KF: Inv’t in Offices Amounted to €1.3bn & €0.8bn in Madrid & Barcelona, Respectively, in 2017

13 June 2018 – ABC

The performance of the office sector in Madrid at the end of 2017 bodes well for a “historical” 2018. That is according to all of the investment indicators managed by the real estate experts. Some very positive data for the region, which consolidates the Spanish capital’s position as the most attractive place for companies to locate their headquarters. In fact, it continues to be the greatest magnet for securing capital in the office market with a business volume of €1,324 million – 61% of the aggregated total – compared with €835 million in the Catalan capital. In terms of rented office space, 570,000 m2 was leased in Madrid, compared with 300,000 m2 in Barcelona.

Those are the findings of a recent report about the sector compiled by the consultancy firm Knight Frank, which forecasts greater activity in the sector in Madrid this year due to the rotation of assets by the Socimis and funds to fulfil their business plans. In Madrid, more than 40% of the total investment in 2017 involved funds, which, together with the Socimis outperformed other real estate players during the second half of last year.

The notable differences between the two regional capitals have increased as a result of the effects of the political instability caused by the independence drive and the decrease in tourism that has hit Cataluña. The experts consulted highlight that the rate of company creation has decreased in Cataluña since last summer, whilst in the Community of Madrid, the numbers have increased, with more than 185,000 companies registered with the Social Security at the beginning of 2018.

“The Spanish capital continues to be the key location due to its wide range of opportunities. Net absorption has been increasing for several years and rental prices are still very competitive in comparison with the main European centres”, explains Raúl Vicente, Director of Offices at Knight Frank. Nevertheless, the experts indicate the path that the city should take to become a “super city”. “In terms of the major challenges that it will have to overcome, they include mobility, adaptation to the technological revolution that we are living applied to the service of the city, efficiency, access to housing and an office supply that is commensurate with international demand, amongst others”, highlights the report.

The average price of offices in Madrid’s CBD has been rising in recent years. Prices in the capital now exceed €8,000/m2 on average, whilst in Barcelona, they amount to €6,900/m2. The highest price paid last year was for the former Barclays headquarters in Plaza de Colón, which was purchased from Barclays by CBRE Global Investors for €14,000/m2.

Other notable operations stand out including the purchase of Torre Serrano by Infinorsa and the sale of the Isla Chamartín Business Park to Tristan Capital and Zaphir Asset Management for €103 million. Also, the acquisition of the Palacio de Miraflores on the Carrera de San Jerónimo for €60 million by Remer Investment and of the Los Cubos building by Henderson Park and Therus Invest for €52 million (…).

Original story: ABC (by Adrián Delgado)

Translation: Carmel Drake

CBRE GI Invests €10M in Star Project in Plaza de Colón (Madrid)

21 June 2018 – Eje Prime

CBRE Global Investors (CBRE GI) is increasing its commitment to Spain with its latest project. The investment arm of the CBRE group is going to invest €10 million in the project to renovate the building at number 1 Plaza de Colón and, to this end, the multinational firm has engaged one of the most sought-after architects in the world, Norman Foster. The new property, which is going to be constructed on the site of the former Barclays headquarters, will become the star of CBRE GI’s growth plan in Spain.

The asset manager acquired the former Barclays headquarters in 2017. In November of the previous year, the financial institution started to sound out the possibility of selling the building on Plaza de Colón (at the intersection of Paseo de la Castellana and Paseo de Recoletos) to move to another location and, three months later, in January, it sealed the deal.

Three years after the acquisition, CBRE GI is preparing to transform the building, a project that has formed part of its plans since it completed the operation. The former Barclays headquarters is now beginning a renovation that will convert it into Axis, where offices and a commercial area are going to be opened on the four floors that will comprise the new asset.

This project forms part of an investment plan that will amount to €800 million. The company has almost one hundred properties in its portfolio, spread across the retail, office, logistics and hall of residence markets.

Nevertheless, in May, the company announced that it is going to enter the residential sector in 2018. The consultancy firm’s investment fund wants to access that segment through the rental market (…).

The company’s objective for this year is to repeat or even exceed the investment figure recorded last year. In 2017, the manager closed transactions amounting to €1.3 billion.

In addition, CBRE GI, which works with eight investment funds in Spain, manages a portfolio of assets worth €3.2 billion (…).

Original story: Eje Prime (by J. Izquierdo)

Translation: Carmel Drake

Savills: Office Inv’t In Barcelona Exceeds Madrid For First Time Ever

25 April 2017 – La Vanguardia

Transactions in the Spanish office market amounted to almost €900 million during the first quarter of 2017, more than twice the figure recorded during the same period in 2016. Moreover, Barcelona exceeded Madrid in terms of investment, for the first time, with a differential of €50 million – investment in Barcelona amounted to €450 million – driven by the purchase of Torre Glòries, according to data from the real estate consultancy firm Savills.

Two mega-operations amounting to more than €100 million each boosted office investment during the first quarter, which represented 30% of the total figure recorded during the whole of 2016. Firstly, during the second week of January, Merlin Properties announced the purchase of Torre Glòries (Torre Agbar) for €142 million.

The second deal saw the sale of the so-called Boston portfolio, comprising 14 BBVA office buildings (eight in Barcelona, five in Madrid and one in Valencia), which were sold to Oaktree and Freo.

According to Savills, the operation involving Torre Glòries is one of the largest recorded in Barcelona in recent years, exceeded only by the €145 million that Deka spent in 2010 on the former headquarters of Caja Madrid on La Diagonal.

The fact that 20 of the 35 assets that changed hands during the quarter were located in Barcelona significantly increased the Catalan capital’s share of the national total. The city accounted for 52% of total investment, which allowed it to exceed Madrid for the first time in the historical series.

The volume of office investment in Barcelona amounted to almost €450 million, compared with €40 million during the same period in 2016. In Madrid, office investment exceeded €400 million, an amount that was distributed between thirteen assets. In interannual terms, the volume of investment in the capital increased by 60%. One of the major operations in Madrid was the sale of Barclays headquarters in Plaza de Colón, which was acquired by CBRE Global Investors for more than €55 million.

Original story: La Vanguardia

Translation: Carmel Drake