Tag: CBRE Global Investment Partners

CBRE Global Investment Partners and IBA Capital to Sell Gran Vía 18 in Madrid

19 November 2019 – CBRE Global Investment Partners and IBA Capital announced their intention to sell the property located at Gran Vía 18, in Madrid for an estimated 70 million euros. The two firms acquired the asset in 2017 for €44 million and have since implemented a major renovation.

The building, which is on the corner of Calle Clavel, will become a mixed-use retail and office building. The retail side of the asset, which has a basement and seven above-ground floors, is large enough to accommodate a flagship store of a major retailer.

Original Story: El Economista – Alba Brualla

Adaptation/Translation: Richard D. K. Turner

Round Hill: A New Player in Spain’s Student Hall Market

19 July 2018 – Eje Prime

A new player wants to benefit from the boom in student residences in Spain. The British fund Round Hill has set its sights on the domestic market and is joining the long list of investment firms that are looking for opportunities in these types of assets in the country, according to explanations from sources close to the company speaking to Eje Prime.

The fund currently has a pipeline of more than 7,000 beds in the student hall market in several countries across Europe. Spain and Portugal feature on the list, as do the United Kingdom, Ireland, The Netherlands and Portugal.

Round Hill, founded in 2002 by Michael Bickford, a former director of Morgan Stanley, is sounding out the market to find both land and student residence assets through which to compete in a sector that is clearly booming around the world and, above all, in Spain, the country the receives the most Erasmus students.

The company even has strategic alliances with other investment funds for specific projects. In this way, in the Netherlands, Round Hill and KKR have created a joint venture to purchase a three-acre plot in Utrecht, in partnership with Stadium Capital Partners, on which they are going to build a 23-storey building with 577 beds. In addition, the tower will contain 173 apartments for young professionals.

The joint venture between Round Hill and KKR may also make its debut in Spain, according to sources at the company. “We hope to expand our footprint in student housing and residential accommodation in certain key markets in Europe”, they say.

In addition, Round Hill has been interested in the Spanish hall of residence market for several years now. One example is that the fund was one of the parties interested in buying the Resa asset portfolio, which ended up in the hands of AXA Real Assets and CBRE Global Investment Partners for around €500 million.

Luxury developers of Palo Alto

Round Hill Capital already has a star project in Spain. Palo Alto, located in Ojén, a town adjacent to Marbella, comprises 600 homes spread over a plot measuring fifty hectares, including twenty hectares of green space. A luxury urbanisation in which the real estate fund invested €250 million in 2016.

Moreover, following its arrival in the Spanish market, the company led by Bickford explained that it had another €1.5 billion to invest in real estate. One of the closest directors to the founder of Round Hill is a Spaniard, who played a key role in the development of Palo Alto. Matías Villarroal, formerly of JP Morgan and Morgan Stanley in New York, is the Director General and Head of Residential Developments at Round Hill in the Spanish market (…).

Original story: Eje Prime (by J. Izquierdo & P. Riaño)

Translation: Carmel Drake

BNP Paribas: Spain’s Hall of Residence Market Will Grow by 4% in 2019

16 July 2018 – Eje Prime

(…). With 1,148 accommodation centres for university students located all over the country, split between halls of residences (963) and residential colleges (185), the domestic market comprised 93,500 beds at the end of 2017. Nevertheless, that supply “is small compared with current demand”, explains BNP Paribas Real Estate in a report to which Eje Prime has had access. For this reason, the international consultancy firm forecasts that this alternative market will grow by 4% in Spain in 2019.

In recent years, the sub-sector has recorded some major operations involving the sale of both assets and companies. The most important deal came at the end of 2017, when AXA Real Assets and CBRE Global Investment Partners invested almost €400 million in the purchase of the entire portfolio of Resa, the vehicle specialising in student halls previously owned by Lazora. Following the operation, the manager Greystar became the king of the halls in Spain with 37 assets under ownership (four of which were being developed). In total, more than 9,000 beds changed hands.

Resa’s sale is nothing more than a consequence of the current investor appetite, primarily from international funds, many of which specialise in this sector. In 2017 alone, fourteen student halls opened their doors, adding 2,149 new beds to the sector. Moreover, since this is a very fragmented market with many owners, we are seeing the purchase of large bundles of beds, which the new players arriving in Spain are using to initiate their expansion plans.

Such is the case of Corestate, an investment fund headquartered in Luxembourg, which purchased a former residence, containing 260 rooms and 302 beds, in Madrid in 2016 to renovate the building and give it its personal stamp. With support from Villar Mir, the company disbursed €40 million on that project. A year earlier, the Dutch company The Student Hotel paid the same amount for two halls of residence in Barcelona (Melon District Marina and Melon District Poblesec) containing 600 rooms in total.

Those operations led by international funds show the influence that foreign capital has and, above all, is going to have, in the student hall sector. A large part of this interest in the domestic market stems from Erasmus. Spain is the most sought-after country by university students, ahead of Germany, the United Kingdom and France. Two years ago, 45,813 young people arrived in the country, including Erasmus and international students on secondments, and all of them needed to find a bed for the year.

Geographical dispersion

Another one of the major attractions of the student hall market in Spain is its geographical dispersion. It is not only Madrid and Barcelona that are attractive: Málaga, Valencia, Sevilla, Salamanca and Granada are all cities with a large influx of students, many of them international, arriving every year.

Madrid is the city with the largest supply of rooms for students, with 21,159 beds in 198 centres at the end of 2017. That figure accounts for 23% of the total stock on the market in Spain (…). Cataluña was ranked in second place (…) with 170 centres and 14,177 beds, accounting for 14% of the stock. It was followed by Castilla y León (where Salamanca plays an important role) and Andalucía, with shares of 14% and 12%, respectively (…).

Activity is spreading to the north too. Just last week, the fund WP Carey paid €10 million to buy an office building in San Sebastián from Solvia, which it is going to convert into a hall of residence for students (…).

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake

Corestate Finalises More Land Purchases in Spain

25 June 2018 – Eje Prime

Corestate wants its share of the student resident cake in Spain. The Luxembourg-based fund manager is finalising the purchase of new plots of land in the country, at the same time as it is starting to search for new opportunities in Portugal, according to explanations provided by the company’s most senior executive in Spain, Christopher Hütwohl. Corestate’s objective is to be ranked as one of the Top 3 operators in the sector by 2020.

The group is whereby seeking to fight off competition from companies such as Greystar, currently number one in the sector by number of beds following its acquisition together with Axa Real Assets and CBRE Global Investment Partners of Resa’s portfolio (formed by 37 assets) for €500 million. Another prominent operator is GSA, which acquired RIO’s portfolio for €180 million.

Corestate, which managed assets worth €22 billion at the end of the first quarter, is now launching new land acquisitions to build halls of residence for students, which will be added to the 206 beds that it is going to open in the Madrilenian district of Moncloa in September and the more than 300 that it will incorporate in Sevilla following the purchase of a plot of land in May.

According to Hütwohl, the company is currently finalising the acquisition of another plot on which it will build 400 beds and is “analysing four more plots” for 700 beds. Thus, Corestate’s plans include closing 2018 with more than 200 beds in Madrid and reaching 1,000 beds by 2020, which, according to Hütwohl “would place us as one off the Top three players in Spain”.

In parallel, the company has started to analyse its entry into Portugal with its business model. According to the head of Corestate, the fund is looking for opportunities in cities such as Lisbon, Porto and Aveiro.

The company is looking for plots on which to build with sizes that depend on the sizes of the halls of residence that they want to build, provided they are located in university cities. Nevertheless, Hütwohl warns that the “minimum size to achieve efficient management is 200 beds”.

“The student residence sector is becoming increasingly more competitive in Spain and we do not want to miss out on the opportunity and the advantage that our international knowledge affords us”, says the group’s executive in Spain (…).

Original story: Eje Prime (by P. Riaño)

Translation: Carmel Drake

British Firm Collegiate Plans its Arrival in Barcelona After Opening Student Halls in Madrid & Valencia

9 January 2018 – Eje Prime

Spain is already a reference country in Europe for investment in student halls, as evidenced by the entry of foreign capital into the domestic market. The latest company to look for returns in this sector is Collegiate. The British firm is searching for an enclave in Barcelona, after opening student halls in Madrid and Valencia. The company has already announced that it plans to make its debut in the Catalan capital “soon”.

Collegiate is a company specialising in the management of student residences with a notable presence in the British Isles, where it owns assets in most of the capital and large cities. In Spain, the firm arrived first in Madrid with a hall of residence in Aravaca with 213 prime private rooms, whilst in Valencia, it entered in the maritime area with 350 rooms.

Both buildings have common areas that are typical for these types of prime assets, including a swimming pool, a fitness room, a cinema and a study area with library. The price per person in the Madrilenian hall ranges from €204 to €238 per week, depending on the features of the room, whilst staying in the building in Valencia costs between €196 and €204 per week.

Currently, Collegiate is embarking on an expansion process across Europe, as evidenced by its upcoming openings in Portugal, in Porto, and in another town with a great university tradition in the neighbouring country, Coimbra, which will be added to the hall of residence it recently opened in Lisbon. In Spain, nevertheless, its next major project is yet to come, given that the company has announced its upcoming arrival in Barcelona, a destination city for students from all over the world.

