Madrid Nuevo Norte will Generate €13.2bn of Business for the RE Sector

12 October 2018 – Eje Prime

Madrid Nuevo Norte represents good news for the Spanish real estate sector. The Town Hall led by Manuela Carmena expects the project, which received the green light at the end of September, to generate €13.2 billion of business for the real estate sector.

The urban development project, to the north of Chamartín train station, is going to house 10,485 new homes, as well as 1.5 million m2 of offices and another 103,119 m2 of commercial space. The acquisition of the plots will involve a total cost of €3.74 billion and the construction costs will exceed €2.78 billion.

The Town Hall of Madrid has confirmed that the tertiary assets will contribute the bulk of the income for the property developers that participate in the construction of Madrid Nuevo Norte. Together, the sales price of those properties will amount to €10.2 billion. In the case of the development of new homes, the business will amount to €2.98 billion, according to reports from Cinco Días.

The results of an economic study for the project show a range of returns of between 11.2% and 16.4%, although the Town Hall warns that the margin will depend heavily on factors such as the evolution of the real estate market and the acquisition price of the land. In terms of the latter, an orientative cost of €2,899.47/m2 is forecast for private housing located in the financial centre.

Following several adjustments, the total buildability of Madrid Nuevo Norte has decreased by 21%, down from 3.37 million m2 according to the initial plan to €2.66 million m2 under the current plan. In addition, the district has been divided into four areas: Chamartín station, the business centre, Fuencarral-San Roque-Tres Olivos and Fuencarral-Las Tablas. Each area will have its own construction timetable and urbanisation costs.

The project will have to be financed almost in its entirety by the landowners, who will disburse €1.2 billion on average. The Town Hall of Madrid is going to spend €307.89 million with the aim of covering the urbanisation costs, which will be added to €24.78 million from the Community of Madrid and €220.49 million from Adif, the concessionaire of the rights.

Original story: Eje Prime

Translation: Carmel Drake

Operación Chamartín: Carmena Cuts Number Of Homes By 75%

11 May 2016 – Cinco Días

Manuela Carmena, the mayoress of Madrid, has made her proposal for Operación Chamartín. Almost 25 years after the first plans were outlined, the team from Ahora Madrid revealed its plan on Tuesday, in an “open document”, according to the councillor, although the details have not been agreed or discussed with the site’s property developer, Distrito Castellana Norte (DCN), or with the other authorities involved. The Town Hall thinks that it should take charge of the city’s plans and so has presented this document to serve as a basis for negotiations.

The Town Hall has drastically reduced the number of homes in its plan, called Madrid Puerta Norte. From the 17,000 homes planned by the current developer, the Town Hall projects 4,600 homes (of which 1,000 will be social housing), representing a reduction of 75%. It also decreases the planned space allocated to tertiary use, by 15%, to 1.1 million sqm.

One of the points that will cause controversy, the buildability rate, is maintained at 1.05 m2, but that is because its calculation excludes all railway and road land, which means that the number of homes resuting from the calculation is significantly lower. Even so, sources in the sector say that the regional regulations approved in 2002 require the calculation of this ratio to include the railway land.

Carmena also proposes a business hub around Chamartín train station, whose profits would be used to finance the remodelling of the infrastructure for the Metro, roads and the station itself.

The last attempt to obtain approval for this urban development was undertaken last year, when the team led by Ana Botella (PP) approved the partial plan presented by the developer DCN (controlled by BBVA (75%) and Grupo San José (25%)) although it never received the green light from the Town Hall authorities.

DCN owns the rights to 61.6% of the land belonging to Adif, thanks to a contest won by the developer in 1993, organised by the Socialist Government of Felipe González. The agreement with the railway administrator, for which it would receive up to €1,300 million, is due to terminate on 31 December 2016.

“I would like us to see this as a starting point, for achieving synergies, rather than as a finished document” said Carmena, who will send the proposal to the Ministry of Development, the Community of Madrid and the development company. “We cannot evaluate the project because we do not know anything about it”, said a spokesperson from DCN. Now it is time to see whether there are enough points for negotiation.

For this reason, the Town Hall has reduced the weight of the infrastructures. It has decreased the proposed number of Metro stations from three to one, excluded another planned Cercanías (local railway) station and diminished the slabs required to bury Chamartín’s tracks underground by 90%.

Carmena also proposes the construction of a business centre around Chamartín train station, which is owned by Adif, whose profits will be used to finance the North Junction, the Fuencarral Junction and the renovation of the station itself. In this context, two iconic 40-storey skyscrapers will be constructed for office use, along with other buildings containing between 20 and 40 floors.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Bluespace Buys Building In Madrid From The Baraka Group

11 March 2015 – Expansión

Bluespace is bringing its storage rental business to the centre of Madrid, in a deal valued at €8 million. The self-storage company has acquired the building located on Avenida de los Toreros, 8, in the district of Salamanca, where it plans to open a new centre, containing one thousand ‘lockers’ or mini-storage spaces, by the end of the year; it will be the company’s fourth largest space.

The property, measuring almost 8,000 square metres, was owned by Baraka Global Invest, the real estate group (in turn) owned by the Murcian businessman Trinitario Casanova. Until now, the building was occupied by a Peugeot car dealership.

The investment of €8 million includes both the acquisition of the building, as well as the cost of refurbishment for its new use. The new centre will have floor space of 4,500 square metres and, in addition to the storage spaces, will also include a business centre and meeting rooms, and will offer clients a removals service.

This transaction is the largest closed by Bluespace since January, when the company was taken over by the Fremont Group, an investment company from San Francisco (USA).

Network of centres

Bluespace is headquartered in Sant Just Desvern (Barcelona) and has a network of 22 (owned) centres located in Madrid, Barcelona and Valencia. It also has 25 partner centres in 22 cities across Spain.

Bluespace’s largest centres are located in Sant Just Desvern, Alcorcón (Madrid) and on Avenida Ramón y Cajal, also in the Spanish capital.

In 2013, the company generated turnover of €18.26 million and an EBITDA of €7.62 million.

Original story: Expansión (by J.O.)

Translation: Carmel Drake