Tag: El Corte Inglés

Talus To be Ortega’s Neighbour On Gran Vía

29 January 2015 – Cinco Días

Two buildings on the same street in Madrid have changed hands within just over a week of each other. The fund Talus Real Estate has agreed the acquisition of the building on Gran Vía 30 (on the corner of Calle Valverde) for €42 million. On Monday, the company Drago Real Estate announced the sale of its building on Gran Vía 32 to Pontegadea, the company that owns Inditex’s real estate assets and receives its dividends on behalf of Amancio Ortega, the founder and primary shareholder of the fashion group.

According to sources close to the negotiations, JLL and Aguirre Newman have participated in the sale of the property on Gran Vía 30, as advisory consultants. However, the companies involved did not want to confirm this information yesterday.

The same sources said that the buyer plans to refurbish the property. The fashion chain Sfera, owned by El Corte Inglés, has a store that occupies two floors of the building.

Talus Real Estate’s main executives are David Finkel and Jordi Moix and its headquarters are located in Madrid. According to the company’s website, before joining Talus, Finkel worked for Westbrook Parners, where he co-directed their business in London. Westbrook Partners is a real estate investment group that was founded in 1994, has offices in the US, London, Munich, Paris and Tokyo and has invested USD 10,000 million to date. Prior to that, he worked for the Japanese entity, Nomura and for iStar Financial, another international real estate investment group.

Moix has held senior positions in the Spanish real estate companies Reyal Urbis, Metrovacesa, Layetana and Habitat; he has also worked for IAG and Citibank. Currently, he is vice-president of FC Barcelona’s real estate business.

Gran Vía is trading up

The sale of the property on Gran Vía 30 is the latest in a series of transactions undertaken on the Madrid street that will change its appearance as it approaches its 105th birthday.

The fashion group Primark will occupy several floors of Gran Vía 32, when it opens its largest store in Spain there. Talus Real Estate will also refurbish the Gran Vía 30 building. In Plaza de España, the Chinese group Wanda will convert the Edificio España into a luxury hotel and shopping centre. Next to the building sold by Santander, the hotel chain Barceló will take over some of Torre Madrid to open another hotel.

Late last year, Axa Real Estate, a subsidiary of the insurance company Axa, acquired Gran Vía 37, where the fashion retailer H&M has its largest store in Spain and which used to house the Avenida cinema, for €80 million. Also last year, the Community of Madrid sold Gran Vía 20 for €20 million to Caja Rural de Almendralejo Sociedad Cooperativa de Crédito.

2015, another big year for real estate investment

With the sale of Gran Vía 32 and the upcoming sale of the Plenilunio shopping centre, the amount of investment in Madrid will amount to €800 million. According to sources familiar with the transaction, the sale of the shopping centre will reach a figure close to €400 million.

In 2014, investment in real estate in Spain amounted to between €6,000-€9,000 million, almost twice the figures recorded in the previous three years.

During the year ahead, Socimis, which revolutionised the sector in 2014, will continue to invest, as will investment banks, whereby replacing opportunistic funds. The liquidity injection announced by the ECB will boost the sector. The expected sale of Realia will be another major transaction. Industry experts are also drawing attention to investment in logistics platforms.

Original story: Cinco Días (by Alberto Ortín Ramón)

Translation: Carmel Drake

El Corte Inglés Values Its Properties In Galicia At €600m

26 January 2015 – La Voz De Galicia

El Corte Inglés’s Galician assets account for almost 5% of the total, valued at €15,000 million.

The value of the real estate assets owned by El Corte Inglés in Galicia amounts to €601 million. So the company led by Dimas Gimeno revealed in information sent to the Irish Stock Exchange (the stock market in Ireland), on the occasion of its first bond issue (€500 million) placed by Hipercor.

According to the 333-page document, El Corte Inglés owns 217,000 square metres of retail space in Galicia, with an average value of €2,344 per square metre. Overall, the group’s most expensive buildings are located in Madrid (€4,823 million), followed by Andalucía (€2,563 million) and Cataluña (€1,646 million).

The group has explained to the Irish regulator that Tinsa Tasaciones Inmobiliaria valued most of the group’s property portfolio in September 2013 and March 2014, and assigned it an aggregated value of €15,126 million, of which almost 5% (by surface area) is located in the region of Galicia.

Department stores account for the majority of the group’s real estate assets (€9,187 million), followed by hypermarkets (€4,338 million), other retail space (€803 million) and offices and mixed-use properties (€797 million). “The group has developed an irreplicable property portfolio with unique locations” says the group.

At the end of last year, the group had around 1,555 outlets in total, including 88 department stores, 43 hypermarkets, 203 supermarkets and 451 specialist stores.

42 properties

According to the document, at the end of last year, the group’s commercial presence in Galicia comprised 42 outlets located across the four provinces, including Viajes El Corte Inglés offices (15), Sfera stores (11), Bricor stores (4), Óptica 2000 shops (4), Hipercor stores (2), Supercor shops (11) and El Corte Inglés stores (4).

The department store business accounts for almost 60% of the group’s consolidated turnover. Including Hipercor, Sfera and Viajes El Corte Inglés, amongst others, the group’s revenue amounted to €14,291 million in 2013.

Within the department store division, 51.1% of turnover is generated by the fashion, accessories, jewellery and beauty departments, which together accounted for revenues of €3,858 million.

In the document submitted to the Irish regulator, the group also highlighted the importance of its brands (the fashion lines Emilio Tucci, Green Coast, Dustin and Formul@), which now account for 16% of revenues, compared with 11% in 2008.

The group also revealed that approximately 635 million people visited its stores during 2013. Furthermore, 155 million people visited its website, where it has 4.2 million registered users.

Only twelve female directors

In the final part of the report, which focuses on accounting aspects, there is also mention of employment considerations.

For example, last year, its workforce comprised 93,223 employees, however only 12 of its executives were women, compared with 186 men. Also, 4,276 females were employed as supervisors, versus 9,141 men. In stores, however, women were in the majority, with 47,434 female sales assistants, versus 18,283 males.

Original story: La Voz De Galicia (by M. Sío Dopeso)

Translation: Carmel Drake

Adif Hands Over the Castellana Plot to El Corte Inglés Paying €136 Mn

26/11/2014 – E Pais, El Mundo

El Corte Inglés ponders next extension of what it considers its flagship department store in Spain due to its excellent location on the coveted Paseo de la Castellana street in Madrid’s downtown. The chain has acquired a plot situated just in front of its existing store and at few meters from the Nuevos Ministerios light railway and subway station from Adif for more than €136 million.

The piece of land has 13.000 square meters and it is located inside the Azca complex. Adif, a public company managing railway infrastructure in Spain, put the parcel up for sale in September at an asking price of €40 million. It received six offers for the lot, from such known developers and co-ops managers as Monthisa, Allegra, Capriles, Colonial or Grupo Villar Mir.

Newly named president of El Corte Inglés Dimas Gimeno said ‘town planning project for the terrain displays a total buildability of 35.192 square meters, of which 10.176 square meters are intended for construction of three stories above the ground level, of the tertiary use (i.e. commerce, services but no dwellings), and around 25.000 square meters below the ground level which can be used for building four underground parkings’.

The El Corte Inglés store has been growing throughout years. Opened in 1969 with less than 50.000 square meters, it was amplified by a new building, which replaced the old Windsor, in 2011. Currently, it has a 130.000 square meter floor area.

Thanks to the purchase and the planned extension, the Castellana store will become the biggest in Spain. Right now the honour belongs to the center in the El Bercial neighbourhood in Getafe which covers 180.000  square meters. In any way, it will be much smaller than other departments stores said to be largest in the world and even in Spain, as the Marineda City retail park in A Coruña offers a 500.000 square meter built area and a GLA of 200.000 square meters.

This acquisition adds to the latest three November land purchases in the center of the Spanish capital amounting to €370 million in total.

