Castellana Norte Wants To Become The New “City” Post-Brexit

20 October 2016 – Expansión

BBVA and the San José group are refusing to throw in the towel on their plans to construct the Castellana Norte urban development (previously known as Operación Chamartín). To this end, the heads of the company Distrito Castellana Norte have engaged the real estate consultancy firm Colliers to perform a study, which will delve into the need for Madrid to have a new supply of offices and high quality residential properties.

“Madrid is a very attractive business centre, with good infrastructure and security, but there is clearly a lack of high quality products on the market at the moment, because the market has grown in a heterogeneous way and the stock of available offices is extremely poor compared to the centres of other European cities”, explained Antonio Pan de Soraluce, the Director General at Colliers International España.

Sources at the consultancy firm highlight the opportunity that exists to turn Madrid into a international destination of choice and to become the new “City” in Europe. “Projects such as Castellana Norte are very attractive because companies are becoming increasingly demanding about where they locate their offices. We have an opportunity not only because of Brexit, but also because we are a very attractive location for companies from Latin America looking to open offices in Europe”, said Pan de Soraluce”.

20% of the total surface area (more than 3 million m2) in Distrito Castellana Norte will be allocated to offices, homes and businesses, whilst the remainder will be used for infrastructure and communal space.

International comparisons

The project has very low buildability ratios when compared with other similar urban planning projects around the world. “We have studied 200 projects, of which 14 are similar, given that they also involve the regeneration of obsolete railway and port infrastructures, and we have identified that Castellana Norte has the third lowest buildability coefficient of them all”.

Projects assessed included La Défense in París, Canary Wharf in London and Postdamper Pl. in Berlín. All of those projects received institutional support and some even benefitted from public financing. That is something that is not happening with the Town Hall of Madrid, against whom the property developer company has filed an appeal for cancelling the project that was planned initially. The Community of Madrid and the Ministry of Development have supported DCN’s appeal, given that they own most of the land where the project was due to be constructed.

To date, the company owned by BBVA and San José has invested more than €120 million on the Castellana Norte development.

Original story: Expansión

Translation: Carmel Drake

GreenOak Buys 5 Logistics Assets In Madrid For €75M

24 June 2015 – Expansión

GreenOak hereby completes its second major deal in Spain. Over the last few months, the US fund has closed the purchased of five logistics assets in the Community of Madrid, which cover a surface area of 200,000 m2 (100,000 m2 of facilities and 100,000 m2 of land).

Based on the prices of these assets in the market, GreenOak must have paid between €60 million and €75 million for the five assets, according to various real estate sources.

The US fund is planning to continue its growth in this segment and has already agreed to purchase another three logistics assets, also in the Community of Madrid, which will add a further 100,000 m2 to GreenOak’s portfolio in Spain.

The fund plans to continue acquiring assets – in Barcelona, Zaragoza and Valencia as well – to reach (a surface area of) half a million square metres over the next 12 months.

All of the assets purchased by GreenOak are located in Getafe and in the Corredor del Henares and are currently leased out to companies such as Seur, Montfrisa and TransXtar. The vendors have been banks, other funds and family-owned companies.

“Logistics is an asset class where scale and experience make a difference. We are focusing on Spain, where we have the strongest interest”, says John Carrafiell, founding partner at GreenOak.

“Given our resources to undertake investments in the sector, our team on the ground and our real estate due diligence skills, GreenOak can close deals quickly, with investments of between €5 million and €100 million”, says Carrafiell.

The chief executive at GreenOak is leading the fund’s strategy in Spain first hand. Carrafiell is regarded as one of the gurus of global real estate investment. He used to lead Morgan Stanley’s business in this segment and in 2004 he closed one of the largest deals ever in the UK, the purchase of Canary Wharf.

Fund history

After leaving Morgan Stanley, Carrafiell created GreenOak in 2010. Since then, the fund has raised assets under management amounting to €4,751 million and has opened offices in USA, London, Seoul, Munich, Tokyo and Madrid.

GreenOak signed its first major purchase in Spain last year, with the acquisition of seven shopping centres from the Dutch group Vastned Retail for €160 million.

Moreover, in recent months, GreenOak has tried to enter the office market. It was in the running for the purchase of Castellana, 77, which was eventually sold to GMP; and Castellana, 89, which was acquired by Corporación Financiera Alba, owned by the March family. The fund expects to close the purchase of offices and shopping centres within the next few weeks.

 Original story: Expansión (by Jorge Zuloaga)

Translation: Carmel Drake

Madrid’s Own Dedicated Financial District

2 February 2015 – Expansión

The Castellana Extension / The plan is to create a new trendy area in Madrid to rival Canary Wharf in London and La Défense in Paris.

A sustainable area, with every kind of facility – a landmark axis for Madrid. These are some of the foundations upon which the new real estate development in Chamartín, in the north of Madrid, have been created.

“It is an ambitious proposal that draws clear parallels with urban regeneration projects in other European capitals, such as the changes brought about by Canary Wharf in London, La Défense in Paris and Potsdamer Platz in Berlin”, explains Flavio Tejado, Director of the Technical Office of the company Distrito Castellana Norte and Head of the engineering firm Arup in Spain.

The company is one of a group of more than 30 entities that have worked on the project, including professional services and real estate firms, lawyers and the architect studio Rogers.

The ambitious Castellana Norte project will be structured in four parts: the first one, called Parque Central, will be closed to Plaza de Castilla, and will include 6,300 homes and a park covering 24 hectares. “It is an area where the (current) housing stock barely amounts to 1%”, say its developers.

The second, called the business area, will boast 878,150 square metres of offices and 87,425 metres of public facilities, two metro stops (with 4.4 km of new track) and one train station, which will complete the Cuatro Torres complex located in the adjoining area. “We want it to be a space that is full of life not only from Monday to Friday, (but also on the weekends) and so there will also be shopping centres and hotels”, said Antonio Béjar, the Chairman of the company Castellana Norte, on Friday.

The new development will also involve the lengthening of the Paseo de la Castellana, with the construction of 10,000 homes and the new public facilities will also provide services to the existing neighbourhoods of Fuencarral and Begoña. In addition, there will be a tram service, which will operate through the middle of the new section of the Castellana. In addition to an office complex, the development with have a technological area, measuring 180,350 square metres, which the developers expect to appeal to number of companies and to generate new economic activities.

The extension of the Castellana will improve access to the city for the area with the regeneration of the North Junction and the M-40, and the integration of the Cuatro Torres area with developments in Las Tablas, where several large companies, such as FCC, Telefónica and BBVA have their head offices. All of this will create a renewed financial district in the Spanish capital to rival those of its European counterparts.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake