Mango Sells its Store on c/Corrida in Gijón & Leases it Back for €30,000/Month

28 October 2018 – El Comercio

Mango has sold the building located at number 28 Calle Corrida, in Gijón, which has housed its megastore in the city since 2015, to a domestic investor for €8 million. The Catalan multi-national textile firm acquired the iconic property, which used to house the former headquarters of Banesto, in 2014. At the time, it paid Banco Santander €6.2 million for the property. The building work for the commercial conversion of the building, which spans a surface area of 1,642 m2, spread over the ground first and attic floor, cost another almost €2 million.

On this occasion, the sale operation has been undertaken as a sale&leaseback deal (…). In other words, Mango has sold the asset on the city’s main high street but will remain there as the tenant, paying a sizeable rent to the new owner: more than €30,000 per month (…).

That is not the only change happening on Calle Corrida over the coming months. The Inditex Group is looking to relocate some of its brands onto the Golden Mile of Gijón despite the shortage of available units (…).

In terms of prices, according to Alejandro López, lawyer and director of the real estate consultancy firm Noxtrum Novotec, “the average rental price is €62/m2/month, with variations ranging from €50/m2/month to €70/m2/month”.

Original story: El Comercio (by M. Moro)

Translation: Carmel Drake

Telefónica to Close & Sell Off 650 Telephone Exchanges between 2018 & 2020

16 March 2018 – Cinco Días

Telefónica is continuing its intense level of activity in the management and disposal of its assets (…). In this way, the telco has recorded an impact on Operating Income Before Depreciation and Amortisation (OIBDA) of gains from the sale properties in Spain of almost €180 million over the last three years. This maximisation in the value of these assets has generated a positive impact on the profitability of the company during a period marked by strong competitive pressure. In other words, these sales have helped to improve the results on firm’s income statement.

According to the company, in the accounts for the last three years, the impact of gains from the sale of properties in Spain exceeded €35 million in 2017 (…), €71 million in 2016 and €73 million in 2015.

In recent times, Telefónica has focused a large part of its real estate activity on adapting its infrastructure to the real needs of the business. In this sense, the most recent drive has been motivated by the process to shut down copper exchanges, accelerated by the migration of clients from that traditional technology to new fibre optic networks, which the company has rolled out right across Spain. With this change, those facilities are no longer necessary for the operations.

And this process is going to continue to the extent that more copper exchanges are closed, in accordance with the company’s plans. Thus, the operation may accelerate the sale of these facilities, which in many cases are located in important buildings in central areas of provincial capitals and other cities.

Overall, Telefónica plans to close 650 copper exchanges in total right across Spain between 2018 and 2020, as part of its program to modernise its infrastructure and shut down the ageing networks, according to explanations provided by the group at the recent presentation of its results for 2017.

For example, the telco has put up for sale the exchange that it owns in Gijón, in the heart of the shopping district of the Asturian city, for a price that could reach €12 million, according to reports in the local press.

In any case, its sales in recent times have affected different types of buildings. According to sources in the sector, in recent years, Telefónica has sold iconic buildings in cities such as Madrid, Barcelona, Valencia, Bilbao, Santander, Tarragona and Zaragoza.

Sources in the sector also indicate that the gains (from future sales) may be high given that in many cases the buildings are old, and were acquired or constructed by the company a long time ago.

Amongst other movements in the real estate segment, in 2016, the operator sold several buildings in Madrid, Barcelona, Santander and Zaragoza to Beach Bienes Inmuebles for almost €50 million.

In turn, at the beginning of 2017, Telefónica sold a building in the Argüelles neighbourhood of Madrid to the British real estate group Princeton Investments for almost €25 million (…).

Original story: Cinco Días (by Santiago Millán Alonso)

Translation: Carmel Drake

Sabadell Sells Bal Hotel & Spa in Gijón to Grupo Artiem

27 December 2017 – Revista Hostel Pro

The 5-star Bal Hotel & Spa has 45 fully equipped rooms (doubles, junior suites and suites), as well as 4 meeting rooms, a restaurant, a piano bar, an extensive spa measuring 450 m2, a gym, 3 padel courts, a car park and a large garden area for events. It is located in Asturias, just 10 minutes from the city centre of Gijón.

The asset has been acquired by Grupo Artiem, which is also going to operate the property itself. Grupo Artiem, originally from Menorca, has a long history on its home island. It has recently started to operate hotels in the urban segment, incorporating the 4-star Artiem Madrid Hotel, with its 83 rooms, into the chain.

José Guillermo Díaz Montañés, CEO of Grupo Artiem, highlights: “The features of the property and its location in Asturias, a region that fits perfectly with our value proposition, make the Bal Hotel Spa Business & Leisure the perfect candidate for incorporating into Artiem Fresh People Hotels, given that our business philosophy is based on well-being, sustainability and people. The facilities and, above all, the team that we are incorporating into the Group will allow us to start to grow in the north of Spain and remain faithful to our philosophy and management model.

Íñigo Cumella, Hotel Broker and the person responsible for the operation, indicated: “this is a unique property in the area, both due to its quality as well as the variety of its services and facilities. On the other hand, its environment and location (just 10 minutes by car from both the beach and Gijón city centre) make it very attractive for leisure guests, as well as for the organisation of corporate meetings and the celebration of events. The completion of this operation once again highlights the significant investor interest in the hotel sector, where luxury assets such as the Bal Hotel & Spa are continuing to generate demand”.

Meanwhile, Inmaculada Ranera, Director General in España and Portugal added: “The month of December is proving to be particularly intense in terms of the closing of operations. We hope that this won’t be the last announcement of its kind before the end of 2017”.

Original story: Revista Hostel Pro 

Translation: Carmel Drake

Telefónica Negotiates Sale of HQ in Gijón for €12M

14 December 2017 – Eje Prime

Telefónica is pushing ahead with its real estate divestment strategy. The Spanish telecommunications company is currently finalising the sale of the copper network centre that it owns in the shopping district of Gijón, for which it expects to receive around €12 million. The multinational company will continue to occupy the building, located between Calle Corrida and Plaza del Carmen, under a compulsory 7-year rental contract, which may be extended subsequently on an annual basis for up to five years.

The sale of this asset forms part of the divestment plan that Grupo Telefónica has launched for its non-strategic properties and to close its copper network centres. Behind this building, which is located in the shopping district of Gijón and which serves 3,000 homes, is going to be an investment group already known in the city. Not in vain, it is going to be the same company that acquired another historical building in the city, the headquarters of Banco Urquijo, according to El Comercio.

The new owners will receive an annual rental income of €600,000, although they will have to wait for a few years to really generate a return from this asset, and undertake the change of use, likely to for retail purposes, once Telefónica has turned off the light in this historical building, which was constructed in 1932.

Original story: Eje Prime

Translation: Carmel Drake

Duro Felguera Puts Its Non-Core Properties Up For Sale

4 November 2016 – Expansión

Liquidity crisis / The engineering group has two large corporate headquarters in Madrid and Gijón, which it is looking to sell to cover its financial commitments whilst it resolves several legal disputes overseas.

Duro Felguera explained yesterday during the presentation of its results for the 9 months to September 2016 that it has ordered the sale of its “non-productive assets” to avoid the deterioration of its cash balance whilst it resolves legal disputes overseas for unpaid invoices amounting to more than €300 million. According to the sources consulted, the assets under analysis include the company’s two major headquarters in Madrid and Gijón, the proceeds from which could amount to several tens of millions of euros.

For the time being, the company has issued a sales mandate but has not specified which formula it will use for the divestment. In recent years, many of Spain’s large corporations have sold their headquarters through sale and leaseback contracts, whereby the company sells the property but remains as the tenant for a certain number of years. Ferrovial, Acciona, Prisa, Telefónica, Santander, Gas Natural and Endesa, amongst others, have all used this formula in recent years.

Duro Felguera’s office building in Madrid has been on the company’s balance sheet for two years, after it acquired it for €20 million in 2014. The previous owner was the real estate company GMP. The headquarters is located on Vía de los Poblados, in the north of Madrid, alongside the M-40 ring road and the Campo de las Naciones business park.

Duro Felguera’s headquarters in Madrid has a useful surface area of 13,791 m2. It is an eight-storey building – five of the floors are used for offices, two are used for parking and one contains an undercover space for storage and other facilities.

In Gijón, the company chaired by Ángel Antonio del Valle owns of one of the best complexes in the city’s Scientific and Technological Park. That building has a surface area of more than 9,000 m2.

Legal disputes

Duro Felguera will have to use the proceeds from its divestments to cover several urgent obligations. In December, for example, the company is due to repay a loan amounting to €35 million.

In parallel, the group is looking to encompass its financial commitments into the process of recovering its unpaid invoices overseas. Yesterday, the company stated that “it is holding negotiations with various credit institutions (Bankia, Santander, Popular, BBVA, Sabadell and CaixaBank) to adjust the maturity dates of its debt to bring them in line with the expected resolution dates of these conflicts.

In Australia, the group is fighting against one of its client, the Korean firm Samsung C&T, for overruns on the mining project Roy Hill. The court of arbitrage in Singapore calculates that DF may recover almost €140 million (the last invoice amounted to €40 million, plus €90 million in avals). The Australian courts are claiming €46 million, of which €9 million has been already recovered. In Argentina, Duro is claiming another €150 million for overruns at the power plant in Vuelta Obligado. Finally, in Venezuela, the Government led by Nicolás Maduro still owes the Spanish group €101 million.

Original story: Expansión (by C. Morán)

Translation: Carmel Drake

Supreme Court Places Thousands Of Homes In Legal Limbo

1 July 2016 – Expansión

The town plans for Gijón, Vigo and Marbella are the latest to join the long list of projects that the High Court has declared null and void, placing thousands of homes into legal uncertainty.

The real estate bubble is still causing problems years after it burst. In the last five years, the Supreme Court has ratified the annulment of several general town plans (PGOU) all over Spain, decisions that have continued in the last year with the High Court bringing down the plans in three other places, specifically, in Vigo, Marbella and Gijón.

These rulings make thousands of homes illegal, given that they were constructed in accordance with PGOU guidelines that are now considered null and void. What will happen to them now? Although the risk of demolition exists, it is minimal and the next step for the municipal companies is to draft and approve new PGOUs that include a process to normalise these buildings, which currently find themselves in a kind of legal limbo.

However, that is not the only negative consequence of this escalation in litigation, as reflected in the round table organised by two partners at Ontier, Jaime Díaz de Bustamante and Jorge Álvarez, together with Susana Rodríguez, Managing Director at the consultancy firm Aguirre Newman, and Antonio Pleguezuelo, Director of Town Planning at the same firm.

“The cascade of PGOU annulments is generating a considerable lack of legal certainty”, said Díaz de Bustamante, who insisted that this situation “deters international investors, who cannot afford to allocate their capital to an urban development plan that is subject to unstable regulation”.

But, what are the reasons behind all of these rulings from the Supreme Court, which are nullifying PGOUs all over the country? According to the experts consulted, one of the main reasons is the lack of communication and coordination between the different administrations involved in the preparation of the urban plans.

In this sense, Jorge Álvarez and Antonio Pleguezuelo requested greater coordination between autonomous communities and the central Government when it comes to defining the rules that are going to be applied, as that would result in greater certainty, in their view.

Delays in the process

Nevertheless, more concern and unease in the sector is leading to delays in the approval of urban plans, which, in some cases, is even resulting in changes in government.

For this reason, the experts at Ontier and Aguirre Newman insist on the importance of reducing the regulations relating to PGOUs. “The bureaucracy surrounding these plans need to be reduced so that they can be approved more quickly and adapted to the social reality”, explained Díaz de Bustamante.

Not surprisingly, most of the PGOUs that have been declared void by the Supreme Court in recent years had defects relating to the processing of the different reports required or to the sectoral processes, almost all of which are provided for by state law.

Original story: Expansión (by Laura Saiz)

Translation: Carmel Drake