Habitat Debuts in A Coruña with a €19M Investment in a 96-Home Development

16 January 2019 – Eje Prime

Habitat has arrived in Galicia. The property developer is making its debut in the region with a development comprising 96 homes in A Coruña and an investment of €19 million, according to reports made by the company to EjePrime.

The company has acquired a plot of land with a buildable surface area of 10,500 m2, on which it is going to build a seventeen-storey tower. The marketing of the homes, located on Calle Aurelio Aguirre Galarraga, in the San Vicente de Elviña neighbourhood, will start during the first quarter of this year.

“With the start of this new project in A Coruña, Habitat has launched itself in Galicia, an area with a high degree of urban development and which has enormous potential for growth over the coming years”, as highlighted by José Carlos Saz, the CEO of the company.

This latest acquisition forms part of Habitat’s business strategy, which will involve an investment of €500 million by 2021. The company’s plans involve constructing new developments with the objective of delivering more than 2,000 homes per year from 2021.

Original story: Eje Prime 

Translation: Carmel Drake

Pelayo Capital to Create a New Breogán Park with an Investment of >€60M

15 January 2019 – Eje Prime

Pelayo Capital is throwing itself into the Spanish retail sector during its second year of life. The Galician family office, which is currently working on the conversion of the Dolce Vita shopping centre in A Coruña into a retail park, is planning to replicate the project in other Spanish cities with an investment of more than €90 million, according to Íñigo Veiga, CEO of the company, speaking to EjePrime.

Similarly, the group wants to add high street stores to its portfolio of assets during the course of this year. In this sense, Pelayo Capital is on the hunt for properties located in Madrid, Galicia and Asturias, in particular, in which it plans to invest at least €1 million. “We are not ruling out other cities either, given that our strategy involves working hand in hand with retailers”, said the director.

Breogán Park is the company’s star project, an asset in which the company is going to invest €60 million and which will be inaugurated in the spring of 2021. It is the first project undertaken in Spain to involve the demolition and conversion of a shopping centre into a retail park. “The initiative that takes advantage of the demand for these types of assets in many cities around the country”, said the executive.

The surface area, spanning 45,000 m2, will have 2,500 parking spaces and used to house the Dolce Vita shopping complex until 2014. “It is a great opportunity to build a retail park in A Coruña; we are not going to find any others because there is no land available in the city on which to build a retail park of this size”, explained Veiga.

Pelayo Capital is looking for ways to handle the maturity of shopping centres and the boom in e-commerce in Spain by committing itself to retail parks and commercial premises located on the most prime streets. For this reason, the company has just purchased its first asset at number 103 Calle Hermosilla in Madrid, revealed the director.

“We do not have an investment objective or commitment, because we believe that pressure can lead to errors”, explained Veiga. Saddled between Galicia and Madrid, Pelayo Capital has the support of investors with different profiles and is not averse to the idea of backing the logistics or residential markets in the long term.

The company was created in 2017 hand in hand with Breogán Park, a project that launched it into the midst of the Spanish real estate sector. Although it is also working on the rehabilitation of a residential building in A Coruña, Pelayo Capital has placed its focus on retail and for that reason, it has hired Luis Íñiguez, former director of JLL’s retail division in Spain, as senior advisor to the company.

Original story: Eje Prime (by Berta Seijo)

Translation: Carmel Drake

Inditex Caused the Ministry of Development’s Results to Soar in Galicia in 2017

13 November 2018 – Economía Digital

Inditex purchased more square metres of land from the Ministry of Development’s land manager than the Xunta sells in one year. In a single transaction, the company owned by Amancio Ortega acquired 218,000 m2 of land last year spread over 26 plots on the A Laracha industrial estate (A Coruña) from the company Suelo Empresarial del Atlántico, controlled by the department led by José Luis Ábalos.

The implementation of the multinational’s new logistics hub to complement the group’s central complex in Arteixo, multiplied the revenues and profits of the Ministry of Development’s land manager, which has 13 industrial estates up for sale in Galicia, but which faces serious difficulties when it comes to selling the plots unless it offers them  significant discounts.

