Tag: centre

Aedas Homes has a Landbank Covering 4+ years of Visibility

8 October 2018 – Nasdaq

Aedas Homes, a leading property developer in the new real estate cycle in Spain, already has enough land in its portfolio to cover deliveries until 2022, as well as a significant part of 2023, thereby confirming the delivery targets set out in its IPO prospectus. The company’s landbank (close to 90% is classified as ready-to-build) will allow it to develop up to 14,521 homes in Spain’s key residential markets and is considered by analysts to be the best in the country.

So far in 2018, the publicly traded company, with CEO David Martínez at the helm, has completed the construction of 222 homes scheduled for delivery this year, 190 of which have already been sold.  As of August 31, the company had 6,287 active units, 55% more than in December 2017, and of those, 1,623 were already under construction. These figures reflect the strength of the property developer’s operating capacity during its first year.

In 2019, the developer plans to deliver almost five times as many homes, with a delivery target of 1,055 residential units; 1,071 homes are currently under construction and 761 have been sold. In 2020, Aedas Homes will deliver 1,986 homes and reach its cruising speed in terms of launches (3,000). The plan for 2021 is to deliver 2,438 homes and begin 2,471 new projects. 2022 will mark the moment when the developer reaches its cruising speed in terms of deliveries, with plans to put 3,063 homes in the hands of customers and launch another 3,000. In 2023, the number of homes being delivered will reach 3,326.

Martínez highlighted the company’s strict compliance with the goals announced at its IPO, noting that the company returned a profit one year ahead of schedule. Specifically, the property developer earned €3.7 million during the first half of 2018, making it the first of the new large developers in Spain to become profitable, and doing so only eight months after being listed on the Madrid stock market.

“We designed a realistic business plan, meaning that we will reach our targets in the coming years: by 2020, for example, we will have delivered more than 3,200 homes. Right now, we have almost 6,300 active units across 117 developments which gives us the visibility we need in terms of our objectives,” Martínez explained.

About Aedas Homes

The property developer Aedas Homes became a listed company on 20 October 2017 in Madrid, with a market capitalization of over €1.5 billion. Aedas is an industry leader at the national level and aims to play an important role in the new cycle of the Spanish real estate sector, which must be marked by professionalism and an adherence to rigorous standards.

Aedas Homes has a fully permitted residential landbank with more than 1.5 million buildable square metres (the highest quality landbank in Spain, according to analysts). This will permit the development of 14,500 residential units in the key markets, and their surrounding areas (both in terms of real estate and finance) where Aedas operates: the Centre, Cataluña, the East & Mallorca, Andalucía and the Costa del Sol.

Original story: Nasdaq 

Edited by: Carmel Drake

Urban Land Shortage Shatters Property Developers’ Dreams

15 January 2018 – Eje Prime

There is not enough land in the city for so many opportunities. That is the complaint that is increasingly being heard amongst experts in the real estate sector and above all, amongst residential property developers in the country, who warn that this problem is starting to take on a more serious tone. Not in vain, in the midst of the economic recovery, in one of the most critical moments of the upwards cycle (that has given confidence back to the house-building sector), available buildable land is scarce.

Real estate specialists like Anna Gener, Director General in Barcelona of the consultancy Savills Aguirre Newman, warns that “the sector is heating up a lot”, due to the shortage of land, given that property developers “by definition, can only purchase buildable land”, according to comments made in a recent interview with Eje Prime. In the opinion of the Catalan executive, “it is starting to become a matter of urgency for the public administration to take sides and streamline the procedures because, in certain areas of Spain, there is a genuine need for new homes…(…)”.

Whilst making her comments, Gener may have had in mind regions such as Madrid, Barcelona and Málaga. All three provinces are experiencing high demand for housing and they accounted for more than 50% of the total investment in land in Spain in 2017, with €3.5 billion spent there on urban land purchases. That figure represents an increase of 19% in recent quarters in relation to the number of property developer operations formalised, according to the Solvia Market View report compiled by the Spanish servicer, which analyses the real estate brokerage situation in the country.

Over the last twelve months, property developers have strengthened their presence in the Spanish residential market, starring in 74% of transactions, supported in many cases by investment funds that hold stakes in them. That fact, together with the aforementioned lack of land supply, has resulted in a 6.2% YoY increase in land prices.

Newly created companies such as Neinor Homes, Aedas Homes, Vía Célere and Aelca have led the current boom in domestic housing with ambitious land purchase plans. Their residential projects have breathed life and confidence into an activity that had been in decline following the real estate bubble of not so long ago, but they have caused the market to become more expensive again due to the increased competition to acquire the limited supply of buildable land available in the most sought-after areas.

In terms of amounts, operations of this kind were closed with prices ranging between €500,000 and €10 million in 60% of cases, whilst 15% of transactions exceeded the €10 million threshold (…).

Generating buildable land: a new line of business for 2018

In the Community of Marid, for example, the most sought-after buildable urban land is that allocated for residential use, above even that allocated for logistics use. As the main market in Spain for the buying and selling of land, the Madrilenian case exemplifies the constraints that the residential sector will have to battle against in 2018.

Firstly, the report from Solvia indicates that property developers will have to leave the city in search of buildable land on the outskirts. Areas such as El Cañaveral and the Corredor de Henares were the most sought-after places last year by companies in the sector (…). There is hardly any land left inside the M-30 (…).

The same applies in Barcelona. Buildable land is scarce both in the Catalan capital, and in its surrounding metropolitan area, which is leading some property developers to return to investing in towns in the second ring of the city’s outskirts, such as Sabadell, Terrassa and Granollers, amongst others, according to the report from the servicer owned by Banco Sabadell (…).

For this reason, one of the challenges for property developers this year is going to be to attract demand to new provincial capitals and markets. On the national map, the Solvia Market View report highlights cities such as Jaén, Pamplona, Oviedo and Valladolid. Regardless of where, what is in no doubt, is that the search for and acquisition of land for house building will continue for the next few months.

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake

Aguirre Newman: RE Inv’t In Barcelona Amounts To €2,500M In 2016

19 December 2016 – La Vanguardia

The real estate market in Barcelona is on course to break records again this year. It is expected to end 2016 with total investment operations amounting to €2,500 million, compared with €1,978 million last year, according to data presented by the real estate consultant Aguirre Newman on Thursday.

2016 will also be a “historical” year for Spain as a whole, with investment figures once again exceeding the level recorded in 2007, the year before the outbreak of the crisis. Investment operations worth almost €14,000 million are forecast to be closed.

Cataluña accounts for 20% of Spain’s total investment in this sector, although that figure is set to increase to 25% in 2017, given the significant potential of Barcelona.

The Director General of Aguirre Newman in Barcelona, Anna Gener, explained that; demand in Barcelona is still very active; there is still a lack of available land for sale; international demand is very active; and the real estate market is regarded as an attractive sector for investment.

Of the total investment volume expected this year, €860 million correspond to offices, down by 2.8% compared to last year, given that 2015 was a year of “blossoming”, when several major corporate operations were recorded after years of crisis.

The residential market will reach €120 million this year, shopping centre investment will amount to €865 million, retail investment will reach €100 million and investment in the industrial sector will amount to €144.1 million, up by 61%, due to the scarcity of land.

Around 80% of the investment volume has been made by international buyers; and domestic investors “are back again” after years away, according to Hipólito Sánchez, Director of Investments.

57% of the investments were made by funds, 26% by Socimis, 10% by private equity firms, 3% by institutional investors and 2% by insurance companies.

The leasing of office space continues to be a very active market; the availability rate has been decreasing since 2012 and now stands at 9.9%.

Construction activity is continuing to recover, with a 40% increase in the number of new construction permits compared to 2016.

The average price of free (unsubsidised) housing increased by 9% in Barcelona this year and by 4.5% across Cataluña. There was also a great deal of interest in renovation projects and in changes of building use status towards high standing residential properties in the centre of Barcelona, where more than 60% of buyers are foreign. (…).

The retail sector has continued to receive interest from investment funds and private equity firms in the main areas of the centre of Barcelona.

La Diagonal has established itself as an area of expansion following its renovation, with a 30% increase in rental income in just two years and the opening of megastores by certain brands, such as Massimo Dutti, Zara, Uniqlo and H&M.

The most important operation in the shopping centre sector was the sale of Diagonal Mar to Deutsche Bank for €495 million.

Another sector that continued to attract investors was logistics, whose investment volume increased by 60% with respect to last year, due to the shortage of land. (…).

The hotel sector has also continued to perform very well, given that prices per room have increased, thanks in part to the fact that there are no new competitors.

The forecasts for 2017 indicate that the real estate sector will continue to attract international investors, demand will continue to be very active, and products will continue to be scarce, although prices are not predicted to rise by very much.

Original story: La Vanguardia

Translation: Carmel Drake

Liberbank Puts Building On c/San Jerónimo Up For Sale

13 September 2016 – El Confidencial

Liberbank has decided to cash in one of the gems that it inherited from the former Caja Castilla-La Mancha (CCM), specifically: the building located at number 19 on the sought-after Carrera de San Jerónimo. It is a modern, 5-storey building, with a ground floor, terrace and parking area, which was fully renovated less than a decade ago; and it is located just a stone’s throw away from Palacio de las Cortes, right in the heart of Madrid.

In financial circles, it has always been said that this building was a personal whim of Juan Pedro Hernández-Moltó, who, after leaving the Congress of Representatives and taking over the reins at CCM, saw an opportunity to unit his two passions in this property, which was completely remodelled in 2007, just two years before the Manchego entity was intervened by the Bank of Spain and sold to Cajastur, from which the current Liberbank emerged.

Faced with these trappings from the past, the entity led by Manuel Menéndez is now immersed in an asset sale process, which includes an open process to sell this headquarters building, which has a total surface area of 2,500 sqm and which may fetch up to €13 million upon sale, according to sources familiar with the process.

In addition, the decision to put this property up for sale comes a year and a half after Liberbank acquired a complex of office buildings measuring 13,500 sqm from Sareb in Fuente Mora, number 2, in the area known as Manoteras, which is close to the headquarters of companies such as Axa, Caser and BBVA’s Ciudad Financiera. (…).

Although initially, the group was considering the possibility of holding onto the headquarters on Carrera de San Jerónimo for its President and institutional work, the roadmap that the entity is now working with involves transferring all of its offices in Madrid to the new offices in Manoteras, and leaving the building free for the new purchaser to fill with its own tenant.

Sales plans

At the presentation of its latest quarterly results, Liberbank acknowledged that its priority now is to sell off as many of its non-performing assets as possible this year, given that the EPA (asset protection scheme) that it was granted by the State to cover it against potential losses in CCM will come to an end on 31 December 2016.

The hole inherited from the Manchego entity currently amounts to €2,000 million, whereas the cushion from the EPA barely amounts to €456 million. Its divestment strategy also includes trying to sell a portfolio of overdue mortgages amounting to between €700 million and €800 million.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Madrid: 26% More Office Space Was Leased In Q2 2016

7 July 2016 – Expansión

Despite the decrease in investment in the real estate sector and, specifically, in the office segment so far this year, leasing of office space in Madrid is continuing to rise; and it exceeded the threshold of 100,000 sqm in Q2 2016.

Specifically, leasing of office space in the capital rose by 26% during the second quarter of the year, to 110,000 sqm. In half year terms, that figure represents an increase of 14,000 sqm, to 219,500 sqm, according to a report from BNP Paribas Real Estate. For BNP Paribas Real Estate, this leasing trend reflects the “good health” of business activity in Madrid, which is driving further forecast increases in office space leases.

During the second quarter, approximately 110 operations were signed, which means that more than 100 operations have been signed per quarter for the last seven consecutive quarters, compared with the average of 88 contracts per quarter registered between 2009 and 2014.

In terms of average rents, the real estate consultancy firm notes an increase in four sub-areas of Madrid (the financial district, the centre, the decentralised area and the outskirts). Specifically, overall average rents have increased by around 13% in annual terms, to €15/sqm/month.

BNP Paribas Real Estate highlights the behaviour of the decentralised area of Madrid, which accounted for 42% of the new leases during the quarter and recorded the highest increase in rents, with rises of almost 30% YoY. “The trend seen during the crisis, when most lease contracts were signed in areas inside the M-30, is now being reversed”.

The consultancy firm highlights in its report that the amount of available surface area is still decreasing, in light of the shortage of new offices and the flurry of new leasing activity over the last two years. Specifically, at the end of June, the availability rate stood at less than 15%, with further decreases forecast.

In terms of predictions for the rest of the year, BNP Paribas Real Estate expects the leasing figures in the second half of the year to be in line with those seen during H1, and it forecasts that rental prices will increase “slightly”.

“These figures are backed up by a labour market that is continuing to recover, with the most recent employment figures showing positive results. The number of people registered as unemployed is at its lowest level since September 2009 and that figure is expected to fall further still”, say sources at the consultancy.

Original story: Expansión

Translation: Carmel Drake

Sidorme To Trial Tourist Flats on c/Fuencarral In Madrid

4 April 2016 – Cinco Días

The arrival of summer will see a 180-degree turnaround in Sidorme’s strategy. The hotel chain, which currently manages 12 properties located in Madrid, Albacete, Granada, Valencia, Girona and Barcelona, will move into the tourist flat sector in June. In recent years, this segment has seen tremendous growth in Spain thanks to online platforms such as Airbnb and Homeaway and numerous hoteliers have declared war (on players in the sector) accusing them of unfair competition.

In the case of Sidorme, the property in question is located at number 46 on Calle Fuencarral in Madrid, just a few meters away from a hotel owned by the company. The building is owned by the company Bawar Real Estate, which is responsible for renovating it, and will contain 20 apartments.

“Our idea is that the apartments will be located within a 3-5 minute radius of the hotels that we have in the centre of Madrid, so that we can provide a personalised service from the hotel reception”, says the CEO of Sidorme, Jairo González (pictured above). In addition, the company is finalising a second building containing apartments, which will be located close to the hotel that the chain plans to open after the summer, on Calle Montera, very close to the Puerta del Sol. With this second project, in which Sidorme will invest €2 million, the chain will operate 40 tourist apartments in the centre of Madrid.

Through this initiative, Sidorme hopes to differentiate itself from BeMate, the online platform operated by Room Mate, which also markets tourist flats close to its hotels. After these two buildings, which will form the company’s testing ground, González says that Sidorme will add between 40 and 50 apartments per year, which will ideally be located in buildings dedicated exclusively to this activity. Sidorme is cautious about other cities, “if we do not already have a hotel there, then it will not work”.

Alongside this activity, Sidorme will continue with its growth plans for the hotel segment. It will open its first establishment in San Sebastián in June and its second property in the centre of Madrid in September. The company has halted its plans to dives hotels that it owns, after it failed to receive any financial offers that were in line with its expectations, set at around €30 million. It does not rule out a capital increase or the incorporation of new partners to accelerate its growth plans and it is open to growth through hotels in Madrid “if that is appropriate”, as well as in other secondary cities.

Original story: Cinco Días (by L.S.)

Translation: Carmel Drake