El Corte Inglés Plans to Open 1,000 Gas Station Stores in Conjunction with Repsol

15 October 2018 – Real Estate Press

There are almost 11,500 gas stations in Spain, of which more than 8,500 have shops. El Corte Inglés was one of the first groups to operate in conjunction with oil companies and that group is now planning to open 1,000 new gas station stores together with Repsol.

Gas station stores typically have a wide range of opening hours, span an extensive network and are easy to stop at to make quick purchases. It was only a matter of time before distribution groups decided to team up with oil companies to manage their service station stores. Now the time has come for those formats to flourish.

The formula allows supermarket chains to grow rapidly without having to recruit staff or undertake significant investments. Meanwhile, the petrol companies benefit from offering more attractive service stations, with a more extensive range of products and a lower cost base by entrusting the management of their stores to specialists with a volume of purchases that generates significant savings.

Sales at gas station stores amounted to €580 million in 2017, although the potential of this format is much greater.

Forecast growth

El Corte Inglés was one of the first groups to operate agreements with petrol companies. Initially, it constituted the company Gespevesa together with Repsol in 1998, which they control (50%) and which owns 39 service stations. Last year, that entity recorded revenues of €39.2 million, down by 26% and earned profits of €3.8 million, up by 28%. Next, it joined forces with Cepsa to develop a refuelling discount strategy. And, now, it has committed to a major agreement with Repsol to create “the largest network of convenience stores in Spain” under the brand Supercor Stop & Go.

Carrefour has also changed its petrol partner over the years: it started working on this type of alliance with BP, but in 2013, it opted to join Cepsa to grow a new format, Carrefour Express Cepsa, which currently comprises 333 stores. One fact serves to explain the importance of this agreement for the French group, namely, that it is the format with the most stores in around twenty Spanish provinces, including Asturias, Murcia, the Balearic Islands, Castellón, Lleida, Toledo, Valladolid and Zaragoza, amongst others.

Día is the other group that has heavily backed the format, with the launch of a pilot project together with BP in four of its gas stations in Madrid under the Shop brand. Previously, in 2015, Dia signed an agreement in collaboration with Disa (Shell) to supply the counters in five of its stores. BP has also worked with other partners. Between 2013 and 2016, Alcampo supplied products, including its own brand range, to stores in its gas stations. Moreover, BP has operated some regional alliances for years with other smaller supermarket chains to generate benefits through their loyalty cards (…).

Finally, Galp, the fifth largest petrol company in Spain, has not been averse to these agreements either; it has worked with GM Food, the former Miquel Group. Their partnership began in 2013, with 12 pilot stores operating under the Sar brand; it continued the alliance once that project had finished, with the Catalan group as the supplier of its stores; and now, the two firms have started another trial in eight locations under the format Suma Exprés.

Original story: Real Estate Press

Translation: Carmel Drake

BP Acquires 65 Gas Stations in Spain from Avenue Capital and JZ International

2 October 2018

The British oil company has reached an agreement to take over 100% of Kingbook Inversiones Socimi and Petrocorner Retail, the owner and manager of gas stations in 21 provinces of Spain.

The oil company BP has reached an agreement with the venture capital funds Avenue Capital and JZ International for the acquisition of the Kingbook socimi and Petrocorner Retail, a company that owns and operates 65 gas stations spread across 21 provinces in Spain.

The operation has already been finalised, pending the corresponding regulatory approvals, as confirmed by official sources at BP.

Kingbook Inversiones, 60% owned by GL Europe REIT (Avenue), with the remaining 40% held by JZ Real Estate (JZI), both vehicles domiciled in the Cayman Islands, was delisted from the Alternative Stock Market (MAB) on July 20, just one year after its debut.

Kingbook had already warned in June that it was conducting “very advanced” negotiations for the sale of 100% of the company. The firm had been building its portfolio since 2014.

Another source close to the operation said that DISA (Shell in the Peninsula), the Canary Islands oil company chaired by Demetrio Carceller (Damm), also considered acquiring the asset.

The service stations that will become the property of the company formerly known as British Petroleum are distributed between the north, the centre and the southeast of Spain. Specifically, the oil company chaired by Luis Aires in Spain will increase its presence in Asturias, Cantabria, Vizcaya, Guipúzcoa, Navarra, León, Burgos, Zamora, Valladolid, Ávila, Madrid, Valencia, Albacete, Alicante, Murcia, Jaén, Huelva, Málaga, Granada, Almería and the Balearic Islands.

BP is thus consolidating its position as the third largest fuel distributor in Spain, behind Repsol and Cepsa and ahead of Galp and Shell. With this agreement, BP will control around 700 service stations in Spain. In 2017, the company stated, within its expansion strategy, that it owned 648 total stations.

Until now, these gas stations were operated by Petrocorner, which has also acquired BP. According to Petrocorner’s website, the service stations are branded by Repsol, Cepsa, BP, Shell, Galp, Avia, while some are independent.

According to the latest accounts sent to the Mercantile Registry, Kingbook lost more than €1.5 million in 2017, compared to a loss of €1,733,446 in 2016.

Although the price of the transaction was not disclosed, the statement company submitted to MAB said that its assets were valued, according to the consultancy CBRE, at approximately 70 million euros (€40 million book value).

Avenue Capital has participated in several important operations in Spain. The US fund gave financial support to Quabit and is participating in the purchase of debt from Banco Santander’s Ciudad Financeira. In June, the fund acquired tile company Roig Cerámica (Rocersa).

Original Story: El Confidencial – Juan Cruz Peña

Photo: Reuters

Translation: Richard Turner

Merlin Buys Galp’s HQ & Another Property In Lisbon For €103M

15 March 2016 – Expansión

The Socimi Merlin Properties has purchased two properties in Lisbon, one of which is leased in its entirety to the oil firm Galp, for a combined total of €103 million, and has whereby strengthened its presence in the Portuguese capital, where it has an office portfolio comprising three buildings with a total leasable surface area of 42,842 m2.

The real estate company has explained that the acquisition price was fully paid down using own funds, and so the acquisition will generate an initial gross yield of 7.4% and an initial net yield of 6.5%.

Specifically, Merlin has acquired the Monumental building (pictured above), located in Plaza Duque de Saldanha – in the heart of the city’s financial district -, with a total leasable surfacea area of 22,387 m2, comprising offices and retail space. 89% of the offices are leased, to domestic and international firms, such as KPMG, Marsh and Mercer. Meanwhile, the retail area has 41 outlets.

The other property it has acquired is the Torre A Building, with a surface area of 13,715 m2, spread over 16 floors and leased to Galp under a long-term contract. Torre A forms part of another office complex, which contains eight buildings that have a surface area of more than 70,000 m2 and 1,683 parking spaces.

Merlin, which focuses on the Iberian market, made its debut in Portugal last June with the acquisition of an office building in Lisbon for €18 million.

The office building, located in the Expo area, is fully leased to Novabase. Meanwhile, Fidelity has notified the CNMV that it holds a 3.55% stake in Merlin, which is worth €117 million at the current share price.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake