Tag: Calle Raimundo Fernández Villaverde

Domo Gestora Invests €33M to Build c. 100 Homes in Tres Cantos (Madrid)

27 April 2018 – Eje Prime

New challenges lie ahead for Domo Gestora. The property developer has just acquired a new plot of land in Madrid on which it will build around one hundred homes in Tres Cantos, according to sources at the group speaking to Eje Prime. The real estate manager, which specialises in housing cooperatives and delegated management, is going to invest €33 million in this development.

Domo is going to manage the project after one of its cooperatives acquired the plot where it is going to build the development. It will consist of 101 apartments in a gated community with a swimming pool and common areas, whose quality stands out due to the proposals in terms of efficiency, sustainability, child safety and accessibility. Construction work is expected to start in June and all of the homes are expected to be handed over in the middle of 2020.

Domo Gestora is currently operating in the market with a dozen developments. In Madrid, where the group has already handed over more than 500 apartments, the company has 700 homes under development, whilst in Guadalajara, Badajoz, Málaga and Granada, it has 81, 26, 23 and 24 homes under construction.

The most noteworthy developments include one located on Paseo de la Castellana, where Domo is building around twenty terraced homes and one located on Calle Raimundo Fernández Villaverde, which is going to comprise 334 homes.

In addition to the homes under construction, the company has also handed over more than 500 homes in recent years, located in places such as Valdebebas, where it has built 200 apartments; Vallecas, with around fifteen family homes; and Arroyomolinos, with a development of 43 family homes, amongst others.

In total, since Domo Gestora has been active, it has built more than 200,000 m2 of properties, handed over around 1,000 homes and managed more than 2,000 assets. Domo has also managed more than €108 million of contracted work and has accessed more than €300 million of financing.

Domo Activos, the Socimi

In addition to its core business, Domo Gestora has also had to focus on its Socimi in recent months. Last year, the company launched the first property developer Socimi dedicated to medium-sized investors. The business model of Domo Activos involves the acquisition of land for the development of buildings destined for rent, which are then sold off after three years of ownership.

The return on that project, once the divestments have been made could reach 10% per annum, according to the company’s estimates. Until the home is sold and for the period that the building is leased, investors receive the profit resulting from the rental income in the form of a dividend.

Currently, the largest project being promoted by Domo Activos is the development that it is constructing in Madrid, in El Ensanche de Vallecas. This building is going to comprise eighty rental homes, according to explanations from the group.

The next steps for the group are to look for new land on which to build more homes under its Socimi. The company has already identified opportunities in Spain and is now hoping to increase its financial muscle in order to carry out the purchase of the new land through a capital increase of up to €15 million. Domo Activos is going to focus these acquisitions on Madrid, Málaga and Valencia, in the first instance, but is also on the lookout for plots in Sevilla, Córdoba, Granada and Zaragoza.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Ebrosa Buys Ministry Of Defence’s Last Auctioned Plot In Madrid

9 February 2017 – Expansión

The Ministry of Defence is continuing with its real estate divestment plan. Its last major sale was completed yesterday with the sale of an urban use plot that has a surface area of 3,569 m2 and a buildable surface area of 9,865 m2. The plot is located in the former central park of the engineers in Villaverde, in the neighbourhood of Los Angeles, in the south east of Madrid.

Like in the case of the Administration’s other assets, the sale has been conducted through a public auction, which was publicised through the real estate portfolio addmeet. Specifically, the Ministry of Defence had planned to carry out two simultaneous auctions, for an initial asking price of €4.7 million (in the first round of bidding) and a second asking price of €4.28 million (in the second round). In the end, the second round was not necessary as the initial bids exceeded the initial asking price, and the plot was awarded to the real estate company Ebrosa, which bid €5.04 million.

This Zaragoza-based property developer will use the land, for which planning permission has already been granted, to build a block of flats similar to those projects that it is already developing in other areas of Madrid, such as in Las Tablas and Sanchinarro, in the north east of the city, as well as in Ensanche de Vallecas.

Ebrosa’s new development will be located next to “residential developments that are being sold at a good rate”, according to information included in the addmeet advert. Specifically, one hundred homes that Inmoglacial is promoting together with the investment fund Aquila Capital, in the same central park of the engineers in Vallaverde, after it was awarded nine plots of land from Sepes in July 2015, covering a buildable surface area of 120,000 m2. That project, which is being completed in nine phases, involves a total investment of almost €200 million to construct more than 1,200 homes, whose first phase is due to be completed in the spring of 2017.

According to the most recent annual accounts, corresponding to 2015, Ebrosa generated a profit of €31.38 million, compared with €4 million the year before, from a turnover of €16.68 million.

Divestment plan

The sale of the plot in the neighbourhood of Los Angeles was included in the real estate asset sales plan that the Ministry of Defence launched in 2013, with the aim of divesting some of its land, premises, rural estates and homes.

The most high profile sales in this plan include the sale of the former Precisión Workshop, located on Calle Raimundo Fernández Villaverde, next to Paseo de la Castellana and Nuevos Ministerios. In November 2014, the Ministry of Defence awarded those unused plots to the housing manager Domo for €111 million, which acquired them with the aim of constructing a 320-home development on the site, with an average price of €325,000.

Currently, the Ministry of Defence has two other plots of land up for sale, in Alcalá de Henares and in the Campamento area. The latter, whose sales price has not been revealed, is one of the most attractive sites for construction in the capital, given its location, between the Somosaguas area and the former land of Campamento, whose sale is also being considered by the Ministry.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Carmena Grants Partial Demolition Licence For Former MOD Building

9 December 2016 – Expansión

The Town Hall of Madrid has granted a licence for the partial demolition of the Precision Artillery Workshop, on Raimundo Fernández Villaverde, despite opposition from Ganemos.

Cooperativa Maravillas, the property developer behind the residential project that is going to be constructed on a plot of land that used to be owned by the Ministry of Defence, on Calle Raimundo Fernández Villaverde, has received some good news this week. The Town Hall of Madrid has granted the management company Domo a licence to demolish the Precision Artillery Workship, now in disuse, despite opposition from Ganemos, one of the parties that forms part of the municipal government’s coalition.

Following a favourable report from the Community of Madrid’s Local Heritage Committee, the Town Hall has authorised the partial demolition of the building. The remodelling of the property forms an essential part of the management company’s plans, which involve the construction of more than 300 homes on this street, located in the Madrilenian neighbourhood of Chamberí.

In any event, the licence for the complete demolition is pending a decision by the Heritage Committee to determine whether the building’s basement still contains any old air-raid shelters from the Civil War, in which case, they should be preserved. In addition, the cooperative is waiting for the agreement reached between the Town Hall and the management company to be ratified.

Details of the agreement

According to this agreement, the Town Hall of Madrid will receive 5,422 m2 of land for residential use, corresponding to 10% of the obligatory concession.

Similarly, the Town Hall of Madrid will receive 3,360 m2 of green space and 1,000 m2 of space on the ground floor of the building, where it plans to building a primary school. It will also receive 250 m2 of free space.

Manuela Carmena’s urban planning team has reached an agreement with the property developer to assign the property in this way, rather than monetise it, with the aim of “covering the deficiencies of these types of facilities in the district of Chamberí”, explained the Town Hall.

The agreement, which is necessary for the approval of the urban planning project and the subsequent work and construction licence, will be circulated for public information purposes and referred to the Town Hall for its ratification.

Opposition from Ganemos

The decision to demolish this building does not have the blessing of Ganemos. The municipal platform, which forms party of Ahora Madrid, considers that “there is no reason” to grant a licence to allow the demolition of the historical building, given that the management agreement required to be able to construct the new buildings has not been approved. According to the platform, several legal cases are still open with the Prosecutor’s Office and the High Court of Justice of Madrid that may still result in the cancelation of the urban planning project. (…).

Meanwhile, the cooperative pointed out that the buildings belonging to the former Workshop are not classified as being of cultural interest, nor do they have any kind of offical protection. “The General Urban Planning Plan of 1997 and its subsequent review did not foresee the need to classify buildings or land as urban land for residential use.”

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

The Housing Paradox: Supply Is Failing To Match Demand

21 June 2016 – El Confidencial

Spain is going to need 180,000 homes per year until 2025 to meet the demand being created by new households. In the Community of Madrid alone that means 25,000 new units. Those are the forecasts published by the real estate consultancy CBRE, which estimates that the existing stock contains around 300,000 homes, of which between 20-25%, in other words, around 75,000, will never be sold because no-one wants to buy them, either because of their locations or other characteristics.

(…) According to Samuel Población, the National Director of Residential Assets and Land at CBRE, “by the beginning of 2017, the stock of new homes will have pretty much been absorbed; what is left will be very localised and technical, which will drive the launch of new developments”. To give us an idea, in the centre of Madrid, there are currently only 800 (new) homes up for sale and in Barcelona, there are just over 1,000, according to estimates from Sociedad de Tasación.

Specifically, markets such as Madrid, where demand is high – house sales have risen by 13% in the capital in the last year – and where there is a shortage of new homes being constructed, account for almost one in seven of the new homes being built. Nevertheless, the available land inside the M-30 ring road has capacity for less than 1,500 homes. In Cataluña, demand amounts to 14,000 homes, of which Barcelona accounts for 7,900 units, ahead of the Balearic Islands, where demand reaches 7,544.

In fact, Madrid has become one of the most active markets from the point of view of the residential sector, given that almost 30 operations have been signed there in the last year and a half, which have involved a total investment of almost €1,000 million, in some cases exceeding €100 million each (such as the cases of the plots in Raimundo Fernández-Villaverde and Juan Bravo, 3). However, that activity contrasts with the paralysis that exists in other autonomous regions, such as Extremadura, Castilla y León and Castilla La Mancha, where demand is currently non-existent, according to Lola Martínez, the Head of Research at CBRE.

According to Samuel Población, this strong demand in Madrid has already had a direct effect on prices. “We have seen operations involving land, where prices have doubled in just a few months…”. In fact, although the consultancy firm forecasts that house prices will rise by 6% on average across Spain in 2016, it does not rule out the possibility of higher price increases in the centre of Madrid, where the average price of new homes amounts to €3,000/sqm, and where prices for new developments in the neighbourhood of Salamanca are as high as €10,000/sqm.

The lack of buildable land inside the M-30 ring road, the paralysis of the sale of public land and the high prices of plots owned by private developers means that the market for renovations is gaining strength in the centre of Madrid. Some of the most notable operations in recent months include the refurbishments of the former Agencia EFE building and the former tenement building in San Juan de la Cruz, which are both going to be converted into luxury homes. (…).

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

Demand For Off-Plan Homes Rises From The Ashes

8 May 2015 – El Confidencial

We can see cranes and bulldozers on the horizon in Spain once more. And although players in the real estate sector would rather talk about prudence than euphoria, stabilisation than recovery, the outlook is very encouraging.

Mortgage lending is increasing, more new homes are being built and more homes (in general) are also being sold. And, although the second-hand market is still winning hands down – even though the statistics are distorted by the foreclosures of homes by banks – demand for new builds is returning once more. Thus, purchasing a home off-plan, a practice that became almost anecdotal during the crisis, is returning to the fore once again, seven years after the real estate bubble burst.

There are several advantages to purchasing off-plan. You buy a new home that, for the most part, does not need any work doing to it. Some developers even allow future owners to adapt homes to their needs and likes – to convert a 4-bedroom home into a 3-bedroom property with a larger living room, for example – but, undoubtedly, the main advantage is that purchasers are not obliged to make a major outlay (of cash) in one go, but rather, they make small contributions until the keys are handed over, and those amounts are then deducted from the final price of the home. The main drawback is that new builds are not yet finished, which means they are not available immediately. And construction work can last for between 18 and 24 months.

Recently, several dozen people queued up overnight to reserve one of 62 homes that Solvia will soon build in Barcelona. It will be the real estate platform’s first development in the regional capital. (….) “There was a great deal of interest because it was a well-located product, with great features and reasonable, attractive prices”, said Augusto Monte, Director of Sales and Transactions at Solvia. “Clearly, it was an exceptional case and you cannot make wider generalisations about what happened with this development”. Nevertheless, Monte acknowledges that the fear of buying off-plan has declined in recent months.

(…) Other recent examples include the actions of housing cooperatives – for example, the plot of land in Raimundo Fernández-Villaverde or the old engine sheds at Cuatro Caminos – which obtained 100% of the partners in record time to sign up to purchase homes that will not be built for another two years.

Property developers, banks and servicers are conscious of this change and have come to the largest real estate fair in Spain (SIMA) with this type of product. Thus, for example, Solvia has a 75-home development of Alcalá de Henares. Between July and September last year, 64% of the development had already been purchased. And it is not the only one.

“We still notice considerable uncertainty amongst prospective buyers. Many of them come to the stand to ask us when the construction work will to begin. They are quite afraid that the building work will get delayed or that it will not happen at all”, says Inmaculada López-Gasco, sales manager at Magnum & Partners, which started to sell 63 homes in San Sebastián de los Reyes in April. “We have already sold 16 – i.e. 25% – and we will have the licence to start the construction work in June. We hope that sales will accelerate once the bulldozers start work.

(…)

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake

Cooperatives Queue Up To Buy A Plot That The Treasury Purchased 30 Years Ago

16 February 2015 – El Confidencial

All eyes are focused on one plot of land in Madrid. A plot of land, which the Treasury purchased from a group of nuns for 800 million pesetas in 1985, could now, three decades later, be sold for several million euros. It is one of the largest and rarest gems left in Madrid and many of the large housing cooperatives have already expressed interest. These same cooperatives were responsible for some of the most talked about transactions in the country last year; and this deal would allow them to offer hundreds of low cost homes in the centre of Madrid, just a few metres from the Paseo de la Castellana, something that was unthinkable a few years ago.

The plot measures just over 15,000 square metres and is located at the intersection of Calles Padre Damián and Fray Bernardino Sahagún, very close to the Castellana and ten minutes away from the Santiago Bernabeu stadium and the Torres KIO. It is owned by State Heritage (Patrimonio del Estado), which in turn reports to the Treasury (Ministerio de Hacienda). The land has its own history…it used to house a convent, which was demolished shortly after the plot was acquired by the Government. Three decades later…., the plot may come back onto the market in a perfect transaction for the public coffers, thanks to the increase in land values during the intervening period.

Nevertheless, before the plot is auctioned, some administrative hurdles will need to be overcome to change its intended use. The State Heritage department has proposed a one-off amendment to the General Urban Plan for Madrid because, for this land to be attractive in the market, and for the Treasury to obtain the maximum price for its sale, its use must be residential; currently it may only be used for the collective services of the Public Administration. (…)

This one-off amendment is awaiting provisional approval by the Town Hall of Madrid and definitive approval by the Community of Madrid, according to sources from the Treasury who say that until this happens, the plot will not be put up for sale. (…)

(…)

Under the spotlight of the management cooperatives

“The size of the plot, its location, its environment, its intended suitability for construction, its scope, the potential appeal of the project that could be developed makes this plot of land a clear target that is going to generate a lot of interest”, said Leopoldo Morena, the CEO of the Ibosa Group, the cooperative manager that was responsible for one of the most important land transactions in the capital last year, when it was awarded ownership of Metro de Madrid’s depots in Cuatro Caminos for €88 million. That project, Residencial Metropolitan, which will bring more than 400 homes onto the market, with prices upwards of €2,600 per square metre, has almost all been sold (95%).

Nevertheless, the operation of the year was, without a doubt, the sale of a plot of land on Calle Raimundo Fernández Villaverde by the Ministry of Defence in a bid that was won by the cooperative manager Domo. Its offer for €111 million exceeded those made by Ferrovial, Pryconsa and Construcciones Amenabar; all of the homes in the development have already been sold. The sales price of the 355 homes was expected to start at €3,300 per square mete.

These two transactions boosted the market in 2014. According to data from the real estate consultant Irea, transactions involving land in Spain amounted to €346 million last year, which represented just 4% of the total investment in the market. A low percentage, however, in 2013, there weren’t any transactions involving land above five million euro, the threshold that Irea uses to prepare its analysis of investment in Spain (and so the deals closed in 2014 did represent a move in the right direction).

“Transactions such as the one in Calle Raimundo Fernández Villaverde, the Metro de Madrid and more recently, Amenabar’s purchase of various plots of land from Sareb, without financing, were unthinkable a few years ago”, explains Mikel Echavarren, the CEO at Irea.

In his opinion, the main players that may sign land-related transactions in Spain this year will continue to be domestic companies, developers and cooperatives, which are capable of financing their land purchases with their own funds: “There are scarcely six companies in Spain at the moment with sufficient financial capacity to finance land purchases”….

The role of international investment funds in the direct purchase of land will be practically zero, but they will be involved in the acquisition of portfolios of debt that contain land or residential developments as underlying collateral.

The plot of land in Madrid has also attracted interest from prospective house buyers, as evidenced by the fact that some managers have received requests from more than 2,000 interested parties. And it is no wonder: if the land falls back into the hands of cooperatives, they may build homes right in the centre of Madrid at very competitive prices, especially compared with those in private developments, such as the one that will start soon in Calle Juan Bravo, 3, where the prices of the luxury homes that are going to be built on the site may reach €9,000 per square metre, significantly higher than the less than €4,000 per sqm being charged by both the Ibosa Group and Domo Gestora for their recent acquisitions in Madrid.

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake