15 January 2015 – Expansión
The acquisition of office buildings soared by 212% in 2014, thanks to deals signed by international investors, such as Blackstone, and new real estate companies, including Hispania and Merlin Properties.
The launch of Socimis and the arrival of large international funds in Spain has resulted in record investment figures in the Spanish real estate sector. And a new type of asset is proving particularly popular: offices.
According to a report by Deloitte Real Estate, 40% of the non-residential purchases (i.e. offices, shopping centres and stores, hotels and logistics platforms) made in Spain last year were office buildings. Thus, of the €6,500 million invested in 2014 in total, €2,520 million was spent purchasing office property, including Vodafone’s headquarters in Madrid, Gallina Blanca and HP’s headquarters in Barcelona, and the old offices of BBK in Bilbao.
In total, almost 50 transactions were closed, and more than half (57%, according to Deloitte Real Estate) were made by investors with an institutional profile, such as Socimis.
All four of the real estate companies listed on the stock exchange – Merlin Properties, Lar España, Hispania and Axia Real Estate – acquired office buildings during the last year. Merlin Properties, the largest Socimi currently listed in Spain, invested €130 million in the purchase of five office buildings in Madrid, which it leases to groups such as Philips, Vestas and Neoris. Yesterday, the company announced the purchase of Gallina Blanca’s headquarters, together with two logistics warehouses, for €88 million.
Meanwhile, Axia Real Estate paid €180 million for a portfolio of properties owned by Credit Suisse in Spain, which included 3 office blocks located in the Campo de las Naciones area of Madrid.
“Investment in the office market has grown significantly thanks to the Socimis and overseas investors, who consider that rents have reached their lowest levels and now is the perfect time to take positions”, explains Javier García Mateo, Director of Deloitte Real Estate. In this sense, rental costs in Spain’s two largest office markets (Madrid and Barcelona) have already recorded slight increases in the most sought after areas, i.e. in the business districts.
According to Deloitte, the highest rents in Madrid have been agreed for offices on Paseo de la Castellana, 31 (31 euros per square metre per month) and in Barcelona, on Avenida Diagonal, 640 (21 euros per square metre per month).
Original story: Expansión (by Rocío Ruiz)
Translation: Carmel Drake