The Inditex effect: revenues multiplied by six

Last year, Suelo Empresarial del Atlántico multiplied its revenues by six, up from €2.5 million in 2016 to €15.7 million in 2017. Of that amount, €13.4 million proceeded from the plots sold in A Laracha, the industrial estate chosen by Inditex. The remainder (€1.1 million) was invoiced in Rianxo or was received through subsidies to the business parks of Cee, Muros, Vimianzo and Rianxo itself, given that the entity is a recipient of European funds.

The dependence on a single operation in 2017, the one involving Inditex, shows the difficulties faced when it comes to finding companies to set up shop in Galicia, both for the property developer of the Xunta, which in just two years since its creation has sold 200,000 m2, as well as for the Suelo Empresarial del Atlántico, formerly Plan Galicia promoted by José María Aznar in 2003 to compensate the Prestige disaster.

The purchases by the textile giant also caused the profits of the land manager to soar, up from €53,554 to €444,500, an eight-fold rise. Suelo Empresarial del Atlántico is owned by the Xunta (15%) and by Abanca (1.6%), although the bulk of its share capital, more than 83%, is in the hands of the Ministry of Development through the Public Land Management Company (‘Entidad Pública Empresarial de Suelo’ or Sepes) (…).

Original story: Economía Digital (by Rubén Rodríguez)

Translation: Carmel Drake

Goodbye to Galicia’s Concrete Blocks

29 August 2018

The Galician Regional Executive is imposing more orderly and aesthetic urbanism to municipalities without urban planning rules. The government is prioritizing the adaptation of new buildings to the environment and to traditional construction.

The wide range of municipalities with no urban planning, 215 of a total of 313, which had been governed by minimum standards dating to 1991 and which are already obsolete – three land laws have been approved since then -, will henceforth be subjected to a basic urban planning corpus, that sets outs more orderly urbanism and aesthetic rules. The new rules regulate everything from the appearance of canopies and roofing to the walls that surround farms. The Basic Regional Plan, which was published on Monday in the DOG, but will come into force in a few weeks when it is published in the four provincial bulletins, has a more protectionist bent for non-urbanized spaces and will be mandatory for those countries that lack their own planning. “Determinations of Basic Regional Plan will be binding on any municipalities that lack a general plan for municipal ordination, until they are endowed with such,” the text assures, incorporating the urbanistic and planning guidelines of the territory as approved in the last years by the Regional Executive, especially the Lei do Solo (Land Law) and its regulatory development, both approved in 2016.

Municipalities with less than 5,000 inhabitants may delegate their planning. The Basic Regional Plan, besides being the immediate legal framework for any municipalities lacking planning, will be the template on which the basic municipal plans should be elaborated, and include some urgent urban planning instruments that the Regional Executive will elaborate for those municipalities that ask for it expressly, delegating this function to the Regional Government. The Regional Executive thus assumes the important task of assisting the municipalities that lack the means to elaborate their own urban planning, delimiting the rural centres, the consolidated urban land and the rural version. However, in those municipalities that have a General Plan for Municipal Ordination (PXOM), the basic plan will have a complementary nature. In other words, it will fill the gaps in municipal planning without modifying land classification.

Standards for buildings

The buildings must be convergent and “with constructive aesthetic solutions.” The “anything goes” phase is over. Both the materials and the colours used in houses must be adapted to the environment and houses must be adorned “with characteristic features”, as well as ethnographic elements of interest such as balconies or galleries. Buildings must employ “constructive aesthetic solutions”, according to the rules of the Lei do Solo, “without major transformations or negative alterations”. In other words, the displacement of earth is limited.

Walls and Canopies

Goodbye to concrete blocks. The elements that close off farms must also be in harmony with the existing structure in the area. Opaque materials are limited to 1.5 meters. From there, vegetal or metallic elements must be used. The traditional walls – those of stone, for example – should be preserved and any new ones should be inspired by them. If the walls are built using new techniques, they must be justified. “The use of cement blocks or factory materials is prohibited unless they are duly covered and painted.”

The canopies and roofs of any houses should be adapted to the predominant style of each geographical area (roofing with slate or tile, for example). The use of corrugated sheet metal without covering is prohibited.

Facades

Integrated into the surrounding environment and with walls treated as facades. The facades must also be adapted to the characteristic construction of their surroundings. The walls should be treated as if they were facades, to avoid the terrible visual effect that occurs in many Galician towns. Service networks should preferably be placed underground. Thus, electric power lines must avoid “a strong visual impact” to avoid a mishmash of wiring. The buildings that are not in agreement with this directive will be able to do conservation works, without worsening their lack of compliance.

Height

Between 10 and 7 meters. In consolidated urban lands, one-floor houses cannot exceed 7 meters, while those with two floors should be limited to 10. In rural areas, the height may not exceed 7 meters.

Rural centres

The dwellings must be “completely” finished. Exposed brick or unpainted homes are prohibited. Detached or paired single-family homes are allowed. Only one dwelling is allowed per plot, and the occupation of the land may not exceed 50% of the net plot. Farms must have a minimum area of 300 square meters. The buildings must adhere to the constructive solutions provided for in the Lei do Solo. The typology of the constructions and the materials and colours used should not only be integrated into the environment, but all of their elements must be completely finished. “Exposed partitions are explicitly prohibited, as is the use of other materials without covering or painting.”

Town councils with problems approving their planning

Approvals for urban planning can be complicated, especially when there are platforms or individuals that successfully take legal action. This is the case of two Ourense towns. In the case of Verín, a year and a half ago, the Supreme Court vetoed its urban planning after a complaint by an individual. Curiously, the urban development document approved in 2012, was the second annulled by the court. In Monterrei, the document was also annulled by the Spanish high court. Both municipalities had been elaborating urban development plans for months. Something very similar has happened in the municipality of Abegondo, in the province of A Coruña.

In Cambre, the local government determined the redrafting of the PXOM in 2010, but the breach of the contract and errors of the packaging of the documentation made the current local government rescind the contract at the end of 2017 and reconvene a new tender. Regarding Noia, the plan was approved definitively a couple of years ago but was sent back by the Regional Executive. This was due to the lack of a hydrographic report that guaranteed the population’s water supply, among others. Meanwhile, Rianxo had already received approval, but during the elaboration process, the Lei do Solo changed and it was necessary to readjust it. In Carnota and Mazaricos they have also been trying to approve the plan for years.

Several municipalities on the Costa da Morte have been awaiting approval of the PXOM for years, without success. Sometimes, it is for judicial reasons, since the TSXG has just cancelled the initial planning of Muxía because it was not submitted for a strategic environmental assessment. Other municipalities lack rules for many reasons: lack of agreements, differences of opinion with the Regional Executive, lack of political will, changes in government… Although in different phases, Cee, Cerceda, Corcubión, Dumbría, Fisterra, Malpica and Vimianzo are still pending.

In Celanova, a PXOM approved in 1995 is in force. In 2008, the drafting of the revision was awarded to a company that was absorbed by a Chinese multinational that broke away from the planning division.

Original Story: La Voz de Galicia – Pablo González

Photo: Merce Ares

Translation: Richard Turner

 

Galicia Awards 1.1 million m2 of Industrial Land Supported by Aid from La Xunta

6 June 2018 – Eje Prime

La Xunta is promoting the sale of industrial land and Galicia is whereby reaching pre-crisis occupancy levels in the logistics sector. In total, 1.1 million m2 of logistics land has been awarded in the autonomous region, which represents almost 40% of the total available land for sale in 2015.

Amongst the measures adopted by La Xunta in 2018 include the elimination of regional taxes for the purchase of industrial land from the administration, with a 100% deduction of the Property Transfer Tax and Documented Legal Act Tax, according to Inmodiario.

The intention of the territorial government is, in addition to promoting the entry of new players into Galicia, facilitate the reactivation of disused industrial plots. In those cases, La Xunta adds discounts to the land prices of between 30% and 50%.

The Councillor for Infrastructure and Housing at La Xunta, Ethel Vázquez, anticipates that 2018 “will continue along the same path”. Not in vain, her portfolio has received a significant increase in budgeted aid, of 16.5%, achieving an additional €60 million taking the total fund to €424 million.

Original story: Eje Prime

Translation: Carmel Drake

Viqueira Buys Plot in Vigo on which to Build 130 Homes

20 March 2018 – Inmodiario

Viqueira has recently acquired a plot for the construction of 130 homes in PERI IV-09, known as “Baixada de San Roque”. The surface area of the plot measures 1,508 m2 and a 10-storey tower, comprising 2-, 3- and 4-bedroom homes, is going to be built on the site.

Specifically, the plot is located on Rúa Morcego, in a new urbanisation that has been completed and approved by the Town Hall, and which has green space alongside it.

This new acquisition by the company forms part of its strategic plan for 2015-2020 through which Viqueira is planning a number of investments in Galicia and the Canary Islands, and which represents the start of the most important residential real estate project in Vigo.

It is not the first time that Viqueira has carried out a residential project in the San Roque area, in fact, the Vigo-based construction company has built more than 400 homes in the region, the most recent and iconic of which was the “Plaza de las Palmeras” project, undertaken by the company in the 1990s.

The company is already working on the building plans and hopes to be in possession of the construction licence by the end of the summer when it expects to start marketing the development (…).

Original story: Inmodiario

Translation: Carmel Drake

First 100,000 m2 Of Land at Vigo’s new Logistics Platform Will Be Sold for €50/m2

28 November 2017 – Inmodiario

The councillor for Infrastructure and Housing at the Xunta de Galicia, Ethel Vázquez, has attended a meeting held by the Commission for the Monitoring of the Industrial Logistics Platform in Salvaterra-As Neves (PLISAN), where it was agreed that the tender to sell the plots contained therein should be convened before the end of the year. An incentive will be offered to entice buyers: the first 100,000 m2 of land will be sold at a discounted price of €50/m2.

At the meeting, which was also attended by other representatives from the Xunta, as well as from the Port Authority and the Free Trade Zone Consortium of Vigo, it was also agreed that the companies that sign up to PLISAN will be able to access the land with surface rights equal to the conditions applied to parks by the Xunta. They are awarded for 30 years, extendable for another 30 years, with an annual fee of 1.5% of the sales price during the first 2 years, and the option to request an initial 1-year grace period; then, 2.5% during the next 2 years; and 3.5% from the fifth year onwards.

Moreover, the attendees at the meeting agreed to start the creation of a management company for the future maintenance of the facilities at the logistics platform. Vázquez Mourelle said that in terms of work, the construction of the general systems has now been completed.

The councillor specified that the activity, which required investment of €11 million, involved the construction of the roads, lighting and pipework necessary for the supply, sanitation, electricity, gas and telecommunications systems, which will serve all of the companies that set up shop on the plots in the PLISAN area.

In terms of the construction of the sewage treatment plant, the plans and construction were awarded together, for a combined amount of more than €3 million. The plans are now being drawn up and the construction work is expected to begin in 2018.

The councillor said that the administrative procedures for the sewage treatment plant will continue to move ahead in parallel, given that the start of the construction work has now been authorised and the cost will be covered by the Galician Building Institute (Instituto Galego da Vivenda el Solo). In this way, in December, the tender will be published for execution during 2018, with an investment of around €6.3 million.

At the meeting, a decision was also taken to approve the tender for the urbanisation of the logistics-business area that the Free Trade Zone Consortium of Vigo is going to build. Technical approval is currently being processed for the project to develop 400,000 m2 of land, work that will require the investment of more than €12 million. Like in the case of the water purification plant, the plan is for the contract for the construction work in the logistics-business area to begin in December, and for the work itself to be carried out in 2018.

Original story: Inmodiario

Translation: Carmel Drake

Andbank Launches Fund To Invest In Galician Real Estate

13 November 2017 – La Voz de Galicia

(…) The real estate market in Spain is back with a vengeance, above all in the central areas of large cities where, due to a lack of (past) activity in the property development sector, there is now insufficient supply to cover the growing demand (…).

And this business opportunity has not passed unnoticed for the financial sector, which, in an environment of low-interest rates and minimal profitability on the most conservative products, has launched a series of investment vehicle. Their objective is to buy buildings in prime areas, renovate them and then sell the resulting homes on to individuals, whereby generating high returns for investors.

This model, which was first tested, successfully, in Madrid and Barcelona, is now being introduced in Galicia, with the help of Andbank. The entity, specialising in private banking, has launched a real estate investment vehicle, Seagull Real Estate, which is going to acquire residential buildings in the central areas of A Coruña and Vigo, undertake comprehensive renovation work and then sell the homes (individually, in order to maximise prices).

According to Rubén Casales (pictured above), Director of Andbank’s branch in A Coruña, this is the first product that focuses exclusively on the Galician market, and it is being born with the objective of securing investment of €20 million (minimum of €250,000), which it will use to perform between five and ten operations, given that in order to minimise risk, external financing should not exceed 50%.

The appeal of this product for savers is an expected return of 14%, well above the yields they can expect to achieve on fixed income and other conservative products and, which Casales justifies due to the illiquidity of the fund, which obliges investors to maintain their investment for at least five years.

For the execution of this project, Andback has teamed up with two local partners: Ünique Singular Properties and Desarrolla. The first is the only Galician real estate agency specialising in prime residential assets and is the market leader in unique properties; it will help identify investment opportunities and will be responsible for selling the homes once they have been renovated. The second is a construction company known for its renovation work and with a great deal of activity in the autonomous region, which will take care of giving the properties a facelift.

More than 50 properties

According to Andbank, there are lots of investment opportunities: “We have identified some very interesting buildings due to their architectural uniqueness”, says Luis Touriño, territorial director of the entity in Galicia. (…). The bank currently has a team of eight people analysing more than fifty properties, of which between eight and ten will be selected.

Casales explains that the response from investors is proving positive, and so they hope to be able to launch the vehicle before the end of the year (…).

The launch of this fund is another sign of the investor interest in the Galician real estate sector, which, although somewhat lagging behind other parts of Spain, has resumed its upwards path. This news follows the announcement by a group of Galician real estate companies linked to the trade association Fegein that they are going to create a Socimi, which will manage assets in Vigo, Santiago and the north of Lugo, and which seeks to trade on the MAB.

Original story: La Voz de Galicia (by Gabriel Lemos)

Translation: Carmel Drake

Kronos To Build A New Shopping Centre In Galicia For €35M

28 September 2017 – La Región

Kronos, a company that develops and manages both residential and commercial assets and that has projects all over Spain, is going to embark on an important operation on the San Cibrao das Viñas industrial estate (in Ourense). The firm is going to build a large retail park on a plot of land measuring 40,000 m2, of which 18,100 m2 will constitute the net sales area. The park will be located on the site of the former Muebles Calvo factory, on the main road of the industrial estate, next to the access roundabout, by the Reboredo exit. The property’s façade overlooks the road, along which more than 20,000 vehicles travel per day (…).

Kronos has been looking for a site for this retail park for a year and a half “in areas where the market is interesting, and Ourense undoubtedly appealed to us for that reason”, says Manuel Holgado, Partner at the property developer. In addition to the 18,100 m2 of sales space, the retail park will have 750 parking spaces and the total investment is expected to amount to around €34.5 million. The company calculates that 250 direct jobs will be created as a result of the operation, as well as 96 indirect roles.

The largest store will be occupied by a DIY company

Enrique Feduchy, Partner at Kronos, says that the names of the commercial brands that are going to move into the park cannot be confirmed yet “because we are still holding negotiations”, but he did reveal that the largest retail space, around 8,000 m2, will be reserved for a DIY company.

In addition, there will be a food space, which will occupy 2,000 m2; another space measuring 1,500 m2 for domestic appliances; and the rest of the stores will house retail, sportswear, household goods, textiles and leisure goods, according to the first version of the plans “which may be subject to changes”, according to the company.

Feduchy specifies that the model that they are going to introduce in San Cibrao “does not exist in Ourense, because it is going to be a retail park with specialist stores, serving a sector of the public that will travel from Vigo, Santiago and A Coruña”. According to the developer’s plans, the first phase of the construction work will be undertaken during the first half of next year (…) and the park is expected to be open by the end of 2019 (…).

In terms of other opportunities, Manuel Holgado says that “we are looking at other options in Galicia for residential and commercial operations, but we have not signed anything yet” (…).

Original story: La Región

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