Equilis Invests €120M in a Commercial Complex in Esplugues

27 June 2018 – El Mundo

The Belgian real estate firm Equilis is finalising a new shopping centre in Esplugues de Llobregat, which is expected to be inaugurated in November; 90% of the stores in the complex have already been commercialised. The centre, which has received investment of €120 million and which has employed 1,000 people for its construction, will receive up to 8 million visitors per year and will create 500 more jobs once it begins operation, according to forecasts prepared by the company.

The macro-project from the company controlled by the Mestdagh family is a first step in its expansion in Spain, where it expects to begin six projects with a value of €750 million over the next few years, two of which will be in Cataluña, which will receive investment of €200 million – including Esplugues – and four in the rest of the country.

Finestrelles Shopping Center, as the commercial complex in Esplugues is known, is located in the Ca n’Oliveres sector, in the neighbourhood of Can Vidalet, on the plot that exists between Calles Laureà Miró and Sant Mateu. It will have two tunnels that will connect the space with Ronda de Dalt and la Avenida Diagonal.

The surface area of the complex will span 40,000 m2, distributed over five floors, two of which will be dedicated to parking and the rest for commercial use. The centre will contain 110 stores as well as a hall of residence for students with almost 375 beds and a hypermarket. “For the time being, there won’t be any cinemas, but we are not ruling that out”, said Víctor Gómez (pictured above), CEO of the company in Spain.

Original story: El Mundo 

Translation: Carmel Drake

British Fund Buys Modoo Shopping Centre in Oviedo from Alpha Real Capital

22 January 2018 – Eje Prime

The shopping centre that Calatrava designed for the heart of the Palacio de Congresos in Oviedo has a buyer. Modoo, owned until now by Alpha Real Capital, has been acquired by a British investment fund. Created by the famous architect Santiago Calatrava, this complex is located in the Buenavista neighbourhood of the Asturian capital.

The sale and purchase negotiations have also resulted in the arrival of a new manager for Modoo in the form of Estabona Management, which has already announced its plans to renovate the shopping centre, as well as to add a cinema and include more spaces. The operation, led by Estabona, was signed on 31 December 2017, the last day of the period set to agree a sale, according to reports from La Nueva España.

Located in the upper area of Oviedo, inside the city’s Palacio de Congresos, the complex was acquired by Alpha Real Capital in 2014, when it purchased the property from the Dutch firm Multi Development.

Estabona, which already has a presence in Spain in the Albacete Imginalia shopping centre, has proposed a renovation plan for Modoo. The shopping centre has a surface area of 40,000 m2 and is home to renowned retailers such as Primark and El Corte Inglés. This will not be the first space restructuring that has been requested for the shopping centre, given that Alpha Real Estate and its former managers, JLL, tried to incorporate a cinema and make significant changes to the land in the past, but that construction project never got off the ground.

Original story: Eje Prime

Translation: Carmel Drake

Heron City Sale Fails to Spark Interest amongst Investors

12 December 2017 – El Confidencial

A concept too unique for a market that is used to something a lot more familiar. That is the moral that can be drawn from the decision by Heron International, the property developer behind the famous Heron City centres, to put into quarantine the sales process of the three leisure centres that it owns in Spain.

The offers received by the British company fall well below its expectations, which has caused it to reconsider its whole strategy and take the decision, last week, to suspend the current sales process, according to sources familiar with proceedings.

As El Confidencial revealed in September, the British company engaged CBRE to find a buyer for its whole portfolio, which comprises Heron City Las Rozas (Madrid), Heron City Paterna (Valencia) and Heron Diversia Alcobendas (Madrid), and which has a valuation of between €230 million and €250 million.

Nevertheless, the appetite in the market has been lower than anticipated because the usual suspects who typically participate in these types of operations (large international funds and Socimis) actually specialise in shopping centres, whose casuistry differs from those of leisure centres, and where lots of investment opportunities are still emerging.

In 2017 alone, with less than a month to go before the end of the year, 17 transactions involving shopping centres and retail parks have been closed across Spain, according to data from the trade association AECC, led by giants such as Xanadú. Moreover, during the next two years, around twenty new centres are expected to open and six centres are due to be expanded, which will see an additional gross leasable area come onto the market of more than 2 million m2.

The result has been that Heron International has decided to suspend the sales process and redefine its strategy. The three Heron City complexes, which span a combined gross leasable area of 84,000 m2, have 6,100 parking spaces, receive more than 12 million visitors per year, and represent a brand that arrived in Spain almost three decades ago with a very specific leisure concept, based on cinemas and a restaurant offer that tries to distance itself from classic fast food.

Since its arrival in Spain, Heron International has only starred in one operation, involving the sale of one of its leisure centred, namely Heron City in Barcelona, which it sold to Babcock & Brown and GPT at the end of 2006 for €138 million. Almost a decade later, as El Confidencial revealed, that complex was acquired by ASG, the Spanish subsidiary of Activum, a deal that represented that firm’s first operation in the Catalan capital.

The leisure centre in Barcelona, as well as those in Las Rozas and Paterna were all built by the British company. In the case of Diversia, it purchased that centre in 2003 in conjunction with Realia (50%) and a decade ago it took over all of the share capital when it also acquired the stake owned by FCC’s subsidiary.

Original story: El Confidencial (by R. Ugalde)

Translation: Carmel Drake

Gorbea Puts FCC’s HQ on the Market for €150M

30 November 2017 – El Confidencial

The headquarters of FCC, located in the Madrilenian neighbourhood of Las Tablas is on the verging of changing hands. Its owner, Gorbea Arrendamientos, has decided to cash in its holding and, to this end, has engaged CBRE to launch an express sale process. The intention is to choose a winner before the end of the year. Sources at the consultancy firm declined to comment.

This operation is set to be the most important of the year in the office segment, since the vendor aims to close the sale for around €150 million, according to market sources. That amount has not been reached so far by any of the other office transactions closed in 2017.

Gorbea Arrendamientos is owned by the Hernández-Beitia family, which acquired the land where the headquarters of the company controlled by Carlos Slim is now located for €80 million from FCC seven years ago.

Then, the infrastructure group signed a 20-year lease contract, of which almost 13 years still remain. Specifically, this rental commitment is the main feature of the operation, given that it guarantees the future buyer a stable income in one of the fastest growing areas of Madrid.

When Gorbea acquired FCC’s headquarters, a return of 7% was estimated on the basis of the rental contract. However, the new buyer will see that yield decrease to around 3%-4%. That range that makes this purchase a classic operation for conservative investors, such as insurance companies and pension funds.

Cinematographic fortune

The Gorbeas, as the family behind this real estate group is popularly known, amassed their real estate portfolio as owners of important cinemas in Madrid, including Roxy B on c/Fuencarral, Lido on c/Bravo Murillo and Renoir on c/Narváez. From there, they leapt into the office segment, where they are known for naming many of the buildings they own after their parent company, Gorbea.

Despite the box office crisis that caused so many cinemas to close, this family group still owns several subsidiaries linked to the world of cinema, such as Cines Floridablanca, Cines Retiro and Cines Princesa, in the centre of Madrid, as well as several multiplex companies in Majadahonda, Zaragoza and Guadalajara.

Construction of FCC’s headquarters, which cost €48 million to build, was completed five years ago and, since then, the building has housed more than 1,000 employees from the infrastructure group.

The building has a surface area of 21,000 m2, spread over 3 inter-connected buildings, which occupy an entire block and form an H-shape. They have two basement floors and a ground floor, with capacity for 400 parking spaces, as well as six office floors and a rooftop.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Gran Vía: The New Showcase For Flagship Fashion Stores

5 September 2016 – Expansión

Along the one-hundred year old Gran Vía, fashion houses and hotels are now competing with restaurants, cafes, theatres and cinemas to occupy space on the sought-after street in Madrid. The thoroughfare was known as the Madrilenian Broadway in its heyday, thanks to the profusion of cinemas and theatres that it housed and which, to a lesser extent, still remain today.

In the race to set up shop on the busiest thoroughfare in Madrid, the largest brands and more contemporary designer hotels now occupy buildings that were formerly inhabited by banks, insurance companies and large cinemas.

In this sense, the size of the buildings on Gran Vía, makes them more attractive assets for fashion chains to house their large flagship stores than, for example, the properties on Calle Preciados. According to a calculation by the consultancy firm CBRE, in 2014 and 2015, real estate investment on the street amounted to €1,100 million.

Undoubtedly, the most significant operation in recent years was Pontegadea’s purchase of the property at Gran Vía, 32 in January 2015. The investment arm of Amancio Ortega, the founder and majority shareholder of the retail giant Inditex, paid €400 million for the asset. And that is the building that Primark chose to locate its flagship store, which occupies five storeys over 12,400 sqm. The megastore has become a tourist attraction in itself and there were traffic jams and queues at its doors during the first few months after its opening.

Following this example, other brands have opened stores on Gran Vía in the last year. For example, the fashion accessory chain Parfois and the Spanish jewellery firm Tous, have taken up residence at numbers 42 and 38, respectively. In addition, the cosmetics firm Nyx and the sports brand Adidas both opened new stores at numbers 21 and 36 of the Madrilenian street in the spring of 2016.

Moreover, the stretch of Gran Vía that runs from Plaza de Callao to Plaza de España has been revitalised in recent months, with the arrival of the gift and accessories chain Ale-hop at number 74, the perfume store Druni, at number 61 and Axa’s purchase of the Rex cinema building.

The future renovation of that building, alongside the refurbishment of the controversial Edificio España, which has changed hands several times in the last two years, will also help to reactivate this final stretch of the street.

Other important transactions on Gran Vía have involved the premises at number 44, measuring 500 sqm. That property, which used to house a branch of Bankia, was acquired by Hines at the beginning of the year from the Baraka group – the current owner of Edificio España – for almost €40 million. Meanwhile, the Socimi Saint Croix acquired another property on Gran Vía – specifically the building located at number 55 – for €13 million in March this year.

The size of the buildings on Gran Vía makes them ideal properties for flagship stores.

Original story: Expansión (by R.Arroyo)

Translation: Carmel Drake

Drago Capital Acquires Plaza Norte 2 Cinemas

18 May 2016 – Expansión

The real estate investment and management company Drago Capital has acquired the Plaza Norte 2 cinemas, located in the shopping centre of the same name in San Sebastián de los Reyes (Madrid), together with a private Spanish investor. The asset, with a total surface area of 6,034 m2 distributed over two floors measuring 3,017 m2 each, has 14 screens in total and 2,600 seats. The cinema is operated by Yelmo Films, which was recently acquired by the Cinépolis Group cinema chain.

Original story: Expansión

Translation: Carmel Drake

Axa Buys The Cine Rex Building On Gran Vía For €42M

11 December 2015 – El Confidencial

Another high profile operation on Gran Vía. Axa Real Estate, the real estate arm of the French insurance company, has just added another property to its portfolio on the most sought-after thoroughfare in Madrid. This week, the company has reached an agreement to acquire the building that houses Hotel Rex and the historical cinemas of the same name, for €42 million.

The entity won a sales process that was launched at the start of the year by the firm Equity Inmuebles SL, controlled by the Mazon, Calero (owner of the Vincci hotels) and Briones families, which opened the bidding at around €28 million, but which, thanks to the huge appetite that exists to purchase assets on this street, has ended up selling the property for 50% more, according to comments made by several sources in the know.

This is the second operation of this kind that the French firm has closed on this thoroughfare, which last year acquired the former Avenida cinema, at number 37 Gran Vía for almost €80 million. It paid that high figure thanks to the “sweetener” afforded by having the Swedish fashion chain H&M as a tenant; it opened its most iconic store in the capital there in 2009.

For this new operation, Axa’s plans to remodel the building, which measures around 9,000 m2 and to operate it by combining its two current uses as a hotel and retail space. Moreover, the entity is willing to respect the protected nature of the cinemas, which have been closed for several years and which occupy a surface area of almost 700 m2.

Currently, the building houses a 3-star hotel with 147 rooms, managed by the owners of the property. Axa’s idea is to open a high-class establishment, which will add to the resurgence that Gran Vía is experiencing thanks to the boost that Operación Canalejas is generating in the whole area.

Hotel fever

The real estate development, which is being led by OHL Desarrollos, includes the opening of the first Four Seasons hotel in the capital. The hotel chain is proving to be a real magnet, attracting brands of high standing to the Gran Vía area. In fact, experts expect that Grupo Wanda will end up choosing a chain of such standing to manage the hotel that it will open in the Edificio España, although for the time being, the only clue is that it will be a 5-star establishment.

The majority of the new hotels being planned on this thoroughfare are 4-star and 5-star properties, such as: the one due to be opened in the building on Calle Montera, 25-27, owned by the Díaz Estrada family; Gran Vía, 10, which houses the Ministry of Education and which has been acquired by Generali for conversion into a hotel operated by Vinnci; and the Barceló, which has been opened in Torre de Madrid in Plaza de España.

Through this operation involving the Edificio Rex, Axa Real estate joins several other high profile players in the hotel business in the centre of the capital and diversifies its interests, which until now have been very concentrated in the office sector, above all after it acquired 381 Santander branches from the Socimi Uro and after it purchased the headquarters of the Generalitat de Catalunya.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake