Tag: Divarian

Cerberus and BBVA Hire Konstantin Sajonia-Coburgo to Head Up Divarian

16 August 2019

The US fund Cerberus and BBVA have hired Konstantin Saxony-Coburg to head up Divarian, the company that they created after Cerberus acquired the bank’s real estate assets. Saxony-Coburg left his position as co-head of investment banking at Barclays Spain last year, where he had worked since 2010. Divarian, owned 80% by Cerberus and 20% by BBVA, has €13 billion in assets in its portfolio.

The North American fund and BBVA opted to merge Divarian with the US firm’s servicer, Haya Real Estate, this year. Haya is responsible for managing and selling all Cerberus’s real estate holdings in Spain, except for its land bank, which is managed by Inmoglaciar.

Original Story: El Confidencial – Jorge Zuloaga

Photo: Cordon Press

Adaptation/Translation: Richard D. K. Turner

Haya Real Estate Looks to Expand into Italy & Greece to Grow its Business

27 May 2019 – Expansión

Haya Real Estate, the servicer controlled by the US investment fund Cerberus, is looking to grow its business. Following its merger with Divarian (formerly Anida), it is now the second largest servicer in Spain, after Altamira, with 1,200 employees and €47 billion in assets under management.

In order to diversify its portfolio, the servicer led by Carlos Abad (pictured above) is evaluating its expansion into Italy and Greece, two emerging markets in which multiple NPL investment and management opportunities are expected to arise in the short term. That would help alleviate concerns over Haya’s future, which currently depends heavily on the outcome of the servicer’s negotiations with Sareb, whose contract is due to expire in December.

The future of Haya Real Estate has been up in the air since its stock market debut was postponed last year. Cerberus has held its stake in the servicer for six years now and is keen to exit soon given that its typical investment rotation period amounts to five years. Following the postponed IPO, the US giant is now holding preliminary conversations with several other investment funds interested in acquiring its stake, but the price will depend on the servicer’s future with Sareb.

Original story: Expansión (by Rebeca Arroyo)

Translation/Summary: Carmel Drake

Cerberus Receives 3 “Low” Offers For its Stake in Haya Real Estate

24 May 2019 – El Confidencial

Cerberus may be forced to revise down its price expectations for the sale of its real estate platform Haya Real Estate. The US fund had been hoping to receive more than €1 billion for the servicer, which is one of the largest in Spain, but so far the offers it has received amount to just €700 million.

There are currently three candidates in the running, namely, the Italian firm doBank, the US fund Centerbridge and the Asian fund Centricus, according to financial sources – all are familiar faces in the Spanish market and are willing to buy the servicer, but not for the asking price.

The reason is that considerable uncertainty exists over the renewal of Haya’s contract with Sareb, despite Cerberus’s efforts to diversify and grow the servicer’s portfolio with purchases such as the Apple Portfolio from Santander last year, and the agreement to purchase and manage almost all of BBVA’s property. Haya also administers assets for Bankia, Cajamar and Liberbank.

Nevertheless, Haya’s main client is still Sareb, for which it manages €21 million in debt and properties, which account for around half of the platform’s assets. That figure will fall to around a third following the agreement with Divarian, formerly Anida (BBVA), but Sareb wants to significantly reduce both the perimeter of management and the fees that it pays Haya, which would hit the servicer’s revenues hard.

As such, the funds in the running to purchase Haya are requesting protection clauses to cover themselves in the event of the various outcomes from the negotiations with Sareb, which are expected to conclude in September. Whether Cerberus will manage to sell its servicer before then remains to be seen.

Original story: El Confidencial (by Jorge Zuloaga & Ruth Ugalde)

Translation/Summary: Carmel Drake

Cerberus & BBVA to Merge Divarian with Haya Real Estate

25 April 2019 – Europa Press

The Cerberus investment fund will merge Divarian, the company that it created with BBVA after buying the bank’s real estate assets, with its servicer, Haya Real Estate, the firm announced. The combined firm will manage the 60,000 most residential properties that the entity sold to the fund. Divarian and Haya’s management and real estate management operations will also merge.

Under the agreement, Haya will have a total of €49 billion of assets under management, consolidating its position as the largest servicer in Spain. Haya currently provides services to Sareb, BBVA, Bankia, Grupo Cajamar and Liberbank, as well as to several institutional funds.

Divarian is 80% controlled by Cerberus, while BBVA holds the rest.

Original Story: Europress Economia

Translation/Summary: Richard D. Turner

Project Ánfora: BBVA Studies €1bn+ Offers from Cerberus, CPPIB & Lone Star

19 November 2018 – Voz Pópuli

BBVA has chosen the three finalists who are going to compete for the largest portfolio of assets currently on the market, Project Ánfora. The entity is holding negotiations with three major North American funds, Cerberus, CPPIB and Lone Star, according to financial sources consulted by Voz Pópuli.

Up for grabs: a portfolio a real estate loans worth €2.5 billion. Some of the offers exceed €1 billion, according to the same sources.

BBVA expects to conclude the process before the end of the year to whereby end 2018 in the best way possible. It will be the last set of annual accounts with Francisco González as President, and at the current pace, they could be closed with one of the largest profits in the group’s history. The entity earned €4.3 billion to September; its record annual profit to date is €6.1 billion, which is registered in 2007.

In addition to Project Ánfora, BBVA has just closed Project Marina: the sale of its real estate arm Anida and of assets worth €13 billion to Cerberus. Nevertheless, the transfer of a large part of those assets, which proceeded from Unnim, is pending authorisation by the Deposit Guarantee Fund (FGD).

Property to zero

Following those two operations, and others in the past – such as the sale of its stake in Testa – the property left on BBVA’s balance sheet is going to almost immaterial. With that, the CEO, Carlos Torres, hopes that the real estate unit will stop weighing down on the group’s income statement from 2019 onwards.

The favourite of the candidates to purchase the €2.5 billion portfolio is Cerberus. Not only because of the appetite that the US fund has been showing regarding the purchase of real estate assets in Spain, but also because of the interest that it will have in Divarian, the new Anida, continuing to manage the assets.

CPPIB (Canada Pension Plan Investment Board) is the other entity that is backing the Spanish market most heavily, through its stake in Altamira and the acquisition of portfolios from Sabadell and BBVA.

Meanwhile, Lone Star has started investing more money in Spain following the changes in its management team and because it wants to gain volume to make its acquisition of CaixaBank’s property profitable.

Original story: Voz Pópuli (by Jorge Zuloaga)

Translation: Carmel Drake

CPPIB, doBank & Haya Compete for Altamira

14 November 2018 – Cinco Días

The sector of real estate servicers for assets proceeding from the banks is in flux. The latest process in the market to catch the attention of major funds and operators in the sector involves Altamira, the firm controlled by the manager Apollo, which owns 85% of the company, and Santander (15%). The first entity to make a major bid has been its competitor Haya Real Estate (owned by Cerberus), as published by Cinco Días on 8 November. That offer has now been joined by one from CPPIB, the Canadian Pensions Fund and one of the largest investors in the world.

Another player interested in Altamira Asset Management, according to financial sources, is the Italian firm doBank, formerly UniCredit Credit Management. That listed entity is controlled by Fortress. It is the largest doubtful loan manager in the transalpine country. Meanwhile, Canada Pension Plan Investment Board (CPPIB) is a fund that manages the pensions of 20 million Canadian people, with assets worth €245.7 billion.

Altamira was created by Santander as a servicer for its toxic assets linked to property. In 2013, the bank sold 85% of the entity to the US fund for just under €700 million. Five years later, the manager from New York, which has not managed to star in any of the major bank portfolio purchases, has decided to exit the company. The amount of the operation, a sales process that has been entrusted to Goldman Sachs, is expected to exceed €600 million.

Altamira has become one of the large managers of financial and real estate assets in Spain, with a total volume of assets under management of €53.8 billion compared with €26 billion at the end of 2014, and with more than 82,000 properties, on behalf of around fifteen clients.

In recent months, there has been significant movement in the shareholders of these servicers, in large part linked to the sale of the bank portfolios. If Cerberus, through Haya, manages to acquire Altamira, it will be the third entity that the US fund controls, after Haya and Divarian (formerly Anida, linked to BBVA). The idea of the fund is to integrate it with Haya to relaunch that firm’s debut on the stock market, as reported by this newspaper. Blackstone, in turn, controls Aliseda (previously owned by Popular) and Anticipa. Lone Star acquired Servihabitat (formerly owned by La Caixa) this summer, and Sabadell has also put Solvia up for sale, another servicer that also interests Cerberus.

Original story: Cinco Días (by Alfonso Simón Ruiz & Pablo Martín Simón)

Translation: Carmel Drake

Cerberus Plans to Create a Real Estate Giant by Acquiring Altamira & Solvia

10 November 2018 – Expansión

Cerberus is increasing its commitment to the Spanish real estate market. The US fund is the favourite candidate to take over the reins at Altamira, the manager of property loans and foreclosed real estate assets currently owned by Apollo and Santander. Moreover, Cerberus is battling it out with the fund Lindorff (now Intrum) and other investors to purchase Solvia.

As Expansión revealed on 8 October, Apollo renewed its contract with the investment bank Goldman Sachs at the beginning of the summer and distributed the teaser (the sales document containing a general description) to potential interested parties to dispose of this asset for between €500 million and €600 million. Although it is not alone in the process, Cerberus is the candidate that has the best chance of acquiring that company.

But Cerberus is not going to settle for that asset only. Financial sources assure that the US fund is also bidding for Solvia, in a process in which it is also competing with Lindorff. The CEO of Sabadell, Jaume Guardiola, noted, during the presentation of the results on 26 October, the “good appetite” in the market for Solvia, “whose sale will close “soon”. He whereby confirmed the sale of Solvia Servicios Inmobiliarios (SSI) and Solvia Desarrollos Inmobiliarios (SDI). For the sale of SSI, in which it is being advised by Alantra, the bank hopes to receive up to €400 million.

Concentration of the market

If Cerberus ends up being the winner of both processes, it will become the clear leader of the servicer sector and a proponent of concentration between the servicers. These companies, created from the former real estate subsidiaries of the banks, have become some of the stars of the new real estate cycle.

Currently, almost all of the assets under management of the banks are in the hands of a few companies such as Altamira, Servihabitat, Haya Real Estate, Aliseda, Anticipa, Solvia and Divarian (previously Anida). These firms are mainly responsible for the management and recovery of debt and transformation of loan obligations into foreclosed real estate assets, as well as the sale and rental of assets.

If Cerberus ends up taking control of Altamira and Solvia, it will control almost 65% of the market for servicers, which will allow it to mark a differentiation in its strategy. Currently, the US fund controls Haya Real Estate, one of the large servicers with €40 billion in assets under management. Moreover, it took over the reins at Anida, which was in the hands of BBVA, and which manages €13 billion.

If it adds Altamira and Solvia to its portfolio, the volume of assets under management will soar to €138.9 billion, with a market share in the servicer segment of 65%. According to numbers managed by the consultancy firm Axis, the other two dominant funds are Blackstone, with Anticipa and Aliseda (also from Santander) and LoneStar, which controls Servihabitat after purchasing that company from La Caixa in the summer.

Other assets

In addition to the servicers, Cerberus is also the owner of the property developer Inmoglacier; the online estate agency between individuals Housell; and the debt recovery company Gescobro (…).

Original story: Expansión (by R.Arroyo and D.Badía)

Translation: Carmel Drake

BBVA Finalises Transfer of 80% of its Spanish Real Estate Business to Cerberus

11 October 2018

The bank chaired by Francisco González, who announced the operation at the end of November of last year, stated that this “will not have a significant effect” on the bank’s profits or its solvency ratios. The joint venture between BBVA and Cerberus has been dubbed Divarian.

On Wednesday, BBVA finalised the transfer of the bulk of its real estate business in Spain to the US fund Cerberus, contingent on “obtaining the necessary authorisations.”

The transaction, which the bank announced on November 29, has allowed the institution to free itself from 80% of its exposure to the property sector in a single stroke, transferring 13 of the 17.8 billion euros gross of its holdings of real estate and loans to developers to Cerberus. The bank will maintain the remaining €4.8 billion in its balance sheet.

The portfolio, which Cerberus acquired, is valued at around 5 billion euros and result in a gain of roughly four billion euros for BBVA, though the final price is subject to “the effective transfer of some real estate assets.”

The bank structured the operation through the creation of a company called Divarian Property, to which the bank transferred its real estate business in Spain. BBVA has subsequently sold 80% of Divarian to Cerberus, retaining the remaining 20%. The assets that the bank transferred to the US fund “included both the real estate assets and the employees necessary for the management of the business.”

Drastic reduction of exposure to real estate sector

The bank stressed that “this operation marks a milestone in the BBVA Group’s strategy to eliminate its exposure to the property market almost completely.” The CEO and future president of the entity, Carlos Torres, stated when the deal was announced last November, that “it significantly reduces our exposure to an activity outside our core business and allows us to undergird our process of transformation.”

In 2017, BBVA recorded losses of 501 million euros stemming from the real estate sector and expects these red numbers to be reduced by 80% this year. Likewise, it estimates that as of 2019, the contribution of this area to the financial institution’s results will not be “relevant.”

The group chaired by Francisco González added that this operation “will not have a significant effect on the attributable profit of the BBVA Group, nor on the fully loaded CET1 capital ratio.”

In the last two years, the bank has been particularly active in the divestment of assets linked to the property sector. Among the bank’s most important operations were the sale of a portfolio of almost 3,500 properties and a lot of 14 office buildings, each with a gross book value of about 300 million euros.

Original Story: Expansion – J.D.

Photo: Francisco Rodríguez / Expansión

Translation: Richard Turner