Tag: international investors

Cerberus, Intrum & DoBank Bid to Acquire Altamira

15 November 2018 – El Confidencial

There is still an appetite for the servicers’ business. The sale of the 85% stake that Apollo owns in Altamira is making its first cut of candidates, with some of the most high profile investors in the segment amongst the finalists. According to financial sources, the fund Cerberus (Haya Real Estate), the Swedish firm Intrum (Nordic Capital) and the Italian firm DoBank (Fortress) are the candidates that have progressed in the process, which is being coordinated by Goldman Sachs, and which was relaunched after the summer following months on the table.

Other players in the sector interested in Spain are also in the process, both at the domestic and European level. One of those new candidates is the US firm Davidson Kempner, which has a portfolio of USD 30 billion under management and with interests in the transformation of toxic assets in the United Kingdom and Ireland, according to sources involved in the operation.

Apollo is willing to take advantage of the hunger for this type of vehicle to make gains, although it does so after four years at the helm of the servicer and having not been awarded any of the large real estate portfolios that the banks have sold (Santander to Blackstone, BBVA to Cerberus, CaixaBank to Lone Star and the Sabadell-Solvia process, in whose final stretch it is not participating). In fact, this divestment comes after Apollo’s manager for the last few years – Andrés Rubio – left the fund.

The price of the management platform could reach €1.5 billion (debt included), a business for which Apollo paid €664 million in January 2014 in exchange for an 85% stake (the remaining 15% is still owned by Banco Santander). The agreement comprised the management of toxic assets (recovery of loans and sale of properties) until 2028, although the transformation of that perimeter has led to a change in the management conditions (commissions) and to the repayment of a €200 million dividend.

Altamira has assets under management amounting to more than €50 billion, compared with €26 billion in 2014, and a portfolio comprising more than 82,000 properties at the end of 2017, making it the largest servicer in operation in Spain. In addition to its contract with Santander, it also manages assets for Sareb (which account for 30% of its portfolio) and for third parties – international investors, financial institutions, family offices and institutional clients – as a result of the international expansion plan launched in 2017.

Original story: El Confidencial (by Carlos Hernanz)

Translation: Carmel Drake

Savills Aguirre Newman: International Investors Focus on Spain’s Offices

25 October 2018 – Eje Prime

Offices are the most sought-after assets by overseas investors in Spain. The limited availability of workspaces with the appropriate requirements is pushing international investors to bet heavily on this real estate segment.

In light of the shortage of high-quality stock, overseas investors have a Plan B for the country. According to the latest report from Savills Aguirre Newman, investors are currently looking for new build projects and are opting to renovate properties already being offered in the Spanish market.

The recovery of the economy and the consequent reactivation of employment has meant that buyers see Spain as a country with lots of opportunities in the office segment. This trend is expected to last for a few more years, above all in cities such as Madrid and Barcelona, where the creation of employment is set to grow above the European average; with annual growth of 1.7% and 1.5%, respectively (…).

In 2017, rents in the office segment rose, by 6% on average, in the main financial districts of Europe. Nevertheless, four cities led the growth in rental prices last year: London, up by 13.9%; Stockholm, 12.5%; Berlin, 12.4%; and Madrid, 10.7% (…).

Original story: Eje Prime (by B. Seijo)

Translation: Carmel Drake

Eurostone Buys 2 Mixed-Used Buildings in Barcelona

21 May 2018 – Eje Prime

Major operation in the prime area of Barcelona. The Luxembourg-based fund Eurostone, managed by Grupo Mina, has purchased two entire buildings in the Sarrià-Sant Gervasi district of the city from a local family office for €50 million. The properties span a combined surface area of more than 12,000 m2.

The larger asset is located on Calle Aribau and measures 7,461 m2. Constructed in 1918, the property is designated for residential use, for living in as well as for tourist rental. In the internal patio, there is also an office building called La Farinera.

Meanwhile, the second building acquired by Eurostone, which has been advised in this operation by the consultancy firm BNP Paribas Real Estate, is located on Calle Tuset. The asset, constructed in 1944, has a surface area of 4,786 m2 and a commercial premise on the ground floor. The rest of the property is made up of homes.

“This operation highlights the interest that the Catalan real estate sector is sparking amongst the funds and other international players, who still see Barcelona as a priority market in which to invest”, says Francisco López, Director of BNP Paribas Real Estate in Cataluña.

Original story: Eje Prime

Translation: Carmel Drake

Knight Frank: Inv’t in Logistics Will Amount to €1.2bn in 2017

4 December 2017 – Eje Prime

The Spanish logistics sector is on the right track as the industry approaches the centres of the country’s largest cities. The new methods of consumption, which demand greater speed when it comes to receiving a product and the increase in the volume of online purchases, has led to a rise in the leasing of logistics land in Spain, in particular in the regional capitals. During the nine months to September, investment in the market amounted to €550 million and that figure is forecast to reach €1.2 billion before the end of the year.

Spain’s Gross Domestic Product (GDP) is growing at a rate of 3% p.a., and the index is not escaping the gaze of international investors, who are placing their trust in the country. This has been demonstrated by the largest logistics operation recorded so far this year involving P3 Logistics Parks, the developer controlled by the sovereign fund of Singapur GIC, which paid €243 million for GreenOak’s logistics portfolio in April, according to a report from the consultancy firm Knight Frank.

In addition to Madrid and Barcelona, several other large regional capitals have benefitted from the investments made in the purchase of industrial land on the outskirts of cities. Such is the case of Valencia, in the adjoining town of Ribarroja, where the largest operation was signed during the third quarter of the year. There, TH Real Estate acquired a Carrefour logistics platform measuring 55,000 m2, on a plot with a surface area spanning 87,000 m2.

Focusing on the Community of Madrid, the report points out that the absorption of logistics space has soared this year. The figures for the third quarter of the year, when 675,000 m2 of space was leased, exceed the surface area recorded during the whole of 2016 in the Spanish region. The international consultancy firm forecasts that Madrid will close the year with absorbed logistics surface area of around 800,000 m2.

The large deals notably drove the increase in the surface area leased in the country. Seven of the transactions signed in the sector during 2017 involved assets spanning more than 40,000 m2.

Prime yields, on the rise in Madrid and Barcelona 

In a survey of international investors conducted by Knight Frank, 51% of those questioned chose industrial and logistics assets as their preferred asset type for investment over the next five years. This investor appetite has led to an increase in the price of Spanish industrial land. Prices in the logistics market are on the rise, although yields are remaining stable.

In the market for logistics assets in Madrid, prime rents amount to around €5.25/m2. The forecasts indicate that the increase in demand and the improvement in the quality of new logistics facilities will lead to an average annual increase in rental prices in the region of around 3%.

Meanwhile, in Barcelona, the price of prime logistics land is even more expensive at around €6.85/m2. If we look at a map of Europe, the Catalan capital is the seventh most expensive city, and the most expensive, by far, in the south of the continent. In this sense, Barcelona, where land is already more expensive than it is in Frankfurt (€6.65/m2), is only exceeded by Amsterdam (€7.10/m2), Munich (€7.10/m2), Dublin (€8.15/m2), Helsinki (€10/m2), Geneva (€14.55) and London (€15.25/m2).

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake

Spain’s Largest Banks Compete to Grant Property Developer Loans in Benidorm & Dénia

26 November 2017 – El Confidencial

The appearance of new housing developments in areas of high demand, as well as those targeting a premium public, has opened a battle between the large Spanish banks to position themselves as lenders once again. CaixaBank, Santander, Sabadell and BBVA have gone from recoiling at the mere sight of real estate projects unrelated to their own portfolios and stocks, to fighting it out with each other to grant loans to private property developers for certain initiatives linked to luxury and super-luxury projects.

That is what El Confidencial has been able to confirm with financial sources from two of the most powerful property developers that have fired the starting gun on the Alicante Costa Blanca, namely, the Delfin Tower in Benidorm and Amare in Dénia. The former is a 22-storey luxury skyscraper, measuring 100 m tall, on one of a handful of beachfront plots in the well-known mecca of Spanish tourism. It boasts location, high quality, architectural design and environmental sustainability. So much so that the prices of its apartments range from €700,000 to €1.56 million.

The money to carry out this project will not come from international entities or investors. CaixaBank, Sabadell and BBVA have taken a step forward and entered the final round in the process to negotiate the financing. The process is being led by independent consultants and the entity led by Jordi Gual (CaixaBank) is leading the race in an operation that will exceed €30 million.

The same level of competition, or more, and with the same players, has happened in the case of the Amare development in Dénia. The real estate project is backed by a company called AB Living, owned by the founder of SHA Wellness Clinic, Alfredo Bataller (…).

The businessman, originally from Argentina, who has lived in Altea since 1989, is known together with his wife, Graciela Pineda, for his hotel activity, but he has also launched himself into luxury real estate development. He manages properties on the Costa Blanca, is building an events space in the heart of Madrid’s Salamanca neighbourhood (SHA Loft) and has just put on the market the largest luxury beachfront development in Dénia, where very few free undeveloped plots remain. The residential project comprises 68 homes with terraces, infinity pools and more than 5,000 m2 of gardens, plus swimming pools, a children’s club, gym and events room. Prices per apartment range between €350,000 and €500,000.

Bateller purchased the plot several years ago. The project is being marketed by Olivares Consultores and has already been granted the corresponding licences by the Town Hall of Dénia, and so the construction work could start shortly. With almost 30% of the properties reserved, AB Living has started negotiations to obtain the bank financing it needs to carry out the construction work. And it has no shortage of offers. According to market sources, CaixaBank, Santander, Sabadell and Bankinter have all entered the bidding and are fighting to grant Amare’s property developer loan. That operation will amount to around €25 million.

According to sources in the sector, the premium nature of these kinds of developments allows them to demand additional guarantees from their buyers in the pre-sales contracts (…). And with those conditions, the financial entities are drooling over the prospect of becoming the lender to enable the execution of the building work. Moreover, their loans may subsequently be subrogated to the individual homeowners, normally wealthy people and families, who automatically become clients (…). The bank financing will cover around 60%-70% of the cost of the building work. The property developer contributes its own funds and the pre-sales contracts.

Original story: El Confidencial (by Víctor Romero)

Translation: Carmel Drake

Demand for Luxury Homes Plummets in Barcelona & Soars in Madrid

23 November 2017 – Expansión

Since 1 October, demand for luxury homes has plummeted by 50% in Barcelona, with a 20% decrease in prices; meanwhile, demand has risen by 40% in the Spanish capital where prices have gone up by 10%.

Secessionism is sinking the Catalan real estate market due to the threat of uncertainty. “Demand for luxury housing has plummeted by 50% in Barcelona between 1 October and 15 November”, explains Emmanuel Virgoulay, Founding Partner at Barnes International in Spain. Whilst Barcelona falls, interest from buyers in these kinds of assets in Madrid is soaring by 40%, according to the real estate company that specialises in the premium segment.

“For every home for sale in Madrid, there are four buyers”. In Barcelona, by contrast, “the damage has already been done”, explained Virgoulay, referring to the unilateral referendum. That process has marked a before and after in the Catalan economy. The uncertainty has caused panic to spread throughout the markets, leading to the flight of more than 2,600 companies, causing the confidence of businessmen and consumers to collapse and paralysing investments. Housing, along with tourism, has been the most affected sector.

Before 1-O, Barcelona was enjoying its best moment since the crisis. The prices of high-standing properties were growing at a rate of 15%. However, since 1 October, the decrease in prices amounts to 20%. During the same month, the cost of these types of assets in Madrid has also moved by double digits, but in the opposite direction, with growth of 10%, like in the Balearic Islands. In Andalucía, the variation has been somewhat lower, between 5% and 10%, according to market sources.

In Barcelona, the rise in prices had generated a bubble. “Some owners were aligning the price of their properties with those in the most exclusive parts of other cities in Europe”, explained Virgoulay. However, investors “put the handbrake on” several months ago now. In October, there was a 50% decrease in the number of deeds signed for the sale and purchase of homes and mortgages, with buyers pulling out and preferring to lose their deposits, which can represent up to 10% of the purchase price, than going ahead with their purchases.

“Investors are going to come to Madrid because the market is safer”, explains Virgoulay. Currently, 57% of the luxury real estate acquisitions that are made in Spain take place in Madrid. The Spanish capital is the most attractive city for domestic and international investors alike. “The weight of the investor market is comparable with the market for primary residences”, he explains.

Looking ahead to year end, Virgoulay considers that, since the Government took action, with the application of Article 155, “the outlook is stable and demand has been starting to recover since 15 November”. But, 21 December is emerging as a new door to uncertainty “anything can happen once again”. Nevertheless, “Prices are going to rise, in general, but in Barcelona, it is clear that they are not going to evolve, they are going to fall”.

In Madrid, like in Barcelona, the average price of luxury housing amounts to €8,000/m2. In the Balearic Islands, where the main demand is from European buyers for second homes, the price per square metre amounts to €7,500/m2.

Barnes plans to open new offices in 2018 in locations such as the Balearic Islands and the Canary Islands. Cataluña was another one of its objectives, but, for the time being, no date has been set for that opening.

Original story: Expansión (by Inma Benedito)

Translation: Carmel Drake

CBRE: Real Estate Inv’t Will Exceed €13,000M In 2017

5 October 2017 – Expansión

Real estate investment in Spain is continuing to enjoy happy times, with on-going growth and record-breaking figures.

Between January and September, €10,300 million was spent on real estate assets, up by 58% compared to the same period last year, say sources at the real estate consultancy firm CBRE. Between July and September, the volume of investment moderated with respect to the “extraordinary figures” recorded during the first half of the year, to amount to more than €2,700 million. “This data is very positive and confirms investors’ appetite for the Spanish real estate sector”, said Adolfo Ramírez-Escudero, President of CBRE España.

By type of property, retail assets and hotels are the investment focus, accounting for 26% and 23% of the total, respectively, although all of the assets are experiencing growing interest. “Domestic and international investors are continuing to see Spain as a market with great potential and are showing interest in the full range of asset types”, say sources at CBRE.

In total, the retail sector accounted for €2,700 million of the total investment during the first 9 months of 2017, comprising both shopping centres and high street premises. Meanwhile, operations such as the purchase of Edificio España by the hotel chain RIU for €272 million increased investment in hotel assets during the first nine months of the year, by more than 122% with respect to the same period in 2016, to reach €2,390 million. Another type of asset that saw an exponential increase in its investment was the logistics business, which grew by 153%, to amount to more than €1,500 million. In the case of offices, investment rose by more than 38% to reach €1,542 million, whilst investment in residential assets fell by 32% to €617 million.

Buyer profile

By nationality, overseas investors accounted for 67% of the total volume spent, compared with domestic buyers (22%) and Socimis (10%) – which, although they are Spanish companies, are mostly financed by international capital -. “Last year, Socimis accounted for 43% of real estate investments. Nevertheless, this year, their role has been moderated and they have only participated in 10% of the transacted volume”, explain sources at CBRE.

The replacement of Socimis – which are focusing on managing their portfolios and selling their first non-strategic assets this year – is being led by foreign funds, with new profiles and nationalities closing operations in Spain. Such is the case of the Australian firm Macquarie, which has purchased Empark.

In fact, overseas investment in 2017 has been led by buyers from the Middle East and Asia Pacific, which account for 31% of the total volume of international investment. They are followed by US funds, which account for 18%, and buyers from France, with 17% of the total share, say sources at CBRE. “Overseas investment has increased by 73% with respect to the same period last year, to reach €6,747 million, backed by an increase in investment from most countries, with the exception of the USA and Germany, whose investment volumes have decreased by 36% and 48%, respectively.

Thanks to the good behaviour of the market during the first 9 months of the year, experts predict that 2017 will close with investment of more than €13,000 million, in line with the volumes registered in 2016 and 2015, which were characterised by several large corporate operations.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Grosvenor Buys 2 Buildings In Madrid To Turn Them Into Homes

17 July 2017 – Expansión

The British real estate company Grosvenor has acquired two buildings in Madrid, which it will transform into new luxury apartments and commercial spaces. Specifically, Grosvenor, through its subsidiary Europe, has purchased one building, with a surface area of 3,000 m2, located between c/Modesto Lafuente and c/José Abascal. The property, which currently houses offices, will undergo a comprehensive renovation to create thirteen 3- and 4-bedroom homes, spread over ten floors.

Similarly, the British group has acquired another property, located on c/Santa Engracia, with a surface area of around 1,800 m2. There, the real estate company plans to create 18 homes, including two penthouses and some retail premises.

The two operations form part of the joint venture created by Grosvenor and the Asian firm Amcorp in July 2016, which has the aim of investing €70 million in Spain during its first phase.

In May, the alliance closed its first transaction with the purchase of a plot of land measuring 820 m2, at number 53 on Calle Jorge Juan, to promote seven exclusive apartments.

The British group, founded in 1677 by Sir Thomas Grosvenor, is currently one of the largest real estate owners in Great Britain.

Grosvenor is one of several major international investors that has taken the decision to back the residential market in Spain. Funds such as Kennedy Wilson, Lone Star, Greenoak, Grosvenor, Autonomy Capital, Invesco, as well as family offices and representatives of wealthy families such as Shaftesbury, the Capriles family, Stoneweg and Dazi are all currently working on residential projects in the Spanish market.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Without Secessionist Threat, Merlin Would Invest Twice As Much In Barcelona

16 June 2017 – Expansión

The President of Merlin Properties, Ismael Clemente (pictured above), confirmed yesterday that his Socimi would invest “twice as much in Cataluña in the absence of the political instability there”. “Our investments in Barcelona account for 16% of the total at the moment, but we could invest up to 30%”, he said. However “the types of political movements based on superiority do not create any kind of sympathy amongst investors”, he added, and so “we are not able to invest as much as we would like to in Cataluña”.

Regarding the reactions that international investors – including some of Merlin’s shareholders – have had to the political problems in Cataluña, Clemente said that “there is no kind of sympathy for the topic” and that “if the (Spanish) Government were to give a more definite reaction, both the international investor community and the Ibex 35 would applaud it”.

Clemente, who participated yesterday in the Annual Meeting of the Esade Alumni Real Estate Club, in Barcelona, said that the Catalan sovereign process may also affect the city’s candidacy to host the European Medicines Agency. “The project has a lot of potential, the coordination between the administrations is exemplary and the proposal is spectacular, but Barcelona has a gigantic problem, the political issue”, he added.

Context

Ismael Clemente shared the discussion table with Colonial’s CEO, Pere Viñolas. They addressed issues such as the change in the cycle of some international real estate markets. “The deceleration in London and New York may have a limited impact here, but Spain will continue to grow and at a faster rate than other European economies”, said Clemente. Viñolas added that the only approach is “to focus on industrial added value because it is the only margin that we can work with”.

Original story: Expansión (Marisa Anglés)

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