Tag: construction company

Aelca Plans To Sell c. 1,000 Homes In 2017

10 April 2017 – El Mundo

The map of the new real estate sector is continuing to take shape, one step at a time, and it is becoming increasingly clear who the main players are going to be and what role each one of them is going to adopt in this cycle. The latest star to come to the fore is Aelca, a property developer founded in Madrid at the end of 2012, in which the US fund Värde Partners purchased a 75% stake in the middle of 2016, taking over the shares that the construction company Avintia had held until then.

After working for almost five years in a very discrete way, Aelca has arrived at this current point in the recovery of the real estate sector with a very clear objective: “We want to be the leading house builder in this new cycle”, explain its founders and CEOs Javier Gómez and José Juan Martín (pictured above, left and right, respectively).

A priori, this aim does not sound like a particularly original aim – it is very similar to those expressed by the three other great property developers, namely, Neinor Homes, Aedas Homes and Vía Célere. (…).

Perhaps, the main difference between Aelca and the other “big four”, as sources at Aelca refer to this select group of giants in the property development sector, is the number of homes that the company has already completed. “We have been working behind the scenes, preparing the way for where we are today”, say Gómez and Martín. “None of the other three large companies has completed 900 homes like we have over the last few years”, they add.

That figure, beyond its absolute value, needs to be put in context, remembering that during the crisis that hit the housing market between 2008 and the end of 2014, almost all sales and starts of new build homes were suspended. (…).

The financial partner’s (Värde) entry into the company’s share capital came in response to the need for growth that its founders understood a property developer such as theirs needed, in order to survive in the residential market that is being created. “In the nine months that we have been working with Värde, we have gone from having land on which to build 3,000 homes to having double that figure”, said Martín. (…).

Aelca closed 2016 with turnover of €103 million and more than 600 homes sold. This year, the company plans to increase revenues by 49%, to €154 million and sell around 1,000 homes.

Projects underway

Currently, the company has 43 property developments in progress in the Community of Madrid, with a total of 1,316 homes. Its delegation in the South region has projects comprising 498 units; the Cataluña-Aragón delegation is building 241 homes, and the Valencia and Alicante region is constructing 145 units. In total, 2,200 homes under construction, according to its plans, and that figure will rise a lot soon.

In line with its strategic objective to consolidate its dominant position in the residential market, Aelca plans to start marketing another 16 developments this year in several locations across the provinces of Barcelona, Málaga, Valencia, Vizcaya and Madrid. (…).

Original story: El Mundo (by Luis M. De Ciria)

Translation: Carmel Drake

Meridiano Sells Its HQ In Málaga To Grupo Ñarucola

15 March 2017 – Real Estate Press

Aguirre Newman has advised Meridiano (Grupo ASV) on the sale of its headquarters in Málaga, which is located on Calle Olózaga 10, to Grupo Ñarucola. The property has a surface area of 1,400 m2, spread over a ground floor, three upper storeys and an attic.

The asset, which is located next to the central Atarazanas market, has housed the corporate headquarters of Meridiano since 1973. The company, which forms part of Grupo ASV, has more than 80 years of experience and a significant presence across the country, in particular in Levante and Andalucía. The consideration paid has not been revealed.

Grupo Ñarucola is a construction company/property developer that has built more than 2,500 homes and other projects in the province of Málaga and the autonomous cities of Ceuta and Melilla since 1991.

Aguirre Newman has worked as the sole interlocutor on behalf of Meridiano, which has facilitated the success of the transaction. Aguirre Newman considers that an orderly sales process brings transparency to operations and generates benefits for investors and owners alike.

Original story: Real Estate Press

Translation: Carmel Drake

Grupo Ortiz To Partially Spin Off Its RE Business

9 February 2017 – Cinco Días

A new company is getting ready to join the fruitful world of the Socimis. Grupo Ortiz, a Madrid-based construction company founded in 1961, is working with the financial group Arcano to prepare for the debut of its real estate business on the Alternative Investment Market (MAB). The new company will own the Group’s real estate assets, which are all rented out, according to sources familiar with the operation.

Through this transaction, the company is looking to bring assets amounting to around €150 million to the market, along with associated debt amounting to €55 million. Moreover, the company chaired by Juan Antonio Carpintero is looking to take advantage of the future listed company to secure other investors for his business, and Arcano will act as advisor. Both companies declined to comment on the operation.

The intention of the construction group is to open up the Socimi to other investors and whereby partially sell off part of the new company, but to retain ownership of at least 30% of the capital. The company is currently undergoing a process of internationalisation, and sources close to the group indicate that these resources could be reinvested in new opportunities.

