Luxury Brands Flood Barcelona’s Paseo De Gracia

22 September 2017 – Eje Prime

Paseo de Gracia is getting ready to renew its portfolio of brands. The street, one of the most sought-after in Spain for international luxury, will see the arrival of three new firms over the next few months. According to modaes.es, Christian Louboutin and Isabel Marant will both open their second stores in the Spanish market, whilst Fendi is going to make its debut in the country.

Those three firms will soon play their part in a busy year for Paseo de Gracia. On Tuesday, the Barcelona street witnessed the public opening of Uniqlo’s first establishment in Spain, whilst a week ago, Kiabi was in the limelight, when it opened a store at number 11.

In February, H&M opened its largest establishment in the Spanish market on Paseo de Gracia in the Generali building, and in April, Sandro, owned by the French group SMCP, opened its first store on the street at number 37.

Isabel Marant, who already has one store in Madrid, has signed the lease at number 32 on Paseo de Gracia, after the investment fund BMO Real Estate Partners decided to split the premises occupied by Adolfo Dominguez in two.

The arrival of Isabel Marant in Barcelona comes just a few months after the investment fund Montefiere Investment acquired 51% of the share capital in the French company, with the aim of accelerating its development and geographical expansion (…).

Meanwhile, Christian Louboutin will take over the Starbuck’s store on the avenue. The US coffee chain currently occupies number 97 on Paseo de Gracia, next door to the multi-brand business Santa Eulalia and the firm Jimmy Choo.

The footwear brand launched its first establishment in the Spanish market in 2009. Christian Louboutin opened a 150 m2 store at number 13 on Calle Claudio Coello in Madrid.

The third operation on Paseo de Gracia is going to star the French giant LVMH. Fendi has signed the lease of number 38 on the Barcelona street, a property that has been on the market since March last year, when Hugo Boss moved to another site.

According to Cushman & Wakefield, after Portal de L’Angel, Paseo de Gracia is the second most expensive commercial street in Barcelona for opening a store. The price per square metre amounts to €230/month, compared to €270/m2/month on Portal de L’Angel, which retains its position as the most expensive street in Spain.

Original story: Eje Prime (by I. P. Gestal)

Translation: Carmel Drake

Apollo Gets Ready To Buy Property Developers & Hotels In Spain

14 March 2017 – El Confidencial

A new player has emerged in the Spanish real estate market. Apollo, one of the largest fund managers in the word, has decided to join the fray between Värde, Castlelake and Lone Star, and analyse the purchase of its own property developer, according to sources familiar with the entity.

The firm led in Spain by Andrés Rubio is tackling this strategy through its new fund (its third), which already has €2,700 million and which plans to raise up to €4,000 million. This money will be used to acquire real estate assets, NPLs and hotel portfolios in Spain, Italy, UK, Ireland and Germany. Our country could receive around €1,000 million of investment, given that Apollo is expected to continue its commitment to the hotel sector, into which it took a giant leap last December, when it acquired two portfolios from CaixaBank and Popular, and looks set to enter the property development business with a bang.

According to the same sources, one of the companies that is on the fund’s radar is Levitt, which has some of the best plots of land and fame in the sector. Its possible sale has been mooted in the market for a while, given the generational change that the group faces and the appeal of the company, which operates in the high-end segment.

Asentia, Colonial‘s former bad bank is one of the other companies that has been making a name for itself in the market; Acciona Real Estate has also been considering its options, which range from an IPO to the entry of a large fund into its share capital; whilst Procisa, the former property developer behind La Finca, has sold 40% of its offices to Värde and continues to control important developments on plots of land in Madrid (Pozuelo de Alarcón and Brunete), Huelva (Cartaya) and Lleida (Baqueira).

In fact, Apollo was previously involved in negotiations regarding a similar operation to the one that Värde ended up signing with the Cereceda family. But the rapid consolidation that has taken place in the market, with the creation of Aedas by Castlelake, the purchase of Vía Célere by Värde and the imminent debut of Neinor on the stock market, has convinced the fund that a window of opportunity has now opened up in the property development sector.

Apollo plans to invest this new €1,000 million fund over the next three or four years, during which time it wants to become a top-tier player in the property development sector, in line with the moves made by its competitors, and to create its own hotel platform.

In the residential sector, it intends to focus on buildable land, located primarily in Madrid and Barcelona, the two provinces where the incipient recovery is being felt most strongly.

In the tourist segment, in parallel to the strategy to purchase loan portfolios secured by hotel collateral, the fund is actively looking for well-located establishments to create a vacation platform along the coast and on the islands, comprising around 20 assets.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Mexican Investor Buys Residential Building In Madrid For €48M

13 March 2017 – El Mundo

A new and important real estate operation has been closed along the so-called Golden Mile, in the most exclusive area of Madrid. A Mexican investor has purchased the majestic building located on Plaza Marqués de Salamanca, 11 for €48 million, according to comments by Pierre-Célestin & García-Argüelles Partners, a firm that specialises in brokering the sale of prime assets in major international capitals and which has brokered this super-operation.

If this figure is correct, it will be the highest grossing transaction involving a residential building in the city for at least a decade. The historical property, which is used for both residential and hotel purposes, has an above ground surface area of 8,797 m2, spread over eight storeys including the ground floor (which contains storerooms, the concierge’s house and a commercial outlet) and the roof top terrace. Each floor has a surface area of 1,000 m2 and is currently divided into two homes with ceilings measuring more than 3.5 m high.

Javier García-Argüelles, one of the partners of the company that advised the sale, highlighted the great interest that this asset has sparked. He reportedly received nine expressions of interest – five from funds and four from individual investors – from two domestic and seven international buyers – two Venezuelan, one Colombian, one Brit, one Dutch and one Canadian -. “The property was awarded to the first investor who was willing to pay the non-negotiable figure of €48 million and make the 10% deposit”, he said.

Regarding the new owner, for confidentiality reasons, García-Argüelles is only able to reveal that he is Mexican, features on Forbes’ list and works in the international real estate market. (…).

Until now, Marqués de Salamanca, 11, whose homes were being operated under a lease arrangement, belonged to an aristocratic family from Oviedo.

“This operation is a clear sign that the luxury real estate sector is experiencing a real boom”, said García-Argüelles, who revealed that the new owner intends to invest heavily (“spending no less than €10 million”) on the renovation of the building to transform it into exclusive apartments.

Apparently, although the property could be converted into a five-star hotel, the new owner’s plans involve creating three 250-300m2 homes per floor and holding onto the whole of the top floor for his own personal use (the rooftop terrace will be left untouched. It has views of the entire city of Madrid as it is the highest point in the neighbourhood of Salamanca). In total, around 15 high-end apartments will come onto the market as a result. Their price? According to García-Argüelles and Pierre Célestin, and based on comments made by the buyer, the asking price for the homes will start at €14,000/m2.

Original story: El Mundo (by Jorge Salido Cobo)

Translation: Carmel Drake

A Peak Inside The Luxury Homes On Juan Bravo, 3

12 March 2015 – Expansión

The Socimi and the North American management company are investing €120 million to rescue the most exclusive residential project in the city. Designed by Rafael de La-Hoz, its 50 apartments will cost around €4 million (each).

Three months ago, the Socimi Lar España and the North American management company Pimco agreed to purchase the company Juan Bravo, 3. The agreement will result in the revival of one of the most exclusive residential projects in Madrid, which has suffered from the full force of the real estate crisis.

“It was a transaction that was in the market and we were not the only interested party. Nevertheless, many funds dropped out when they saw the complexity of the project. There were lots of stakeholders: from the judge overseeing the bankruptcy process to the former owners of the company and its creditors”, explains Jorge Pérez de Leza, who heads up Lar España.

The Socimi proposed that the company be brought out of bankruptcy, rather than be liquidated, through the purchase of the remaining loans from its main creditor (Santander). In total, both partners invested €120 million in the land and (associated) loans, as well as in a residential building adjacent to the plot, which used to belong to the former owners of Juan Bravo 3. “The existing creditors are going to be paid, which is the innovative part (of the transaction), and we hope that the bankruptcy proceedings will be lifted within the next few days”, said Pérez de Leza.

The investment has been made through a company whose share capital is owned split 50:50 between Lar and Pimco, one of the largest fund managers in the world. “When Pimco joined the Socimi as an ‘anchor investor’, it suggested that we make a number of joint ventures in the Spanish market. Pimco wants to continue investing in Spain and we think that the next wave of investment will be in the residential market”, predicts the director. With this project, Lar does not exceed the threshold set for Socimis (that no more than 20% of the assets in their portfolio may not generate returns) and therefore it does not rule out continued investment in the premium residential sector.

After closing the acquisition of this land, Lar España hired the architectural firm Rafael de La-Hoz, which had also been appointed by the former managers to design the project. “Juan Bravo 3 offers the opportunity to construct a new building concept with four façades. The homes, from the garages to the bedrooms, will be completely new. As such, we will have almost total freedom in terms of the form (it takes) and we will be able to do without elements such as common areas and patios”, says Rafael de La-Hoz.

This architect will be responsible for designing the block of homes, which will contain between 50 and 55 units, on a plot of land measuring 26,203 square metres. “Last summer, we conducted a study in the market to see what type of project would fit best and we identified that there is room for luxury (properties) in this area. Therefore, each home will measure at least 250 square metres and on average, will measure between 400 and 450 square metres, as well as having three parking spaces”, says Jorge Pérez de Leza.

The homes will have an average price of €10,000/m2 (prices will range from €8,000/m2 to €12,000/m2 depending on the floor). “It will be different to anything else that exists in the area. There will be common areas with a gym, spa and a space for events. We are going to customise the product and for that reason, we have created a specific team of technical architects to advise clients in their choice of materials and the distribution of their homes, as well as on implementation costs and timings”.

Buyers

The sale of these homes will begin this summer, although the developers have already received a number of requests. “We expect 60% of the homes to be sold to foreigners; and the remainder to be sold to people who live in the area and want a new home, or who have a home in La Moreleja or Somosaguas and now want to move to the centre”. The construction work will begin at the start of 2016 and will be completed in mid-2018. “Some of the below-ground work has already been completed, but we will have to improve it because it is somewhat dilapidated”.

In addition to fifty homes, the property will also have a shop space measuring around 1,000 square metres, which will be rented out.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Engel & Völkers’ Business Grows By 60.7% In Spain

30 January 2015 – La Vanguardia

E&V brokered property sales worth €699.25 million in 2014 compared with €435.1 million in 2013.

The luxury real estate agent Engel & Völker increased its business in Spain by 60.7% in 2014, when it brokered property sales worth €699.25 million, compared with €435.1 million in the previous year.

During 2014, it closed 1,071 sales, an increase of 77.6% on the 603 transactions completed in 2013. Nevertheless, the average sales price decreased by 9%, from €719,759 to €652,894, said the firm.

As for the rental market, the number of homes handled by the firm in Spain increased by 66.4% in 2014 with respect to the previous year, as it closed 724 transactions.

As with house sales, the average price of rental accommodation also decreased, by 7.6%, in line with the trend in the market to amount to €2,305 (per month).

During the course of last year, Engel & Völkers opened 14 new offices in Spain: its Market Centers in Madrid and Valencia; and 12 offices located in San Sebastián, Vigo, Tarragona, Benidorm, Calpe, Denia and in several parts of Madrid, including Conde de Orgaz, Majadahonda, Las Rozas, Alameda, Sanchinarro and Aravaca, amongst others. In addition, 16 new licences were sold.

According to Philipp Neimann, the CEO of Engel & Völker in Europe, the Middle East and Africa, the market in Spain is a key priority for the company at the international level.

Having opened its Market Centers in Madrid and Valencia last year, with a total investment of €4.5 million, the prestigious property firm considers that there are still many business opportunities in the country.

Globally, the Engel & Völkers group increased total income from commissions by 10.1%, to €300.3 million, the highest amount the company has ever recorded in its 35-year history.

In 2015, it plans to employ 2,000 new real estate agents around the world, with Spain and the USA earmarked as the priority markets for the firm.

Original story: La Vanguardia

Translation: Carmel Drake