Savills: House Sales will Exceed 500,000 Again in 2019

19 February 2019 – Voz Pópuli

For the first time since 2008, more than half a million homes were sold in Spain last year, and the good performance is expected to be replicated in 2019 with forecasts that between 500,000 and 600,000 homes will be sold.

The deceleration of the Spanish economy – which will move from growing at a rate of 2.5% in 2018 to around 2% this year – is not expected to prevent the residential sector from consolidating its growth, although the maximum levels recorded in 2007, when 775,300 operations were signed in the country, is not going to be repeated.

“We do not think that we will return to those figures. Staying at the sales levels seen over the last two years, of close to 550,000 units sold, will be an excellent result”, explained Arturo Díaz, Executive Director of the residential market at the consultancy firm Savills Aguirre Newman, speaking to Voz Pópuli.

He considers that this rate of growth is reasonable if we take into account the rate of household creation in the country, the levels of purchases for investment and the purchases for holiday homes (…).

The real estate consultancy CBRE agrees with this outlook (…). In fact, the firm is more ambitious with its forecasts as it expects 625,000 house sale operations to be closed in 2019, due to an increase in demand (…).

The growth profile

The main real estate consultancy firms all agree that there will be an increase in new build sales in 2019, in parallel to a slight decrease in the sales of second-hand homes, and so the gap between the two will begin to close.

Moreover, they confirmed that a change has taken place in terms of the profile of house buyers in Spain, with large international investors playing an increasingly greater role.

“Whilst a decade ago, demand for residential assets was dominated by domestic private families (individuals), nowadays, the market is characterised by investment vehicles, institutional funds and insurance companies – owned by foreign capital in many cases – the most active players in this segment”, said Lola Martínez Brioso, Head of Research at CBRE.

House prices in Spain rose by 8.2% in 2018, according to the Real Estate Statistics Registry from the College of Registrars, which means that they are still well below the peaks reached during the construction boom. In 2019, the sector expects the price rises to moderate (to around 4-5%) (…).

Although the price rises will be more moderate overall, there will be important differences by area (…). By region, the experts forecast that the large cities and their metropolitan areas will continue to lead the charge in terms of house price rises, specifically, Barcelona, Madrid, Málaga and the major municipalities in those areas.

Díaz also adds that “other large cities such as Valencia and Sevilla are starting to show a high level of activity”, along with certain holiday markets, “such as the Costa del Sol, Costa Blanca and Costa de la Luz, where the recovery in domestic demand, together with the appeal that those regions have for international buyers, is generating a high volume of purchasing activity”.

Original story: Voz Pópuli (by Alejandra Olcese)

Translation: Carmel Drake

BBVA Completes Sale Of Torre Puig To Grupo Puig

7 June 2017 – La Vanguardia

BBVA has completed the sale of Torre Puig, in Plaza Europa, L’Hospitalet de Llobregat (Barcelona) to Grupo Puig, which has occupied the building in its entirety, as a tenant, since 2014. Aguirre Newman has managed the operation, which has now been signed, after it was announced on 24 April.

The building, constructed in 2014 and designed by the prestigious architect Rafael Moneo, measures 14,288 m2 and has 199 parking spaces.

A group of international investors with varying profiles participated in the sales process, including family offices – firms that manage the investments of wealthy individuals -, insurance companies and institutional funds, although in the end the best offer was made by Inmo, the real estate company owned by the Puig family, which participated in the process like any other interested investor.

“It has been a long and complex process given the characteristics involved, but in the end, we have closed the deal to everyone’s satisfaction”, said Hipólito Sánchez, Director of Investment at Aguirre Newman, in a statement. He is convinced that this will be “one of the most important operations of the year in the investment market in Barcelona”.

Original story: La Vanguardia

Translation: Carmel Drake

Stoneweg Will Construct 2,000 Homes During 2017

22 May 2017 – El Mundo

(…) In line with the strong performance of the Spanish economy and, more specifically, the residential market, the real estate investment platform Stoneweg, a company that manages funds on behalf of institutional investors and family offices in Europe and Latin America, has just made its official presentation, confirming that it has €750 million to invest in property development in Spain during 2017.

Although headquartered in Switzerland, the company was founded in 2015 by two Spaniards, Jaume Sabater and Joaquín Castellví, who both previously worked in the Real Estate area at the investment bank Edmond de Rothschild. Over the last few years, Stoneweg’s investment capacity in real estate assets has exceeded €1,600 million, spread across Spain, the USA, Italy and a small part of Switzerland. (…).

Commitment to Spain

“We decided to take positions in Spain in 2015, buying land and buildings from financial institutions, Sareb and individual owners”, said Joaquín Castellví, Stoneweg’s CEO in Spain. The reasons for the firm’s commitment to Spain include its confidence in the strength of the economic recovery, the “attractive” financing conditions being offered for real estate assets and the “speed and transparency” with which the firm is able to access and close operations with local agents. “Moreover”, added Castellví, “mortgages for real estate assets are increasing again, which means that the Spanish market will be the ideal place to sell assets in around five years”.

Stoneweg’s main investment focus is on the residential market (where it will allocate two-thirds of its capital under management) be it the development of new homes or the renovation of existing buildings. To this end, the modus operandi of the management company, which has already invested €450 million of the €750 million that it is planning to spend this year, consists of closing operations to purchase land or buildings with tickets of between €100 million and €150 million to build on themselves or in conjunction with local property developers.

Currently, the company has 30 residential projects underway (in varying phases), with a total of 1,300 homes, which are due to be ready at various points between this year and 2020. It also plans to close the year with 50 projects in its portfolio, corresponding to 2,000 homes for sale.

Stoneweg insists on building homes “in accordance with the highest international standards, to ensure an extraordinary level of comfort”.

In terms of their locations of choice, Castellví confirmed that his company is focusing on Madrid, Barcelona and the Mediterranean Coast, “but” he says, “ we are flexible both in terms of the type of project, as well as location within the aforementioned areas”. (…).

Original story: El Mundo (by Luis M. De Ciria)

Translation: Carmel Drake

Meridia Capital Considers Creating A Hotel Socimi

21 January 2016 – Expansión

The fourth investment fund that Meridia Capital is going to launch will specialise in the acquisition of urban hotels and may be a Listed Real Estate Investment Company (Socimi).

The founder and CEO of the fund manager headquartered in Barcelona, Javier Faus, said at a forum organised by Exceltur in advance of Fitur that “there is capacity in Spain to have three or four Socimis specialising in the hotel sector”. “And not only in the holiday segment”, said Faus, referring to the only pure hotel Socimi in operation in Spain at the moment, namely, Bay, which was created last year as the result of an alliance between Barceló and Hispania. Faus acknowledged that Meridia is currently analysing whether its fourth fund “could be a hotel Socimi”.

“The final decision still needs to be taken, and although that will not happen for a few months, it will be taken in 2016”, he said. The CEO of Meridia also said that the new vehicle will specialise in urban hotels, although the firm still needs to decide whether it will lease or manage these properties and whether or not it will build up a multi-brand portfolio, containing hotels from various chains. Faus added that he has not yet started talks with any hotel group.

Nevertheless, he is very clear about the location of the assets: Madrid and Barcelona, “although the fund may allocate between 15% and 20% of its resources to investment in other countries”, he added.

Investors

The strong interest in Spain from the international markets is helping the Spanish Socimis, which are consequently not facing much difficulty when it comes to raising capital. The urban hotel segment continues to be one of the most attractive, given the strong performance of the tourist sector in Barcelona and the significant recovery that the business sector is experiencing in Madrid.

In fact, experts in the real estate sector say that the biggest problem at the moment is finding assets available for sale, although in the hotel sector the willingness of the large hotel chains to sell buildings and continue leasing and managing them (sale & leaseback) may represent an opportunity for the Socimis, which for the most part, are looking for assets that they can lease.

This would be Meridia’s fourth fund and it may be created almost in parallel to the third, which is currently being established and which is focusing on investment in real estate assets in general. Faus expects that the third fund will raise capital amounting to €250 million, mainly from institutional funds in the US and Europe, but also from insurance companies. Together with bank financing, he expects that it will invest around €600 million.

The previous fund, Meridia II, invested €400 million between 2014 and 2015, of which €150 million came from investors and the rest from bank financing. The first fund launched by Faus, in 2007, was devoted entirely to the hotel sector, and as such the Socimi that he is considering creating now would not be new territory for him. That first fund acquired hotels outside of Spain, operated by a variety of hotel brands. They included the Hotel Ritz-Carlton and the Crowne Plaza in Santiago de Chile, the Four Seasons in México DF, the InterContinental in Sao Paulo and the Hotel W París Ópera, as well as a stake in three resorts in Thailand operated by Six Senses (…).

Original story: Expansión (by Y. Blanco and M. Anglés)

Translation: Carmel Drake

Axiare Closes Accelerated Placement Ahead Of Its Capital Increase

18 May 2015 – Expansión

The Socimi has just closed an accelerated placement with investors ahead of its capital increase.

The listed real estate investment company (Socimi) Axiare Patrimonio wants to maintain the speed of investment that has enabled it to disburse €460 million since its IPO last summer. To this end, the company has announced a capital increase of €394 million, with the aim of doubling its share capital.

Last week, the Socimi led by Luis López de Herrera Oria launched a brochure containing the details of the transaction, which would involve the issue of around 35.87 million new shares, at a nominal value of ten euros per share, plus a premium of one euro (per share).

The capital increase will have preferential subscription rights. The Socimi’s shareholders include funds such as T. Rowe Price and Taube Hodson, and Citigroup.

Axiare owns assets worth €507.95 million, including office buildings in Madrid and logistics warehouses in Guadalajara (pictured above). During the first quarter of 2015, the Socimi generated revenues of €7.59 million and a profit of €2.32 million.

Placement

Ahead of this capital increase, Axiare closed an accelerated placement of the shares of one of its largest shareholders, Perry Capital, on Friday. The objective of this placement was to provide greater liquidity for the company’s stock.

The placement of 3.5 million shares (representing 9.721% of its share capital) was closed in record time (one hour) and with a slight issue premium (€12 per share). Buyers of these shares included institutional investment funds from the US, Britain and Norway, according to sources at the company.

The subscription rights for these shares will begin trading on 20 May, whilst the shares themselves will begin trading on 10 June. On Friday, Axiare’s share price closed down 0.29% on the stock exchange at €11.94 per share.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

CBRE To Invest €600M In The Spanish Market In 2015

16 March 2015 – Expansión

Real estate assets / The former subsidiary of ING is looking to improve its portfolio through refurbishments and asset purchases.

After more than two decades in the market, the fund manager CBRE Global Investors has become a major player in the Spanish real estate sector thanks to its intense asset rotation policy.

The company, which manages property in this market (primarily shopping centres) worth €2,000 million, closed the sale of various assets last year: Urbil, in Guipúzcoa, which it sold to Axa Reim for €60 million; Alcalá Magna, in Madrid, which it sold to Incus Capital for €85 million; Gran Vía de Vigo, which it sold to the US fund Oaktree for €100 million and Modoo, in Asturias, which it sold for €45 million.

In 2013, CBRE Global Investors was involved in the first major sale of a shopping centre following the outbreak of the crisis, when it sold Parque Principado in Asturias for €141.5 million to the British real estate company Intu Properties. “Between 2008 and 2014, we rotated the portfolio we had created during the previous two decades. Thus, we sold Parque Principado, which was a mature asset, but we purchased other assets. In total, we bought and sold assets worth €1,000 million last year”, explains José Antonio Martin-Borregón, CEO at CBRE Global Investors in Spain and Portugal.

The (property) management company made its first investments in Spain between 1992 and 1993 and three years later, it opened its first offices. Through its five funds, it currently manages 19 shopping centres, including Bilbondo in Bilbao; Vallereal in Maliaño (Cantabria) and Parc Central, in Tarragona. “We started out as the investment vehicle for National Nederlanden, which wanted to invest in properties outside of Holland that were not for its own use. We have maintained this philosophy for 20 years. Our traditional clients are institutional investors”. The latest addition to the portfolio was La Zenia in Alicante, which was acquired using money from the Alaska pension fund.

Advantages

The goal of the Head of CBRE Global Investors is to repeat the transaction volume (recorded last year) during 2015 but with a greater focus on purchases. “We would like to close transactions amounting to €1,000 million this year with a 60:40 split in terms of purchases and sales”, he says. “We have a portfolio of mature assets and therefore we are interested in buying properties that we can add value to”.

In total, the (property) manager expects to invest €930 million in Spain and Portugal. “Demand exceeds supply, which means that prices have increased and new rules are in play. It is not going to be as easy (as it once was) to target successful investments”.

Nevertheless, the Head of CBRE GI does not fear competition from the multitude of investors and institutional funds that have arrived in the Spanish market attracted by the decrease in real estate prices and the expected economic recovery. “As a (property) manager, we try to maximise the opportunities that the market offers, leveraging on our competitive advantage, which is our local knowledge”, says Martín-Borregón. “As a (property) manager, we have more access to capital, which allows us to move (more) quickly to close transactions”, he adds.

The (property) manager is also considering investments in premises (shops/stores) on the street and in strengthening its logistics platforms (it already owns 15). “We will buy logistics assets in new areas and we will sell old warehouses”, he explains.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake