Urbania Acquires Land for 1,895 Homes in Málaga from Unicaja

29 July 2019 – Richard D. K. Turner

The developer Urbania International has signed an agreement to acquire the rights to build 1,895 homes in the future neighbourhood of Sánchez Blanca from Unicaja’s GIA. The 66-hectare development, located between Avenida de Ortega y Gasset and the AVE railway, will have a total of 3,443 homes.

The deal will make Urbania the principal developer of Sánchez Blanca. The rest of the building rights are distributed between the City Council (606 subsidised homes and 88 market-rate homes), the developer Andria (85 subsidised homes and 429 market-rate homes), the Vimpyca Foundation (411 subsidised homes) and Adif, which will develop 14. Urbania also expects to take over 429 homes from Andria, bringing its total to 2,324.

Sources estimate that Urbania will invest more than one hundred million euros in acquiring and developing the land. Construction, which could last about three years, is awaiting approval by the local planning department.

Original Story: Diário Sur – Jesús Hinojosa

Unicaja Takes In €20 Million Through Sale of Land

26 March 2018

Unicaja, the Malaga-based bank, is accelerating its sale of the real estate assets it was forced to take on during the financial crisis. Last year it sold a portfolio of land, reducing its holdings of foreclosed assets by one hundred million euros, and reported a gross profit, due to the transaction, of 20 million euros, according to a report.

In addition, Unicaja reached an agreement last year with the Norwegian fund Axactor to create two joint ventures and de-consolidate more than 4,000 foreclosed assets (in lieu of debt payments) valued at €252 million. The Nordic fund paid Unicaja between 150 million and 200 million euros in the transaction, according to knowledgeable sources. One of these companies will take control of 3,035 of Unicaja’s foreclosed assets, and the other will take on a further 1,034 foreclosed assets from España Duero. Axactor will control 75% of both, while the remaining 25% remain with the Unicaja group.

Unicaja’s real estate management platform, called GIA, will manage the properties. The majority are located in Andalusia and Castilla y León, where the two institutions are based.

The transaction has not had a significant impact on its financial statements, according to the report.

Property assets

In total, the Unicaja group, including its subsidiary España Duero, reduced its volume of unproductive assets by 21% last year. In absolute terms, €1.201 billion in toxic assets left its balance sheet. Such loans to developers and real estate assets generate many expenses and no income, reducing profitability.

Unicaja earned 138 million euros last year, 2.5% more than in 2016. The level of balance sheet provisions related to real estate stands at 64%, one of the highest in the sector. Its delinquency rate stands at 8.7%.

The bank has a market value of €2.225 billion. Investors who took part in its IPO in June 2017 have seen their initial investment go up by 23% in nine months.

Original Story: ProOrbyt Expansion – R. Lander / R. Sampedro

Translation: Richard Turner

Santander & Apollo Call Off Altamira Negotiations

30 December 2016 – Vozpópuli

Santander’s repurchase of Altamira has run into trouble.

After months of to-ing and fro-ing, Banco Santander and Apollo have decided to call off their negotiations regarding the possible sale of the 85% stake that the US fund owns in the real estate company. And the reason is price, given that Ana Botín is not willing to meet the expectations of the asset manager chaired by Leon Black. Apollo will not drop its asking price below €1,000 million, whilst Santander’s informal offer amounts to around €800 million, according to several financial sources.

Unless there is a last minute change of heart, all indications are that Altamira’s share capital structure will continue as it is now: with 85% in the hands of Apollo and 15% controlled by Santander. The Spanish bank sold the controlling stake in the real estate company in 2013 for €664 million.

Santander’s intention was to repurchase its stake to create a world-leading property management firm, to administrate its assets in other countries where the default rate is rising, such as in Brazil. Santander engaged Citi to complete this operation. The possible repurchase has been on the table since Ana Botín (pictured above) took over as President of the bank, given that this sale was one of the things that she liked the least from her father’s inheritance.

Botín sees it as a much more expensive way of raising capital than would have been possible to obtain by other means. But unless she can afford a price that will allow Apollo to close this deal at a profit, it is unlikely to go ahead. This change in strategy comes at a time when Apollo is raising a new fund, amounting to more than €4,000 million, to invest in the south of Europe. Given that it has new ammunition to spend from now on, it will value a platform such as Altamira very highly

New strategy

Following this turnaround in negotiations, Apollo has decided to strengthen the future of Altamira be making acquisitions. Santander’s property management firm is well placed in two current acquisition processes: firstly for Unicaja’s real estate arm, GIA, where it is competing with Haya Real Estate; and secondly, for the first bad bank created by the Portuguese State, Oitante, which manages Banif’s problem assets – other players such as Servihabitat (owned by TPG and CaixaBank), Hipoges and Värde Partners (Banco Popular’s real estate shareholder) are also bidding in that tender.

If the latter operation bears fruit, it would be Altamira’s first international venture, and the ideal way for Apollo to generate value from this investment, and obtain more from its sale when it eventually decides to exit.

The fund chaired by Black (one of the 150 wealthiest people in the USA and owner of the painting The Scream) is putting all of its meat back on the grill in Spain after a couple of less active years. In 2013, it closed its largest two acquisitions in the country: Altamira and Evo Banco. Since then, its activity has been limited to the purchase of a small portfolio of homes from BMN and GE Capital’s mortgage portfolio in Spain. Moreover, Altamira was awarded one of the four management contracts by Sareb.

In recent months, Apollo has purchased one of the largest banking portfolios on the market, Project Sun from CaixaBank, containing hotel debt, and it is expected to soon close the acquisition of one of the aforementioned real estate platforms (Oitante or Unicaja).

Original story: Vozpópuli (by Jorge Zuloaga)

Translation: Carmel Drake

Unicaja Negotiates The Sale Of Its RE Arm With Haya & Apollo

29 December 2016 – Vozpópuli

(…). In recent months, the Málaga-based entity has accelerated the divestment of its investment companies to make some cash ahead of the challenges that it faces over the coming months. First came the sale of Iberdrola and now, Unicaja is in advanced negotiations to sell its real estate arm to Haya Real Estate, the platform owned by the US fund Cerberus in Spain, or Altamira, owned by Apollo (85%) and Santander (15%), according to financial sources consulted by Vozpópuli. Sources at the entity say that the final decision has not been taken yet.

Through this operation, Unicaja wants to replicate the sales carried out by the large banks in 2014: Santander with Altamira, CaixaBank with Servihabitat and Popular with Aliseda. Through those deals, the banks recorded combined profits of more than €2,000 million.

It is critical that the Málaga-based entity generates profits at the moment for two reasons: the tax blow that it is going to suffer, due to the upcoming rise in Corporation Tax (CT); and the need to accumulate capital to pay back the public aid it received for Banco Ceiss (€604 million), over the next year; it has asked Brussels for more time in this regard. This would be an alternative solution to the entity’s debut on the stock market and would allow it to repay the contingent convertible bonds (CoCos) from the Restructuring Fund (Frob), which is what Ibercaja has done; yesterday, that entity repaid €163 million to the public fund. With this, the former savings banks avoid the blow for their shareholders that a debut on the stock market in the current environment would mean, although that comes at the price of them not being able to get rid of their shares.

Subsidiary up for sale

In the case of the real estate arm, the name of the subsidiary that Unicaja is negotiating the sale of is: Gestión de Inmuebles Adquiridos (GIA). It is a platform that administrates and sells the group’s foreclosed residential assets, and it has around 40 employees. It recorded turnover of €108 million in 2015, up by 5% compared to a year earlier.

Overall, GIA lost €114 million last year, because Unicaja recognised its real estate provisions in that company. In theory, this operation would only involve the sale of the management of the assets, not their title, although a small portfolio of around €50 million could also form part of the sale, according to sources close to the deal.

The entity, led until this year by Braulio Medel (pictured above, who continues to control the Foundation that owns 90% of the bank), does not have one of the largest exposures to property in the financial sector. It has foreclosed assets with a net value of €1,051 million, according to the figures as at June, which include provisions, meaning that they have a combined appraisal value of €2,690 million. (…).

The market also expects Unicaja to get rid of some of its other stakes, such as Deoleo, in which it holds a 10% shareholding and Reyal Urbis, in which the Foundation controls just over 4%. (…).

Original story: Vozpópuli (by Jorge Zuloaga)

Translation: Carmel Drake