Tag: buyer

Blackstone Offers €3bn+ for Santander’s Ciudad Financiera HQ

10 September 2018 – El Confidencial

Santander’s Ciudad Financiera, the operating headquarters of the bank chaired by Ana Botín in Boadilla del Monte (Madrid), is being put up for auction five years after its owner, the company Marme Inversiones 2007, owned by several investment funds, filed for bankruptcy. After an arduous legal process whereby the bankruptcy administrator and the court managing the liquidation has released the asset, the central offices of Spain’s largest financial institution have been put on the market in search of a buyer.

According to financial sources close to the process, one of the most interested parties is Blackstone, the US hedge fund that has become Santander’s largest real estate partner after it purchased half of its portfolio of toxic assets last year. The US fund is negotiating the finishing touches for the presentation of its offer for the building where the bank employs almost 7,000 employees, including the office of the President, Ana Botín. According to the same sources, Blackstone is debating whether to participate in the auction by itself or to team up with the other creditors that supported the purchase of the Ciudad Financiera in 2008.

Of those, the presence of ING, HSH Nordbank, CaixaBank and Bayeriche Landesbank stand out, which 10 years ago granted a €1.575 billion loan to Propinvest to acquire Santander’s largest real estate asset on a “leaseback” basis. Other entities also participated in that loan including Deutsche Postbank, Royal Bank of Scotland and Raffeisen Zentralbank, which in 2011 started to sell its stake in the loan to vulture funds at significant discounts on the nominal value, when the owner started to realise that it could not afford to pay the debt.

One of the players that purchased that debt was Blackstone, together with other similar funds, such as Centerbridge and Avenue Capital. According to other sources, those investors are seriously considering submitting a joint offer on 17 September, the date on which the interested parties have to appear before the judge. That date is the one that has been set for the binding offers for all of the assets to be processed. If none are received, which is unlikely, then the Ciudad Financiera will have to be split up and sold off piecemeal.

According to these sources, Blackstone is now the main candidate, after two Arab groups placed tentative offers on the table that never proved successful due to legal wrangling and the lawsuits filed by some of the creditors, such as the Iranian Robert Tchenguiz. The investor, who owns several properties in London and is known for his idle lifestyle, was another person to take advantage of Propinvest’s bankruptcy to acquire debt at low prices and whereby become a significant creditor. Nevertheless, his problems with the Law – he ended up being arrested – have ruled him out of the process to take ownership of all of the Ciudad Financiera.

Arab interest

The player that came very close to acquiring Santander’s headquarters was AGC Equity Partners, a Kuwaiti fund with €3 billion under management, which received approval from Mercantile Court number 9, which was leading the bankruptcy of Marme. But its bid, which amounted to €2.5 billion, now needs to be updated, given that, according to various sources, the debt alone of the special purpose vehicle reached €2.8 billion, including senior and mezzanine. Therefore, the offers must exceed at least €3 billion, which means that this auction is going to turn into one of the largest real estate operations of the year.

The attempt by AEG, which was suspended when Ana Botín exercised the right of first refusal over Ciudad Financiera, came at the same time as the bid from Aabar, a company from Abu Dhabi, owned by IPIC, the owner of Cepsa, now renamed Mubadala. According to those sources, that fund is no longer interested in the auction and Santander has no intention of exercising its preferential right, as acknowledged by official sources at the Spanish entity.

The main attraction of Ciudad Financiera is that Santander, which financed the first operation with a loan amounting to €304.6 million to pay the VAT on the purchase, has committed to remain as the tenant of the property for the next 40 years, which means that the rental income is guaranteed.

Original story: El Confidencial (by Agustín Marco)

Translation: Carmel Drake

La Caixa’s Subsidiary Inmo Criteria Negotiates Purchase of Tertiary Plot in 22@

6 June 2018 – Eje Prime

More and more operations are being negotiated in the 22@ district of Barcelona. The latest to join the party is La Caixa, which, through its real estate subsidiary Inmo Criteria, is negotiating the purchase of a plot in 22@ on which it plans to build two office buildings with an above ground surface area of 27,000 m2, according to sources close to the operation speaking to Eje Prime. Although no more details have been disclosed at this stage, the price of the operation could amount to €34 million and will have also caught the attention of another group, namely Glenwell Group, which specialises in opportunities in the Spanish real estate sector, according to the same sources.

Nevertheless, Inmo Criteria is the best-positioned player to acquire this plot. If the operation goes ahead, then the real estate arm of La Caixa will acquire a plot of land located on the block of Calle Ávila y Badajoz, where two buildings are planned, spanning 14,500 m2 and 12,500 m2, respectively. The plots are owned by several owners, including the Miette Group, which declined to comment on the negotiation process.

According to sources close to the operation, the price being considered for the purchase of this land is, approximately, €1,250/m2, which would mean that for 27,000 m2, the buyer could end up spending between €33 million and €34 million. If Inmo Criteria does acquire the plot, it will carry out the promotion and marketing of the offices and will entrust the construction work to a third party, like a large number of groups in the sector do, such as Colonial for example.

Inmo Criteria is the owner of a portfolio of properties with a net value of €2.8 billion, of which €505 million are classified as available-for-sale, €605 million as rental properties, €1,146 million as land and €557 million dedicated to affordable housing programs. The portfolio of properties is managed by InmoCaixa, a company that belongs 100% to CriteriaCaixa (…).

Land in 22@ is highly sought-after

Land in 22@ has attracted attention from a large number of operators, who have invested in the district to promote new residential and office buildings. One example is La Llave de Oro, which signed the purchase of a plot measuring 3,330 m2 in the 22@ district of Barcelona in April for €22 million. On that plot, which had been owned by Metrovacesa, the group plans to build 17,400 m2 of offices (…).

Original story: Eje Prime (by Custodio Pareja)

Translation: Carmel Drake

Criteria Negotiates with Torreal, ProA & KKR to Acquire 100% of Saba

9 April 2018 – Expansión

Criteria, the controlling shareholder of Saba, with a 51% stake, is holding advanced discussions with the minority shareholders of the parking lot group to become the sole shareholder of the company. The investment by La Caixa’s industrial holding company, which could take a decision within the next few weeks, would put an end to the current period of uncertainty that the company has been subject to since Torreal (20%), KKR (18.5%) and ProA (10.5%) agreed to sell their stakes (49%) in a coordinated way more than a year ago.

For Criteria, which declined to comment on the operation, the investment in Saba would represent its first major buy-side move since it sold 10% of Gas Natural-Fenosa to the fund GIP in 2016 for around €1.8 billion and ahead of its eventual exit this year from Abertis if the joint takeover bid by ACS and Atlantia proves successful. For its 18% share in the highway group, Criteria could receive more than €3 billion to use for new investments.

Saba’s valuation ranges in multiplies of between 12x and 14x its EBITDA, which amounted to €100 million in 2017. Taking this relationship as a reference, 100% of the parking lot group chaired by Salvador Alemany would be worth €1.4 billion, including the debt.

Saba’s minority shareholders have forced this outcome. According to the shareholders’ agreements, in May a drag along clause will be activated whereby any of the shareholders may force the sale of 100% of the company. KKR, ProA and Torreal notified La Caixa of their intention to look for a buyer. According to the sources consulted, Criteria has manifested its willingness to buy at the estimated prices.

For the funds, this is an acceptable solution – given the good relationship they have with the majority shareholder – which would also give continuity in terms of the management of the company. With 100% of Saba, Criteria could tackle the subsidiary’s growth strategy with greater freedom at a time when the parking lot sector is open to new corporate movements and company consolidation. Saba will hold its Annual General Shareholders Meeting on 9 May, which Criteria and the investment funds could use to materialise the operation with the configuration of a new Board of Directors if there is a change in the shareholding. The agenda for Saba’s meeting includes the appointment and ratification of directors.

Saba recorded turnover of €205 million in 2016, up by 7%. Its EBITDA, without taking into account the effect of divestments from its logistics parks, rose by 10% to €94 million, whilst its net profit remained at €4 million, which would have been €32 million if the aforementioned exceptional operation was taken into account. The firm’s net financial debt at the end of 2016 amounted to €357 million. Two-thirds of Saba’s business is generated in Spain.

Between 2011, when it broke away from Abertis, and 2016, the company led by Josep Martínez Vila invested €545 million to expand its business perimeter to include 195,000 spaces, although it also divested its logistics assets, with the aim of focusing purely on its parking lot activity. Following the operations of Aena, Adif and the Town Hall of Barcelona, the company has barely made any significant moves, despite expressing interest in its rivals such as Empark and Vincipark, amongst others.

