Tag: gran via

French fund Klépierre Acquires Plenilunio For €375M

17 March 2015 – Cinco Días

The shopping centre in Madrid, which measures 70,000 square metres, is home to brands such as H&M, Primark and Media Markt.

The active market for the sale and purchase of shopping centres in Spain recorded another milestone yesterday. The French fund Klépierre announced the acquisition of the Plenilunio shopping centre in Madrid, from Orion Capital Managers for €375 million. The transaction had been in the pipeline for months and was expected to close during the first half of the year.

The Plenilunio shopping centre is located in Madrid and measures 70,000 square metres. It is home to brands such as Primark (where the Irish company has its largest store in Spain, although its flagship store on Gran Vía will take over that title when it opens later this year); Inditex, Mercadona, H&M, Mango and Media Markt.

The transaction announced yesterday is the second largest ever involving a shopping centre in Spain. The largest involved the sale of Puerto Venecia in Zaragoza. The investment fund Orion, which was also the vendor of Plenilunio, received €451 million from that sale. Through these two transactions, which have taken place within four months of each other, more than €820 million has changed hands in the sale and purchase of shopping centres. The third largest sale in Spain was also closed in 2014 involving the Marineda City shopping centre in La Coruña, which was sold for €260 million.

Plenilunio is the first large sale to be closed in 2015, after record figures were registered in the shopping centre real estate market in 2014 – total investment amounted to €2,500 million, according to data from the Spanish Shopping Centre Association (‘Asociación Española de Centros y Parques Comerciales’ or AECC). The organisation itself thinks repeating the volume recorded last year again this year will be challenging.

The sector’s trade association also highlighted the importance of contributions from overseas funds to ensuring that investment volumes in Spain are higher than their pre-crisis levels. The French firm that has acquired Pleniluno already has a presence in the country through the La Gavia and Príncipe Pío shopping centres in Madrid; Meridiano in Santa Cruz de Tenerife and Maremagnum in Barcelona.

Turnover of €21 million per year

The French investment group confirmed yesterday in a statement that it expects the Plenilunio shopping centre, which had an occupancy rate of 99.3% at the end of last year, to generate annual revenues of €21 million. Its turnover increased by 15% last year. The fund said it has “plans to differentiate” the property, which (it expects) will result in improved cash flows.

Klépierre reported that it had paid the €375 million consideration using its own funds. The group ended last year with liquidity of €2,700 million. Nevertheless, according to the statement, it does not rule out (the possibility of taking out) a mortgage loan (on the property). The company estimates that it has assets in Spain valued at €1,400 million. PwC advised Klépierre on the transaction and Cushman and Wakefield advised Orion.

The French group confirmed that Plenilunio is a “dominant shopping destination” in Madrid, with more than 10.5 million visitors per year and a catchment area of 1.5 million inhabitants. Its proximity to the centre of the city, its visibility from the main arteries (roads) into and out of the city and its good public transport links are the main attractive features for the company. It said that 14,000 homes are currently being built in the area, which in general has a purchasing power than is 30% higher than the Spanish average and where 33% of the population falls into the highest income bracket.

Original story: Cinco Días (by Diego Larrouy)

Translation: Carmel Drake

‘Dear Hotel’ Overtakes Wanda In Plaza de España

2 March 2015 – Expansión

In Madrid’s Plaza de España, the hubbub of construction work is accompanying tourists as they journey into the commercial heart of the capital: Gran Vía. The Edificio España remains in tact (for the moment), as Wang Jianlin, the owner of Dalian Wanda, finalises the designs for his megaproject, which will include a hotel, shopping centre and homes.

The site that will house the future Hotel VP Plaza de España remains empty, but scaffolding is now up on the Torre Madrid, where Metrovacesa is refurbishing the building that will house a Barceló hotel – on one of the corners that Plaza de España shares with Gran Vía.

Plaza de España is also where the first of the hotels that is intended to revitalise the area will be opened. The area has been in decline since 2005, when Intercontinental closed its Hotel Crowne Plaza, which was located into the Edificio España building. Now, work is nearing completion on the Dear Hotel, a property that the Sebrango family acquired in 2012, after exercising a call option that Renta Corporación held over the building. The Sebrango family, which also owns the Hotel Chiqui (in Santander) have designed a four star hotel, with 162 rooms and it is scheduled to open on 15 May, on the day of San Isidro, one of the most important fiestas in the Spanish capital.

Roof terrace

The Dear Hotel project, which will have its entrance on Gran Vía, 80, has required an investment of €30 million – including the purchase of the building and the work required to refurbish it. Previously, the property housed homes and offices.

The hotel will have 12 floors and there will be a roof terrace and restaurant on the top floor, which its owners hope will become an iconic space for the hosting of special events in the capital. The style (of the property) will be elegant and modern, and in terms of prices, the average room will cost between €150 and €160 per night. The price of the suites will range between €250 and €300 per night and the hotel will create between 70 and 80 new jobs.

“It will be a four star hotel due to the individuality of the building, but the service and quality will be on a par with a luxury establishment”, explains its director, Francisco Sebrango. According to the owner’s forecasts, more than 60% of the hotel’s guests will be foreigners.

Since purchasing the building, the Sebrango family has received numerous offers to sell or transfer the operation of the hotel. Nevertheless, they have decided to pursue their original strategy and operate the hotel themselves. “We considered the option of a franchise agreement, but in the end we ruled that out. We want to create a unique hotel and we believe that it has the most value in our hands”.

Original story: Expansión (by Yovanna Blanco)

Translation: Carmel Drake

Celio Plans To Open 10 New Stores In Spain In 2015

20 February 2015 – Modaes

The French menswear company Celio is looking for new opportunities in the Spanish market with a clear message from the group’s head office: generate profitability. The company, which closed 2014 with sixty stores in Spain, has set an overall goal of generating profits in all of the countries in which it has a presence. In the context of the chain’s development in Spain, Celio will open ten new stores this year, mainly using the franchise formula; it is also looking for new opportunities in Madrid and Barcelona, where it wants to open two flagship stores before the end of 2015.

Celio was created in France in 1982 by the siblings Marc and Lauren Grossmen; the pair also own the womenswear chain Jennyfer. The company, which currently has a distribution network of more than 1,200 stores across 65 countries, opened its first outlets in Spain in 1985, although it was not until the year 2000 when the company created a subsidiary in the country, led by Abel Núñez, from Adolfo Domínguez.

The Spanish branch of Celio, which has a distribution network comprising 60 stores in Spain, closed 2014 (on 31 January 2015) with sales of €42.7 million, an increase of 4.2% on the previous year.

“The message from head office is that the mantra for the global business is: generate profitability in all of its stores”, explains Antonio Pirruccio, Head of Expansion at Celio in Spain. “To achieve this, we have hired a new Head of Stores for the Spanish subsidiary, who will be in charge of budgets, analysis and sales forecasts by product family for Celio’s stores in Spain”.

Celio, which recently appointed Guillaume Motte, from Jennyfer, as the new Chairman of the group, says that Spain is its third largest market in terms of turnover. “This year we have increased our contribution to total revenues, so we can see that the chain is working well in this market” adds Pirruccio.

Last year, the company launched a new strategy for the Spanish market, focused on the opening of flagship stores on the country’s main (high) streets. The chain opened a store on Gran Vía in Bilbao last June, in premises that previously housed the womenswear chain Blanco and has a retail surface area of 300 square metres.

Celio has also launched a process to search for premises to open flagship stores on Gran Vía, in Madrid, on Paseo de Gracia or in Portal de l’Angel in Barcelona, and in the south of Spain, where Celio is considering opening stores in Malaga and Sevilla.

“Another goal at the group level is the reorganisation of Celio’s portfolio of stores in all of its countries (of operation), which is why we are currently renegotiating rents and relocating shops that are not profitable”, explains Pirruccio. Celio plans to open ten stores in Spain, of which at least eight will be franchises.

Original story: Modaes

Translation: Carmel Drake

Spain’s Real Estate Sector Closed 2014 With A Record High

02/01/2015 – Expansión

The arrival of international funds and the implementation of large REITs have increased investments, with respect to previous years, up to 9 billion euros. Both the total figures and number of operations have skyrocketed. Well-located large shopping centers and office buildings have been the most desirable assets in 2014.

After more than five years of decline in business, the Spanish real estate sector predicted that recovery would arrive in the year 2014. However, the more optimistic reality has exceeded all expectations.

In anticipation of the year-end figures, this is already the second best year in the last decade, surpassed only by 2007, in the boom of the Spanish economy. “The market this year has been proportionally more active than in 2007. A higher number of assets have been purchased, and the prices, when compared with 2007 figures, are much higher,” explained representatives from the research department of JLL Spain.

So far this year, more than 6.18 billion euros have been invested in real estate for tertiary use (i.e. non-residential), according to Deloitte Real Estate.

This figure soars to 9 billion, according to the consultancy group, Aguirre Newman, if we take into account multiple debt portfolios whose securities were real estate assets, and the sale of land and housing.

These figures are double those recorded in 2013, 2012 and 2011, and are explained by a combination of several factors. “2014 was a year in which all the elements were present to favor real estate investment: the improvement of the overall economic situation, the emergence of new players with liquidity and the pressure to invest (the REITs), the return of funding and the need to sell certain closed funds,” says Javier Garcia-Mateo, director of Deloitte Real Estate.
New investors

The new players in the real estate sector, the REITs, are among the most influential reasons for investment growth. Only four major listed real estate companies, Merlin Properties, Hispania Real, Lar España and Axia Real Estate, have invested over 2.4 billion euros. Among their investments was the purchase of Marineda City, a shopping center located in La Coruña (Galicia), by Merlin Properties for 260 million euros, the largest purchase of a shopping center until December 24, 2014.

A few days ago, the British real estate company, Intu Properties, beat this record by paying 451 million euros for Puerto Venecia in Zaragoza. With these last transactions, investment in shopping centers in 2014 amounted to 3 billion euros, the same amount invested across the real estate sector in 2013.

Shopping centers are not the only commercial properties to be the star of large operations. Street storefronts have also been key players in investments. Thus, companies such as Mango bought property in Madrid and Bilbao to create large retail stores; while international funds, such as Axa Real Estate and Deka, bid for being the landlords of the main brands along the Gran Via in Madrid.

As for office buildings, investment has soared over 200% from January to September to 2.4 billion euros, according to CBRE. These figures are due to the purchase of portfolios such as the four buildings located in Barcelona and Madrid held by Blackstone, in addition to the other four buildings that the same fund bought from SAREB a few days ago.

Also noteworthy is the purchase of two properties in Barcelona — Torre Agbar and Paseo de Gracia 111 — which will be transformed into luxury hotels, and the numerous buildings sold by public administrations such as the Generalitat.

“A year of great investment activity has closed and the market should expect the same level of activity for the next year, albeit with some changes in the profile of investors,” says Jaime Pascual, Executive Managing Director of Aguirre Newman.

Original article: Expansión (by Rocío Ruiz)
Translation: Aura REE