Tag: crane

Who is the Largest Residential Property Developer in Madrid

29 November 2018 – El Confidencial

With 12 developments underway comprising 758 homes with some type of protection, the Municipal Housing and Land Company (‘La Empresa Municipal de la Vivienda y Suelo’ or EMVS) is the most active property developer in the city of Madrid. Of the more than 350 residential projects under construction in the capital at the moment, the public initiative (by the Town Hall of Madrid), together with the promotion of cooperative homes or units with some kind of protection, has significant weight in Madrid, given that more than 16% of new build projects underway and 22% of the units under construction are public initiative developments (EMVS) or cooperative promotions.

That is according to data from the consultancy firm CBRE, which has compiled a study to analyse real estate activity in the Spanish capital, using satellites, taking into account both new build projects that require cranes for their completion as well as comprehensive renovation projects that do not need cranes or scaffolding. On the basis of the data obtained, the property developers who are currently carrying out those projects in the 21 districts of Madrid have been identified, be they new build projects, renovations, private homes or social housing units, excluding any homes being marketed on which construction work has not started yet.

The study establishes a ranking with the top 25 residential property developers in the capital on the basis of the number of projects underway and the number of units under construction. That ranking is led by the EMVS both by number of developments as well as by number of homes. Its developments are concentrated in the Pau de Vallecas (8 projects comprising 475 units), Latina (one development comprising 87 homes), Arganzuela (one development comprising 85 units), Villa de Vallecas (one development comprising 72 homes) and Carabanchel (one development comprising 25 homes).

Despite the strong development activity of the EMVS, the reality is that it is the private property developers who lead the activity overall, given that they account for three quarters (78%) of the new home units under construction in the city of Madrid. In fact, there are 12 private property developers with three or more projects under construction, which account for more than a third (34%) of the homes under construction.

Pryconsa and Inmoglacier, the most powerful

The second position in the ranking by number of developments is held by Pryconsa. The company chaired by Marco Colomer currently has seven projects underway, comprising 500 homes (…).

By number of units under construction, the second place in the ranking is held by Inmoglacier, with 748 homes under construction, distributed across just five developments, all of which are concentrated in Parque Ingenieros in Villaverde (…), all with some kind of protection and constructed on land acquired from Sepes more than three years ago. The company chaired by Ignacio Moreno (…) is one of the most active property developers in the capital and is focused towards a segment of the population capable of acquiring a home at affordable prices.

“At first glance, the sector appears to be vey fragmented. The 351 residential projects underway in Madrid are split between 241 companies or cooperatives. However, many property developers assign a separate legal entity to each promotion (…) and so it is not always easy to identify the large groups (and commercial brands) behind each project”, explains Samuel Población, National Residential Director at CBRE speaking to El Confidencial (…).

By area, the main national property developers are committed to constructing large projects in new areas, such as Arroyo del Fresno (Amenabar and Grupo Pinilla), Valdebebas, Parque de Ingenieros and El Cañaveral, where the projects with the largest number of units are concentrated. Companies such as Grupo Ibosa (…) and Vía Celere, along with the newcomer Brosh, complete the ranking (…).

International firms stick to the rich neighbourhoods

In terms of the property developers with a more international profile, by contrast, they are continuing with a strategy focused on the renovation of homes inside the city, in the most sought-after neighbourhoods. Venezuelan property developers have been particularly active, including Gran Roque (…), which has a dozen residential projects underway comprising more than 100 homes in some of the most sought-after areas of Madrid (…).

Also, Grosvenor (from the UK) and Darya Homes or Dazia Capital (France) are concentrating their activity exclusively in the districts of Centro, Chamberí and Salamanca. Those three developers – include Gran Roque – are currently managing 10 residential remodelling projects, which are characterised by the limited number of units (14 on average) and a clear vocation towards the high- and very high-end segments of the market.

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

Barcelona From The Sky: 123 Cranes At Work In The Catalan Capital

7 November 2017 – Eje Prime

Cranes and new projects are drawing a new real estate business in Spain once again. According to the study Barcelona from the sky, compiled by the real estate consultancy CBRE, the Catalan capital has 187 projects underway, requiring 123 cranes altogether. Of the total number, 75% are dedicated to residential projects and 17% to tertiary projects, whilst 8% of the cranes are being used for other kinds of projects, according to the report.

By sector, the residential market is the most active in Barcelona with 107 new build projects and 34 refurbishment projects currently underway or due to start imminently. In total, the Catalan capital is currently decorated with 77 cranes working on the construction of new residential developments, led by the largest Spanish property developers, such as Neinor and Aedas, as well as some more local players, such as La Llave de Oro and Nuñez I Navarro.

Cuitat Vella and Eixample are the districts where the most refurbishment projects are being carried out, due to the age of the housing stock there. There are eight projects (24% of the total) and eleven projects (32%) underway in those neighbourhoods, respectively. Many of these renovation projects, especially those closest to the city’s nerve centre, such as along Passeig de Gràcia and Plaça Catalunya, are high standing affairs, such as the refurbishment of Casa Burés, located at number 2 Calle Girona.

In terms of new build homes, the districts of Sarria-Sant Gervassi, Horta-Guinardo, Eixample and Sant Andreu are leading the ranking, with 18, 15, 12 and 11 new build projects, respectively (…).

The tertiary sector is also building 

(…). In the office segment, there are twelve projects underway after several years of little construction activity due to the economic crisis, in general, and in the office sector, in particular.

“The greatest number of projects, both new build and renovations, are concentrated in the 22@ area, in the district of Sant Martí, where key projects include the future Parc Glòries and the Luxa Business Park, amongst others”, according to the study (…).

Several projects are also underway in the Sants-Montjüic area, including the construction of the Campus Administratiu, which the Generalitat de Catalunya will occupy and Can Batlló, very close to Plaça Cerdà. In addition, construction work is expected to start at the beginning of 2018 on the construction of the remaining two towers that form part of the Barcelona Fira District project, owned by Iberdrola (…).

In the retail segment, four renovation projects are underway in the Catalan capital, whilst one new space is being constructed, with the development of the Finestrelles shopping centre in Esplugues de Llobregat, which will open its doors at the end of 2018. This project is being executed by the Belgian property developer Equilis and has a gross leasable area of 25,700 m2.

Moreover, renovations are being carried out on several of the city’s main shopping streets, such as Las Ramblas, Fontanella and Paseo de Gracia, as well as in some of the large retail spaces such as the Glòries Shopping Centre.

Hotels and others 

“More than two years have now passed since the implementation of the hotel moratorium, which has negatively affected the number of hotel developments”, says CBRE’s study. Nevertheless, the construction of new hotels has not stopped in Barcelona, given that some players obtained their building permits in time. There are currently fourteen projects underway, with six cranes working on them in total (…).

According to CBRE, a small number of the projects currently being carried out in the city do not form part of the residential or tertiary sectors. Fifteen projects are underway at the moment involving twenty cranes to build or renovate parks, churches, schools, gyms, infrastructure work and nursing homes.

Original story: Eje Prime (by Custodio Pareja)

Translation: Carmel Drake

Cranes Return To Spain After Almost A Decade Away

19 December 2016 – La Vanguardia

After nine years away, since the financial crisis first started to crush the real estate bubble in 2007, cranes have returned to form part of the Spanish landscape during 2016, They are a visible sign of the recovery that the real estate sector has been enjoying since 2014.

With just a few weeks to go before the end of the year, real estate investment is on track to set a new record in 2016, of almost €14,000 million, thanks to large-scale operations such as the merger of two giants in the sector, Merlin and Metrovacesa, to create the largest real estate company in Spain, with assets worth more than €9,300 million.

This year, the growth of the economy, improvement in employment, low interest rates, return of financing and the continuous inflow of foreign capital have combined to allow the real estate sector to consolidate its recovery despite the political uncertainty that hung over Spain for most of the year.

After almost a decade of paralysis, the property developers that survived the crisis and others created more recently have set cranes up on the streets, especially in cities with the most economic and tourism activity, where the “stock” is now practically non-existent and demand for new homes a reality.

Quabit is planning to invest €470 million between now and 2020 on the purchase of urban land on which it will build more than 3,000 homes; and Neinor Homes has set itself the objective of launching around 40 new developments this year and selling more than 1,500 homes.

The newly formed company Dospuntos, controlled by the US fund Värde Partners, plans to invest €2,000 million over the next six years and complete 2,000 homes per year from 2019 onwards. Vía Célere has just bought the largest available plot of land in the centre of Madrid from Repsol and Adif, which is ready for the construction of homes.

Inveravante, owned by the business man Manuel Jové, and the real estate subsidiary of BBVA, have joined forces to promote 850 homes; the German investment fund Aquila Capital and Ónice will spend €100 million building luxury homes in La Moreleja; whilst Ibosa will invest another €30 million converting the Hotel Foxá M-30 into homes.

The recovery of the sector is undeniable. According to the notaries, house purchases grew by 10.3% in September, a percentage that rises to 13.2% according to INE, after registering eight consecutive months of increases and growth of 10% in terms of the signing of mortgages for house purchases.

The Ministry of Development calculates that prices rose by 1.6% during the third quarter, to complete 6 consecutive quarters of increases, whilst permits for the construction of new homes soared by 32% in September to reach figures not seen since 2011.

Moreover, house purchases by foreigners grew by 19.7% during the first half of the year, with Britons leading the ranking, despite the threat of “Brexit”. (…).

During 2017, the number of transactions is expected to grow by 6.5% and prices are forecast to rise by 3.5% to reach 2004 levels. Meanwhile, Tinsa estimates that prices will remain stable or will increase by between 1% and 2%, at most, during 2017, in line with forecasts for the end of this year. (…).

Original story: La Vanguardia (by Cora Serrano)

Translation: Carmel Drake

Sabadell To Release 800 New Homes Onto The Market

27 July 2015 – Expansión

The improved outlook regarding the performance of the Spanish economy is reflected in the real estate market, where prices are stabilising and even increasing in certain areas of Madrid and Barcelona. And the stocks of newly constructed homes are drying up in some towns, due to a lack of new developments in recent years.

Against this background, cranes are returning to the domestic landscape and banks are taking on a new role in the market for real estate development, as they aim to generate returns from the land and half-finished construction projects that they foreclosed in exchange for debt payments. And Sabadell is playing a very active role. It will release 800 homes onto the market over the coming months.

The bank led by Josep Oliu is currently developing eleven of its own real estate urbanisations, most of which are located in Barcelona, Andalucía and Levante, but also in País Vasco and Asturias. The construction work will be completed during the remainder of 2015 and 2016, and will culminate in the release of more than 400 homes – flats and houses – onto the market, over several stages, with some of the properties already being sold.

Beside these developments, which spread across the country and whose degree of completion ranges between 15% and 100%, three other new developments will be started after the summer in Madrid – in the towns of Colmenar Viejo and Alcalá de Henares – and Levante. Once finished, these urbanisations will contain approximately 400 homes.

During the first half of 2015, 46% of Sabadell’s property sales were made in cash, whilst 37% were financed by the bank and the remaining 17% were funded using loans from other entities. In fact, the Catalan bank is offering buyers both variable rate and fixed rate mortgages – at Euribor plus 1.6% and 2.9%, respectively.

The entity’s real estate and mortgage offer is in line with those of other banks such as Santander and BBVA, which are developing 600 different urbanisations at the moment, as well as with that of Sareb, which will release 1,200 homes onto the market during the remainder of 2015, in some of the 30 developments that it completed last year and the 42 that it currently has on-going.

Signs of recovery

After an intense and long-lasting period adjustment, both in terms of activity and prices following the burst of the real estate bubble, the sector is now showing clear signs of recovery, to the extent that foreign funds have also entered the sector for the development of homes. But, is there a risk of excess supply?

Residential development is likely to grow over the next few years, says Javier López Torres, the partner responsible for the real estate sector at KPMG in Spain. And there is still room for more new builds without any risk of a new real estate bubble, says an expert from Andbank, Rocío Ledesma. And Sabadell wants to maximise the opportunities in the market through its development company Solvia.

