The Pace of NPL Sales Falters in Spain

6 December 2019 – Spanish banks have reduced their pace of sales of NPLs this year, as CaixaBank, Sabadell, Bankia, Bankinter, Unicaja and Liberbank unloaded a total of just 4.9 billion euros in the first nine months of 2019. Those financial institutions wrapped up the quarter with €35.006 billion of such assets on their books, 12% less than at the beginning of the year. In contrast, Spain’s banks in sold off €90 billion in non-performing loans and REOs in 2018.

Standard & Poor’s, on the other hand, published a report in February estimating that Spain’s banks should rid themselves of €30 billion in NPLS between 2019 and 2020. That figure would have lowered their collective NPL ratio to below 4% compared to 7% at the time. Both S&P and Spain’s central bank also argued that the banks needed to increase the pace of sales to prepare for a potential slowdown in the economy.

Original Story: El Economista – Eva Díaz

Adaptation/Translation: Richard D. K. Turner

 

Mercal Inmeubles Sells Two Stores in Madrid for €1.7 Million

2 December 2019 – Mercal Inmuebles has finalised its first sale of assets, selling two commercial premises in Madrid for 1.7 million euros. The two conjoined properties are located at Calle Guzmán el Bueno 16, on the ground floor and mezzanine levels of the building.

According to Ibertasa, the stores were valued at approximately 972,000 euros just last year, up from 903,000 euros in 2013. The assets together have 307 m2 and are currently leased to Bankia. Mercal had already had the assets in its portfolio for a decade.

Original Story: Idealista – David Martínez

Adaptation/Translation: Richard D. K. Turner

Bankia Finalises Transfer of €2.7-Billion Real Estate Portfolio to Lone Star

28 July 2019 – Richard D. K. Turner

Bankia has finalised the transfer of a portfolio of foreclosed properties and non-performing loans to companies controlled by the Lone Star XI Fund.

The final value of the portfolio of foreclosed real estate assets has an approximate gross accounting value of 1.42 billion euros, while the portfolio of non-performing loans is worth approximately €1.283 billion. The total size is slightly lower than originally announced due to recoveries since the deal was signed.

The transaction with Lone Star involves the creation of a new company which will hold the assets and be 20 percent held by Bankia and 80 percent by Lone Star Fund XI.

Original Story: Expansión

Goldman Sachs Sells Office Building in Central Madrid

16 July 2019 – Richard D. K. Turner

Goldman Sachs has just sold the office building located at Calle Serrano, 39, five years after it acquired the asset together with another 37 residential and office buildings from Bankia. The property is located in Madrid’s CBD, nearby the well-known Paseo de la Castellana. Goldman was reportedly paid about 8 million euros.

The four-floor building, which was once home to the Lazard investment bank, has 1,212 square meters of constructed area, including a semi-basement. The asset comes with an pre-approved rehabilitation project, as the American bank opted not to invest in the renovation itself. The main drawback to the asset is that the building’s main entrance is not on Calle Serrano, but rather in a central courtyard.

Goldman Sachs acquired the building as part of a €355-million portfolio, previously owned by Bankia.

Original Story: El Confidencial – Ruth Ugalde

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

Haya Real Estate Tops Off its Annus Horribilis with Losses of €0.5M

18 June 2019 – El Confidencial

Haya Real Estate suffered an “annus horribilis” in 2018 after it failed to debut on the stock market and was unsuccessful in its efforts to renegotiate its contract with Sareb (discussions are still on-going). Those events were further compounded by the servicer’s recently published results for the year, which saw it record losses of €445,000, compared with a profit of €32.57 million in 2017, despite a 6.7% increase in revenues to €273.7 million.

The losses were caused by several factors, both accounting and operational nature, and would have been even greater had the group not consolidated the results of Haya Titulización, which contributed profits of €1.27 million.

In fact, the real estate servicer platform Haya Real Estate itself recorded losses of €1.7 million in 2018 compared with profits of €20 million last year. They were caused in part by the new contract that the servicer signed with Bankia in 2018, to include BMN’s assets, which involves disbursements and amortisations during the first few years and which have penalised the company in accounting terms. In addition, Haya purchased the company Mihabitans from Liberbank in June 2018.

Specifically, the amortisations of the management contracts of Bankia and Liberbank increased by more than €20 million YoY in 2018, which, combined with the poor performance of other operating costs (they soared by 46% to €92.2 million) meant that the servicer had little chance of repeating its success of 2017.

Original story: El Confidencial (by Ruth Ugalde)

Translation/Summary: Carmel Drake

Sareb Offers the Contracts of Altamira, Servihabitat & Solvia to its Rivals

17 June 2019 – El Confidencial

Sareb is on a mission to change its course. According to market sources, the bad bank chaired by Jaime Echegoyen (pictured below) has decided to put its contracts with Altamira (owned by doBank), Servihabitat (Lone Star) and Solvia (Intrum) out to tender two years before their scheduled renewal.

Even though the contracts are not due to expire until the end of 2021, Sareb is putting them out to tender alongside that of Haya Real Estate, which is due to expire at the end of 2019. This represents a boost for Cerberus’s servicer, given that its competitors will now also have to focus on retaining their own contracts rather than just bidding for Haya’s.

In the event that Sareb awards the contracts of Altamira, Servihabitat and Solvia to other entities, it will have to compensate the servicers since their contracts clearly establish early termination clauses.

Altogether, Sareb is looking at putting out to tender the management of €34 billion in loans and properties that it still has left in its portfolio. The four will have to submit their bids in the next few months, specifying which assets they want to manage and what commissions they will charge.

The largest mandate is that of Haya, which manages assets proceeding from Bankia, which accounted for 37% of the bad bank’s original assets. It is followed by Altamira, which manages the assets proceeding from Catalunya Banc, BMN and Caja 3 (29% of the total); Servihabitat, which manages the assets from NCG Banco, Liberbank and Banco de Valencia (19%); and Solvia,  which manages assets from Bankia (foreclosed), Banco Gallego and Ceiss (15%). Clearly, there is a lot at stake for these servicers.

Original story: El Confidencial (by J. Zuloaga & R. Ugalde)

Translation/Summary: Carmel Drake

Bankia Puts 3,000 Foreclosed Flats Worth €500M Up for Sale

4 June 2019 – El Confidencial

Bankia has put another problem asset portfolio up for sale as it continues to take the Spanish real estate market by storm in 2019. Project Jarama contains 3,000 flats worth €500 million and is one of the bank’s largest operations involving foreclosed assets to date.

The bank chaired by José Ignacio Goirigolzarri has engaged KPMG to coordinate Project Jarama, which is complicated by the fact that more than half of the assets have not yet been fully repossessed by the bank.

In those cases, rulings have been made in the courts to award the property to the bank in exchange for the defaulted debt, but the entity does not yet hold the deeds or the keys, and the final stage of the foreclosure process could take several months in each case.

This sale forms part of Bankia’s strategy to accelerate its strategic plan. At the beginning of 2018, it set itself the target of divesting non-performing assets worth €9 billion from its balance sheet. By March 2019, it had already sold €6.5 billion.

In recent weeks, it has sold a €300 million portfolio to Blackstone and a €150 million portfolio to Cerberus and Kruk.

Original story: El Confidencial (by Jorge Zuloaga)

Translation/Summary: Carmel Drake

Haya Real Estate Manages the Sale of Bankia’s Branch on Calle Serrano for €59M

6 May 2019 – Eje Prime

Haya Real Estate has managed the sale of Bankia’s former premises on Calle Serrano, 64, to the Prada group for €59 million. The premises have a surface area of 908 m2 and are distributed over three storeys.

Bankia will have to vacate the property within six months of the transaction being formalised and will be replaced by one of the Prada group’s brands: Miu Miu, Church’s, Car Shoe, Prada and Pasticceria Marchesi.

Original story: Eje Prime

Translation/Summary: Carmel Drake

Debt Recovery Firm KRUK Prepares to Make its Real Estate Debut

18 March 2019 – Bolsa Mania

The debt recovery firm KRUK is getting ready to enter the real estate market. The company, which has already acquired debt portfolios in other segments (e.g. consumer loans) from entities such as Bankia and Unicaja, now wants to start buying real estate-related debt portfolios from the banks, servicers and Sareb.

Until now, the group has specialised in the unsecured segment in Spain. Last year, it acquired a portfolio of doubtful consumer loans from Bankia and a year earlier, it did the same with another similar portfolio from Unicaja. A few months ago, it purchased another from Carrefour’s financial arm.

Further afield, the company currently has a presence in Poland, Romania, the Czech Republic, Slovakia, Germany, Italy and Spain, with the last two markets representing its priorities for the time being.

Original story: Bolsa Mania (by Elena Lozano)

Translation/Summary: Carmel Drake