Tag: hotel assets

CBRE GIP & Pygmalion Join Forces to Acquire 9 Hotels

13 November 2018 – Iberian Property

CBRE GIP and Pygmalion Capital Advisers LLP have recently established a new joint venture for the acquisition and repositioning of hotel assets in Europe, including Spain.

The partnership was launched through a formal tender, the acquisition of NPL’s debt and a portfolio of 9 four-star hotels in Spain, formerly belonging to construction group Urvasco.

The portfolio includes 1,650 rooms in hotels in Sevilla, Madrid, Bilbao, San Sebastian, Santander, Tenerife, Valladolid and Ciudad Real. Hoteles Silken will operate the assets through a long-term deal established with the joint venture, as part of a full repositioning program.

Alexander van Riel, in charge of CBRE GIP for Western Europe, said in a release: “We have entered the Spanish hotel market for the first time with the acquisition of a much sought-after portfolio. This transaction is in line with our global strategy to create strategic joint ventures with experts in the sector”.

And he added that “We will generate value through selective actions of added value and at the same time we will benefit from the stable and safe flow of stays. In time, we will make additional investments in hotels with indexed rentals”, he concluded.

Christophe Beauvilain, founding partner at Pygmalion Capital Advisers LLP, added that «This alliance underlines our vision for the market of buying, at desirable prices, a pan-European portfolio of businesses and hotels, taking advantage of the special circumstances provided by the growing market of bad loans (NPL)  which exists in Europe. The combination of European banks which remain highly exposed to bad loans and the countless debt funds that have been actively buying NPL portfolios, provides a large source of opportunities for investment and for our specialised strategy. Silken’s hotel portfolio provides us with a solid basis to carry out a fast expansion in the Spanish market given our growing flow of investment opportunities”, said the release.

Cuatrecasas law firm, directed by Fernando Bernad Ripoll, provided legal assistance. Christie & Co and JLL carried out the commercial and technical due diligence respectively.

Original story: Iberian Property (by Ana Tavares)

Edited by: Carmel Drake

Hotel Investment Is Thriving In Valencia & Alicante

2 December 2016 – Levante-EMV

Hotel investment has increased by 162% and profitability has soared by 17.5% in Valencia and by 27.5% in Alicante, driven by the tourist boom. According to sources in the hotel and real estate sector, the owners of buildings are aware of the increase in investor demand; and offers for buildings up for sale and rent in Valencia have multiplied. Specifically, three properties in iconic locations have come onto the market in recent weeks for €15 million and another three have been put up for rent. Several operations have also been signed, including the Valencian chain Casual Hotel’s purchase of the former Hotel Londres in the Plaza del Ayuntamiento for €6 million and the acquisition by the chain Myr of the Café Madrid building, in an operation amounting to €12 million.

According to the consultancy firm CBRE, the increase in the number of operations is due to “strong demand from investors to buy and capitalise hotel assets, and benefit from the clear recovery in the real estate sector in Spain and the strengthening of the economy, which is expected record GDP growth of 3.1% this year. Moreover, international tourism in Spain is expected to exceed the 70 million visitor threshold for the first time this year”.

Sources in the sector explained that one of the properties that has been put up for sale (for €6 million) is on one of the streets adjacent to the Plaza del Ayuntamiento; another, located on Calle Ballesteros is on the market for €3.5 million; and another one, next to the Palacio del Marqués de Dos Aguas, is up for sale for €9 million. In addition, the German property developer Ratisbona (linked to the Vice-President of Bayern de Munich, Rudolf Schels) has acquired an office building on Calle María Cristina (next to the Plaza del Ayuntamiento) for €3 million, which it plans to convert into a hotel.

Above all, hotel operators are interested in leasing properties as an alternative to buying them. Real estate sources state that there are three high-profile projects in the rental market at the moment: the property at number 1 on Calle Colón; the former headquarters of CAM on the corner of Pascual y Genís with Martín Cubelles; and the former Telefónica building on Calle Isabela Católica.

The building on Calle Colón 1 was the former headquarters of the Social Security agency. The Dénia-based property developer Enrique Pla and the Valencian-based businessman Enrique Ballester acquired the nine-storey property for €14.2 million a year ago and sold the lower three floors in the summer for €20 million (where a Pull and Bear store is due to be opened). The two businessmen have now decided to generate returns from the rest of the building and are converting it into a hotel with the aim of leasing it to a chain.

The former headquarters of the CAM is an office building belonging to employees of Banco Sabadell through their pension fund. The same real estate sources said that the building is not up for sale, but that the owners are looking for a hotel operator who may be interested in operating it (amongst other options). (…).

The former Iberdrola building on Calle Isabela Católica has been closed for years and its owners are also trying to turn it into a hotel. Iberdrola sold the building to a group of local real estate companies led by Gesfesa for €24 million before the collapse of the real estate market.

Original story: Levante-EMV (by Ramón Ferrando)

Translation: Carmel Drake

Sabadell & Bankia Finalise RE Portfolio Sales To Sankaty

29 June 2016 – Expansión

Spanish banks and international funds are negotiating against the clock as they seek to close operations worth hundreds of millions of euros within the next few days. Entities have offers on the table for real estate assets worth almost €4,000 million. And some of them are expected to bear fruit today or tomorrow, so that they can be accounted for in the half-year results.

The negotiations are even more frantic than in previous years due to the slowdown caused by the electoral calendar, which caused opportunistic funds to be prudent with their offers. One of the most influential factors was the fear that Podemos would enjoy electoral success.

Now that the uncertainty (surrounding Podemos) has been resolved, Sabadell and Bankia have been particularly agile in reaching agreements.

Yesterday, the Catalan entity sold a portfolio containing €460 million of problem assets linked to property developers, as part of Project Pirene. The buyer is the fund Sankaty Advisors, a subsidiary of the US giant Bain Capital. Sources in the market estimate that the investor paid Sabadell between €150 and €200 million for these assets.

Dominant investors

Sankaty’s interest in Spain has not been limited to that portfolio, given that it is close to securing another deal that has attracted significant interest from other large international investors: Project Lane, sold by Bankia, comprising 2,500 homes worth €400 million. This is the first portfolio to emerge from the carved up Project Big Bang; the entity had wanted to sell all of its foreclosed assets together, but that plan was suspended at the end of last year. Sources expect to know whether this operation will go ahead within the next few days.

The sale of the other two asset portfolios that Bankia has on the market are proceeding more slowly: one contains non-performing mortgages – Project Tizona – worth €520 million; and the other contains non-performing property developer loans – Project Ocean – amounting to €400 million.

Sankaty expects the recovery of the Spanish real estate sector to go beyond Sabadell and Bankia’s portfolios, as indicated by the fact that it is one of the main favourites to acquire Project Baracoa, from Cajamar. That will be the first sale of bankrupt loans by a Spanish bank. In total, the rural savings bank is looking to get rid of €800 million of these types of loans, which account for 70% of all of its bankrupt assets. 85% of them are secured by real estate collateral.

Another operation that is generating significant interest is Project Carlit, launched by CaixaBank, through which the Catalan group wants to transfer €790 million of doubtful loans to property developers. The bid is in its final phase with two key favourites in the running: Cerberus, which according to sources consulted is “putting all of its eggs into one basket”; and the alliance between Goldman Sachs and TPG, two US investors who have joined forces in the past. The US fund D. E. Shaw is also through to the final round, but it has not participated in any operations in Spain for a long time and the market considers that it is less likely to win the portfolio.

CaixaBank has another major operation underway: Project Sun, through which it wants to sell 155 hotel assets worth almost €1,000 million.

Another one of the most active entities is Abanca, which recently sold €1,400 million in non-performing loans to EOS Spain and which will be negotiating the sale of €400 million property developer loans over the next few weeks.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake

Hispania Completes €337M Capital Increase

28 April 2015 – Hispania Press Release

Hispania has completed the investment of the funds raised in its IPO in March 2014, including its leveraging capacity.

Investors placed orders for shares amounting to more than €844 million at the offer price of €12.25 per share, which implied an excess over demand of 2.5 times vs. the number of shares offered.

Hispania Activos Inmobiliarios, S.A. has successfully closed the €337 million capital increase it announced yesterday, which was aimed at institutional investors. The capital increase was carried out by means of an accelerated private placement and the strong demand allowed the Socimi to close the deal in just 3 hours.

Total demand surpassed €844 million at the offer price of €12.25 per share, which represents a 4.7% discount vs. yesterday’s closing price of €12.86 per share.

The new shares represent 50% of the company’s share capital before the capital increase and 33% of its share capital after the capital increase.

“The excellent response from investors to our capital increase shows how much the market trusts Hispania and its capacity to generate more value within its asset portfolio. Hispania is currently analysing a pipeline of opportunities worth around €2,400 million. For this reason, it is vital that we have equity available so as to be able to take advantage of the opportunities in the market”, said Concha Osácar (pictured above), Board Member of Hispania.

Hispania is the first of the so-called Socimis in the Spanish market to have completed the investment of almost all of the equity raised through its IPO, as well as its leveraging capacity, reaching a total committed investment of c.€880 million. Its asset portfolio comprises 46 assets (including the assets that Bay will acquire by virtue of the Investment Agreement signed with the Grupo Barceló). It is expected that, after the acquisition of the assets by Bay and once the repositioning capex has been invested in the current portfolio and in the assets to be acquired by Bay, 57% of the value of the assets in the portfolio will correspond to hotel assets, 27% to office assets and the remaining 16% to residential assets. These figures include the capex investment expected for 2015.

Hispania foresees significant investments to improve and reposition the assets that currently form part of the portfolio, including Bay, amounting to c.€50 million in 2015- on a consolidated basis.

Original press release: Hispania

Edited by: Carmel Drake