Sareb Launches Project Esparta to Shake Up its Servicer Arrangements

17 May 2019 – Cinco Días

Sareb has launched a new operation called Project Esparta, through which it is seeking to turn its existing strategy on its head.

The bad bank’s aims with this initiative are multiple: to create sub-portfolios into which to classify its assets; to renegotiate the contracts with its servicers to recover the services transferred to them; to delay sales and assume the stock of assets to generate added value; to create regional centres; and to equip itself with its own technological infrastructure. The overall objective is to professionalise sales and enhance the value of its assets.

As a result, Sareb is going to start renegotiating the contracts that it has with Haya, Altamira, Solvia and Servihabitat to recover some of the activities assigned to those servicers. Haya’s contract is due to expire on 31 December 2019 and according to the bad bank, it may be renewed in part or in whole, or the portfolio under management may be put up for tender. The contracts with Altamira, Solvia and Servihabitat are due to terminate in 2021.

Haya was hoping to make its stock market debut this year, but it will have to put those plans on hold until its future with Sareb is resolved.

Original story: Cinco Días (by Ricardo Sobrino)

Translation/Summary: Carmel Drake

Sareb’s Socimi Makes it MAB Debut with 1,383 Homes on the Outskirts of Spain’s Large Cities

3 April 2018 – Expansión

Sareb’s Socimi is making its debut today on the Alternative Investment Market (MAB) with a total valuation of €152.7 million. The company owns 1,383 homes, inherited from the rescued savings banks, located close to Spain’s large and medium-sized cities. Most can be found in very dynamic metropolitan areas such as Vallecas, with annual price rises of 10%-12%, and Hospitalet de Llobregat, as well as in places further afield, such as Manresa (Barcelona).

Témpore Properties, which has just two employees on its payroll, has delegated all of its management work to Azora, which will charge €1.5 million for its services in 2018 and €1.7 million in 2019, provided it fulfils all of the objectives set out in the business plan in terms of profitability and occupancy rates.

Azora, which is also the management firm for Hispania and Goldman Sachs, employs 140 people, half of whom work for Sareb directly or indirectly.

“Our greatest challenge is to increase the profitability of the rental portfolio from 3.7% to 5.5%”, explains Nicolás Díaz Saldaña, CEO of Témpore Properties and former Head of Rentals at Sareb.

As a first measure, the company is going to increase its rents, taking advantage of the renewal of its rental contracts. 33% of them expire in 2018, another 36% in 2019 and the remainder in 2020. “The prices that were applied by the savings banks are very out of date”, explains Díaz Saldaña. The average increase will amount to 15% and will rise to 20% in the outskirts of Madrid and Barcelona. The company assures that, despite those increases, 80% of its tenants are renewing their contracts.

Témpore is tightening up the requirements to access its homes in an effort to reduce its default rate, which currently stands at 4.8%. It demands the payment of a rental insurance from future tenants, which has a cost of €10 per month, as well as the one-month mandatory deposit. Moreover, the monthly rental cost may not account for more than 40% of the total income of the family unit.

In total, 24% of Témpore’s homes are located in Barcelona. “The Catalan political risk is not holding back rental prices. The rise in the metropolitan area of Barcelona stands at around 6%-10%”, says the CEO. 36% of the new package of homes that Sareb is going to transfer to the Socimi this year are located in Cataluña.

Témpore does not have any bank debt and has a credit line open with Sareb amounting to €2 billion, which it has not made use of yet.

The bad bank owns 98.5% of the Socimi and the intention is to allow investors (primarily institutional) to acquire shares, in such a way that will end up with a minority stake within three years. Témpore assures that there are many real estate funds, insurance companies and pension funds with liquidity willing to invest.

“Our business is one of scale. Témpore has to aspire to being as large as Testa Residencial, our best comparable”, says Díaz Saldaña.

Testa, in which Santander, BBVA, Acciona and Merlin all hold stakes, is planning to make its stock market debut at the end of May or beginning of June this year.

Original story: Expansión (by R. Lander)

Translation: Carmel Drake

Large Retailers Compete For City Centre Premises

14 September 2017 – El País

Retailers that typically occupy out-of-town stores only, brands such Ikea, Decathlon, Media Markt, Leroy Merlin and Kiabi have done an about turn with their strategies. Now, they want to take their products to the heart of cities to reach clients who are not visiting them on the outskirts. They are occupying the few large retail premises that are available close to the major commercial thoroughfares of Madrid and Barcelona. They are not pushing up the rental prices of these properties yet; in fact, they are investing between €1 million and €5 million on renovation work. But they will.

The main retail areas in the centre of Madrid and Barcelona have new tenants. The so-called out-of-town retailers, which, until recently, could only be found in retail parks on the outskirts are undertaking a new urban strategy. They want to approach a new group of customers, those who want to avoid using their cars and it wants to lock them in. This week, Decathlon announced that it will open three stores in the heart of Madrid, where Leroy Merlin will also set up shop in 2018, following in the wake of Ikea (which inaugurated its store on c/Serrano in May), Kiabi (which has just done the same in Barcelona on Paseo de Gracia) and Media Markt, the first to arrive in the centre of both cities (as well as in Valencia).

The trend started two years ago in major European cities and comes in response to a move by the population towards the centre and to the fact that e-commerce is requiring companies to respond rapidly to their clients. That means being close to them, explains Robert Travers, Director at the real estate consultancy Cushman & Wakefield (…).

The strategy of these chains is to open stores on the main commercial thoroughfares of large cities in smaller spaces than those they occupy in the out-of-town retail parks, but of considerable dimensions given that they are in the centre. “They are not looking for prime locations, but rather premises very nearby, because they cannot afford the rents of operators such as Zara, Mango and H&M. Instead they pay around 30% less because their margins are smaller”, says Travers. They need streets with high footfall and premises measuring at least 1,000 m2 or 2,000 m2, with open-plan floors; such features are very few and far between in the best shopping areas.

For the time being, the arrival of these brands has not had any impact on rental prices, given that, according to Sergio Fernandes, the Director of Retail at the consultancy firm JLL, the availability of these kinds of properties on the main commercial thoroughfares is very limited and the operators that demand them are also very few. “Only the leaders of each sector are brave enough to make the move. For the time being, we are seeing only six or seven brands”, he says. Examples include Aki, Bricor, Verdecora, Sport Zone and Kiwoko Mundo Animal. Nevertheless, “they are managing to make use of certain properties that would otherwise go unoccupied as they are not in the right locations for the fashion brands”, says David Barragán, Director of Retail at the real estate firm Aguirre Newman (…).

The search is not easy, according to estate agents and retail chains (…). The negotiations are intense and prolonged because the premises need renovating and the brands demand grace periods whilst the construction work takes place, which tenants typically pay. Rental contracts are being signed for periods of between seven and 20 years.

But it is worth it. The pilot store that the Swedish chain Ikea has opened in Madrid is performing better than expected. In fact, some of the new formulas that it offers have already been extended to its other stores (customisation of fabrics, dressers and doors). Nevertheless, Ikea is still assessing whether or not to open more central stores with this format, which combines sales and entertainment (…).

Original story: El País (by Claudio Álvarez)

Translation: Carmel Drake

Colonial’s Profits Rose By 17% To €249M In YTD Sept16

15 November 2016 – Expansión

Colonial earned €249 million during the first nine months of the year, up by 17% compared to the same period last year. The company chaired by Juan José Bruguera said that this improvement was a direct result of the growth strategy employed by the firm, which specialises in the prime office sector, as well as an overall improvement in the market.

The real estate company recorded an increase in recurrent revenues of 21%, to €205 million and growth in EBITDA of 29%, to €166 million. During the nine months to September, Colonial signed lease contracts covering a GLA of 73,160 m2 and the occupancy rate of its assets amounted to 97%. The firm’s share price fell by 0.21% on the stock market yesterday, to €6.12 per share.

Original story: Expansión (by G. Trindade)

Translation: Carmel Drake

Axiare’s Net Profit Rose By 145% To €91.3M In YTD Sept16

15 November 2016 – Expansión

Axiare has closed the first nine months of the year with a net profit of €91.3 million, up by 145% compared with the same period in 2015.

The Socimi, in which Colonial holds a stake, generated revenues from rental income of €30.5 million during the third quarter of the year, up by 22.5%, thanks to its “strategy involving the active management of its property portfolio”.

During the first nine months of the year, the company has signed 22 new contracts and renegotiated the rental agreements for a gross leasable area (GLA) of more than 91,000 m2.

The value of Axiare’s asset portfolio exceeded €1,000 million as at June 2016, which represents a 25% increase over its acquisition price. By type of asset, 68% of the portfolio’s value corresponds to the office sector; 19% to logistics assets; and 13% to retail.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Servihabitat’s Revenues Rose By 17% To €248M In 2015

12 July 2016 – Expansión

Servihabitat, the real estate company controlled by the fund TPG (51%) and partially owned by CaixaBank (49%), closed 2015 with a turnover of €248 million, up by 16.7%. The company led by Julián Cabanillas sold more than 21,100 units during the year. The firm also increased its portfolio of assets under management by 15.2% during the year, to 230,661 units, which have a combined value of more than €50,000 million.

The increase reflects the incorporation of assets previously owned by Sareb and the signing of contracts with other corporate clients, beyond the La Caixa group. In addition, Servihabitat manages financial assets worth €20,000 million. The growth in the business has resulted in several new hires; the firm now employs 453 people, up by 32%.

Original story: Expansión

Translation: Carmel Drake

Inbisa Sells 1,600m2 Of Office Space In Barcelona

31 July 2015 – Noticias Logística y Transporte

Inbisa Inmobiliaria has sold 1,600 m2 of office space, 9 parking spaces and 2 store rooms in the Torre Inbisa Plaza Europa, in Barcelona to a Russian private equity investor. The building’s occupancy rate will increase to 80% as a result of the sale.

According to Inbisa Inmobiliaria, “the buyer, which has been advised by Residae Barcelona Real Estate Consultancy, has valued the investment on the basis of the solvency of the tenants, the stability of their contracts, the characteristics of the asset and the potential for the growth in value of the property”. (…).

Plaza Europa has consolidated its position as a strategic area in Barcelona thanks to its proximity to the Barcelona-El Prat airport, the port, the AVE station and the city centre; and many companies have chosen to locate their headquarters there. Torre Inbisa Plaza Europa is the only building in the area that offers to sell offices, with spaces available measuring as little as 200 m2.

The tower is more than 100m tall and has a total above-ground constructed surface area of more than 19,500 m2 over 25 floors, measuring 800 m2 each. It also has 2 underground floors with capacity for 237 parking spaces, 700 m2 of store rooms and a dining room, which may be used by the building’s occupants. (…).

Inbisa Inmobiliaria confirmed that “special care was taken with the design (of the tower) from the start to control the climatic exposure,  the light, ensure the correct thermal and acoustic insulation and natural ventilation, with the aim of optimising the facilities”.

At the end of June, Inbisa Inmobiliaria sold industrial warehouses measuring more than 3,700 m2 in Vizcaya in the Centro Empresarial Inbisa Derio.

Original story: Noticias Logística y Transporte

Translation: Carmel Drake