Solvia is dedicated not only to the development of urbanisations owned by the bank, it also works for third parties. It is a servicer with assets under management amounting to €28,000 million, and it offers services ranging from the management of loan portfolios, to the development of land, as well as the management and administration of assets. In fact, Sareb awarded its first asset management contract to Solvia.

Original story: Expansión (by Alicia Crespo)

Translation: Carmel Drake

Demand For Off-Plan Homes Rises From The Ashes

8 May 2015 – El Confidencial

We can see cranes and bulldozers on the horizon in Spain once more. And although players in the real estate sector would rather talk about prudence than euphoria, stabilisation than recovery, the outlook is very encouraging.

Mortgage lending is increasing, more new homes are being built and more homes (in general) are also being sold. And, although the second-hand market is still winning hands down – even though the statistics are distorted by the foreclosures of homes by banks – demand for new builds is returning once more. Thus, purchasing a home off-plan, a practice that became almost anecdotal during the crisis, is returning to the fore once again, seven years after the real estate bubble burst.

There are several advantages to purchasing off-plan. You buy a new home that, for the most part, does not need any work doing to it. Some developers even allow future owners to adapt homes to their needs and likes – to convert a 4-bedroom home into a 3-bedroom property with a larger living room, for example – but, undoubtedly, the main advantage is that purchasers are not obliged to make a major outlay (of cash) in one go, but rather, they make small contributions until the keys are handed over, and those amounts are then deducted from the final price of the home. The main drawback is that new builds are not yet finished, which means they are not available immediately. And construction work can last for between 18 and 24 months.

Recently, several dozen people queued up overnight to reserve one of 62 homes that Solvia will soon build in Barcelona. It will be the real estate platform’s first development in the regional capital. (….) “There was a great deal of interest because it was a well-located product, with great features and reasonable, attractive prices”, said Augusto Monte, Director of Sales and Transactions at Solvia. “Clearly, it was an exceptional case and you cannot make wider generalisations about what happened with this development”. Nevertheless, Monte acknowledges that the fear of buying off-plan has declined in recent months.

(…) Other recent examples include the actions of housing cooperatives – for example, the plot of land in Raimundo Fernández-Villaverde or the old engine sheds at Cuatro Caminos – which obtained 100% of the partners in record time to sign up to purchase homes that will not be built for another two years.

Property developers, banks and servicers are conscious of this change and have come to the largest real estate fair in Spain (SIMA) with this type of product. Thus, for example, Solvia has a 75-home development of Alcalá de Henares. Between July and September last year, 64% of the development had already been purchased. And it is not the only one.

“We still notice considerable uncertainty amongst prospective buyers. Many of them come to the stand to ask us when the construction work will to begin. They are quite afraid that the building work will get delayed or that it will not happen at all”, says Inmaculada López-Gasco, sales manager at Magnum & Partners, which started to sell 63 homes in San Sebastián de los Reyes in April. “We have already sold 16 – i.e. 25% – and we will have the licence to start the construction work in June. We hope that sales will accelerate once the bulldozers start work.

(…)

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake

Housing In 2015: More Sales And Higher Prices

9 February 2015 – Expansión

Forecasts / This year the construction sector will emerge from negative numbers in all of the major indicators.

If 2014 was the turning point for the housing market, then it looks like 2015 will be the year 1 a.c (after the crisis). After seven years of hell, the residential sector is seeing the light again with positive data across all of the key indicators. That is the main conclusion drawn from the 21st Edition of the Real Estate Heart Rate Monitor (la XXI edición del Pulsímetro Inmobiliario), which will be published by the Institute of Business Practice (el Instituto de Práctica Empresarial or IPE) in the next few days.

The report has been prepared by MAR Real Estate, the real estate arm of IPE, in collaboration with the Network of Qualified Property Consultants (la Red de Asesores Inmobiliarios Cualificados) (around 600 professionals from all over Spain have participated in the study). And their predictions indicate that a period of great prosperity is upon us: sales, prices, mortgage lending, construction, stock…everything will improve in 2015. From low levels, yes, and still with limited strength, but this can only be good news when we are talking about the impoverished residential market, where the metastasis has been more devastating than in any other sector.

There is a great atmosphere. To begin with, sales will increase by 7.5% this year, having closed 2014 with an increase of 2.6%, the first rise since 2010, the year in which the market was shaken by the removal of tax relief for buying a first home. According to MAR Real Estate’s forecasts, 344,000 residential properties will be bought and sold in 2015; 24,000 more than last year (320,063).

The second major indicator in the residential world is price, the eternal purchase thermometer. According to IPE’s report, house prices rose by 6.47% last year and are expected to increase by a further 2.5% in 2015. The average value of homes sold in 2014 was €141,718 and this year is expected to be €145,261, showing a return to 2012 levels.

Price rises

“The trend is rising, something which is evidenced by the fact that the vulture funds have now left Spain”, says José Antonio Pérez, Director of Real Estate at IPE. “The properties being sold are those in good locations, in prime areas that are nicely finished and ready to live in. Speculative purchases have practically disappeared”, he adds.

Furthermore, a phenomenon not seen since the years before the Great Crisis is now happening: homes are being sold off plan and prices are rising during the purchase process.

There are two examples that illustrate this. Both are on the Costa del Sol, which analysts regard as the area where the trends in the rest of the housing market are first seen (that was the case in the 1980s and 1990s and it is starting to be the case again now). In Estepona, the British company Taylor Wimpey put a development containing 44 properties up for sale. Off plan. They now have only three loft apartments left to sell – the original asking price for these properties was around €400,000….and they are now being sold for €500,000. A 25% increase. The majority of its customers, are foreign (around 85%-90%).

The second example is that of Inmobiliaria Sur, which has a strong position in the domestic market, away from luxury properties. To the extent that it has been putting homes up for sale – also off plan – in its developments in Marbella and Mijas-Costa, the prices of the best properties that it has not yet sold have increased from between €200,000-€220,000 to reach close to €300,000.

“In prime areas, prices are rising. In mid-market areas, prices will be stable in 2015 and in the areas that still have a lot of surplus, there will be further price decreases”, says Pérez.

In other words: good properties have already been sold; but structural stock, born out of the excesses of the real estate bubble, has not. In the case of the former, bargaining power has decreased, although there are still bargains to be had; in the case of the latter, there is simply no demand, aside from investors looking to obtain yields from their properties, or to renovate them and wait for better times. “Buy-to-let homes will continue to generate good returns and so money will continue to move from the financial system into the real estate market in 2015”, predicts José Antonio Pérez.

There are potential buyers in the market, but they cannot obtain access to credit. Experts believe that natural demand in Spain would generate around 400,000 transactions (per year), but it will be a while before we see that figure again, especially given that the construction of new homes is clearly following a downwards curve. The return to sustainable figures will depend heavily on financial institutions opening the mortgage tap, which is currently shut off to ordinary mortals, i.e. to anyone that does not fall into the vague category of “solvent”.

Mortgages

According to Pérez, we are now seeing a rise in the number of loans being granted for property purchases, but lending is still scarce. In 2014, 299,064 mortgages were signed, which is 2.3% fewer than in 2013, but we expect to see the first increase in nine years in 2015, with 306,639 mortgages being signed for urban properties. In 2006, the last year in which an increase was recorded, that figure stood at 1,816,878, i.e. 592% higher.

“The mortgage market will continue to be very restricted in 2015, very focused on the products that are marketed by the banks themselves”, says Pérez. Moreover, “two thirds of sales will be paid for in cash”, he adds.

The average mortgage size grew by 15.8% in 2014 (from €113,972 to €131,984) and will increase by 3.4% in 2015 to reach €136,447. The volume of these loans will increase by 6% to take total mortgage borrowing to €41,840 million by the end of the year.

One question remains unanswered: if everything is going to start growing again, will the cranes return to Spain’s urban landscape? And the answer is yes. Very slowly at first, but yes. In 2015, 40,255 new homes will be constructed, i.e. 7.5% more than in 2014.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake