Tag: BNP Paribas Real Estate

Valencia, in Search of Land for Construction

21 August 2018

The lack of available land is the reason that only 2% of the acquisitions of homes are for new housing in Spain’s third biggest city by population.

Valencia is after new land to re-energise its real estate market. With stable prices and an increasing number of transactions, the absence of new buildings is palpable in the statistics for the first quarter of this year, when just 2.3% of purchases (a total of 2,658) were for newly-built homes.

With a population that has been relatively stable in recent years, around 790,000 inhabitants, the city of Turia has doubled the number homes sold in the city since 2013, from 4,922 operations that year to 10,973 last year.

This has not yet pushed up prices, but it has been the basis for recovery. After the harsh effects of the crisis (apartments are 45% cheaper today than in 2007), housing prices reached 1,235.60 euros per square meter in the first quarter of this year, according to data on bank valuations at the Ministry of Public Works.

In homes less than five years old, the average price rose to 1,536.90 euros in the first quarter, while in second-hand homes, the investment needed to acquire a home fell to 1,233.70 euros per square meter.

The absence of development ready lands is a fact for the Spanish city’s real estate developers. According to a report by CBRE, the city is currently in the midst of desvloping and marketing sixty new construction projects, and it is expected that twenty more will be put on the market by the end of the year. Companies such as Neinor, Aelca and Aedas have housing developments in neighbourhoods such as Quatre Carreres, Patraix, Nou Campanar and Malilla Norte.

However, the high demand will cause prices to rise if more land is not made available, according to the consultancy. Metrovacesa’s project for the development of Benimaclet could be one of the most outstanding in this regard in Valencia. The real estate company controlled by Santander and BBVA is pushing for an agreement to present to Valencia City Council a project to build 1,500 homes in partnership with the local developer Urben.

Vía Célere is another of the developers active in the city: the company will build 22 homes in the Pechina neighbourhood, next to the Turia gardens. Aedas Homes is more advanced: the Spanish developer has sold another 120 homes in Turia’s capital through its Torres project, a residential complex that will be composed of two 16-floor apartment blocks. Aedas also has 252 flats in Valencia.

Residential prices in Valencia are now 45% lower than before the start of the crisis, but the city has great appeal, and the activity of private operators has been intense. Attikos is another local developer that has carried out work in the city, with the purchase of 1.9 million euros of development-ready land, where it will build 27 houses.

Offices on the rise

With a total of 63,480 companies, 88.2% of which are in the service industry, the office market in Valencia saw record allocations last year. According to a report by BNP Paribas Real Estate, the contracting amounted to 39,500 square meters in 2017, which caused a slight upward trend in rental prices, which are close to 14.5 euros per square meter in the city centre.

“Since the end of 2013, the last year of economic recession, demand has been positive,” the consultancy noted. “The good pace of allocations in recent years, together with the lack of new projects, are generating a considerable adjustment in the vacancy rate of the Valencian market which, fell to 10.4% at the end of 2017, out of a total stock of 774,000 square meters. This means that there are currently 80,546 square meters of available offices on the market,” they added.

One of the most notable operations in recent months was the rental of the former headquarters of CAM, leased by Solvia to the architectural firm Join Contract. The property’s new tenant will remodel it to transform it into a luxury hotel.

Original Story: EjePrime – C. De Angelis

Translation: Richard Turner

 

Teleno Real Estate Buys a Residential Building in Madrid for €16M

12 June 2018 – Idealista

The real estate consultancy firm BNP Paribas Real Estate has advised on the sale of a residential building in the north of Madrid, worth €16 million. The property comprises 59 homes, 42 storerooms and 96 parking spaces. Teleno Real Estate is the company that has acquired the asset; it has been advised by Jesús Segado and Javier Escudero, partners of Smart Invest.

The asset is located in the north of Madrid. The firm that has undertaken the purchase, the former Tauro Real Estate, invests in the purchase of real estate assets and is led by José María Xercavins. Tauro Real Estate was acquired in April by the Israeli millionaire, Teddy Sagi (pictured above), who paid €180 million for the company. Currently, it owns 600 flats in Madrid and Barcelona.

David Forteza del Rey, Head of Residential Investment at BNP Paribas Real Estate, explains that “these types of operations confirm the continued dynamism of the residential market, which is still offering attractive returns for investors in a low-interest rate environment”.

Last month, the consultancy firm also advised the investment fund Eurostone on the purchase of two real estate assets, in that case in the upper area of Barcelona, on Calle Tuset and Calle Aribau. Those properties have surface areas of 4,786 m2 and 7,461 m2, respectively. The first is a residential asset with a commercial premise on the ground floor. The property on Calle Aribau contains homes for residential use and tourist rental (…).

Original story: Idealista 

Translation: Carmel Drake

BNP Paribas Real Estate: 85,500 m2 of Office Space was Leased in Barcelona in Q1 2018

24 May 2018 – Eje Prime

During the first quarter of 2018, 85,500 m2 of office space was leased in Barcelona and its area of influence, which represents 33% more than the quarterly average for the last 10 years (64,445 m2) and 5% more than the quarterly average for the last three years, according to research compiled by BNP Paribas Real Estate.

“The strong performance in terms of demand between January and March 2018 reflects the fact that the occupational market remains dynamic”, states the report.

During the first three months of the year, 84 new contracts were signed in total, below the quarterly average for the number of operations signed in the last three years (93), however, these contracts involved larger surface areas, thanks to expansions and the creation of new companies.

The three largest operations closed during the quarter were located in the decentralised and peripheral areas, specifically in the BCN Fira District multi-functional complex (6,467 m2), El Prat de Llobregat (5,000 m2) and Cornellá (4,863 m2).

The 22@ district retained its appeal, in fact, the fourth most significant operation, the rental of 3,500 m2 by the Town Hall of Barcelona, was signed in that district. In total, 28% of the surface area leased during the first quarter was located in 22@ and the district is expected to attract more demand, as new office spaces come onto the market. The availability rate of the market in Barcelona amounts to 10%.

The average rental price in the Barcelona market also continued its upward trend. Prime rents, which closed 2017 at €23.5/m2/month, had risen to €24/m2/month by March 2018. Behind that behaviour is the shortage of surface area available in the CBD as well as the scarcity of high-quality buildings.

Original story: Eje Prime 

Translation: Carmel Drake

Eurostone Buys 2 Mixed-Used Buildings in Barcelona

21 May 2018 – Eje Prime

Major operation in the prime area of Barcelona. The Luxembourg-based fund Eurostone, managed by Grupo Mina, has purchased two entire buildings in the Sarrià-Sant Gervasi district of the city from a local family office for €50 million. The properties span a combined surface area of more than 12,000 m2.

The larger asset is located on Calle Aribau and measures 7,461 m2. Constructed in 1918, the property is designated for residential use, for living in as well as for tourist rental. In the internal patio, there is also an office building called La Farinera.

Meanwhile, the second building acquired by Eurostone, which has been advised in this operation by the consultancy firm BNP Paribas Real Estate, is located on Calle Tuset. The asset, constructed in 1944, has a surface area of 4,786 m2 and a commercial premise on the ground floor. The rest of the property is made up of homes.

“This operation highlights the interest that the Catalan real estate sector is sparking amongst the funds and other international players, who still see Barcelona as a priority market in which to invest”, says Francisco López, Director of BNP Paribas Real Estate in Cataluña.

Original story: Eje Prime

Translation: Carmel Drake

Barcino Acquires c. 20 Assets in Barcelona for €2.15M

16 May 2018 – Eje Prime

The Socimis are continuing to party in Spain. Although the experts said that 2018 would be a year for portfolio management, the fact is that many of these companies are continuing to add new assets to their portfolios. The latest is Barcino Properties, which is continuing to specialise in the residential sector with the purchase of a package of 20 assets in Barcelona for more than €2 million, according to a statement issued by the group.

Barcino, which signed the purchased deed on 14 May, has acquired the property at number 18 Calle Olivera for €2.15 million. The asset comprises two commercial premises and 14 homes, and the current occupancy rate stands at 79%. To finance this purchase, the company has signed a mortgage loan with Bankinter for €1 million.

The Socimi debuted on the MAB last December with a share price of €1.33 and a market value of €19.1 million. Specialising in real estate investment and management, the Catalan entity has eight properties in its portfolio, all of which are located in the Barcelona metropolitan area. Most of its assets are rental homes, although it also owns some office buildings and commercial premises. Currently, the Socimi is controlled by Barcino Management (50.01%) and managed by a related party company Vistalegre Property Management.

The company’s most recent purchases include a residential building in Barcelona, which it bought just 48 hours after making its stock market debut. In that case, the company executed a €1.2 million purchase option that it had signed over the property, located at number 92 Calle Girona, after paying €493,000 euros in November for the rights to acquire the asset.

That building contains two commercial premises and seven homes in total, all of which are currently occupied. For the operation, the company made use of its own available funds, without having to resort to additional leverage.

Created in 2015 

Barcino defines itself as a company whose main activity is the “acquisition and renovation of urban assets for their subsequent rental”. The company primarily invests in central locations in the Barcelona metropolitan area. In terms of the characteristics of its desirable assets, the company must be able to purchase the entire building and subject it to a comprehensive renovation.

The group was constituted in January 2015 and since February 2016 it has been registered as a Socimi. The company is chaired by Mateu Turró, who is also an honorary director of the European Investment Bank (EIB), where he worked from 1988 until 2009 (…).

Turró is accompanied in the management of Barcino by Francesc Ventura, an architect who has held roles as director and secretary of the management board and executive committee of APCE (Association of Property Developers of Barcelona) and as CEO of La Caixa de Pensions de Barcelona.

Moreover, the company is also led by Ralph Weichelt, Investment Director at Triple Point Social Housing, a public company listed on the main London Stock Exchange, which operates in the social housing sector in the United Kingdom. The executive has also served as the director of several companies including BNP Paribas Real Estate and JLL.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

BNP Paribas: Record-Breaking 39,500 m2 of Office Space Leased in Valencia in 2017

22 March 2018 – Eje Prime

Offices are breaking records in Valencia. The leasing of office space in the Mediterranean city reached a historical high in 2017, amounting to 39,500 m2, according to a report compiled by BNP Paribas Real Estate. Moreover, the good behaviour in terms of demand led to a slight upward trend in rental prices, which are now approaching €14.50/m2/month in the most iconic buildings of the old town, around the Plaza del Ayuntamiento.

“Since the end of 2013, the final year of the economic recession, demand has behaved in a positive way”, explain sources at the consultancy firm. The activity drivers that have grown by the most in recent months have been the construction sector, together with the services and industrial sectors.

“Demand has not focused on a particular area, given that between 8,000 m2 and 12,000 m2 of office space has been leased in each of the four areas that comprise the market.” In the prime area, 8,300 m2 of space was leased, a much higher figure than the average for the area over the last ten years (3,000 m2)”, they maintain.

“The good results in terms of space leased in recent years, coupled with the lack of new build projects, are generating a considerable reduction in terms of the availability rate in the Valencian market, which, at the end of 2017, decreased to 10.4%, over a total stock of 774,000 m2, which means that currently, there is 80,546 m2 of space available in the market”, conclude the sources at BNP.

Original story: Eje Prime

Translation: Carmel Drake

‘Improving Logistics’ Leases 30,000 m2 of Space in Ribarroja

20 March 2018 – Eje Prime

The largest logistics operator in Valencia has moved into the most sought-after industrial estate in the Mediterranean city. ‘Improving Logistics’ has installed itself in Ribarroja with 30,000 m2 of logistics space, after signing up to lease three warehouses in the complex.

With assets measuring 14,000 m2, 9,000 m2 and 7,000 m2, respectively, ‘Improving’ is seeking to continue with its growth plan in the multi-customer logistics segment. The Valencian operator already occupies a surface area of more than 110,000 m2 in the province.

On the El Oliveral Industrial Estate, the company has leased a logistics warehouse spanning 7,000 m2 and a logistics platform with a constructed surface area of 14,000 m2, whilst the other warehouse it has leased is located on the Sector 14 industrial estate, also in the town of Ribarroja.

‘Improving’ has grown by up to 60% in recent years, which has pushed it up the ranking of the main logistics operators in Valencia. Created in 2003, the company operates at the international level, rendering services ranging from storage, customs warehousing, sea and land transportation, and real-time management of logistics processes.

Last year, the industrial park in Ribarroja accounted for 80% of all of the investments made by the sector in the metropolitan area of Valencia. There, Mercadona signed one of the largest purchases of logistics spaces in the autonomous region, with the acquisition of more than 23,700 m2 of land. In total, 107,000 m2 of space was purchased on this industrial estate in a dozen operations, according to a report compiled by BNP Paribas Real Estate.

With this new operation, Valencia is also consolidating its position as one of the regions of the country with the highest volume of logistics space leased. In 2017, the autonomous region saw a record 220,000 m2 of space leased, and now it is starting to experience problems in terms of a shortage of prime assets, with an average availability rate of 4.3%.

Original story: Eje Prime 

Translation: Carmel Drake

Barcelona’s 22@ District Will Put 270,000 m2 of Office Space on the Market in 2019

7 January 2018 – Expansión

Meridia, Värde, Emesa and other investors are constructing corporate buildings in the technological district of Barcelona in light of the shortage of available large spaces in the city.

The investment fund manager Meridia Capital, the US fund Värde Partners and the business corporation of Emilio Cuatrecasas, Emesa, are just three of the investors who are backing the development of office buildings in the 22@ district of Barcelona.

A report from BNP Paribas Real Estate forecasts that 405,300 m2 of new office space will come onto the market in the Catalan capital and its surrounding area in 2019, of which 60% will be concentrated in the technological 22@ district, where 270,000 m2 of space is being constructed.

Original story: Expansión (by Marisa Anglés)

Translation: Carmel Drake

Experts: Foreign Investors will Continue to Back the Spanish RE Sector in 2018

11 January 2018 – Expansión

The experts believe that the residential sector is going to be the main protagonist of 2018, in terms of both development and investment. The banks are expected to continue their balance sheet clean-ups with more portfolio sales.

The real estate sector is expected to continue to constitute a mainstay of the Spanish economy in 2018 thanks to the growth of residential property development and the commitment from international investors to Spanish property as a safe haven for their investments, according to the experts consulted by Expansión.

For Adolfo Ramírez-Escudero, President of CBRE España, property developers will be some of the most dynamic investors in 2018. “Last year, they underwent an expansionary cycle and, through specialisation and the sophistication of their product, they will continue to increase their prominence in the sector”, he explains.

The CEO of JLL España, Enrique Losantos, forecasts that 2018 will maintain the positive rhythm of recent years and that figures will remain in line with 2017, with a total investment volume of around €13 billion. Losantos also expects that portfolio operations, which were the major stars of 2017, thanks to the sale of assets by Banco Popular and BBVA, will continue to strengthen their position in 2018 (…).

Rents

For Santiago Aguirre, President of the Board of Directors of Savills Aguirre Newman, “we are entering a year of consolidation in terms of the upward cycle that we have been immersed in since 2014. Several segments, such as offices and logistics, have reached maximum leasing levels, nevertheless, we still see potential for rents to reach the maximum levels seen in the previous cycle”.

In terms of investment in tertiary assets, Oriol Barrachina, CEO at Cushman & Wakefield, explains that there is a perception that there will be more liquidity than product, despite caution being erred in light of the local and international uncertainty. “The main difference with respect to the last two years is that one group of buyers, the Socimis, are now also going to be selling assets. For years, they have purchased lots of assets and after generating value from them, they are going to put them up for sale, a fact that will also help to bridge the gap between supply and demand”, adds Barrachina.

Sandra Daza, Director General at Gesvalt, thinks that this year those investors who entered the cycle during the opportunistic period, between 2013 and 2015, will be replaced by long-term investors, such as insurance companies and pension funds.

In terms of trends, Mikel Echavarren, CEO at Irea, considers that residential development will continue to generate news this year, both in terms of land transactions, as well as price rises and the recovery of secondary markets (…).

Humphrey White, Director General at Knight Frank, highlights that Spain is currently at the beginning of an expansion period, with forecast demand of between 120,000 and 150,000 new homes per year, even though it closed 2017 with just 47,500 new home transactions (…).

No sign of a bubble

White considers that the growth in the sector in Spain rests on “some very firm foundations in terms of the law of supply and demand, whereby moving firmly away from a possible real estate bubble”.

For Gonzalo Gallego, Partner in Financial Advisory at Deloitte, buildable land will be one of the major challenges in the property development sector.

In terms of the rental market, Ramírez-Escudero explains that in 2018, we will see “quite a lot” of activity in the market from institutional investors backing rental homes. Over the last decade, the number of rental homes has increased significantly to reach 22.5%. Nevertheless, Spain still has major potential given that the average in the EU is 33% (…).

Javier López-Torres, Partner in Real Estate at KPMG, agrees. He considers that the rental segment will continue to gain weight due to the difficulties involved in accessing credit, mobility and cultural change (…).

Asset types

By sector, Thierry Bougeard, Director General at BNP Paribas Real Estate, says that demand for office space will continue its strong performance (seen in 2017), above all in Madrid, where leasing volumes are expected to increase to around 600,000 m2.

Meanwhile, in the logistics market, e-commerce will continue to be the main motor of demand, whilst in retail, many owners are betting on improving the quality of their centres, boosting leisure areas and the quality of them, with the aim of encouraging customers to stay longer, he explains.

The experts also agree in highlighting the high level of interest expected in alternative real estate assets, such as student halls and nursing homes.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Neinor Buys Plot For 96 Homes In Valencia From Meridia Capital

15 November 2017 – El Economista

Neinor Homes is continuing to strengthen its presence in Valencia. The property developer has purchased a plot of land from Meridia Capital in the Quatre Carreres area of the city, for the construction of a residential development that will comprise 96 homes and several commercial premises.

The real estate consultancy BNP Paribas Real Estate has acted as the advisor to the operation. The asset, which has a surface area of 3,418 m2 and a buildable surface area of 15,027 m2, is located on Carrer de Antoni Ferrandis, in an established urban environment, just a stone’s throw from the ‘Ciudad de las Artes y las Ciencias’, the ‘Ciudad de la Justicia’ and the El Saler shopping centre. Moreover, it is well connected by road, is served by several bus routes and, in the future, will have a stop on line 2 of the tram.

Rafael Paz Martínez, Head of Capital Markets at BNP Paribas Real Estate in Valencia, explains that “this operation highlights the renewed appetite that investors have for Valencia as one of the most interesting markets given the shortage of developable land, after several years when property development activity has been paralysed, and the supply of new developments has been very limited”.

Over the last 12 months, there has been a clear reactivation of property developer activity and several new residential projects have been started in the city. For this reason, Neinor is backing the market with a vengeance. The strong performance of demand is translating into a good rate of sales for the majority of projects and currently, the average sales period for developments stands at 13 months. Similarly, slight increases in house prices are started to be noticed and, therefore, so too in the price of residential land, explain sources at BNP Paribas Real Estate.

Original story: El Economista 

Translation: Carmel Drake