The market expects the new Socimi to be constituted within the next few months. Experts in the sector say that the objective, given Grupo Ortiz’s portfolio of assets, is to offer to pay a quarterly dividend, which could exceed 5% p.a.

The portfolio will initially comprise several office buildings, plus more than 340 rental homes, a parking lot on Calle Ortega y Gasset in Madrid with 800 parking spaces, as well as retail premises and warehouses, most of which are located in Madrid and the surrounding area. According to the Group’s website, Ortz has 36,000 m2 of tertiary assets leased out and 1,445 social housing properties, owned by Madrid’s Housing Institute (Ivima) and the Municipal Housing Company (EMV).

It also has 24,000 m2 of office space leased out in Madrid, primarily in the area around La Gavia (Ensanche de Vallecas). According to its annual accounts for 2015 (the latest available), the real estate business generated revenues of €55.34 million.

The group’s total turnover amounted to €376 million in 2015, with an EBTIDA of €41.22 million. Although the firm started out as a construction company, it has since diversified and now operates four divisions: concessions, energy, services and real estate.

The Socimi structure allows those who adopt its tax regime to enjoy exemptions from corporation tax in exchange for the compulsory payment of dividends to their shareholders each year (who do pay tax). The structure has served to boost the Spanish real estate market, with the backing of international funds, and many large property owners have also benefitted from these structures. Around 30 Socimis are currently listed on the MAB.

Grupo Ortiz launched its international activity in Peru in 2010. It currently has operations in Colombia, Peru, Mexico, Panama and Algeria, with energy projects in Italy and France, photovoltaic solar plants in Guatemala, Honduras, Chile, El Salvador and Japan and other integrated water management projects in Romania.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Bouygues Relaunches Its RE Business In Spain

3 February 2017 – El Independiente

Bouygues, the French industrial giant that operates in the construction, public works and telecommunications sectors, wants to reactivate its real estate division in Spain. Its Spanish subsidiary was created in 1989, but following the burst of the real estate bubble, its activity in the sector was paralysed. Now, it is returning to property: at the end of 2016, it completed the construction of a hotel in Barcelona, the Ibis Bogatell, located next to the Olympic Park, and it wants to increase the number of projects in its portfolio in 2017.

That is according to Bouygues’ Spanish subsidiary. “We are not going to promote residential properties”, specified the Director General of Bouygues Inmobiliaria, Ana Vidal. “We are going to focus on the hotel, office and retail sectors, amongst others”. Although the French Group never disappeared from the Commercial Registry, Bouygues’ real estate activity in Spain has been suspended for almost seven years.

Before the real estate bubble burst, the multi-national firm was a key player in the market, in particular in the construction of business parks and shopping centres. In the case of the latter, Bouygues constructed Parque Oeste (Alcorcón, Madrid), Alcalá de Guadaira (Sevilla) and El Triangle (Barcelona). In the year 2000, the French group expanded its operations to Portugal.

The crisis forced the subsidiary to carry out an aggressive capital reduction in 2010, which left its own funds at 10%. “We are not going to be a Metrovacesa or a Merlin”, said Vidal. “We want to boost the development of projects in Spain through selective, carefully-chosen projects, which prioritise environmental improvement”, added the Director General. One of the models that the real estate division is likely to promote are eco-neighbourhoods, such as the one Bouygues developed in Bordeaux, called “Ginko”.

Bouygues Inmobiliaria is looking to become a “pure property developer”, adopting the turn-key formula, whereby it will take responsibility for identifying the plots of land, designing the properties and executing the construction work. In addition to Barcelona, the subsidiary has acquired a plot of land measuring 18,000 m2 in the industrial area of Julián Camarillo, to the east of Madrid.

Bouygues’ return to activity is further evidence of the recovery of the sector in Spain. Nevertheless, the improvement is slow and uneven. The property development sector estimates that 450,000 new homes were constructed in 2016, compared with 400,000 during the previous year. And house prices have soared in Madrid and Barcelona, along with in the traditionally robust Basque real estate market; however, they are falling in more than half of Spain’s provinces.

Original story: El Independiente (by Pablo García)

Translation: Carmel Drake

The Monje Family Puts Assignia Construction Group Up For Sale

9 December 2016 – Expansión

The Monje Tuñón family, the controlling shareholder of Assignia Infrastructuras, has launched a feasibility plan to refinance the construction company’s debt and resolve the collapse of the group that has, amongst other consequences, resulted in the delayed payment of the last three months salaries to the workforce of 1,600 employees and which may force the company to suspend its payments it it fails to reach an agreement over the next few weeks.

