Bankia Prepares €1bn Toxic Asset Sale to Digest BMN’s Real Estate

17 May 2018 – Voz Pópuli

Bankia is working on one of its largest divestments since José Ignacio Goirigolzarri took charge of the group. The nationalised entity is assessing the sale of a portfolio of problem assets worth €1 billion, the largest since 2015, according to financial sources consulted by Voz Pópuli.

The bank’s teams have not defined the exact perimeter of the portfolio yet nor have they prepared the sales documentation together with an advisor. Nevertheless, the plan is that the project will come onto the market in the summer and be closed during the final quarter of the year.

The portfolio will contain flats and real estate loans inherited from Bankia’s former savings banks as well as from BMN, the group that it merged with at the end of last year. The increase in the size of the portfolio with respect to previous years is precisely due to the integration of the group chaired by Carlos Egea, which contributed €4.4 billion in toxic assets to Bankia’s existing €12.8 billion portfolio.

Strategic objective

In the strategic plan, announced at the beginning of the year, Goirigolzarri stressed the objective of reducing its exposure to problem assets by almost €3 billion from €17.2 billion at the end of 2017. During the first quarter, it managed to clean up €600 million. That rhythm, together with the portfolio that it is working on, would enable it to meet the objective in 2018.

For the time being, Bankia is not working on any multi-million euro operations, such as the ones closed last year by Santander and BBVA, and the one that Banco Sabadell is currently exploring.

By contrast, Bankia is placing portfolios of between €200 million and €500 million on the market to maximise the return that it obtains for its shareholders.

In this vein, it has Project Beetle underway, containing €400 million in problem loans, and it recently put Project Vera on the market, comprising €250 million in non-performing loans. Moreover, it has sold a portfolio worth €300 million to the fund GoldenTree Asset Management, according to El Independiente.

Original story: Voz Pópuli (by Jorge Zuloaga)

Translation: Carmel Drake

Palma de Mallorca to Ban All Tourist Apartments From July

24 April 2018 – El País

From July onwards, homeowners in Palma, on the Balearic Island of Mallorca, will not be allowed to rent out their apartments to tourists. The capital of the popular Mediterranean destination has adopted a pioneering measure, which will see the definitive prohibition of tourist flats right across the city. The local government team – a leftist alliance between the Socialist Party (PSOE), the local group Més per Mallorca and the anti-austerity Podemos – has taken this decision after commissioning several studies on the matter, which revealed that the supply of unlicensed tourist flats increased by 50% between 2015 and 2017 to reach 20,000 beds across the city. In Palma, which is Spain’s eighth-largest city by population, only 645 properties used for short-term vacation rentals have proper licenses.

The government team will approve initial holiday rental zoning plans at a meeting on Thursday, which will then be subjected to public scrutiny before being put to a final vote at a council session in July. At that point, tourists seeking this kind of accommodation will no longer be allowed to rent apartments in multi-family residential housing. Instead, they will only be able to stay in detached, single-family homes, which are being left outside the ban. Yet even these properties will be off limits if they are located on protected rural land, near the airport, or in non-residential areas such as industrial estates.

The move follows a reform of tourism legislation by the regional parliament of the Balearic Islands in August last year. That reform banned vacation rentals in apartments but left it up to local authorities to decide which neighbourhoods to apply it in. In the end, the city of Palma has decided to consider the entire municipality a “single zone” and so the ban will apply in all parts of town. The decision is meant “to protect residents,” said mayor Antoni Noguera.

Studies commissioned by city officials show that 48% of tourist apartments are offered for seven to eight months of the year, meaning they are not available for long-term residential rentals. “There is a parallel between the evolution of vacation rentals and the rise in rental prices,” said José Hila, the local chief of city planning. Rent in Palma has soared by 40% in recent years, making it the second most expensive Spanish city after Barcelona for residents who rent.

“Tourist accommodation affects the makeup of buildings and neighbourhoods, and it also affects social harmony,” said Hila. A report by the Citizen Ombudsman’s Office shows a rise in the number of complaints filed by residents due to problems with tourists who use these apartments, typically related to noise. There were 42 complaints in 2014 and 192 in 2017.

Pioneering initiative

Mayor Noguera is convinced that this measure, which is pioneering in Spain, will set the standard to be followed by other cities. “Palma is a bold and decisive city. We have agreed this on the basis of the general interest, and we believe that it will create a trend in other cities when they see that finding a balance is key.” said the mayor. “All European cities are being transformed from one day to the next by this type of offer,” said planning chief Hila.

Currently, in the Balearic capital, there is a supply of around 11,000 tourist rental beds, of which 645 have licences, all for family homes. Before the new regional legislation was approved in August, the number of beds amounted to 20,000 but the high fines established by the law – of up to €400,000 – led to the withdrawal of adverts from users of many of the large platforms (…).

Original story: El País (by Lucía Bohórquez)

Translation: Carmel Drake

British Fund Behind Purchase of Benidorm’s Kronos Building for €20M

21 March 2018 – Alicante Plaza

A British fund is behind the purchase of most of the apartments in the Kronos building in Benidorm. According to local sources, of the more than 150 homes that are owned by Sareb, 136 are going to be taken over by a British fund. The operation is worth more than €20 million and just needs to be signed, something that should happen within the coming days.

As Alicante Plaza published on Tuesday, the so-called “bad bank” has managed to sell the properties that it owned in the city’s skyscraper in just one year. Around 20 homes have been sold to individuals, whilst the remainder will end up in the hands of a British fund.

But that is not the full story. It would seem that, at the end of last year, Sareb sold the storerooms and garages that it also owned in the building, the fifth highest skyscraper in Benidorm, and one of the tallest in Spain.

The tower has 41 storeys and was conceived as a luxury residential property: the structure occupies less than 20% of the plot. The remainder is used for common areas and recreation with two swimming pools, one for adults and one for children, a gym, a football pitch, padel and tennis courts, as well as extensive green areas.

The building was constructed by the Valencian property developer Grupo García Ojeda in 2005, and the keys were handed over three years later. But the crisis hit the sale of the apartments and ten years later almost all of the flats were still on the market

In this way, Sareb is getting rid of one of the skyscrapers that was hit the hardest by the “bursting” of the real estate bubble. It is worth remembering that Sareb rescued nine savings banks, including properties and loans to property developers. The latter was an operation that saw the skyscraper awarded to the “bad bank, whose debt used to belong to one of the companies owned by Grupo García Ojeda. Kronos has more than one link to Valencia, given that it was designed by the architecture firm MAPRC, which is also from that city.

Original story: Alicante Plaza (by Alba Mercader)

Translation: Carmel Drake

Optimum III Acquires Residential Building in Terrassa for €1.5M

29 January 2018 – Eje Prime

The Socimi Optimum III is starting 2018 in the same way that it finished 2017: by going shopping. The Catalan company has purchased a package of assets comprising 17 homes and 31 parking spaces in Terrassa, a town on the outskirts of Barcelona, according to a report filed by the listed company with the Alternative Investment Market (MAB).

This latest purchase follows those undertaken by the Socimi in recent weeks in both the Catalan capital and Madrid. It has acquired a residential building in Hospitalet de Llobregat, and an office building in the centre of the Spanish capital.

The Socimi’s newest asset spans 1,497 m2 and, besides the 17 homes, contains two storerooms. The company, controlled by BMB Investment Management and Bluemountain, has reported that 100% of the apartments are already occupied, mainly on a rental basis (…).

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Notaries: House Sales Rose by 10.1% in November but House Prices Fell by 0.9%

9 January 2018 – Eje Prime

The positive steps that the housing sector in Spain took in 2017 are continuing. That is according to data from the General Council of Notaries relating to November 2017, when 46,722 transactions were signed, up by 10.1% compared to the same period in 2016.

Nevertheless, the residential sector was hit by a slight decrease in value, with a decrease of 0.9% in house prices, taking the average price per square metre of properties acquired in Spain during November to €1,288/m2. According to the College of Notaries, this decrease in house prices was driven by a reduction in the price of family homes, which suffered a decrease of 1.3%, and flats, whose prices fell by 0.1%.

In terms of the different types of homes, private flats saw a YoY volume increase of 8.9%, with a notable expansion in the number of new build homes (9.5% more) and also in the number of second-hand homes (8.9% more). Despite that, the property segment that grew by the most was family homes, with an increase of 13.7% with respect to November 2016.

Meanwhile, the number of mortgages also grew during the penultimate month of 2017. Loans to buy homes increased by 0.6%, with 28,834 mortgage applications and an average mortgage loan of €169,163.

Original story: Eje Prime

Translation: Carmel Drake

Abandoned Block Of 44 Flats In Silleda Left Uninhabitable

13 June 2017 – La Voz de Galicia

Silleda experienced the real estate boom with vigour. And so, what came next had equally dramatic consequences. Some of the effects are still being suffered by those who invested in and acquired flats in inhabitable skeletons and others are still being felt by society as a whole, because many of the real estate assets became economically harmful and, following bankruptcies and repossessions, ended up in the hands of Sareb (…), whose share capital is split between private and public ownership (55%: 45%).

In Silleda and Lalín, Sareb has around twenty flats for sale. But the toxic asset bank owns a lot more properties around the country that affect all of Spain’s citizens. (…) Silleda also has some significant examples of economic decline, although one stands out in particular: a block of 44 flats, located just a few hundred metres from O Castro on Avenida de la Estación.

The crisis left that building high and dry, even though its construction was almost finished by the time the bubble burst. As a reminder of the past, a sign still hangs on the ground floor, “Obras Técnicas de Galicia SL, Obratec, a company created in Silleda in 2003, constructs, develops and sells homes”.

The property has four floors, a ground floor and basement, with its corresponding 44 parking spaces. Outside, the block is clearly uninhabited, but it gives few indications of what really lies inside and fewer still of the real estate loss resulting from five years of abandonment (…).

The building has a stunning interior courtyard, like a typical Spanish tenement building, a residential structure that promotes community life. It has circular corridors on each of the four floors linking the doors of all of the flats, which have two or three bedrooms, two bathrooms, a lounge, a kitchen…But now this is squatter territory, and even the squatters only visit to dismantle things, add graffiti or make temporary use of the facilities. There are also pigeons and other beings that typically colonise anything left to rot by man.

The building was almost finished, some of the flats had been sold and with individual investments at the time, now it is collapsing amongst its own paint and plaster (…) with the help of the actions of predators who took all of the electrical equipment and other items of value.

From the outside, it has a certain presence, but inside, it is a cesspit with a side entrance in the garage that has been forced open and notches from attempts to enter the rickety front door (…). Its recovery still seems possible. But, as the days go by, its state means that it may soon only be worth demolishing (…).

Original story: La Voz de Galicia (by P. V.)

Translation: Carmel Drake

Notaries: 48,695 Homes Were Sold In March, Up By 19.5% YoY

23 May 2017 – Aquimicasa.net

According to the notaries, March was a great month for the real estate sector. Despite the scare in February, sales of flats and houses rose by 19.5% in March, to reach 48,695 operations. But, since it can’t be all good news, it is worth noting the statistics published by the General Council of Notaries last Monday, which reveal that the average price of operations decreased by 1.3%.

Our analysis of the data published by the notaries shows that by type of home, flat sales recorded a YoY rise of 20.5% and sales of private (unsubsidised) properties rose by 21.9%. But, as has been happening for years, this increase in the number of private flat transactions was due, exclusively, to an increase in sales of second-hand flats, which rose by 26%, given that sales of new build homes continued their downwards trend, decreasing by 11.5%. Meanwhile, sales of houses and chalets saw a YoY increase of 15.6%.

If we look at the prices achieved, we see that the average price per square metre of the homes purchased in March stood at €1,277, which represents a decrease of 1.3% with respect to the same month last year. According to the notaries’ statistics, the decrease in the price per square metre of homes is due to a reduction in the price per square metre of houses and chalets (-6.2%), given that the price of flats did not vary in March.

Meanwhile, there was a slight increase in the average price per square metre of private (unsubsidised) flats, which rose by 0.3%, split between an increase of 0.8% in the price of second-hand flats and a decrease of -0.6% in the price of new build homes.

The sale of other types of properties saw 11,753 operations closed, which represents an increase of 15.2% compared to the same month last year. 39.7% of those transactions corresponded to plots of land. And despite the rumours of an increase in the price of land, that trend must be happening in specific areas only, given that the average price per square metre amounted to €155, representing a decrease of 10.4% YoY.

Finally, if we look at mortgages, during the month of March, they experienced YoY growth of 5.1%, to reach 32,070 operations, for an average amount of €156,229, in other words, a decrease of 3.4%. Meanwhile, mortgage loans granted for the acquisition of a property increased by 16.8% YoY, to a total of 23,542 contracts. Other mortgages included those used to build a home or to finance business activities.

Original story: Aquimicasa.net

Translation: Carmel Drake

Núñez i Navarro Invests €45M To Build 166 New Homes

3 May 2017 – Expansión

Núñez I Navarro (NiN) has started its largest real estate development since before the crisis. The development in question is known as the Nou Can Gambús urbanisation, close to Sabadell (Barcelona), and its first phase has a surface area of 23,336 m2. The company is planning to construct 66 family homes and four residential blocks containing 100 flats in total.

During this first phase, the company will spend €45 million, excluding the price of the plots of land. The company, which is owned by the family of FC Barcelona’s former president, Josep Lluís Núñez, acquired the estate years ago in a deal completed in equal part with Anova. During the recession, the property developer took ownership of 100% of the site.

Several months ago, NiN completed the construction of the first row of homes, comprising eight houses, and it has already agreed their sale or rental. Now, NiN has started to build the second row of houses, comprising 16 units in total. The deadline for their completion is the second quarter 2018. The property developer expects to begin construction of the first two residential blocks around that date.

Low level of debt

NiN is one of the largest Catalan property developers and also one of the entities that is best avoiding the economic crisis thanks to its very restrictive indebtedness policy, with debt amounting to zero in the case of some of its developments. The property developer has strengthened its refurbishment business, although it has not stopped building at any time.

The main business of the family company is the real estate sector, comprising homes, commercial premises, warehouses and offices. Its area of influence is Barcelona, although its presence extends across the whole of Cataluña. It also has some parking and hotel businesses.

The market for new homes in the autonomous region is recovering, although more slowly than the sector had expected. The Association of Property Developers of Cataluña (APCE) states that last year construction of 8,313 homes was started. That figure represents a 34% increase compared to 2015 but is 18% lower than the 10,000 new homes that were planned.

Original story: Expansión (Gabriel Trindade)

Translation: Carmel Drake

Notaries: House Prices, Sales & Mortgages All Rose In Feb

26 April 2017 – Idealista

February was a good month for the residential market. House sales rose by 9.9% YoY to reach 38,176 units, whilst house prices increased by 2.5% YoY, to €1,305/m2. The granting of mortgages also increased, by 2.5% YoY, to amount to 16,337 new loans, according to figures published by the General Council of Notaries.

By type of home, flat sales recorded a YoY increase of 11.2% (11.9% in the series corrected for seasonality) and sales of free (private) housing rose by 12.9%. This increase in the number of transactions involving private homes was due, exclusively, to growth in the sale of second-hand homes (14.5%), given that the sale of new flats decreased by 1.7% YoY. Meanwhile, the sale of family homes rose by 5.1% YoY.

In terms of prices, the cost per square metre of homes purchased in February amounted to €1,305, whereby reflecting a YoY increase of 2.5%. That increase was due to an increase in the price of flats (2.6%), as well as a rise in the price of family homes (1.9% YoY).

Meanwhile, the price per square metre of free (private) flats rose by 2.3%. Of those, the price per m2 of second-hand homes amounted to €1,426/m2 (up by 2.0% YoY) and of new homes stood at €1,809/m2, reflecting a YoY increase of 8.7%.

Finally, the percentage of house purchases financed using a mortgage loan amounted to 42.8%. Moreover, for these types of purchases (with financing), the loan amount represented 77.4% of the property value, on average.

Original story: Idealista 

Translation: Carmel Drake

Albirana: New Rental Housing Socimi Will Debut On MAB On 22 March

21 March 2017 – Expansión

Albirana, the rental housing Socimi controlled by investment funds advised by Blackstone, will start to trade on the Alternative Investment Market (MAB) on 22 March at €33.60 per share, a price that values the company at €168 million, according to the BME.

The company, in turn, owns three Socimi subsidiaries that manage a portfolio of 5,004 properties – mainly homes for rent – located primarily in Madrid and Barcelona.

They also have properties for rent in other cities such as Tarragona, Valencia, Girona, Zaragoza, Logroño, Vitoria, Mérida and Cuenca.

The assets have a combined surface area of around 400,000 m2 and 68% of them are currently leased out, according to sources at Anticipa, which will be responsible for managing the Socimi. In fact, Anticipa already manages the three subsidiaries that comprise Albirana, given that it handles Blackstone’s investments in Spain.

Specifically, Albirana controls the Socimi Budmac Investment, which channels 3,039 homes for rent in the province of Barcelona, as well as Lambeo Investment, which owns 377 flats in Madrid, and Treaman Investment, which manages the 1,588 homes across the rest of the country.

Strategy

The company’s strategy focuses on managing this portfolio of homes to “maximise returns for shareholders”, however, it is “open to analysing any possible investment or divestment opportunities in the market”, according to information provided in its IPO leaflet.

Albirana is chaired by Anticipa in the form of its CEO since 2014, Eduardo Mendiluce Fradera, a professional with more than twenty years of experience in the real estate and financial sectors.

Mendiluce also chairs Esade Alumni Inmobiliario and is a member of theExecutive Committee at the Urban Land Institute in Barcelona.

The new Socimi is the thirty-second entity of its kind to debut on the MAB, where it will trade under the ticker ‘YAPS’. Its shares will be traded through the price fixing system.

Original story: Expansión

Translation: Carmel Drake