Two other plots, curiously enough situated in the same area, were tendered publicly earlier this month and fell into hands of cooperatives managers Domo Gestora and Grupo Ibosa. First piece of land, situated at 50 Raimundo Fernandez Villaverde street, was bought for €111.05 million on the 5th. A week later, the other carrying Madrid Metro’s depots in the Cuatro Caminos zone was sold for €88.3 million. Finally, Pryconsa acquired the old Buñuel studio of Spanish TV RTVE for €35.27 million.

 

Original article: El País (by Cristina Delgado), El Mundo (by Jorge Salido Cobo)

Translation: AURA REE

El Corte Inglés Offers €136 Mn For Adif’s Nuevos Ministerios Plot

25/11/2014 – Expansion

El Corte Inglés is ready to come down to history of real estate investments carried out in Madrid. After spending €480 million on now non-existent Torre Windsor tower (replaced by the Torre Titania), the department store group has submitted a €136.48 million offer for a 10.700 square meter plot situated on the Paseo de la Castellana street in Madrid.

The piece of land, stretching adjacently to one of its stores (pictured), would allow the chain to build a new shopping mall in downtown Madrid, just next to the Nuevos Ministerios Cercanias (the light railway of the capital) station.

Except for El Corte Inglés, the tender of the plot was attended by five other bidders. The second-best offer came from Madrid-based property manager Monthisa (€77.04 million), followed by developer Pryconsa teamed up with one investor more (€62.57 million), Mario Losantos’s holding Allegra (€55.1 million) and Colonial (€52 million). Venezuelan Capriles bidded the lowest with €46 million.

Owned by Adif, the desirable piece of land currently offers 72 parking lots with 22.000 spaces. The public railway manager put the plot up for sale as a part of its non-core assets divestment plan including 16 activities, like awarding commercial spaces and renovation of some stations.

The terrain’s use is tertiary (meaning no dwellings allowed thereon) and it is suitable for constuction of a five-floor building. According to experts, the price may oscillate between €70 million and €100 million, or between €6.200 and €9.000 euros per square meter. El Corte Inglés’s bid reaches 12.775 €/m2.

If the clear bet accepted, the Spanish department store king would extend its 86-large store, 42-hipermarket and over 250-convenience shop (Opencor and Supercor Express) portfolio valued at €18 billion, as Tinsa estimates.

 

Original article: Expansión (by R. Ruiz & A. Polo)

Translation: AURA REE

El Corte Inglés Sells a Building on Preciados Street in Madrid to IBA

El Corte Ingles finalized the sale of one of its buildings at 9 Preciados Street in Madrid. The property, situated on the most expensive commercial street in Madrid and one of the most important in Europe, consists of 1.375  sqare meters´ shopping area. The rest are offices. In total, there are 2.500 square meters of space.

The chain owned by Isidoro Álvarez, possessing more buildings on the same street, used 3 floors of the sold building as a shopping area with sports equipment and 3 more as offices.

The new property owner is a real estate company IBA Capital, a French fund manager which brings together European, American and Asian fortunes. (…) First time the companies did business together when El Corte Ingles sold to IBA a building close to Plaza de Cataluña in Barcelona for 100 million Euros. This time the Gaul fund paid about 50 millions, according to the real estate sector sources. Thus, a square meter has been valued at 20.000 Euros.

The two sold buildings are adjacent with two big shopping centers of the group. Before February 28th, El Corte  Ingles owned 86 department stores, out of which 84 were situated in Spain. According to the valuation conducted by Tinsa consulting company, the firm´s assets on the market exceed 18.000 million Euros.

The decision to shed the property was made after the conclusion of refinance agreement of its 5.000 million Euros debt.  (…) In the last exercise, closed on February 28th, El Corte Ingles earned 171.5 millions, about 18% less, and charged 14.552 millions. (…).

The New Operator

The sale of 9 Preciados was one of the scarce transactions carried out in the so-called ´Golden Triangle´of the capital, which embraces districts of Sol, Gran Vía and Preciados. (…) Rental cost on the last reaches 245 €/m2.

The new owner´s target is to rehabilitate the entire building and convert it into a flagship establishment for an international chain company. That is why, the leaders have already started negotiations on the rental price with various international companies. (…).

There are several Northern American great companies among the potential tenants, who wish to open their branches in Spain. Other important firms interested in the deal are: Japanese Uniqlo, Inditex and H&M.

Source: Expansión

The properties of El Corte Inglés are worth 18.000 million Euros.

The restructuring process of the debt of 5070 million Euros of El Corte Inglés is on the right path. The group has already received the valuation of its real estate assets which was ordered from the valuation firm Tinsa, a condition agreed with its banks in order to renovate the credit.

Therefore, according to Tinsa´s estimations, the value of the real estate assets of the group exceeds 18.000 million Euros, that is, it is more than three times the debt it has with 25 creditors.

The report has taken into account the millions of square meters that make up the real estate patrimony of El Corte Inglés that, according to the last official figures dated 29th February 2012, include 86 department stores (two of them in Portugal), 42 hypermarkets, more than 250 convenience stores under the brands Supercor and Opencor, as well as the logistic platforms and warehouses, and its historic headquarters at Hermosilla Street in Madrid and its latest investment: Torre Titania, in Madrid.

A real estate patrimony created during more than five decades and whose portfolio increased substantially in 1995 with the acquisition of Galerias Preciados, which meant the purchase of thirty buildings at one time and the entrance in thirteen cities.

Years later, in 2001, El Corte Inglés closed the purchase of nine more stores, which had been managed by the British firm Marks & Spencer, among them one on Serrano Street, within the Salamance quarter in Madrid.

Tinsa´s valuation is fairly higher than the only one existing until now, which is the one included in the accounting books, that reached 7578,78 million Euros. When the financial restructuring was announced, El Corte Inglés pointed out that its real estate patrimony was like a “portfolio of assets, located at unique locations, which had a fairly higher market value than the amount of the refinancing”.

Tinsa´s report confirms this declaration. “One of the main features of this portfolio is that these buildings are symbols in their environment and commerce icons in those cities where they are located, mainly due to their location”.

Tinsa´s valuation has not been finished yet. The firm has just finished the total valuation of 80% of the property, whose value reaches 16.000 million Euros. With the rest of the valuation pending, it is estimated that it should add 2000 additional million Euros, which would give out a total sum of 18.000 million Euros.

Once the total valuation has been completed, EL Corte Inglés will share the information with its 25 creditors in order the close the refinancing process of its debt, which reaches 5070 million Euros. The main creditor is Banco Santander, with 1275 million Euros or 25% of the total, although it would have paid off 100 million Euros. CaixaBank follows, with a debt of 754 milion Euros; BBVA, with 705 million Euros and Banco Popular with around 444 million Euros.

The negotiations seem to be on the right path, and according to sources close to the process, the financial institutions see El Corte Inglés as a “perfectly sustainable company” that is carrying out a very important restructuring process as well as the updating of its structure, in order to have a “more solid and well kept” balance. The group presided over by Isidoro Alvarez intends to unify all credits it has with the 25 creditors into one only syndicated loan.

The restructuring process continues its normal procedure and it is expected that a first agreement will be signed in the next few weeks.

With these measures, the company will improve its financing structure regarding costs, deadlines and diversification of financing sources which will allow it to continue its development nationally and internationally.

The financing debt of the group on the short term reaches 2268 million Euros, according to the last accounts, 499 million of which expire this year and 1175 million Euros, in 2014.

El Corte Inglés has also sold non strategic shares which have also contributed with some profit: 1,8% of the air transport group IAG (where Iberia, British Airways and Vueling are integrated) for around 100 million Euros and the 9,9% it had in Inversis for around 20 million Euros. Another great disinvestment  has been the sale of its department store in Plaza de Cataluna, in Barcelona, for 100 million Euros.

Source: Expansion