The owner, which has stepped up talks with its financial creditors, is considering several measures to comply with the banks’ demands and access new lines of financing. In addition to the sale of several smaller assets, the Monje family has put the construction company up for sale, after identifying interest from several investment funds and two Asian industrial groups. The aim is that, with the entry of a new shareholder through a capital increase, the company’s balance sheet would be strengthened and an agreement would be facilitated with the banks to refinance a €60 million debt, which matures in December this year. (…).

The construction company forms part of the group of medium-sized companies in the sector, it is geographically diverse (with operations in 14 countries) and has several valuable assets, especially those granted under concession agreements. Assignia recorded turnover of €250 million in 2015, up by 12% compared with the previous year, and an EBITDA of €18 million. Its result was negative (-€4 million) due to its significant financial expenses, which amount to €12 million per year.

The group’s production portfolio currently amounts to around €700 million, but some of that amount is doubtful, given that Assignia, like all of the other companies in the sector has fallen victim to non-payments by debtors. (…).

As such, the company is preparing to implement an ERE redundancy plan in Spain, which will affect around 150 people, equivalent to almost 10% of its workforce. (…).

In the meantime, negotiations with the banks continue. The aim is that the banks will facilitate new maturity periods and open new lines of credit to ensure the continued operation of the company. Assignia’s financial debt is distributed between 10 banks through a syndicated loan that had to be renegotiated in March this year. Santander is the agent bank and Bankia is the entity with the highest exposure (around €20 million). CaixaBank and Sabadell, amongst others, also participate in the syndicate.

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Amazon Will Invest €200M In Its New Centre In Barcelona

29 June 2016 – Expansión

Amazon’s new logistics centre in El Prat de Llobregat (Barcelona) will be ready in the autumn of 2017. Yesterday, the US multinational e-commerce giant completed the acquisition of land covering 150,808 sqm, next to the airport, from the Generalitat for €30 million. It also announced that it will hire 1,500 direct workers between now and 2020.

This represents the largest investment in terms of job creation in Cataluña in the last five years. The project, financed in its entirety by the group, will absorb a budget of more than €200 million, including the cost of the land, according to sources from Amazon.

The e-commerce giant, founded by Jeff Bezos, will construct a logistics platform in El Prat with a surface area covering more than 60,000 sqm, the equivalent of eight football pitches. It will be its second largest warehouse in Spain, after its complex in San Fernando de Henares (Madrid), which it acquired in 2012. That site has a surface area of 28,000 sqm but Amazon is currently working to expand those facilities, which means that the two centres will be around the same size.

Amazon’s Catalan platform will allow the company to cope with its strong growth, satisfy future demand and ensure that its deliveries to clients are fast and reliable. The centre at El Prat will not only supply the Spanish market, it will also handle orders from across Europe, given that the complex will be incorporated into Amazon’s European logistics network, comprising 29 centres located in seven countries and capable of supplying customers with the more than 132 million products available in its online megastore.

Amazon Fulfillment, the group’s logistics company, has hired the construction company Dragados – which forms part of the ACS Group – to carry out the building work, which will start on Friday. The aim is that this centre will be operational by the autumn of 2017 and it will open with an initial workforce of 500 people. That figure will gradually increase over the next three years, to reach 1,500 people by the end of 2020.

Original story: Expansión (by S. Saborit)

Translation: Carmel Drake

Merlin Completes Purchase Of Remaining 23% Stake In Testa

9 June 2016 – Cinco Días

Merlin Properties now owns 99.9% of Testa. Within the next few days, once the finishing touches have been completed, the Socimi will pay €317 million for the 22.7% stake in Testa that Sacyr still owns. This final transaction, which forms part of the acquisition agreement governing the construction company’s real estate subsidiary, has been moved forward by several weeks, ahead of the original deadline of 30 June.

A year ago, the Socimi chaired by Ismael Clemente, announced the acquisition of Sacyr’s subsidiary for €1,793 million, and established a timetable of partial purchases spanning one year. This arrangement was reached mainly because Testa’s shares were being used as collateral to secure a loan that Sacyr had taken out to buy 20% of Repsol in 2006.

Sacyr is in the process of obtaining the necessary consent from its financing banks and has already obtained approval from 80% of them, according to reports from financial sources. On the other side, Merlin has reserved the amount in cash, pending the conclusion of this final part of the acquisition.

Merlin will obtain an ownership stake of 99.9% (the rest belongs to individuals) and will launch the merger of the two companies immediately. From an operational point of view, the integration between the two companies’ teams has been a reality now for several months; as such, this operation simply represents the completion of the acquisition process and will not result in any changes to the companies’ operations.

During the first phase of the acquisition, completed in June last year, Merlin acquired 25% of Testa’s share capital by subscribing to its €431 million capital increase. On 23 July 2015, Merlin paid €861 million for another 25.1% stake. And then, a few days later, in August, it bought an additional 26.91% stake in the real estate company. The Socimi will pay €317 million in this final transaction, according to information provided to analysts in previous presentations.

Merlin, which is listed on the Ibex 35 and focuses on the rental of properties, generated a net profit of €49.1 million in 2015, the first full year of operation for this young real estate investment company. The company recorded revenues of €214 million from the rental of its real estate portfolio, an amount that almost quadrupled the figure it had recorded in 2014, thanks to the inclusion of the assets owned by the real estate company acquired from Sacyr.

The Socimi’s real estate portfolio was valued at €6,053 million at the end of 2015, according to a report from an independent appraisal company, issued following the purchase of Testa.

In addition, last December, Merlin completed an operation with 10 banks to refinance the €1,700 million debt that it had inherited from Testa. Moreover, in April, it launched a bond issue amounting to €850 million to restructure its liabilities.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Investment Funds Are Still Cautious About Buying Land

10 May 2016 – Idealista

International funds are still finding good investment opportunities in Spain, above all assets owned by Sareb and the banks. Their main objectives include achieving double-digit returns in the office, retail and residential markets. Meanwhile, they are still hesitant about throwing themselves whole-heartedly into the purchase of residential land and construction of homes, although they regard those an investments that have a future.

The economic crisis and subsequent decline of the real estate sector attracted opportunistic funds in search of opportunities in Spain. Now it is completely normal to find these, and other types of funds, in the real estate sector. “The funds were looking for the best investment opportunities with the highest, fastest returns”, said Pedro Abellá, Director of the Real Estate team at HIG Capital, during a forum about investment in the real estate market organised as part of SIMA, which ran from 5-8 May.

“The Spanish real state market is more mature and the investors that are arriving now are coming to add value to the assets through their management. They are no longer in such a hurry to divest, but they are still convinced by the high returns”, said Abellá.

The general decrease in prices in the sector during the crisis created investment opportunities for these funds, which included not only opportunistic funds, but also more established players. Over the years, and with the sector well on its way towards normalisation, experts are continuing to see investment opportunities, above when it comes to assets owned by Sareb and the banks.

The commitment to invest in real estate assets is currently concentrated in the office, retail and even residential home segments; land for development is also on the list, but the experts urge caution. “Property development requires another type of investment and generates other kinds of returns for investors. Not all of the funds are willing to bear the risk of property development”, said Gregg Gilbert, Director for Spain at Benson Elliot Capital Management.

“We are accustomed to other types of investments, where profits are obtained quickly. We should be aware of the fact that we will find returns from property developments. But it is still too early for those returns to be very great”, he said.

The funds are committed to providing experience and capital to renew the assets that they are acquiring, above all offices and hotels, where some investment opportunities still exist. “The stock of offices and hotels in Spain is vast, but it has become somewhat out-dated. It is time to review the supply, in the absence of assets at reasonable prices offering the returns being sought”, said Gilbert.

Those funds that do decide to invest in land should not hesitate to join forces with property developers and construction companies to build homes, but according to experts in the real estate sectors, they are focusing on buildable land in the best locations, which ends up being a small investment for the market as a whole. “There is still a lot of land that needs to be developed, but it is not buildable and it will take some time for it to become urban land. But that all depends on the laws applied by each administration”, said Mario Verdyguer, Director of Investments at Solvia.

Original story: Idealista (by David Marrero)

Translation: Carmel Drake

San José Leaves Losses Behind With Profits Of €7.3M In 2015

2 March 2016 – El Economista

The San José Group generated a net profit of €7.3 million in 2015, compared with losses of €122.7 million in 2014, according to a statement from the construction and renewable energy company, which stated that its profits before tax rose by 49.5%, to €10.6 million.

The turnover of the group led by Jacinto Rey grew by 15.3% last year, to €536.1 million, thanks to a higher contribution from international construction work, which now accounts for more than half (58%) of revenues.

In fact, the group’s sales in the international market increased by 19% during 2015, to amount to €313.1 million, compared with a lower recovery of 10.4% in the domestic market, where revenues reached €223 million.

San José’s EBITDA stood at €43.8 million, up by 29.6% compared with 2014, whilst its EBIT doubled to exceed €30.7 million.

By business line, the construction segment contributed €442.1 million to the company’s sales, up by 15.8% compared with the previous year, meanwhile the concessions and services division recorded revenues of €46.6 million, up by 12.3%, driven by the definitive approval and launch of the concession phase of its hospitals in Santiago de Chile.

Meanwhile, San José’s sales from its energy division rose by 12.1% in 2015, to reach €12.7 million.

Original story: El Economista

Translation: Carmel Drake

RE Firms Prevalent On Hacienda’s List Of Overdue Debtors

24 December 2015 – El Mundo

The tax authorities have published their list of overdue debtors for the first time.

Four large construction companies from the bubble – Reyal Urbis, Nózar and the Cordoban companies Prasa and Arenal 2000 – together owe the tax authorities €852 million.

The real estate bubble was made possible not only thanks to the banks’ willingness to grant loans, but also because the property developers that borrowed money stopped paying their taxes. That is the main conclusion to be drawn from the list of overdue debtors that the tax authorities have published for the first time just days before Christmas Eve – which features construction companies and manufacturers of construction materials in abundance. (…).

Almost none of the stars of the Spanish real estate bubble are missing from the list of major overdue borrowers. Four names stand out in particular: Reyal Urbis, owned by Rafael Santamaría; Nózar, owned by the Nozaleda family; the controversial property developer Rafael Gómez ‘Sandokán’ (Arenal 2000) and the Cordoban group Prasa, owned by the Romero family. Together, the four owe debt amounting to €852 million.

Reyal Urbis leads the ranking of overdue borrowers with a tax debt of €378.2 million. (…). But countless other companies owe millions of euros. From Fernando Martín, the major shareholder of the bankrupt Martinsa Fadesa (€65.39 million) to Carlos Cutillas, one of the main operators in the north of the capital with his company Inmobiliaria Chamartín (€20.53 million). Alongside them feature hyperactive property developers from the boom years, such as Dirusa (€40 million), the Lábaro group (€27.8 million) the Álvarez family (Gedeco-Avantis, with €17.7 million) and Detinsa (€29 million).

Riofisa, the construction company created by the Losantos family and acquired at the height of the boom by Luis Portillo, owes €31.97 million. Another one of the major overdue borrowers is Hilario Rodrígeuz Elías, who was considering listing Group Tremón, a construction company with operations in Madrid and Andalucía, on the stock exchange. His companies Atlantis Servicios Inmobiliarios and TR Hoteles Alojamientos y Hosterías together owe €47.77 million. Other less well known property developers that also have sizeable debts with the tax authorities include: Ventero Muñoz (€11 million); the unknown Ramón Olivareas Garrigós (€68.6 million), owner of Grupo Casoli and the company Vivienda y Bienestar SL; Carlos Monteverde de Mesa, owner of Grupo Monteverde (€13.9 million) who was linked to the “Blesa case”; José Ávila Rojas (€4.3 million); and the Torrego family (Conther), former owner of Cine Bogart and Continental Auto (€2.5 million).

Sahanuja, the great Catalan saga

The Sanahuja family owes the tax authorities €37.2 million through three of its companies -Sanahuja Escofet, Sacresa Terrenos and Sacresa, Terrenos y Promociones-. (…). Another one of the largest overdue debtors is Vicente Roig, owner of Grupo Coperfil, who owes the tax authorities €69.79 million through four companies.

Marina D’Or and the Valencian clans

Jesús Ger, who was behind the Marina D’Or golf complex, owes the tax authorities €46.3 million through his company Comercializadora de Mediterránea de Viviendas. (…). The Community of Valencia is very well represented in the list of overdue debtors. Another illustrious surname is that of the Serratosa Caturla brothers, who together have a debt of €15.9 million. They are joined by Bautista Soler, the partner of Luis del Rivera, who owes €26 million through the companies Inmobiliaria Lasho and Urbanas de Levante. Andrés Ballester, owner of Edificaciones Calpe and the company Nereida, with a debt of €17.7 million. And the controversial builder from Alzira, Vicente Girbés Camarasa, owner of Grupo Blauverd, with €20.6 million. And Juan Cotina and his companies Asedes Capital and Asedes Infraestructuras, with €21.4 million.

Other (in)famous overdue borrowers include the Mexican businessman Luis Nozaleda Arenas; the Romero family, the Sánchez Ramade brothers and Rafael Gómez Sandokán, all from Cordoba; and Facundo Armero, the Murcian developer behind Polaris World, who owes €78.5 million.

Original story: El Mundo (by José F. Leal)

Translation: Carmel Drake