Original story: Expansión (by C. Morán, M. Ponce de León & S. Saborit)

Translation: Carmel Drake

Project Sintra: BBVA Engages PwC to Sell €1bn of Toxic Loans

13 March 2018 – Voz Pópuli

BBVA does not want to waste any more time on the real estate clean-up exercise. In the last few days, the entity chaired by Francisco González has launched a €1 billion portfolio on the market: Project Sintra, according to financial sources consulted by Vozpópuli. It is being advised in the operation by PwC. Neither the bank nor the consultancy firm wanted to comment.

This portfolio is the penultimate step for BBVA in the reduction of its real estate exposure to zero, after the agreement it reached with Cerberus to transfer €13 billion of foreclosed assets, as this newspaper revealed. That sale, Project Marina, is still pending the necessary authorisations and is scheduled to be closed in the middle of this year.

The balance of BBVA’s divestments is as follows: before Project Marina, the entity had a gross exposure (not including provisions) of almost €16 billion, which will end up at just over €3 billion. Of that figure, two-thirds relate to unpaid loans linked to land and completed developments, with a coverage ratio of 54%.

With this new operation, BBVA wants to be crowned as the first major entity to get rid of its inheritance from the crisis. Last year, Santander closed the sale of €30 billion from Popular to Blackstone, but it still has €11.7 billion left to divest.

The same stars

With Project Sintra, BBVA has now awarded the mandate for three consecutive operations to PwC. It did so with Project Jaipur, worth €600 million, which was acquired by Cerberus; and Project Marina, which had the same advisor and buyer.

The latter operation generated unease amongst certain funds, which complained to the bank because it had not opened a competitive process, but instead chose to negotiate one on one with Cerberus. Sources close to that operation defended that a bilateral sale could optimise both the price and an auction, thanks to the threat of opening the process to more rivals.

In this way, BBVA is one of the entities that has decided to accelerate the sale of portfolios during the first quarter, like Sareb, which is finalising the sale of between three and four packages: Nora, Bidasoa, Dune and Slap, with a combined volume of €3.2 billion.

One of the most fashionable assets and one that entities are increasingly including in their portfolios is land. In this way, Sareb is preparing an operation containing land only and Kutxabank is evaluating a similar process.

Original story: Voz Pópuli (by Jorge Zuloaga)

Translation: Carmel Drake

La Sella Group Sells ‘Hotel Denia La Sella’ to Investment Vehicle Managed by Alantra

7 February 2018 – Press Release

Christie & Co has advised on the sale of the Hotel Denia La Sella Golf Resort & SPA, a 5-star hotel located in Denia, province of Alicante.

The 5-star Hotel Denia La Sella Golf Resort & SPA, located only 7 kilometres away from the centre of Denia, is one of the most luxurious establishments in Alicante. The asset has 178 fully equipped rooms and 8 suites, 2 restaurants (Asador Montgó and Segaria Thai Restaurant) and 2 bars. It also has more than 1,400 m2 available for events, a spa and gym area, an outdoor pool and an adjoining golf course, which has also been acquired together with the asset.

The Hotel, always managed by the former owners and known as Marriott La Sella Hotel, was under a franchise agreement with Marriott Hotels International until December 2016.

The new owner of the asset is a vehicle managed by Alantra, a firm specialising in financial advice and asset management whose investors have seen the hotel as an opportunity to reposition the asset. Going forward, the property will be managed on a rental basis by ‘Gestión de Activos Turísticos’ (GAT).

GAT has extensive experience in the hotel sector, managing hotels in several other domestic destinations (Hotel Cándido 4 * in Segovia, Hotel Buenavista 5 * in Toledo) (…).

Original story: Press Release

Translation: Carmel Drake

JLL: Retail Inv’t Will Soar To €4,000M+ In 2017

6 November 2017 – Eje Prime

The retail segment is attracting the attention of investment funds and is set a register a new record in 2017. Investment in retail assets is expected to soar by the end of this year to exceed €4,000 million, according to estimates from the real estate consultancy firm JLL. Operations such as the sale of the Mercado de San Miguel and the Mercado de Fuencarral, both in Madrid, will help this segment of the Spanish real estate sector record a new milestone this year.

So far this year, the commercial premises business has already broken all the records and registered the highest level of investment for the last fourteen years. During the nine months to September, the volume of investment in the retail sector amounted to almost €3,488 million, according to the Market Fundamentals report for Q3, compiled by the consultancy firm.

“The inter-annual footfall index in Spain rose by 1.7% in September and retail sales rose by 0.9% with respect to the previous month”, explain professionals in the retail business. This fact, together with the reality that prime rents are continuing to grow at a good pace, means that funds are looking very closely at retail premises.

The large operations involving portfolios of hypermarkets located across Spain stand out, as do the sales of the Mercado de San Miguel and the Gran Vía Alicante shopping centre. Other operations, such as the sale of Mercado de Fuencarral by Activum to AEW for €50 million have also helped to boost business in this segment in Spain.

“In terms of trends in the retail sector, over the last few months, we have seen how the traditional large format retailers are continuing to move into the city centres, convinced that their proximity to consumers will generate greater sales opportunities for them”, explain sources at JLL. Examples include Decathlon’s arrival on Calle Fuencarral and the opening of a Leroy Merlin store in the heart of Barcelona.

Another example is the case of Ikea on Calle Serrano. The Swedish group has just debuted its “test” of its new format, known as Ikea Temporary; it opened the doors of its first establishment in the centre of Madrid, in a building owned by the Loncito family office.

Moreover, last month, Media Markt opened its third urban store in Madrid, in the central Plaza del Carmen, close to the Preciados shopping street. In this way, Media Markt Preciados became the company’s 81st store in Spain and its 11th in Madrid.

Although the brand dedicated to the distribution of consumer electronics has now opened several stores under this “proximity format” in Valencia (Calle de Colón), Madrid (Calle de Alcalá and Paseo de la Castellana) and Barcelona (Plaza Cataluña and the Digital Store on Avenida Diagonal), the company is looking to further consolidate its arrival in Spain’s city centres with this latest opening.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Empark’s Owners Engage JP Morgan To Sell The Giant For €850M

19 May 2017 – Expansión

Empark is back on the market. The Portuguese controlling shareholders of the car park company have engaged JP Morgan to find a buyer for an entity worth around €850 million, on the basis of the prices and valuations of other similar transactions in the sector. Empark is the leading car park company in Spain with 500,000 parking spaces in the Iberian Peninsula, the United Kingdom and Turkey. The firm’s gross operating profit (EBITDA) amounts to €65 million and its debt, which the company has been restructuring over the last year, amounts to €475 million.

Following the most recent changes, Empark’s shareholder structure is still dominated by the Portuguese investors Silva & Silva, which own 78% of the company. The second largest shareholder is the Chinese conglomerate Haitong, with a 14% stake.

The company’s control vehicle is dominated by the founding families, who participate in the management of the group. The main executives of Empark are José Augusto Tavares, Pedro Mendes (Executive President) and Antonio Moura.

The last attempt to sell the company was made in 2015. Then, the company progressed to the stage of selecting a buyer, Vinci Park (Ardian), but the operation did not come to fruition. Vinci Park reported the breakdown in its negotiations to buy Empark in July of that year after finalising its due diligence work, which produced unsatisfactory findings. Ultimately, the company was concerned about Empark’s high exposure to town halls which, following the local elections held that year, were considering “re-municipalisation”.

Sources close to the fund Ardian say that they are not interested in the operation at the moment. The infrastructure investment giant put Indigo (formerly Vinci park) up for sale this year for around €3,000 million. The sale of Empark is quite complex, given that the shares of the car park company serve, in turn, to secure the shareholders’ personal loans.

According to sources close to the operation, the Portuguese shareholders have dragged the other shareholders into the sale and have been given until the beginning of October to find a buyer. They are keen to leverage the ‘drag along clause’ set out in the company’s shareholder agreements (which means that when a third party makes an offer to purchase the company by buying all of its share capital, then the shareholder that has the ‘drag along right’ may force the other shareholders to sell their stakes to the buyer).

Sources in the sector believe that if Pedro Mendes and his partners do not find an investor with a reasonable offer in time, Haitong may push ahead with the operation by itself or with one of Empark’s creditor banks. Deutsche Bank is one of the company’s latest lenders. The German bank manages the fund RREEF Infrastructure.

One of the possible candidates to analyse the purchase operation is the fund First State, which acquired España Parkia from the Nordic fund EQT and Mutua Madrileña in 2016 for just over €300 million. The US fund Alinda is also very active in Spain. It has made an offer to buy Isolux’s car park portfolio. Another candidate could be the Chinese firm Haitong

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Lucas Fox: Luxury Home Sales Soared By 31% In 2016

27 February 2017 – Expansión

Luxury homes enjoyed a buoyant 2016. Sales soared by 31% thanks to the boost from foreign investors, above all in cities such as Barcelona, where the purchase of high-end residences increased by 69%, according to the latest report from the real estate company Lucas Fox, which specialises in high-end homes. In Madrid, the increase amounted to 12%.

The study attributes this mini-boom to the declining demand for properties in London following the Brexit referendum. That “has caused citizens from outside the EU to be more interested in Madrid and Barcelona, and the trend is set to continue in 2017”.

Foreign investors will continue to be the main driver behind Spain’s luxury residential sector. They now account for 65% of the market, according to the real estate company. The remaining 35% are Spaniards.

Buyers from the UK and Ireland accounted for 11% of overseas purchasers in 2016, whilst French buyers accounted for 5%. Purchasers from the Middle East were the cohort that grew by the most, to account for 8% of all luxury residential property purchases. Scandinavian buyers accounted for 6%.

In terms of buyer motivation, 30% acquired a property as a primary residence and 43% as a second home. It is worth remembering that 75 million tourists visited Spain last year, a historical record. There was also a considerable increase in the number of buyers who purchased properties for investment purposes (22% of all purchases by overseas buyers). Finally, 3% bought because they were looking to obtain a Golden Visa, in other words, the permit to reside in Spain that is granted to real estate investors from outside the EU.

In fact, Lucas Fox estimates that demand for Spanish properties from buyers outside the EU, including from the USA and the Middle East, “will cause the current bullish trend to continue throughout 2017, thanks to the Golden Visa program”.

During the first three quarters of 2016, foreigner buyers spent just over €47 million on new build and recently renovated properties, which represents a YoY increase of 9%. The apartments that are most in demand are those located in classic buildings in prime areas, measuring between 150 m2 and 200 m2 and worth between €1 million and €1.5 million.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

BBVA: RE Sector Has Positive Outlook In 2017

18 January 2017 – La Vanguardia

BBVA thinks that the outlook regarding the real estate sector is “positive” and that this trend will continue into 2017, according to its report “Real Estate Situation in Spain” and the activity of its ‘BBVA Valora’ users.

For the bank, the progress in 2017 will be “very heterogeneous” across all autonomous communities. Specifically, Madrid and Barcelona currently lead the searches on ‘BBVA Valora’, for both the customer and non-customer categories. They are followed by Valencia, Sevilla, Alicante and other provinces such as Málaga and Cádiz.

At ‘BBVA Valora’, users can find information about house prices. Upon entering the address of the property, the tool returns the purchase and rental price, as well as what would be a “well negotiated price” for the buyer.

In terms of surface area, users tend to be most interested in purchasing properties that measure between 80 m2 and 130 m2, which account for half of the searches registered in the app

Original story: La Vanguardia

Translation: Carmel Drake

KKH Property Buys Monte de Piedad’s Former HQ For €80M

9 December 2016 – El Confidencial

A year after engaging Irea to organise an official sales process for its headquarters in Plaza del Celenque, the Fundación Montemadrid (the successor of the former Fundación Caja Madrid) has reached an agreement with KKH Property Investors to sell the property for around €80 million, according to sources consulted by El Confidencial.

This is a key operation both for the Fundación, which will raise funds through this divestment to allow it to ensure the continuation of its social work, as well as for the buyer, which is entering the sought-after real estate market in Madrid with a bang.

Headquartered in Barcelona, KKH Property is a joint venture between KKH Capital, the investment group controlled by the former CEO of Renta Corporación, Josep María Farré, and Perella Weinberg, which owns a stake in this partnership through one of its opportunistic funds.

The JV plans to convert the Monte de Piedad building in Madrid into a luxury hotel, with 180 rooms and suites, as well as an extensive range of restaurants and spaces for conferences and social events. The building has a surface area of 27,000 m2, spread over seven above ground floors and two basement floors, used for parking.

Located between Plaza de Celenque and Plaza de Las Descalzas, the property will continue to house the activities of the Fundación Montemadrid, which will continue to occupy approximately 2,000 m2 of the property. (…).

The building was constructed in 1975, on the site of the former Montepío, just opposite the Monastery of Las Descalzas Reales and only 200 m from the Puerta del Sol. (…).

The sale of the former headquarters of Fundación Montemadrid, whose offices are now located next door in La Casa de Las Alhajas, sparked interest amongst a large group of buyers. Nevertheless, the price expectations of the seller ended up whittling down the potential candidates to just two, KKH Property and Hispania, both of which submitted definitive offers in the summer, according to market sources.

In the end, KKH has emerged victorious. Although this is the company’s first major operation in Madrid, the vehicle led by Farré already owns several iconic buildings in Barcelona, most notably the former headquarters of Deutsche Bank, located at numbers 109 and 111 on Paseo de Gracia, which it acquired in July 2014. (…).

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake