BlackRock Enters Hostel Sector Through the Creation of a JV with Amistat

7 June 2019 – Hosteltur

BlackRock Real Assets has acquired an initial portfolio of three hostels and six establishments in the pipeline from the Barcelona-based hostel chain Amistat Hostels through the creation of a joint venture worth €100 million.

Specifically, Amistat currently operates two establishments in Spain: the Amistat Beach Hostel in Barcelona and the Amistat Island Hostel in Ibiza, and is also building another hostel in Barcelona. In addition, it has signed agreements to open another six hostels in Rome, Porto, Lisbon, Dublin and London.

According to Thomas Mueller, European Head of Value-Added Real Estate at BlackRock, this transaction represents a great business opportunity as although the hostel market has attracted a growing number of institutional investors in recent years, it is still an undervalued sector, due to its fragmented nature and “very low brand penetration”.

Original story: Hosteltur

Translation/Summary: Carmel Drake

Fotocasa: House Prices in Ibiza Cost 38% More Now Than in 2008

25 April 2019 – El Confidencial

Together with Madrid and Barcelona, the real estate market in the Balearic Islands has led the real estate recovery in recent years. Boosted by its geographical limitations (land for the construction of new homes is finite), the boom in tourist rents and the huge push from foreign demand (foreigners account for 30% of transactions), house prices have soared over the last four years to return to the levels of the bubble, and, in some cases, even higher.

Specifically, house prices in both Ibiza and Calvià are now higher than their historical peaks at the height of the previous cycle (up by 38% and 1.6%, respectively, compared to February 2008). That is according to data published by Fotocasa relating to second-hand homes, which reveals that the number of building permits being granted in the two municipalities has also returned to pre-crisis levels.

In fact, Ibiza is one of the most expensive cities in Spain for buying a home, after San Sebastián and Sant Cugat del Vallès, according to Engel & Völkers. Much of the rise in house prices on the island is due to the strong rise in demand, especially from overseas buyers, with Germans leading the ranking by nationality.

According to the College of Registrars, the Balearic Islands is the second most active autonomous region in Spain in terms of house sales with 13.41 sales per 1,000 inhabitants, outperformed only by the Community of Valencia with 15.88 and ahead of the Community of Madrid with 11.63. Moreover, it is the eighth most active province by absolute number of transactions.

Original story: El Confidencial (by E. Sanz)

Translation/Summary: Carmel Drake

Ibiza Exemplifies the Real Estate Market’s Recovery

25 April  2019 – El Confidencial

The real estate market on the Balearic Islands, and especially the well-known Ibiza, have exemplified the market’s recovery since the beginning of the financial crisis, just over a decade ago.  Aided by geographical constraints, limiting any potential growth on the islands, housing prices have increased significantly over the past four years.

Burgeoning demand by foreign buyers has pushed prices on Ibiza to a level that is 38% above the previous historical highs seen in February 2008 (for existing housing).  Other Balearic municipalities are also clawing their way back up, though at a reduced pace.  Fotocasa stated that prices on Calvià are 1.6% above pre-crisis levels while prices in Palma de Mallorca are just 1.3% below.

That growth has led to Ibiza to have the third most expensive property prices in Spain, behind San Sebastian and Sant Cugat del Vallès (near Barcelona), and ahead of Barcelona, Santa Eulalia del Río (also in the Balearic Islands), Pozuelo de Alarcón and Madrid. All have prices exceeding 3,000 euros per square meter. The Balearic Islands also has the second highest levels of real estate activity in Spain, with 13.41 sales per thousand inhabitants, only surpassed by the Valencian Community with 15.88 and ahead of the Community of Madrid, with 11.63.

Prices in the Canary Islands are currently 22.1% below the high of May 2007 (2,155 euros per square meter), while prices Madrid are 27.4% below its high of June 2006 (3,970 euros). On the other hand, prices in Navarra are still 53.3% below their previous highs, followed by La Rioja (-53.2%) and Murcia (-50.5%).

Original Story: El Confidencial – E. Sanz

Translation/Summary: Richard D. Turner

Mexican Firm Terralpa to Invest €250M in Spain over 3 Years

8 April 2019 – Eje Prime

Terralpa Investments is planning to invest €250 million in Spain over the next three years. The group, owned by the Mexican magnate Rodrigo Lebois (Unifin) and José Ramón Liñero (Terrafondo), is planning to focus its activity in Madrid, but is also interested in investing in other provincial capitals and internationally recognised cities across the country, such as Ibiza and Marbella.

The group completed its first operation in Spain in 2017 through the company Aralpa Inversiones, when it acquired the building located at number 11 Plaza del Marqués in the Salamanca neighbourhood of Madrid for almost €50 million.

As a result of that project, Terralpa Investments was created in February 2019, to focus on the development and renovation of prime homes. It is already working on its first operation, the purchase of number 5 Calle Monte Esquinza, in Madrid, for €14 million. That building contains twelve homes and the plan is to renovate the property in its entirety, starting this summer ready for delivery at the beginning of 2021.

Original story: Eje Prime (by Marta Casado Pla)

Translation/Summary: Carmel Drake

CBRE: Hotel Investment in the Balearics Doubled in 2018 to c. €1bn

26 March 2019 – Preferente

According to data compiled by CBRE, 47 transactions were closed in the hotel market in the Balearic Islands in 2018, corresponding to a total investment volume of more than €967 million. That figure accounted for 20% of the capital invested in Spain during the year and 32 of the transactions were concentrated in Mallorca, followed by Ibiza with 11 operations and Menorca with just 4.

Most of the operations involved hotel portfolios although two individual asset sales stand out due to their high prices per room: Hospes Maricel & Spa (as part of the Hospes Portfolio) and Belmond La Residencia. Both are 5-star establishments.

Palma (de Mallorca) maintained its position as an attractive urban tourist destination, with the addition of seven new hotel establishments comprising 275 rooms during 2018 alone.

More than 10.3 million visitors travelled to the Balearic Islands during 2018, up by 2.3% YoY, breaking the record the fourth year in a row. Nevertheless, the number of overnight stays fell slightly to 59.3 million (down by 0.4% YoY). Meanwhile, the ADR of the hotels on the islands broke the €100 barrier to reach €104.10 in 2018, up by 5.5% compared to 2017. In addition, RevPAR rose by 3.5% YoY to €80.10.

Original story: Preferente (by R.P.)

Translation/Summary: Carmel Drake

Ministry of Development: Ibiza was Spain’s 2nd Most Expensive City for Buying a Home in 2018

22 February 2019 – Eje Prime

Change is afoot in the ranking of Spain’s most expensive cities for housing, and Ibiza is rising fast. In 2018, the Balearic city was ranked as the second most expensive place in Spain to buy a home, with an average value per square metre of €3,537.40. In this way, in just one year, Ibiza has surpassed Barcelona, Sant Cugat del Vallès and Santa Eulalia del Río to be ranked in second position, just behind San Sebastián.

According to data from the Ministry of Development published yesterday, house prices in Ibiza rose by 20.4% in 2018, compared with an increase of 4.5% in the case of San Sebastián. Meanwhile, prices per square metre in Barcelona rose by 10.1% in 2018; by 8.8% in Sant Cugat; and by 7.3% in Santa Eulalia del Rio.

Madrid retained its position as the sixth most expensive city for buying a home in 2018 with a price per square metre of €3,103.80 and a YoY increase of 8.5%. It was followed by Pozuelo de Alarcón, which exceeded Majadahonda, Getxo and Calvià in 2018 with a price rise of 20.4%, the same as in Ibiza.

Only three municipalities of the twenty most expensive in Spain saw their prices decrease in 2018 (Getxo, Calvià and Leioa) with reductions of 1%, 4.6% and 0.1%, respectively. On the other hand, Avilés, Narón and Alcantarilla were the municipalities with more than 25,000 inhabitants where house prices decreased by the most in 2018, with drops of 11.6%, 8.9% and 8%, respectively.

Moreover, besides Ibiza, the Madrilenian municipality of Torrejón de Ardoz saw its prices rise by the most in 2018, also up by 20.4%. It was followed by rises of 19.8% in Ciutadella de Menorca, 19.6% in Esplugues de Llobregat and 18.9% in Leganés.

House prices in many other places also rose by a lot more than the national average, of 3.9%, including in Móstoles (18.5%), Cornellà de Lloregat and Palencia, with rises of 18.2%, and Martorell (17.4%).

Original story: Eje Prime (by C. de Angelis)

Translation: Carmel Drake

Apple Leisure Group Debuts in Spain with its Purchase of a Majority Stake in Alua Hotels

23 January 2019 – Revista 80 Días

The US group is one of the largest managers of accommodation in the Caribbean. This purchase allows it to enter the vacation segment and the European market.

Apple Leisure Group (ALG), one of the largest hotel investors in the USA, has acquired a majority stake in the share capital of Alua Hotels and Resorts, the hotel group founded in 2015 by its main executives and the private equity fund Alchemy Partners. The amount of the purchase has not been revealed, although the joint operating result of the chain’s main hotels amounted to €6 million in 2017. Given that the properties are located in areas with high tourist demand and good forecasts, the amount of the operation could have exceeded €40 million, based on the multiples that are typically used for this type of transaction.

With this acquisition, ALG is entering the European market through the sun and beach holiday segment. And it is doing so in a country such as Spain, which receives more than 80 million tourists per year in search of that kind of offer. Alua Hotels has 11 hotels located in Mallorca, Ibiza, Fuerteventura and Tenerife, together with an apartment building in Ibiza.

In total, ALG will manage more than 3,000 4-star hotel rooms, focused on the type of tourist who wants a superior service to that usually found in the average accommodation establishments in beach areas. The US company is planning to undertake more acquisitions in the European market and has announced that it wants to become a reference player in the main destinations in the Mediterranean (…).

Apple Leisure Group is one of the most important investment conglomerates in tourism in the USA. It used to be owned by the investment fund Bain Capital (…), which sold it in 2017 to the funds KSL Capital Partners and KKR for an undisclosed sum. (…). According to data from the conglomerate, it manages 14 brands and handles more than 3.2 million passengers per year (…). Its turnover exceeds USD 3 billion per year (…).

Original story: Revista 80 Días 

Translation: Carmel Drake

Taylor Wimpey to Invest €70M in 8 Developments in 2019

22 January 2019 – Eje Prime

Taylor Wimpey is setting out its roadmap for 2019. The Spanish subsidiary of the British real estate group is going to launch eight developments with an initial investment of €71 million during the course of this year, according to comments made by Javier Ballester, the CEO of the company, speak to Eje Prime.

The company is planning to build between 350 and 400 homes in several parts of the country. Specifically, Taylor Wimpey has opted for areas where it already has a presence, namely: the Costa del Sol, Alicante, Mallorca and Ibiza. Moreover, according to the executive, “it is possible that, if we obtain the building permits in 2019, the group will launch three more developments, one in Marbella and two more in Mallorca”.

Taylor Wimpey is whereby reaffirming its commitment to the Spanish second home market, where it has been operating for more than seventy years. In fact, the company is currently one of the main property developers in the country that is building assets on beach fronts and overlooking golf courses,

In 2018, the company handed over 342 homes, 14% more than in 2017. It is currently marketing four developments in Alicante, in the municipalities of Torrevieja, Villajoyosa and Elche (…).

Original story: Eje Prime (by Berta Seijo)

Translation: Carmel Drake

Ibiza’s Real Estate Market is a “World of its Own”

11 July 2018 – Diario de Ibiza

The real estate market in Ibiza is not encouraging (for the majority): the available stock of homes “is residual”, the majority of homes bought there are rented out, the peak prices reached in 2017 have been exceeded…and all of this is being compounded by a distinct shortage of land. All in all, it is a troubling scenario for those wishing to live on the island all year round.

Tinsa’s Regional Director for the East and South of Spain, José Antonio López, warned on Wednesday that the lack of land, combined with the demand for housing “is generating a dangerous melting pot” in the Balearic Islands. As such, he is asking the administration to get involved to facilitate the availability of land for property developers.

Those were the words used by López in response to a question from participants at a Proinba-Tinsa real estate meeting held in Palma on Wednesday, where the situation of the residential real estate market was discussed, in particular, the market on the coast.

López warned that this situation may “lead to serious problems” on the islands, where “young people need primary residences” and they “need options”. “For this reason, land is required, and the administration needs to get involved”, said Tinsa’s Regional Director, before adding that the supply of urban land with building permission is “almost non-existent”.

What’s more, “the supply is going to decrease” and with the “surplus demand”, we are seeing “dangerous growth that cannot be met”. In this context, “rental is not an option because those circumstances are also being taken advantage of”. In fact, according to data from Tinsa, in areas such as Ibiza (town), many people are buying to let (…).

Based on data from Tinsa, the average monthly mortgage payment on the Balearic Islands is very high, €792, well above the average for Spain as a whole, €543/month. The financial effort being made by families on the islands is also greater, given that they spent 22% of their household income on mortgages during the first year, compared with the national average of 16.8%.

Ibiza and Formentera set a new record

Of the 12 coastal municipalities analysed on the Balearic Islands, Sóller leads the increase in prices over the last year, with price rises of 21%. Ibiza and Formentera towns came in close behind, with 17.8%, followed by Santa Margalida (17.7%), Palma (14.7%) and Llucmajor (13.8%).

Palma is one of the top five most expensive capitals in Spain, with an average price of €1,951/m2, and in the last year, its growing trend has exceeded the average for the autonomous region.

By contrast, the municipalities that have grown by the least are Sant Lluís and Mahón (3.7%), Ciutadella (4.5%) and Manacor (7.1%) (…).

Ibiza is “recovering too quickly”

According to data from Tinsa, the real estate sector on the coast in Mallorca is “clearly recovering”, whilst in Menorca, there are “signs of recovery” and in the case of Ibiza, there may even be an “excessive recovery”, in López’s opinion.

Prices have been “rising rapidly” on the white island, on a consistent basis for the last few years, and the YoY variation is well above the average. In fact, current prices have already exceeded the maximums seen in 2007.

On the basis of all of these indicators, the Regional Director at Tinsa said that Ibiza’s real estate market could be considered “a world of its own, set apart from other islands and provinces” (…).

Original story: Diario de Ibiza (by E.P.)

Translation: Carmel Drake

RTV Grupo Inmobiliario Invests €10M in Purchase of Former Lluro de Mataró Cinema

5 June 2018 – Eje Prime

RTV Grupo Inmobiliario is continuing to expand its portfolio of properties in the Catalan market. The company is going to invest €10 million in the purchase of the former Lluro de Mataró cinema (the largest cinema in Spain in its hey-day) and its subsequent renovation, according to explanations provided by the group in a statement.

The start date for the execution of the construction work is planned within the next six months, once the building permits have been granted. The former cinema, which closed its doors in 2001, and the complementary office building, which used to house the Tax Authorities in Mataró until their move to the El Rengle building, has a total surface area of 9,650 m2, of which 4,500 m2 are above ground and the remaining 5,150 m2 are below ground. The buildings will be renovated in their entirety.

The new complex will comprise two residential buildings with 23 homes in total, a commercial space on the ground floor and two underground floors for parking. The plot on which the complex to be renovated is constructed and the area inside the block where the commercial space and parking lot will be located amounts to around 2,700 m2.

RTV Grupo Inmobiliario is working on residential promotions with similar characteristics in different areas of Maresme, including in Vilassar, Llavaneres and Mataró, and it plans to start work on new developments shortly in Barcelona and its surrounding area, Girona and Ibiza.

RTV Grupo Inmobiliario started its activity in 2000 focusing on the property development sector through the management and development of integral real estate projects. In recent years, it has managed the marketing of luxury homes, participated in advising real estate investments and worked on the administration and management of real estate assets.

It acts as a partner for several private banking divisions whose portfolio of clients are interested in diversifying their investments and returning to the real estate sector once again, taking advantage of the opportunities that are arising in the market.  In recent years, they have resumed the direct development of residential promotions in the regions of Cataluña and the Balearic Islands.

Original story: Eje Prime

Translation: Carmel Drake