lone Star. The first features in everyone’s list of likely contenders because of its good relationship with Sabadell in recent major operations. Moreover, it owns a property developer, Inmoglacier, with which there could be synergies following the operation.

Meanwhile, Oaktree is one of the candidates that would start with an advantage, given that it is Sabadell’s partner in similar businesses, and so it knows the team at SDI: they have a platform for the joint development of land and they have purchased land from Iberdrola. Nevertheless, according to sources close to the operation, that fund still needs to confirm its presence in the process.

Other candidates that still need to define their strategies include Blackstone, which is studying all of the operations with Aliseda, but which has opted more for rental assets until now; Apollo, which has wanted to enter the development segment for years; and Lone Star, which since its exit from Neinor has purchased Servihabitat and has as much appetite for Spanish property as it did before the crisis. ‘A priori’, the operation seems large for Bain Capital, owner of Habitat.

Original story: El Confidencial (by Jorge Zuloaga)

Translation: Carmel Drake

Firmum to Increase Share Capital by €60M to Buy More Parking Lots

3 December 2018 – Eje Prime

Firmum Capital is stepping on the accelerator to increase its portfolio of parking lots in Spain. The Spanish parking lot manager is on the verge of closing a €60 million capital increase to finance new purchases in the domestic market.

Through the financing round, the company will increase its investment capacity to almost €210 million, and will also open up its capital to new shareholders. The firm undertakes its investments through the company APK Gestión de Aparcamientos.

Firmum was created in 2016 by Cristian Abelló, Bernardino Díaz-Andreu and Fernando Pire, who have generated a portfolio comprising 64 parking lots distributed over a dozen Spanish autonomous regions, according to El Economista.

In total, Firmum owns 27,000 parking spaces in the market, which following the financing round, will be increased with more assets in Spain and Portugal. The current investors in the manager include Banco Sabadell, through Sabadell Asset Management, and Altamar Capital Partners.

Last year, the fund invested €80 million in the purchase of 39 assets, which added 15,676 parking spaces to its portfolio. That investment plan comes at a time when these types of alternative assets are booming.

This segment is attracting interest from many funds and institutional investors, who are willing to pay high prices for parking lots in the centre of provincial capitals, tempted by their long-term returns. In Europe, there are around 305 million public parking spaces and 53,650 private multi-storey parking lots, according to a report compiled by Catella.

Original story: Eje Prime

Translation: Carmel Drake

Spain’s Banks Plan to Sell Real Estate Worth €12.5bn+ over the Next 2 Years

19 November 2018 – El Economista

The banks have set themselves the deadline of 2020 to reduce the property that remains on their balance sheets to an absolute minimum. On the basis of the strategic plans set out by Bankia, Liberbank, Ibercaja and the portfolio of commercial premises put up for sale by Santander, the entities are planning to divest at least €12.5 billion in non-performing assets over the next 24 months.

At this stage, we do not yet know which objectives CaixaBank will set itself in this regard; the entity will unveil its new strategic plan in London on 27 November. Meanwhile, the entity led by Ana Botín has delayed the presentation of its new objectives to the beginning of next year, as it awaits the evolution of the outcome of the elections held in Brazil in October. The exit of the United Kingdom from the European Union, which must take place in March, is also important for the group.

Spain’s entities have accelerated the divestment of their real estate in a frantic fashion over the last 15 months. This summer, Banco Sabadell sold four portfolios of non-performing assets for a combined gross value of €12.2 billion. Those operations allowed the entity to fulfil in one fell swoop the objective that it had set itself in its Strategic Plan 2018-2020 to reduce its non-performing assets by €2 billion per year.

At the end of the third quarter of this year, the entity led by Josep Oliu held €13.62 billion in toxic property left on its balance sheet, nevertheless, once the sales undertaken this summer have been completed, that exposure will be reduced by almost half to €7.67 billion, most of which comprises doubtful loans. The exposure of foreclosed assets has been reduced to around €1.2 billion.

Orderly reduction

With respect to Bankia, in its Strategic Plan to 2020, the entity projected an annual reduction in non-performing assets of €2.9 billion, which would result in the clean-up of €8.7 billion over three years. The bank chaired by José Ignacio Goirigolzarri has divested €2.4 billion during the first three quarters of this year, according to its latest accounts at the end of September, which means that it needs to sell only another €500 million during the final quarter (…).

In the same way, Liberbank closed the third quarter of the year with gross non-performing assets amounting to €3.6 billion, 25% less than it held a year ago. The bank has set itself the objective of leaving €1.7 billion on its balance sheet by the end of 2020, in other words, €1.9 billion less than it currently has.

Finally, Ibercaja, which also unveiled its objectives to 2020 in March, announced its plans to reduce its toxic assets by 50% in three years, which would mean decreasing the balance by around €1.85 billion.

15 months of sales

Santander fired the starting gun on this race with the sale of 50% of Popular’s property to Blackstone, in an operation announced in August last year. Since then, the largest sale by the bank was a portfolio of flats and garages to Cerberus in September, for a purchase price of around €1.535 billion. Thus, the bank still has a second portfolio of foreclosed assets up for sale with a gross value of around €2.4 billion (…).

The most active investment funds to purchase portfolios over the last few months have been Cerberus, Blackstone and Lone Star. Between then three of them, they have made acquisitions of foreclosed assets and doubtful loans from the Spanish banks and Sareb amounting to €48 billion (…).

Original story: El Economista (by Eva Díaz)

Translation: Carmel Drake

Land at the Former San Jorge Paper Mill is being Advertised for 20 Times Less than the PAI’s Initial Appraisal Value

13 November 2018 – Levante EMV

“Second-hand urban land with a surface area of 10,893 m2 and a buildability of 5,514 m2. Located on the outskirts of Xàtiva, in a quiet area”. That advert has been circulating for months on several real estate websites for  a portion of the land where the historical San Jorge Paper Mill used to be located – a dismantled factory complex and a symbol of the former industrial splendour of the city and, until the middle of the 20th century, one of the most important emporiums in the country.

With the crisis, the plot for sale, which is residential in nature, became part of the portfolio of Banco Sabadell’s real estate division, although a promotion is marketing it for just €65,600: equivalent to €8/m2. The amount has decreased by 47% since the asset was transferred. After its reclassification 13 years ago, the plots were appraised at a price twenty times higher, at €170/m2, a figure that is closer to the current market average. A few metres away, on the industrial estate, commercial and industrial use plots half the size are being sold for €1.5 million.

The different buildings that used to make up the San Jorge Paper Mill occupy two urban plots that, according to the cadastral records, span 65,000 m2. The largest, measuring 54,000 m2, was seized and adjudicated by the court in 2017 to Sareb, the bad bank created to absorb the toxic real estate assets. The property no longer appears in the entity’s public catalogue in Xàtiva.

At the height of the real estate boom, a company administered by a former colleague of Alfonso Rus in the PP, condemned for fraud, managed to persuade the department run by the now imprisoned Rafael Blasco to reclassify 73,000 m2 of land in the factory complex from industrial to residential for the construction of 310 homes. That operation revalued the land by €10 million: Caixa Catalunya appraised the land at €12.4 million and signed a mortgage loan amounting to €6.1 million with the property developer of the PAI, which had previously purchased the land for just €2.4 million.

In the process of being protected

The municipal government of Xàtiva has definitively buried the failed urban planning progress during this legislature. Nevertheless, for the time being,  the Town Hall’s plans do not include the option of following in the footsteps of the former convent of Santa Clara and acquiring the land of the paper mill, founded in 1932 by Gregorio Molina. Municipal sources emphasise that the land of the former industrial company is still considered to be for “undeveloped low-density residential” use, although there is no intention to develop any project on the site for now.

The Paper Mill, which is in the process of being declared an Asset of Local Importance and of having its protection status expanded, is home to the largest brick chimney in the Community of Valencia, as well as a mill and a light factory. Its warehouses, gadgets and other components of industrial heritage were going to be demolished by the property developer of the former PAI. The land for sale also served as a paintball battlefield a few years ago (…).

Original story: Levante EMV (by S. Gómez)

Translation: Carmel Drake

Mapfre Accelerates its Divestments: 250 Properties Up For Sale

9 November 2018 – Economía Digital

Mapfre acknowledged in its annual report for 2017 that its real estate strategy “was focused on the divestment of non-strategic assets”. That strategy has intensified in 2018: the Spanish insurance company has started a major sales operation, involving more than 250 assets, which now have a “for sale” sign hanging over them. The divestment will materialise next year.

According to sources speaking to Economía Digital, Mapfre has engaged Solvia, the real estate firm still owned by Banco Sabadell – which is up for sale itself and which is expected to change hands before the end of the year – to exclusively market 256 real estate assets located across Spain, although they are particularly concentrated in Barcelona, Valencia and Madrid.

The most important assets in this portfolio are six plots in Madrid, Las Palmas and Mallorca, whose sale is expected before the end of this year. The other assets are essentially commercial premises that Mapfre owns as investment assets and leases to third parties. The divestment period will run until 31 December 2019.

The plots and offices that the insurance company wants to sell are located in around a dozen Spanish provinces. Approximately, half of them are situated in three autonomous regions: the Community of Valencia, Cataluña and Madrid, although the firm also has assets in Galicia, Andalucía, Aragón and Navarra.

When consulted by this newspaper, Mapfre and Solvia did not deny the operation but they did decline to comment. Sources at the insurance company have explained that the company is constantly rotating its real estate assets and searching for others of more value, although they have not explained whether the company is currently investing or not.

Mapfre’s real estate sales

The truth is that in 2016 and 2017, Mapfre completed some major real estate divestments, but it did not get rid of anything close to 250 assets in either year. Last year, it sold properties for €130 million, mainly corresponding to four large assets: a plot in Madrid for €5.5 million; a building also in Madrid for €72 million; and two plots in Palma de Mallorca for €22.5 million. With these sales, the company chaired by Antonio Huertas (pictured above) obtained capital gains of €65 million.

In 2016, the entity’s property sales were clearly impacted by the sale of a majority stake in Torre Mapfre in Barcelona. First, it tried to sell that property to an investor who wanted to convert it into a Four Seasons hotel, but after failing to obtain the necessary permits due to Ada Colau’s moratorium, it sold 66% to the Fundación Mapfre for €175.4 million and renovated it.

Mapfre’s real estate risk amounts to around €3 billion. Specifically, it closed 2017 with properties that had a market value of €2.945 billion, around €170 million lower than in 2016. More than €1.2 billion correspond to own-use properties, such as headquarters and offices, whilst almost €1.7 billion are investment assets, including the portfolio that the entity has put up for sale through Solvia (…).

Original story: Economia Digital (by Xavier Alegret)

Translation: Carmel Drake

Cerberus is the Favourite to Acquire Solvia for €300M

31 October 2018 – El Economista

The sale of Solvia, the servicer of Banco Sabadell, is heading into the final stretch. According to reports, the US fund Cerberus is lining itself up as the favourite to acquire that company, worth just over €300 million.

According to market sources, binding offers were submitted on Tuesday for Solvia Servicios Inmobiliarios – the firm responsible for marketing the assets – of which those presented by Cerberus, Intrum (the company resulting from the merger between Justitia and Lindorff) and that of another overseas fund stood out. In particular, the offer submitted by Cerberus is the favourite in the process, which is being coordinated by Alantra.

The entity has engaged Rothschild to find a buyer for its property developer.

In any case, according to the same sources, this transaction exclusively contemplates the sale of the management activity, and not the transfer of assets, which opens the door for Sabadell to obtain greater profits, unlike some of its competitors such as BBVA, which did sell its servicer (Anida) together with a portfolio of assets worth €13 billion to Cerberus, applying a discount to those assets. It is worth recalling, nevertheless, that the US fund closed the acquisition of a portfolio of assets (from the Catalan entity) for more than €3 billion in the summer.

This operation comes in a context in which the international investment funds are very interested in Spanish property, which is allowing the owners to sell at higher multiples. That, together with the requirements of the European Central Bank (ECB) to accelerate the sales of financial institutions to the real estate business, has created the ideal breeding ground for Sabadell to decide to sell this asset.

Moreover, this divestment is going to allow the financial institution to reduce the consumption of capital and, whereby, avoid penalties from the ECB. El Economista made contact with Sabadell, but the entity declined to comment on the operation.

It is worth recalling that the entity – in parallel to the sale of its servicer – has engaged Rothschild to find a buyer for its property developer (Solvia Desarrollos Inmobiliarios) and a portfolio of its best plots of land, worth €1 billion, according to Vozpópuli.

Original story: El Economista (by Araceli Muñoz)

Translation: Carmel Drake