Grupo Ibosa Acquires 10,000m2 Plot on Paseo de la Habana for c. €70M

24 July 2018 – El Confidencial

It has undoubtedly become the most expensive land operation since the start of the real estate recovery. Paseo de la Habana, 147 has smashed all records, given that almost €70 million has been put on the table for its 10,000 m2, which represents a repercussion price of between €6,500/m2 and €7,000/m2. That figure is significantly higher than the expectations of the plot’s vendors, which had set a sales price range of between €60 million and €65 million.

Since the real estate bubble burst, no one has paid such a high repercussion price for a plot of land. The figure comfortably exceeds the €5,000/m2 that the builder Rafael Ortiz and the popular shipping entrepreneur Fernando Fernández Tapias paid in 2007, at the height of the boom for a plot located on Juan Bravo 3, where the Spanish capital’s largest luxury development is currently being constructed, Lagasca 99.

Since coming onto the market just three months ago, the plots have passed through the offices of more than a dozen property developers and private investors and, although many of them agree on the high price of the operation, the fact is that the plot has had half a dozen suitors in the end.

The companies that placed an offer on the table include Nozar, Grosvenor, Domo and Pryconsa, although the successful bidder in the end was Grupo Ibosa, according to some of the candidates that have been left out of the process, speaking to El Confidencial. Both JLL, the consultancy firm advising the sales process, and Ibosa declined to comment in this regard.

The plot in question is located in the heart of Madrid, opposite the Cuban consulate, just 700 m from Paseo de la Castellana and 1km away from the Santiago Bernabéu stadium, where the supply of buildable land for sale is very scarce. In fact, the vast majority of the projects in the area are being built in renovated properties.

Five detached homes are currently being constructed on the acquired plot, with surface areas of between 300 m2 and 400 m2 each, which will have to be demolished to make way for the buyer’s future project. All indications are that a luxury apartment development will be built on the plot, which will be added to the high-end projects that Ibosa currently has underway in Valdemarín – on some plots it acquired from Blackstone – and in Aravaca, and marketing of which has just been launched.

The lack of new build product in the area and the high demand explain this pressure on prices. The development will be built in the Chamartín district, which is home to some of the most sought-after residential areas in the centre of the city, such as El Viso, where the Venezuelan investors Miguel Ángel and Áxel Capriles arrived in April last year to purchase Villa San José on Pablo Aranda 3, just opposite Florentino Pérez’s real estate bunker.

In terms of benchmark prices, one example is the 11 homes that are being built on the plots of the former headquarters of RTVE. The Ministry of Finance put that plot up for auction at the end of 2015 and it was awarded to Martell Investment for €10.8 million, which represents a repercussion price of €4,800/m2. Construction of those homes has now begun and the prices fluctuate around €7,000/m2.

Boom in prices

In just two years, the prices in the most sought-after neighbourhoods of the Spanish capital have soared by more than 20% (…).

According to a recent report from Engel & Völkers, maximum prices in this Madrilenian neighbourhood amount to €6,000/m2, although, as sources specialising in the sale of luxury homes at the agency explain, “there are no new build properties in the area, and so the final prices depend a lot on the features of each project”.

In terms of the area, like in the most trendy areas of Madrid, prices have risen sharply over the last year. According to Engel & Völkers, prices have risen by 10% since 2017, “although, at the moment, more operations are being closed than last year because there is greater access to credit, but, nevertheless, prices are barely rising”.

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

Gran Roque Capital Buys 3 Residential Plots Near The Calderón

16 October 2017 – El Confidencial

The Venezuelan Capriles family has closed another real estate operation in Madrid. Gran Roque Capital, the company controlled by Miguel Ángel Capriles and his cousin Áxel Daniel Capriles, has purchased three plots of buildable land from Prosegur just 500m from the site of the future Operación Mahou-Calderón. The Capriles family has paid around €25 million for this land, which does not require any kind of urban planning modifications, given that it is assigned for residential use according to the General Urban Planning Plan (PGOUM) for Madrid dated 1997, according to sources in the market.

The acquired land comprises three plots (measuring 592 m2, 593 m2 and 3,542 m2, respectively) spanning a combined surface area of 4,723 m2 and a buildable surface area of almost 8,800 m2. Two of the plots (the smaller ones) are vacant, but the largest one is currently occupied by a building that Gran Roque will have to demolish before it can build the new homes on the site. The land purchase operation has been advised by Knight Frank, which, nevertheless, declined to comment on the transaction.

The new residential project (…) will involve the construction of around 80 homes of different kinds, which will be sold for between €5,500/m2 and €6,000/m2, according to sources at Gran Roque, although, they emphasise that the project is still at a very embryonic phase. According to data from Idealista, the price of second-hand homes in the area stands at around €3,300/m2, however, some properties are currently on the market for between €4,000/m2 and €5,000/m2, whereby exceeding the peaks of 2007 (€3,980/m2 in the district of Arganzuela).

This operation represents an about-turn in Gran Roque’s investment strategy in the Spanish capital, where to date, it has opted for plots in prime locations and for projects involving super luxury homes. Its most recent project is in El Viso, opposite the bunker that constitutes the residence of the President of ACS, Florentino Pérez.

500m from the Calderón

This transaction is particularly important in the market given that the price paid for the land, around €2,900/m2, and the prices at which the future homes will be sold, will undoubtedly serve as a benchmark for the future sale of land in the so-called Operación Mahou-Calderón (…).

Experts in the sector consider that a price of between €1,500/m2 and €2,000/m2 would be appropriate for the area (…).

New build homes close to the Vicente Calderon are in short supply. One of the few projects underway is being led by Neinor Homes, which is constructing a 72-home residential project: Riverside homes, for €3,500/m2, a price significantly lower than the properties that Gran Roque is planning to build. Like most of the new builds currently being constructed in the capital, these homes are being targeted at middle and middle/upper-class buyers. Of the 51 homes that will comprise the future 20-storey tower, which will be 72 m tall, 49 units have already been sold.

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

E&V: 800+ Luxury Homes Were Sold In Madrid In 2016

29 March 2017 – El Economista

The luxury real estate sector seems to have been the least affected by the real estate bubble and the serious economic crisis that has hit the country over the last few years. In this sense, premium housing in Madrid has reached a historical high with the number of real estate transactions at maximum levels. During 2016, more than 800 homes costing more than €1,500,000 were sold in the capital. That represents an increase of 60% compared to the previous year.

This data has emerged from the latest report compiled by the prestigious luxury real estate agency Engel & Völkers. The report also states that house prices in Madrid have increased exponentially with respect to previous years.

According to data provided by this luxury real estate agency, in 2016, the vast majority of luxury homes in Madrid, almost 720, cost between €1.5 million and €4 million. A small percentage of the premium homes sold in the capital had a purchase price of more than €6 million. In fact, in some areas of the capital, a luxury home now costs more than €15,000/m2.

Good times for luxury homes

These are good times for luxury homes in Madrid. The current trend, according to the experts, is to construct new build properties, to the detriment of second-hand homes. Nevertheless, this increase in the number of luxury homes sold in the capital in 2016 could be explained by an increase in real estate renovations in the city’s most prestigious neighbourhoods. The high demand for homes in premium areas and the limited supply available also means that prices in certain areas of Madrid are soaring.

The Madrilenian neighbourhoods with the highest demand for luxury homes include El Viso in the Chamartín district and some neighbourhoods in the districts of Salamanca, Retiro and Centro.

In terms of new builds, developers are moving to the outskirts of the capital, given that there is no land left in the city on which to build new and exclusive developments. Boadilla del Monte, Villaviciosa de Odón, Las Rozas and Pozuelo have become the most appealing areas for the construction of exclusive new build homes.

Original story: El Economista (by María Sempere)

Translation: Carmel Drake

House Prices Rise By 10%+ In Most Exclusive Neighbourhoods

5 April 2016 – Expansión

Changing trend / Madrid and Barcelona are leading the recovery in the residential market, with house price increases of 9.2% and 7.5%, respectively during Q1 2016. The appraisal value of homes is now on the rise in every district of both cities.

(…). According to statistics from the appraisal company Tinsa, the value of residential properties increased by 1.4% during the first three months of 2016, with Barcelona and Madrid leading the charge.

The average appraisal value of (unsubsidised) homes per m2 in Barcelona amounts to €2,551/m2, which is 19% more expensive than the average in Madrid (€2,142/m2). This gap between the two cities has a simple explanation: not only have house prices been rising significantly faster in Barcelona than in Madrid, but also the Catalan capital has a higher population density than Madrid, which affects supply and demand, resulting in a higher degree of concentration. Moreover, barely any new residential properties are being constructed in Barcelona. (…).

The evolution of house prices in Madrid and Barcelona varies by neighbourhood. House prices rose in all 10 districts of the Catalan capital during Q1 2016, without exception and, for the first time, they also increased in all 21 Madrilenian districts. That has not happened since the real estate bubble burst.

The ranking

The highest price increases were concentrated in Barcelona. The two districts where average prices rose by the most were Les Corts (13.5%) and Sants-Montjuïc (12.2%). They were followed by the district of Salamanca, Madrid’s main real estate district, with an increase of 11.8%.

With an average price of €3,597/m2 and despite the heterogeneity of the neighbourhoods that comprise it, Salamanca is the district with the second highest prices of all of those analysed by Tinsa, behind only Sarrà-Sant Gervasi, which has an average price of €3,671/m2 (5.8% higher than in 2014). (…)

According to calculations from the consultancy firm Knight Frank, prices are going to rise by between 5% and 10% in prime areas in 2016, especially in five areas of the Madrilenian capital, namely Salamanca, Jerónimos, Chamberí, Justicia and El Viso. (…).

In Madrid, the most expensive districts after Salamanca are Chamberí (€3,444/m2 for subsidised homes, up by 5.4% compared with Q1 2015), Retiro (€3,270/m2, up by 4.3%), Chamartín (€3,312/m2, up by 1.7%) and the Centro, which has exceeded the €3,000/m2 threshold once again (€3,014/m2, up by 3.7%). All of the others sit below this psychological barrier, such as for example Moncloa-Aravaca (€2,793/m2 and 6.9%) and Arganzuela (€2,697/m2 and 8.5%).

The cheapest areas

The cheapest areas in Madrid are Villaverde (€1,232/m2), followed by Puente de Vallecas (€1,307/m2), Usera (€1,398/m2) and Carabanchel (€1,531/m2).

Average house prices will increase significantly in the Madrilenian capital during 2016, according to predictions by real estate analysts.

In Barcelona, Nou Barris is the district where house prices are lowest (€1,752/m2), followed by Horta Guinardó (€2,007/m2) and Sant Andreu (€2,105/m2). They are the only three places in Barcelona where prices are lower than the average price in Madrid (€2,142/m2), however, as is always the case in a market as fragmented as the housing sector, each area has its own micro-market. (…).

In any case, the forecasts are promising, in general terms. “In terms of both the number of transactions and prices, there has been a certain rebound effect following the collapse of the market that had not been seen for many decades. Now we need to wait for the stabilisation of the market, for similar data to that seen last year”, says Jorge Ripoll, Director of Research Services at Tinsa.

For the upwards trend to be maintained, the growth forecasts must be met and the labour market must improve. The other factors are already working on autopilot, at least in Madrid and Barcelona.

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Spain property: Madrid waits for the signal to ‘go’

27 April 2015 – Financial Times

Is the influx of Latin American buyers a sign the capital has turned a corner?

Over the past decade and a half, making even a modest investment in Madrid’s housing market has been a bit like taking a rollercoaster ride. Since the market reached its peak in early 2008, average house prices in Spain have dropped by 35 to 40 per cent, according to a report issued in March by the Spanish Savings Banks Foundation, known by its acronym Funcas. New developments on the outskirts of Madrid have been some of the hardest hit.

Other figures suggest an even greater drop in values: also in March, the Spanish property portal Fotocasa.es calculated that the average home in Spain has lost 45 per cent of its value since the peak of the Spanish housing boom, with values in Madrid (a 44.6 per cent drop) representative, more or less, of Spain as a whole.

But both Funcas and Fotocasa.es report glimmers of light at the end of the tunnel: Fotocasa.es recorded a 1 per cent increase in home prices in Madrid in February, while Funcas says that the Spanish housing market is now in an “incipient, gradual recovery”.

As in Barcelona and the Balearic Islands, where small price rises have also been recorded in recent months, overseas buyers are helping to create a mild sense of optimism.

In Madrid, the most enthusiastic foreign homebuyers are heading from across the Atlantic, rather than Europe, according to Alberto Costillo, prime residential director at Knight Frank Spain. A “perfect storm” is bringing a new wave of wealthy Latin American house-hunters to Madrid, particularly from Mexico, Colombia and Venezuela.

“Madrid has advantages of culture and language, and Latin American buyers have long thought of Madrid as a safe haven. But with an improving Spanish economy, and the recent fall in the value of the euro [Latin Americans are more likely to have savings in dollars than euros], they see now see a real opportunity here,” says Costillo.

With its pretty boating lake and rows of statues, many wealthy foreign buyers look to purchase property near the city’s celebrated Retiro Park.

In the grid-like Salamanca district adjacent to Retiro Park, Knight Frank is selling a three-bedroom, two-bathroom apartment with 187 sq metres of living space, parquet floors and air conditioning in a building dating from the early 20th century for €1.47m.

In the well-heeled neighbourhood of El Viso, part of the Chamartín district north of the city centre, a 402 sq metre duplex apartment with four en suite bedrooms and a txoko — a combined cooking and dining space more commonly found in homes in the Basque Country — has an asking price of €4m. On sale through the agency Rimontgó, the unit has three parking spaces and the building has a pool and a gym for residents’ use.

“[El Viso is] quiet and exclusive, but also well-connected with the rest of the city and within easy reach of the downtown,” says José Ribes, director-general of the agency handling the sale. “This is a part of town most associated with aristocrats and intellectuals, but in recent years it has attracted people working in the financial sector, politicians and sportsmen.”

Salamanca and Chamartín are home to many of Madrid’s best restaurants. The capital has 12 Michelin-starred restaurants, compared with 23 in Barcelona. But Madrid is the only one of the two cities with a three-star restaurant — David Muñoz’s DiverXO, where dishes are called “canvases” and diners are asked to arrive “with an open mind”.

Central districts of Madrid are densely populated, but some of the city’s satellite communities, particularly to the northwest, offer more leg room for buyers. In Pozuelo de Alarcón, nestling among pine trees and benefiting from cool breezes from the nearby Sierra de Guadarrama mountains, a gated housing estate called La Finca is home to some of the capital’s wealthiest residents, including footballers from Real Madrid such as Cristiano Ronaldo.

Typical of the sprawling, cubist-style homes at La Finca is a five-bedroom, seven-bathroom house with almost 2,000 sq metres of living space. The property has a two-bedroom housekeeper’s apartment, a lift, indoor and outdoor pools, a gym, a sauna, a cinema, a wine cellar and a carport for six vehicles. On sale through La Finca Real Estate for €11m, the house stands on a plot of just over a hectare. However, according to one estate agent who prefers to remain anonymous, potential buyers are sometimes put off La Finca “because of its reputation as a playground for soccer stars”.

On Calle de Serrano, a broad, tree-lined avenue in the Salamanca district which is sometimes referred to as Madrid’s golden mile for its high-end shopping, there are few signs of the economic downturn, dubbed la crisis in Spain. However, the recession has hit some of the city’s public infrastructure.

Guillermo Bernardo, a former banker with two young daughters who now runs his own cabinet-making business, points to cutbacks in the maintenance of neighbourhood parks and gardens. “The Retiro is Madrid’s calling card, and it’s immaculate, but there is less money these days to clean and repair local playgrounds,” he says. “The perception that most people have is that the state of the economy hasn’t changed a lot but we may be about to turn a corner. Nothing is forever, not even la crisis”.

Buying guide

● Buyers should budget 6 per cent of the sale price to cover land registry taxes

● Estate agents typically charge vendors a commission of 3 to 5 per cent

● Madrid has the third largest metropolitan area in the EU by population size

● Units in a building without a lift are unpopular and may be difficult to resell

● Madrid has hot, dry summers and cool, usually sunny, winters

● Violent crime is rare but pickpocketing and bag snatching can be a problem

What you can buy for . . .

€500,000 A modern, 90 sq metre flat with two bedrooms in the Chamartín district of Madrid

€1m A 140 sq metre, three-bedroom apartment in the Salamanca district, within walking distance of Retiro Park

€5m A seven-bedroom house in El Viso with an outdoor pool on a plot measuring 1,000 sq metres

Original story: Financial Times (by Nick Foster)

Edited by: Carmel Drake