Tag: Domo Activos Socimi

Domo Gestora’s Socimi Acquires Its First Plot Of Land

24 March 2017 – Inmodiario

Domo Activos Socimi, the Socimi promoted by the real estate manager Domo, has acquired its first asset. The asset in question is a plot of land, located in Ensanche de Vallecas, in Madrid, where the company plans to develop a residential building comprising 80 homes for rent with the option to buy. This Socimi’s business model focuses on buying land on which to construct buildings for their subsequent rental. Once the mandatory three years during which they must lease the properties out has passed, the Socimi will then proceed to sell them, whereby benefitting from the tax benefits enjoyed by these types of companies. In this way, all of the profits generated from the date the land is acquired until the date the properties are sold is taxed at 0% for Corporation Tax purposes.

According to the company’s estimates, the returns on this project, once the divestment has been made, could reach 10% per annum. Before the sale and whilst the properties are being leased, investors will receive profits resulting from the rental income, in the form of dividend payments.

Domo Activos Socimi will debut on the Alternative Investment Market (MAB) in the recently created sub-segment, called “Socimi under development”. Socimis that allocate less than 70% of their assets for rent trade there. In this case, Domo Activos Socimi will ask to be incorporated into this sub-segment, given that initially, it will own just one plot of land.

Domo Activos Socimi’s business model allows its shareholders to participate in the advantages and returns offered by traditional Socimis, as well as in the returns offered by the development and construction of properties.

Domo Activos Socimi plans to file its request to join the MAB during the first half of 2017. This milestone will allow Domo to fulfil one of the main objectives that it set itself when it launched this Socimi, namely, to enable small and medium-sized investors to access investments with these characteristics.

Domo Activos Socimi has successfully completed its first capital increase, which has allowed it to acquire this plot of land and for the time being and until it debuts on the MAB, with the traditional “Ringing of the bell”, it may increase its share capital again, which would likely require a minimum necessary investment per shareholder of €100,000.

Original story: Inmodiario 

Translation: Carmel Drake

Rental Housing Is Booming Following The Crisis

26 October 2016 – El Economista

The rental market, which had never really caught on before in Spain, is now enjoying a genuine boom following the economic crisis. The employment instability experienced in recent years and the inability of people to buy a home in the face of mortgage restrictions have raised the prominence of the rental market in Spain, which now accounts for 15.6% (of the total housing stock), a ratio not seen since 1987, according to the latest data from the Bank of Spain and reported by Idealista. By contrast, the percentage of owned homes has decreased to 77.3%, a figure not seen since 1988.

With this data on the table, it is logical to think that the decrease in owned homes this year will exceed the figure recorded in 2015. Specifically, last year, there was a decrease (in the number of rental properties) of almost 9% from the peaks registered in 2002, when owned homes accounted for 84.72% of the total housing stock.

The increase in demand for rental properties has had a significant impact on prices. After seven years of continuous decreases, which peaked at 25% in some cases, the first increase – of 3% on average – was recorded in 2015. The impact on rental prices was felt most acutely in the country’s ten largest cities, led by Barcelona, where prices rose by 17% on average.

Although the supply has also increased since then, average rental prices have continued to rise and according to pisos.com, they increased by 5.09% during the third quarter of 2016. In this way, the average rental price amounted to €661 in September 2016 for a typical home with an average surface area of 112 m2. In comparative terms, this figure represents a 0.3% increase compared to August. Nevertheless, the YoY increase amounted to 9.26%.

These average increases are symbolic if we focus on specific areas in Madrid and Barcelona, where potential rental clients look for properties in central, prime areas, that are well connected (in terms of transport links). Thus, in the Catalan neighbourhoods of Sant Martí, Gràcia and Sants-Montjuïc, prices are rising by between 12% and 16% p.a..

The real estate market itself is not oblivious to this trend and for this reason, a wave of Socimis are getting reach to focus on the rental housing sector.

For the time being, Fidere and Optimum III are the only Socimis that are actually up and running. Imminent debuts are expected from Alquiler Seguro, with its Socimi Quid Pro Quo, which will have 625 units in its first phase, and Domo Activos Socimi, the cooperative manager, with its portfolio of 1,400 units. The Valencian group Inveriplus, the US fund Blackstone – with Albinara Properties, Pegarena and Tourmalet – and Testa Residencial, with 4,700 homes, are also expected to enter the market.

Original story: El Economista (by Alba Brualla and Cristina Alonso)

Translation: Carmel Drake