Investment in student halls amounted to €560 million in 2017 

The commitment from this international company to Spain comes in addition to those that have been made over the last year by a market that is clearly booming. In 2017, investment in student halls grew to €560 million, according to data from the real estate consultancy JLL. The significant growth, which compares to the barely €50 million that was invested in 2016, was driven primarily by transactions known as Erasmus and Rio.

Project Erasmus involved the sale of the portfolio of assets owned by the Resa Group, the largest in the country, to Greystar in an operation that was appraised at around €500 million. As a result of the purchase, the manager now owns 37 assets (33 of which are already operational) in Spain and is supported financially by a joint venture formed by the international investment funds AXA Real Assets and CBRE Global Investment Partners.

Meanwhile, the operation known as Rio involved the British manager GSA (Global Student Accommodation), which acquired Nexo Residencias from Threesixty Developments, a company owned by the fund Oaktree Capital, as part of an investment plan in which it plans to spend €300 million over the next five years. In addition, another recognised player, the investor group Catella, has also set its sights on this alternative investment business in Spain, with the acquisition of La Campana hall of residence in Pamplona.

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake

Greystar, AXA IM–Real Assets & GIP Buy Spanish Student Housing Provider Resa

7 December 2017 – PE Hub

Greystar Real Estate Partners has acquired Spain-based Resa, a student accommodation provider. The acquisition was made via a joint venture partnership that includes AXA Investment Managers – Real Assets and CBRE Global Investment Partners. No financial terms were disclosed.

Greystar Real Estate Partners (“Greystar”), a global leader in the investment, development, and management of rental housing properties, closed today, through a joint venture (“JV”) partnership, on the acquisition of Resa, the largest student accommodation provider in Spain. The JV includes AXA Investment Managers – Real Assets (“AXA IM – Real Assets”) and CBRE Global Investment Partners (GIP), both acting on behalf of clients, who have acquired the substantial majority holding in the portfolio in equal sized shares, while Greystar has bought the remaining balance and will act as property, development and asset manager for the portfolio. The deal is the largest investment transaction in student housing on the Iberian Peninsula.

The previously announced JV partnership marks Greystar’s first investment in Spain and will serve as a platform to build a diversified rental housing business and portfolio with backing from global institutional capital.

“The Resa portfolio is undoubtedly Spain’s premier student accommodation provider and will provide Greystar with a significant presence in the prime markets of Madrid and Barcelona on which to build out a diversified Spanish rental housing platform,” said Wes Fuller, Executive Managing Director of Greystar’s Investment Management business. “We are excited by the tremendous opportunity in the country, and look forward to bringing Greystar’s proven business model and institutional capital to the Spanish market for the long term.”

Resa is Spain’s market leader in student accommodation managing 9,309 student beds in 19 Spanish cities, including tier one cities Madrid and Barcelona, in addition to Andalucía, Cataluña, Galicia, Navarra, Pais Vasco, Salamanca and Valencia. Resa, managed by Azora since 2011, has experienced significant growth during this period, increasing from 26 to 37 residences, of which four are currently under development. The JV portfolio will continue to trade under the Resa brand with Greystar assuming responsibility for overall management. Resa will operate as a fully Greystar-owned and managed business.

In addition to the Resa acquisition, Greystar together with its strategic long-term partners plans to invest further in the Spanish rental housing market, including additional student, young professional and senior housing for rent. Greystar is currently evaluating a pipeline of opportunities across Spain and Portugal including Madrid, Barcelona, Lisbon and other key Iberian cities.

“We are thrilled to add this high-quality well-established portfolio to Greystar’s growing European platform. As a global provider of rental housing, we are constantly looking for opportunities to expand into attractive new markets, and this acquisition does exactly that,” said Steven Zeeman, Greystar’s Managing Director of Continental Europe. “Spain is one of Europe’s fastest-growing economies with a serious shortage of purpose-built rental accommodation suitable for students and young professionals. Home ownership in the country has fallen in recent years, particularly with the country’s young and highly mobile urban population wanting a flexible alternative.

Despite this healthy appetite for new rental housing, construction has failed to keep pace with demand. The rental housing sector remains highly fragmented, with no established market for the type of purpose-built rental accommodation known as multifamily in the United States. Our investment strategy will allow us to develop a significant multifamily pipeline in Spain and grow our platform to realize the potential we see in the country.” (…).

About Greystar

Greystar is a leading, fully integrated multifamily real estate company offering expertise in investment management, development and property management of rental housing properties globally. Headquartered in Charleston, South Carolina with offices throughout the United States, Europe, Latin America and Asia-Pacific, Greystar is the largest operator of apartments in the United States, managing over 420,000 units in over 130 markets globally, with an aggregate estimated value of approximately $80 billion. Greystar also has a robust institutional investment management platform dedicated to managing capital on behalf of a global network of institutional investors with over $23 billion in gross assets under management, including more than $8 billion of developments that have been completed or are underway. Greystar was founded by Bob Faith in 1993 with the intent to become a world-class class service in the rental housing real estate business.

Original story: PE Hub (by Iris Dorbian)

Translation: Carmel Drake

Savills: Inv’t In Student Hall Market Will Far Exceed €600M In 2017

31 October 2017 – Eje Prime

Between €500 million and €600 million. That was the price paid by a group of international investors to acquire Grupo Resa, the largest platform of student residences in Spain, with 9,309 beds in 19 cities, including in Madrid, Barcelona and Salamanca. AXA Real Assets, CBRE Global Investment Partners and Greystar backed the company, a significant investment that goes hand in hand with the rise of this alternative market in Europe. This operation is a clear example of the boost that this alternative asset is enjoying in the real estate sector in Spain and across Europe.

In neighbouring France, investment in the sector rose by 245% and the forecast is that €250 million will be invested in transactions in 2017. But if there is a country whose student hall market has grown beyond all doubt, it is Germany. The German market has seen a five-fold increase in investment in student residences (380%) and expects to exceed the €1,000 million threshold by the end of this year.

These results all indicate that the whole European continent is now taking this market seriously, although there are still countries where the student hall business is much larger. In 2016, the main players in this sector, the USA and UK, saw a record-breaking volume of transactions involving the purchase of assets of this kind, amounting to €14,100 million, up by 5.4% compared to 2015 (…).

Data from the World Student Housing study, prepared by the real estate consultancy Savills, shows that migration is increasing in the world each year. Almost five million students studied overseas during 2015, which represents an increase of 130% since the beginning of the 21st century. The forecasts indicate that 8 million students will study abroad in 2025.

The Spanish case: great influx and new projects

As a Spanish-speaking country, Spain receives a large volume of Latin American students each year. Of the more than 100,000 international students that it welcomed last year, 10% were from Colombia or Peru. They are, together with the Italians, the overseas nationalities that flock in the greatest numbers to Spanish universities.

This international influx, which accounts for 7% of the total number of students on the state university map, has sparked interest amongst different funds looking to build and buy student halls in the country. The Swiss fund Corestate entered this market last year, with the purchase of a hall of residence in Madrid, for which it paid €13.5 million, whilst Temprano Capital is going to build a 10,000 m2 student residence in Esplugues de Llobregat (Barcelona). Moreover, the multi-national The Student Hotel is now active in Barcelona; and ThreeSixty Developments, a fund managed by Oaktree, sold the Nexo student halls to GSA.

In total, the student hall market in Spain expected to see investment of €600 million in 2017, with a yield on prime residences of 5.75%, above those in countries such as the UK and Germany (5% in both). With the sale of Resa alone, that target has already been fulfilled (…).

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake

Sonae Sierra Returns To Spain With €170M

19 October 2016 – Expansión

The real estate company owned by the Sonae group and the fund Sierra are going to invest in the Spanish market once again. The company, which already owns six shopping centres in Spain, and manages two more, has set itself the objective of investing at least €170 million in the country over the next five years. Of those, €115 million will be spent on the large luxury brand outlet that it is constructing in Málaga together with the US firm McArthurGlen.

“We have started to request the licences and we will begin construction at the beginning of 2017, with the aim of opening the centre in 2018”, said Alexandre Fernandes, Head of Investment for Europe. The remaining €65 million will be spent updating and expanding some of its existing shopping centres in the country. “We are not planning to sell any of our centres in Spain, but rather invest in them and look for opportunities to buy”, said Fernando Oliveira, CEO of Sonae Sierra.

In Spain, the company had decided to divest its least strategic assets. Nevertheless, its strategy has changed radically and Sonae Sierra is now focusing on growing in Spain. “The outlook has completely changed since the end of 2013, financing has returned and all of the brands want to expand their businesses”, said Oliveira.

Partnerships

In addition, the real estate company has decided to launch a new business line dedicated to the search for and management of co-investment commercial projects. “We see that international funds are expressing a lot of interest in investing in Spain, not only in shopping centres and high street premises (but also other assets). We think that there is a market for them and that we can help them with their investments and then continue with the management of those properties”, said Fernandes.

These joint companies, in which Sonae Sierra will hold a minority stake and will manage the acquired assets, will operate as Socimis, given that “that it the structure that is most attractive for investors due to the tax advantages”, say sources at the company. The first of these partnerships was closed in June, with the fund CBRE Global Investment Partners, with which it jointly purchased two shopping centres in Portgual and another one in Spain.

At the global level, the company aims to invest €2,300 million in the development of new real estate projects over the next five years and to continue growing its service offering to third parties.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake