Tag: BuildingCenter

Several Investment Funds Interested in Buying the Torre Sevilla Complex

4 October 2018

CaixaBank has invested 320 million euros in the skyscraper, the commercial centre, the CaixaForum and the Fernando de Magallanes park.

Several international investment funds have signalled interest in a possible acquisition of the Torre Sevilla, a commercial, office and cultural complex in which CaixaBank has invested 320 million euros through the company Puerto Triana. The funds have sounded out the bank “, but no sales process is underway,” sources at CaixaBank stated.

“CaixaBank sees the Torre Sevilla as the crown jewel of the south of Spain, and it is true that it is not a strategic asset for the bank. However, now the whole building is now in the launching phase and still has a long way to go,” the same source noted, stating that no defined sales plan exists for the complex. The company expects to increase the complex’s profitability in the coming years, after a process of consolidation and an increase in rents.

Although there are no plans for a sale, the success of the project has attracted the attention of potential buyers. “The truth is that some investment funds are interested… in such a unique project, but… the sales process has not begun.”

Antonio Cayuela, the sole administrator of Puerto Triana, the owner of Torre Sevilla, as well as president of BuildingCenter, CaixaBank’s real estate company, already told ABC last July that “right now there are no plans to sell, which does not mean that we won’t do it in the future. What we have done is make it valuable for Sevilla and complete the commitment we had with the city.”

“The truth is that our main and only mission during this time has been to start the project. We have not had much time to think about other things. It is true that we have had other shopping centres that we have sold, finished or unfinished, which came to us due to bad loans,” Mr Cayuela said.

For its part, on the same day as the inauguration of the Torre Sevilla shopping centre on September 26, Rafael Herrador, the regional director for CaixaBank in western Andalusia, recalled that “in the middle of the economic crisis, CaixaBank invested 320 million euros in this project. CaixaBank decided that it was an important challenge and that we had to deliver on our commitment to Sevilla. The only solution we saw was to finalise the project and generate value for Sevilla.”

Mr Herrador said that their expectations for the shopping centre “have not only been met but have been overcome. With the opening of the shopping centre to the public, the development of the Torre Sevilla complex has concluded.”

The Torre Sevilla shopping centre has received more than 350,000 visits since it opened a week ago. Only the first day, the shopping mall received 61,000 visits, with queues forming at the first Primark store in Sevilla, persisting to this date. It has been the best inauguration for the low-cost Irish fashion house apart from those in Madrid and Barcelona. The shopping centre expects to receive 8 million visits every year. For the time being, the inauguration has led to the creation of 1,600 jobs, 250 of them at Primark.

For its part, CaixaForum, which is a lessee at the Torre Sevilla, has received more than 300,000 visits since its opening. Moreover, the office tower has also already rented its 37 floors.

The skyscraper has 50,000 of the gross leasable area. When the bank began to market it, Spain was just beginning to emerge from the economic crisis, and many buildings on the Cartuja island were empty. CaixaBank set a very attractive rental price and managed to fill the skyscraper: 15 euros per square meter per month, without condominium fees. 1,500 people now work in the tower, although it has the capacity for 1,800.

Hotusa’s five-star hotel Eurostars Torre Sevilla occupies floors 19 to 37 of the skyscraper. The other floors of the skyscraper are leased by top-level companies, such as Ayesa, Active Business & Technology, a Microsoft partner; Aenor; the technology consultancy Chakray; the Optima software company; Orange; Everis; Deloitte and the Seville Chamber of Commerce, among others.

Original Story: abcdesevilla

Translation: Richard Turner

Torre Sevilla Shopping Centre Opens its Doors

26 September 2018 – Eje Prime

Torre Sevilla has been completed, six years on. The shopping centre, promoted by CaixaBank, will open its doors to the public today, whereby culminating an urban development program that began to take shape in the 1990s. The complex alone, located in the centre of Sevilla, has involved an investment of €100 million, a third of the total amount spent on the macro-project.

Torre Sevilla is opening its doors at the height of the Retail Apocalypse and at a turbulent time for the sector in Sevilla: Palmas Altas announced last week that it has changed its name to Lagoh, whilst the Alcora shopping centre project has been cancelled.

The new complex in Sevilla is a mixed development that includes, as well as a shopping centre, an office building, a Eurostars hotel, CaixaForum Sevilla and Parque de Magallanes. The shopping centre, designed by the Argentinian architect César Pelli, comprises two large buildings with a gross leasable area (GLA) of 26,700 m2 and a constructed surface area of 43,000 m2.

The complex will open its doors with a 95% occupancy rate, and with Primark, Fnac and Ikea as the drivers. “People don’t go shopping anymore, they go for a walk, and formats such as hypermarkets are no longer the drivers”, explains Antonio Cayuela, President of BuildingCenter and sole administrator of Puerto Triana (the company that controls the complex).

In this sense, Cayuela emphasises the location of Torre Sevilla, in the heart of the city, and its integration with the office building and hotel, which ensures footfall “every day of the week”.

“Shopping centres are changing, just like retail: the trend is now returning to local businesses, with smaller but very accessible formats, close to the city”, says the executive. The property developer forecasts that the centre will receive around 8 million visitors per year.

Torre Sevilla’s offer includes, amongst others, the first stores from Ikea, Primark and Xiaomi in the city centre, as well as restaurants and services such as a gym and a catering facility – a cross between a supermarket and a restaurant – serving homemade food to take away.

“Hypermarkets are no longer the drivers”, says Cayuela. “We have ruled out cinemas, because they occupy a lot of space, because there are lots of them and because in the era of Netflix, they are no longer attractive”, he says.

“Omnichannel” corner to compete with the internet 

In this sense, Torre Sevilla is also planning to incorporate new concepts over the medium term to encourage omnichannel integration and attract footfall to the complex at a time when the online channel is gaining more and more traction.

In this sense, the company will launch a space called Omni Tech, which will integrate different omnichannel tools, such as click and collect. “We want to be a leader in the implementation of new ideas in terms of omnichannels; although I do not think that the online channel will ever completely substitute a physical purchase, it is important to have a good experience in person to attract people to stores”, says the executive.

Original story: Eje Prime (by Iria P. Gestal)

Translation: Carmel Drake

Blackstone Buys 50% of Testa from Merlin, Santander & BBVA

17 September 2018 – Eje Prime

Blackstone is strengthening its commitment to Spanish property. The US fund, which has been very active in the domestic real estate market in recent years, has just completed the purchase of 50.01% of Testa from Merlin, Santander and BBVA, according to a statement issued by the parties.

Testa is the largest manager of rental homes in Spain, with 10,615 real estate assets in its portfolio and a turnover of €85 million in annualised gross income. Most of the shares of the Socimi, which has been listed on the Alternative Investment Market (MAB) since July, will now be owned by Tropic Real Estate Holding, a company managed by Blackstone.

One of the largest shareholders of the company, the real estate firm Merlin, has pocketed €321 million from this operation, which means valuing the own funds of Spain’s largest Socimi at €1.895 billion. With the funds obtained, the company led by Ismael Clemente plans to reduce its debt, within the framework of the company’s objectives.

Following Merlin’s exit from the company, Acciona Inmobiliaria, the real estate investment arm of the energy firm, has been left as the main domestic shareholder of the listed company.

Testa’s homes are primarily located in Madrid, although the firm also has a presence in other major cities in the country such as Barcelona, San Sebastián, Valencia, Las Palmas de Gran Canaria, Valencia and Palma, amongst others.

Testa, created in 2001 by the construction company Sacyr, invested €228 million in March in the purchase of 4,500 homes from the BuildingCenter, the real estate arm of CaixaBank. Moreover, following its incorporation onto the MAB, one of its largest shareholders, Acciona Inmobiliaria studied the possibility of becoming a reference shareholder of the Socimi.

Original story: Eje Prime 

Translation: Carmel Drake

MAB Approves Testa’s Stock Market Debut with Market Capitalisation of €1.83bn

24 July 2018 – Eje Prime

Testa is getting ready to refinance its debt. The Socimi in which Santander, BBVA, Merlin and Acciona Inmobiliaria hold stakes has included the refinancing of its liability on its roadmap, given that 91% of the firm’s gross financial debt is due to expire in 2022, according to an information document prepared for its incorporation onto the Alternative Investment Market (MAB), which was published yesterday.

As at 31 March, Testa’s gross financial debt amounted to €475 million, whilst the net financial debt amounted to €415 million. In addition, in order to finance the purchase of the BuildingCenter, the company took out two more loans amounting to €230 million.

As the company explained, of the total gross financial debt, €431 million (91%) expires in 2022. The company plans to refinance its debt by resorting to different instruments.

Testa’s plans following its debut on the MAB involve continuing with its purchase process, which involves acquiring between 1,000 and 2,000 apartments each year. According to the document, the Socimi has a pipeline with a GAV of around €539 million, which represents around 2,959 apartments.

As at 31 December 2017, Testa’s portfolio comprised 9,244 homes, 295 retail premises, located in the same buildings as the homes, and an office building and parking lot in Plaza Castilla, with a combined market value of €2.276 billion. Nevertheless, that data does not include the BuildingCenter portfolio.

In March, Testa signed an agreement to acquire the residential portfolio of the real estate arm of CaixaBank, comprising 1,458 homes. To date, according to the MAB document, Testa has acquired 1,450 apartments from that portfolio for a price of €226 million.

By geographical area, the Community of Madrid accounts for approximately 65% of the gross value of the portfolio, followed by San Sebastián, with 7.2%; Barcelona, 4.1%; Las Palmas de Gran Canaria, 2.9%; Valencia, 2.5%; Toledo, 2.4%; Pamplona, 2%; Valladolid, 1.9%, and Oviedo, 1.5%.

The company, in which Santander holds a 36.8% stake; BBVA a 25.6% stake; Acciona a 20% stake and Merlin Properties a 17% stake, will make its debut on the stock market with a capitalisation of more than €1.83 billion. The company’s stock market debut has suffered several delays, but yesterday it received the green light from the MAB.

Original story: Eje Prime (by P. Riaño)

Translation: Carmel Drake

Testa Completes Acquisition of 1,329 Homes from CaixaBank’s RE Arm for €207M

25 May 2018 – ABC

The listed real estate investment company (Socimi) Testa Residencial has today completed the acquisition of 1,329 homes from BuildingCenter, the real estate subsidiary of the CaixaBank group for €207 million.

The sale agreement was reached in March and accounts for more than 90% of BuildingCenter’s assets, according to a statement issued by Testa. The remaining 129 homes included in the agreement will be acquired for €21 million over the coming months, as certain conditions are fulfilled, added Testa.

On the basis of its existing rental contracts, the Socimi estimates that the homes acquired now will generate annual revenues of €8.5 million from 1 June onwards.

Once Testa has acquired the remaining homes, that figure will increase to €9.3 million per annum. The homes currently have an occupancy rate of 92%.

CaixaBank’s portfolio has a “prominent presence” in the main Spanish cities, including Madrid, Palma de Mallorca, Barcelona and Valencia, and together account for 66% of the total acquired portfolio, explains Testa.

In terms of the financing of the operation, Testa says that it has today signed a bank loan amounting to €92 million, with a seven-year bullet maturity (repayment of the initial capital on the maturity date) and an interest cost of approximately 1.6%, covered at 100%.

The Socimi Testa Residencial plans to go public either before or after the summer through a public sale offer (OPV) of the existing shares and a public subscription offer (OPS) through a capital increase.

Original story: ABC

Translation: Carmel Drake

BBVA, CaixaBank & Sabadell Recorded Revenues of €5bn from House Sales in 2017

2 April 2018 – Expansión

Last year, BBVA, CaixaBank and Sabadell recorded revenues of more than €5,065 million from the sale of homes that came onto their balance sheets due to non-payment during the years of the crisis. Santander obtained €1,295 million in this regard, and Bankia and Bankinter received €457 million and €138 million, respectively. In total, the banks in the Ibex 35 recorded sales of €6,955 million from the sale of homes, which represented a YoY increase of 6%.

In parallel to the signing of agreements to launch the transfer of the bulk of their portfolios of toxic assets to specialist funds, year after year, the banks are marketing properties through their own distribution platforms to clean up their balance sheets and return them to the figures that they registered before the outbreak of the crisis.

BBVA recorded the highest revenue figure, of €2,121 million, which represents an increase of 7.5% YoY, from the sale of 25,816 properties. Its subsidiary Anida is responsible for distributing its products in the market.

By the end of last year, BBVA’s exposure to the real estate sector had decreased by 37.2%, to €6,416 million, due, primarily, to the wholesale operations undertaken.

Last year, the bank chaired by Francisco González made a turn in its real estate strategy by agreeing to create a joint entity with Cerberus to which it will transfer some of its properties, worth around €13 billion. The bank will hold a 20% stake in that entity and the fund the remaining 80%. The operation is expected to be closed during the second half of 2018.

Last quarter

The largest increase in the sale of homes was achieved by CaixaBank, which saw its revenues rise by 20.4% YoY to €1,610 million. Most of those operations were concentrated in the final quarter of the year when proceeds of €561 million were received.

Through Servihabitat, CaixaBank markets the properties of the group’s subsidiary BuildingCenter online, as well as through the branch network and API. The bank has €5,878 million in foreclosed assets up for sale and €3,030 million allocated for rent.

The bank has engaged KPMG, Oliver Wyman and McKinsey to redefine its strategy and gain efficiencies in the divestment of the foreclosed real estate assets.

As part of that roadmap, last week, CaixaBank sold 1,458 homes to Testa for €228 million.

Meanwhile, Sabadell cut its property sales by 14% to €1,334 million due to fewer sales to institutional investors, which fell from €233 million in 2016 to €57 million a year later. Last year, Sabadell divested 14,924 properties, up by 2.6% compared to the previous year. Its subsidiary Solvia is its main distribution channel.

In parallel, Sabadell has placed two toxic real estate portfolios up for sale, proceeding in part from the former CAM, under advice from KPMG.

Last year, Santander recorded revenues of €1,295 million from the sale of foreclosed assets, which represented a YoY increase of 19.5%. The gross value of the assets sold by that bank last year was €2,168 million, up by 33% compared to the previous year. Santander obtained profits of €95 million from its sales, up by 64%.

Altamira is Santander’s distribution platform, which held €11,661 million in foreclosed assets at the end of 2017, of which €5,943 million proceeded from Popular. To that figure, we have to add €3,619 million in assets from Popular included in the operation agreed with Blackstone, which will allow the clean up of the group’s toxic assets (…).

Finally, Bankia sold 8,430 properties in 2017, which represents 20.2% of the stock it had held at the beginning of the year, for which it recorded revenues of €457 million, down by 2.9%. Bankinker, one of the banks with the lightest real estate load obtained €138 million, up by 2.2%.

Original story: Expansión (by Elisa del Pozo)

Translation: Carmel Drake

Record Financing Deal: Testa Raises €0.8bn From 16 Banks

15 December 2017 – El Confidencial

Testa has managed to close new financing amounting to €0.8 billion and, in a move that has made the deal remarkable, has not had to use any of its buildings as collateral.

As El Confidencial revealed, the entity in which Santander, BBVA, Merlin and Acciona hold stakes, was negotiating to refinance all of its debt so as to be well positioned to make its debut on the stock market and to have a sizeable sum to make new purchases.

In the end, according to financial sources, the Socimi has obtained the backing of 16 financial entities for the largest unsecured loan ever granted to a company in this sector in Spain. The new loan will be structured in three tranches, whose maturity dates will range between two and five years.

The first, amounting to €0.35 billion, is a bullet loan, which will be repaid in its entirety upon maturity, in December 2022; the second, for the same amount, is a 2-year bridge loan, which the company plans to refinance with a bond; and the third, a line of credit amounting to €0.1 billion has a mortgage guarantee over five years.

The entities that have participated in this financing are Banco Sabadell, Santander, Barclays, BNP Paribas, Caixabank, Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, ING, JP Morgan, Mediobanca, Natixis and Société Générale.

Following this agreement, Testa’s leverage ratio has increased from 15% to just under 35% and all of its debt is now corporate.

The Socimi is working with a view to making its debut on the main stock market in the spring. It will make that move with a portfolio comprising 9,219 homes dedicated exclusively to rent, spread over 111 buildings and worth almost €2.2 billion.

Nevertheless, thanks to the signing of this new financing, the Socimi now has fresh money to take on new acquisitions before its stock market debut, in line with the purchase that it announced in September of 135 homes from BuildingCenter, the real estate subsidiary of CaixaBank.

65% of Testa’s portfolio is located in Madrid, San Sebastían accounts for 7%, Barcelona 5%, Valencia 4%, Mallorca 3% and other locations the remaining 15%.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Testa Buys 135 Homes From CaixaBank

26 September 2017 – Eje Prime

Testa Residencial has acquired a package of 135 homes located in the Community of Madrid from Buildingcenter (which forms part of Caixabank). The package contains 67 homes located in the municipality of Las Rozas, 51 in Getafe and 17 in Madrid capital, all areas where demand for rental housing is booming, according to the company.

“The operation has been completed after Testa Residencial emerged victorious from the competitive process established by Buildingcenter and managed by Servihabitat”, said the company in a statement. The acquisition has been financed with available cash from the company.

In this way, and following the recent operation to integrate a package of homes from Acciona Real Estate, Testa Residencial has now expanded its portfolio of assets to include 9,219 homes, whereby strengthening its position of leadership in the residential rental market.

According to the company, its portfolio of homes currently has an occupancy rate of more than 90% and is located in areas with the highest demand, led by the Community of Madrid, San Sebastián and Cataluña, which account for 65%, 5% and 5% of turnover, respectively.

Original story: Eje Prime

Translation: Carmel Drake

Losses From The Banks’ RE Arms Rose By 11% To €3,266M

14 March 2016 – El Economista

The banks’ real estate arms are still weighing down on the accounts in the sector. Despite the economic recovery and the improvement in prices, the property development companies owned by the financial entities recorded more losses last year than in 2014. Specifically, according to the available data, their combined losses increased by 11% to €3,266 million.

The reasons for this deterioration are the facts that: the volume of assets on their balance sheets is still growing, which means higher provisions, and that divestments are being made at prices that do not even cover management costs and taxes.

Homes and land are still moving onto the balance sheets of the banks at a high rate. In this way, the largest groups (Santander, BBVA, Bankia, CaixaBank, Sabadell and Popular) increased the volume of homes and land they own by 8% in 2015 to €62,163 million, before provisions and valuation adjustments.

In this context, the main owners of these assets are suffering from huge losses and are not forecasting to make any profits until 2017, at least. Everything will depend on the evolution of the economy over the next few months and the recovery of both real estate transactions and prices. In 2015, for the first time since the crisis began, house prices rose.

The real estate company that recorded the highest losses was the property arm of CaixaBank, which is one of the largest. BuildingCenter generated negative results of €1,427 million in 2015, which represented an increase of 11.4% compared with 2014. In the middle of last year, CaixaBank had to inject €1,600 million into its subsidiary to restore its equity. (…).

Although the property developer owned by the Catalan group suffered the greatest losses, the two main property developers owned by Ibercaja saw the highest rises  in their losses. Cerro Murillo and Inmuebles CAI’s losses shot up by 212%, due to the poor performance of the latter, which was inherited from the former Caja3. The losses of both companies amounted to €203 million in total. Ibercaja is trying to accelerate its sales and improve the administration of its real estate assets….to this end, it has sold its home and land management platform to Aktua, in an operation that will generate profits of €70 million for the entity.

Ibercaja was one of the few entities that had not sold its platform. BBVA and Sabadell are the only others that have not sold theirs yet either; they are retaining this administration in-house for the time being.

In fact, BBVA was one of two entities that managed to reduce the losses generated by its real estate arm. The two companies that own its homes and land, which operate under the name Anida, decreased their losses by 22.2%, to €658 million. In part that was due to the fact that the group, chaired by Francisco González managed to sell some of its assets with gains. (…).

The other developer that managed to reduce its losses last year was Liberbank, but its situation is different from those facing other players in the majority of the sector, given that the entity transferred the bulk of its assets to Sareb as part of the financial rescue plan and the properties it inherited from the former CCM are covered by the Deposits Guarantee Fund, up to a maximum of €2,475 million.

Some entities have tried to sell sizeable batches of properties, but these projects have been suspended or delayed due to the political uncertainty in Spain following the general elections and due to the instability in the market due to the slow down in China and the fall in the oil prices.

In this context, the banks will intensify house sales through their branches to individual buyers. One of the most ambitious projects has been proposed by Popular, which seeks to sell homes worth more than €2,800 million in 2016, as part of a plan to get rid of up to €8,000 million non-performing assets, through various means, to improve profitability.

Popular’s real estate arm, Aliseda, increased its losses by 13% in 2015, to €165 million. (…).

Original story: El Economista (by Fernando Tadeo)

Translation: Carmel Drake

CaixaBank Injects Another €1,900M Into BuildingCenter

6 April 2015 – Expansión

Over the last two years, the bank has invested €4,400 million in its subsidiary, which owns properties that have been foreclosed (by CaixaBank) following the non-payment of debt.

The property sector is still taking its toll on CaixaBank. In 2014, the entity had to inject another €1,900 million in BuildingCenter, the company in which the bank places all of the real estate assets that it forecloses in exchange for (the cancelation of) debt.

This new contribution of funds responds to the need for BuildingCenter to restore the equity balance of its balance sheet, due to the losses generated by these assets, which are managed and marketed by ServiHabitat, the real estate platform owned by TPG (51%) and CaixaBank (49%). BuildingCenter generated a loss of €1,280 million in 2014.

Typically, the bank chaired by Isidro Fainé, rebalances BuildingCenter’s (balance sheet) through capital increases. However, this time, the €1,900 million has been injected into the Catalan group’s bad bank in the form of a “non-refundable monetary contribution from the sole shareholder”. This means that the money forms part of its restricted reserve, and therefore, constitutes the own funds of the company, just like its capital. In 2013, CaixaBank also used this formula to transfer another €750 million to the real estate company.

The BuildingCenter’s last capital increase was also conducted in 2013, for €1,250 million, plus an issue premium of €500 million. Therefore, if we sum the three contributions, CaixaBank has invested €4,400 million in total in BuildingCenter in just two years.

In parallel, over the last two years, the bank has made provisions for the impairment (of its investment in) BuildingCenter amounting to €2,233 million. In 2013, it made provisions amounting to €1,101 million and last year, it made provisions for a further €1,132 million. The NPL ratio of the real estate company is 58.7%.

Financing

According to CaixaBank’s annual report, the financing granted by the bank to its subsidiary BuildingCenter, amounted to €9,268 million at 31 December 2014, i.e. 16% more (than a year earlier).

In total, the net book value of the BuildingCenter’s real estate assets amounted to €6,515 million, i.e. 8% more than in 2013. 73% of that figure related to properties that the company had foreclosed from construction companies and property developers in exchange for the non-payment of debt.

Homes resulting from the foreclosure of individual mortgages accounted for 15% of the portfolio, amounting to €1,000 million.

In 2014, CaixaBank (successfully) marketed 23,400 properties, including sales and rentals, for €2,512 million, i.e. 15% more (than a year earlier). The occupancy rate of the rental portfolio amounts to 87%.

Finally, last year, BuildingCenter took over General de Inversiones Tormes and the company VIP Gestión de Inmuebles, which it inherited from Banco de Valencia.

Original story: Expansión (by S. Saborit)

Translation: Carmel Drake