Madrid Court Annuls Sale of 2,935 IVIMA Homes to Azora in 2013

25 May 2018 – El Mundo

Administrative Court number 29 of Madrid has annulled the sale by the Housing Institute of Madrid (‘el Instituto de la Vivienda de Madrid’ or IVIMA) of 32 housing developments, comprising 2,935 homes in total, to the investment fund Azora Gestión, which was completed in 2013.

According to the explanations provided in the court ruling, the award “does not comply with the law” and is not justified by any “supplementary report or analysis of a technical, economic, financial or legal nature”.

The ruling maintains that although the sale of the homes was justified by the statement that “they are not necessary”, no explanation or justification was provided for that claim, even though, according to the court, they fulfilled “a social function, specifically, to provide decent housing for the disadvantaged classes”.

The ruling “reveals that there was a lack of motivation or justification for the unnecessary nature of those promotions, as claimed by the plaintiff (…), to be able to authorise the sale of the assets, which were owned by the Public Administrations”, adds the ruling.

The almost 3,000 homes belonged to the Youth Plan of the Housing Institute of Madrid. They were sold for €201 million, almost 20% more than the established asking price (€168.9 million).

The annulment of this sale is included in the judgement in which the court considers the claim of a resident of Navalcarnero, through which the transfer of his rental contract with IVIMA to a vulture fund has been annulled, and regarding which the option to appeal exists.

The President of the Community of Madrid, Ángel Garrido, argued that the sale of the public homes to an investment fund (which has just been annulled by the judge) “was not a success” and he recalls that his Executive has committed “to never sell public housing to the investment funds”.

“Logically, the interpretation of the ruling lies with the legal services and they will inform us of the appropriate way to comply with it”, he said, before adding that these sales should have never taken place.

Original story: El Mundo (by Roberto Bécares)

Translation: Carmel Drake

Hadley Sells a Prime Commercial Premise in Pamplona for €8M

7 May 2018 – Eje Prime

Whilst some Socimis are continuing to add new assets to their portfolios in Spain, others are starting to divest. In this vein, Hadley Investments, whose sole shareholder is Stirling Adjacent Investments, has closed the sale of a property on the most prime street in Pamplona. The Socimi has received €7.8 million for the asset, according to explanations from the group.

The premises are located at number 1 Plaza Merindades, where the main fashion, technology and telephony operators are located in the city. The store has a retail surface area of 587 m2. The sales price fixed by the Socimi is equivalent to 105% of the appraisal value of the property, according to sources at Hadley.

The removal of this asset from Hadley’s portfolio represents a 1% reduction in the Socimi’s total portfolio in terms of gross leasable area. Revenues from the rental of the property in 2017 accounted for 13% of the company’s total turnover during that period.

Hadley Investments, constituted in 2014, has the objective of acquiring and managing residential rental assets in Spain. According to the group, “Hadley’s strategy is aimed at working with real estate investment opportunities in Spain, focusing on the acquisition, rental and management of residential, office and commercial assets located all over the country”.

Since its debut on the MAB in June 2016, when the Socimi was worth €30.75 million, the company has been growing its portfolio of assets, which now comprises several retail premises and residential developments located all over Spain.

Hadley Investment is the owner of a retail premise in Palma de Mallorca, located at number 125 Calle General Riera. That property has a constructed surface area of 1,780 m2, distributed over several rooms, and leased to the household décor chain Maisons du Monde.

The Socimi also owns another retail premise, located in the La Laguna shopping centre, in Santa Cruz de Tenerife, which has a surface area of almost 12,000 m2.

Finally, Hadley Investments also operates two residential assets. The first is located in Vallecas and comprises several blocks with 245 homes in total, plus 4 commercial premises and 248 garages. In 2015, a series of repairs were carried out (to the roof, structure and facilities, amongst others) to ensure the safety of the building, amounting to €134,000.

The second residential asset is located at number 1 Calle Nador, in Madrid. This asset, which is leased in its entirety to Ivima (Community of Madrid) comprises several housing blocks with 110 homes in total, plus 2 commercial premises and 110 garages.

Hadley’s sole shareholder is Stirling Adjacent Investments, a firm that is owned by the company TAO Finance 3, which is, in turn, owned by private investment funds. The management of the Socimi’s asset portfolio is carried out by Servihabitat.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Grupo Ortiz To Partially Spin Off Its RE Business

9 February 2017 – Cinco Días

A new company is getting ready to join the fruitful world of the Socimis. Grupo Ortiz, a Madrid-based construction company founded in 1961, is working with the financial group Arcano to prepare for the debut of its real estate business on the Alternative Investment Market (MAB). The new company will own the Group’s real estate assets, which are all rented out, according to sources familiar with the operation.

Through this transaction, the company is looking to bring assets amounting to around €150 million to the market, along with associated debt amounting to €55 million. Moreover, the company chaired by Juan Antonio Carpintero is looking to take advantage of the future listed company to secure other investors for his business, and Arcano will act as advisor. Both companies declined to comment on the operation.

The intention of the construction group is to open up the Socimi to other investors and whereby partially sell off part of the new company, but to retain ownership of at least 30% of the capital. The company is currently undergoing a process of internationalisation, and sources close to the group indicate that these resources could be reinvested in new opportunities.

The market expects the new Socimi to be constituted within the next few months. Experts in the sector say that the objective, given Grupo Ortiz’s portfolio of assets, is to offer to pay a quarterly dividend, which could exceed 5% p.a.

The portfolio will initially comprise several office buildings, plus more than 340 rental homes, a parking lot on Calle Ortega y Gasset in Madrid with 800 parking spaces, as well as retail premises and warehouses, most of which are located in Madrid and the surrounding area. According to the Group’s website, Ortz has 36,000 m2 of tertiary assets leased out and 1,445 social housing properties, owned by Madrid’s Housing Institute (Ivima) and the Municipal Housing Company (EMV).

It also has 24,000 m2 of office space leased out in Madrid, primarily in the area around La Gavia (Ensanche de Vallecas). According to its annual accounts for 2015 (the latest available), the real estate business generated revenues of €55.34 million.

The group’s total turnover amounted to €376 million in 2015, with an EBTIDA of €41.22 million. Although the firm started out as a construction company, it has since diversified and now operates four divisions: concessions, energy, services and real estate.

The Socimi structure allows those who adopt its tax regime to enjoy exemptions from corporation tax in exchange for the compulsory payment of dividends to their shareholders each year (who do pay tax). The structure has served to boost the Spanish real estate market, with the backing of international funds, and many large property owners have also benefitted from these structures. Around 30 Socimis are currently listed on the MAB.

Grupo Ortiz launched its international activity in Peru in 2010. It currently has operations in Colombia, Peru, Mexico, Panama and Algeria, with energy projects in Italy and France, photovoltaic solar plants in Guatemala, Honduras, Chile, El Salvador and Japan and other integrated water management projects in Romania.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Community Of Madrid Will Buy Homes From Banks For Social Housing Stock

22 November 2016 – El Mundo

Next year, the regional government of Madrid, led by Cristina Cifuentes, will spend €10 million buying homes in the free market to incorporate them into the stock owned by the Social Housing Agency – the new Ivima. “We hope to buy properties from Sareb and other financial institutions with significant “stock””, said the Community of Madrid’s Minister for Transport, Infrastructure and Housing, Pedro Rollán (pictured above, right).

According to his calculations, it currently takes around six months for the autonomous Administration to hand over the keys to a social housing property to a claimant (…). The collapse of the real estate market means that the cost of constructing a new social housing property through the Public Administration and the cost of development by a private property developer is almost the same.

“We want to acquire around 60 or 70 homes, depending on the final price. The idea is to take advantage of the exceptional circumstances that we are facing at the moment, to facilitate access to housing for people who need it, as quickly as possible”, he said. (…).

Agreements with Bankia and La Caixa

Despite the sale of almost 3,000 homes to an overseas investment fund, the Social Housing Agency owns a significant real estate stock, comprising 23,690 properties of which, approximately 300 are free market properties “which are being repaired or which belong to the Emergency Social Housing Plan. In other words, they are reserved for use by citizens in the event of a catastrophe or emergency”, said a spokesperson for the regional government.

The regional government has been in conversations with Bankia and La Caixa since the beginning of its term in office to try to reach an agreement about the use of this housing stock, which cannot be put on the market.

“This is the first time that the Community of Madrid is going to undertake an operation of this kind”, said a regional spokesperson. Previous regional governments put in place measures to facilitate citizens’ access to housing, but none of them went this far.

Nevertheless, the Socialist spokesman for Housing, Daniel Viondi, does not share the Minister’s enthusiasm. (…). The parliament member says that the Minister has not specified “how many homes there are going to be, where they will be located or how much they will cost, and furthermore, there won’t be any regional budgets available until at least March”. (…).

“Cifuentes is turning the Community of Madrid into an estate agent. It costs more to buy such properties than build them from scratch and she is missing out on the opportunity to create thousands of jobs and to give the construction sector the boost it needs. For every €1 million invested in public housing, economic activity amounting to €6 million is generated”, he said, according to his data. (…).

Original story: El Mundo (by Jaime G. Treceño)

Translation: Carmel Drake

The Socimi Hadley Will Debut On MAB ON 15 June

14 June 2016 – Expansión

The Socimi Hadley Investment will debut on the Alternative Investment Market (MAB) on Wednesday 15 June 2016, at a price of €6.15/share, which represents a market capitalisation of €30.75 million.

Hadley, the seventeenth Socimi to debut on the MAB, owns three retail premises, one in Palma de Mallorca, another in Pamplona and a third with a warehouse in Tenerife. It also holds “surface rights” (derechos de superficie) over homes in the neighbourhoods of Vallecas and Ventilla de Madrid.

In the case of the latter, the company leases the homes, which it acquired under a surface rights agreement, to Madrid’s Housing Institute (Ivima), and has recognised a receivable for the present value of the minimum payments to be received from the tenant, discounted at the project’s implicit interest rate. These surface rights are valid until 2022 and 2023, respectively.

Hadley’s sole shareholder is Stirling Adjacent Investments, a firm owned by the company TAO Finance 3, which, in turn, is held by private investment funds. The management of the Socimi’s asset portfolio is performed by Servihabitat.

The real estate firm will debut on the MAB under the ticker symbol YHLY and its shares will be traded under the fixing price system.

Original story: Expansión

Translation: Carmel Drake

Madrid Earns €360M From The Sale Of Public Properties

25 March 2015 – El Confidencial

The Community of Madrid sold around thirty real estate assets between 2012 and 2014, including an entire housing development and a number of buildings on Gran Via.

The sale of public properties generated income of more than €360 million between 2012 and 2014. In total, during this period, around thirty real estate assets of all types were sold, ranging from an entire housing development, to a number of buildings in the heart of Gran Via, as well as flats, plots of land and commercial premises.

The starting gun for “property” sell-off began in the summer of 2012, with the sale of a plot of land for tertiary use in Pozuelo de Alarcón for €5 million. In the same year – when Spain was on the black list of all investors – Metro de Madrid sold another plot of land that it owned on Calle Cardenal Cisneros for €2.1 million.

However, the largest transaction signed to date by the Community of Madrid did not take place until July 2013. Then, it sold a 32 home development, owned by Ivima, to Azora and Goldman Sachs for €200 million, whereby the buyers paid almost 20% more than the initial asking price (€168.9 million).

At the end of 2013, two further transactions were signed that “fattened up” the public coffers by more than €26.5 million. These involved the sale of Gran Via 18 for €18.6 million to Iberia Project Management, although the Texas Pacific Group (TPG) was actually behind the bid – that fund purchased 51% of Servihabitat Gestión Inmobiliaria from CaixaBank in September of the same year. The second sale was of Gran Via 3, which the Community sold for €8 million to Baech Bienes Inmuebles.

Then in 2014, when real estate investment in Spain really took off, more than a dozen transactions were signed; the most noteworthy was the sale of a building measuring more than 9,000 square metres for €40.2 million to Línea Directa, the insurance arm of Bankinter. Last year, Gran Via 20 was also sold to the real estate company of Caja Rural de Almendralejo, which paid almost €20 million for the property.

The final two transactions last year were closed in December: a building on the Carretera de San Jerónimo, measuring 4,500 square metres for €14.1 million and another measuring almost 3,000 square metres on Los Madrazo for €3 million; both were owned by Arproma.

The plans to sell off public assets are on-going. The Community of Madrid has placed a “for sale” sign above another 22 assets that is owns. Office buildings, residential properties, commercial premises, plots of lands, flats and individual buildings. Through these, it hopes to “fatten up” the public coffers by around €56 million, taking advantage of investors’ renewed appetite for Spain.

Nevertheless, the jewels in the real estate crown have been sold already. By price, the following assets are up for sale: an office building on General Díaz Porlier, which has been on the market since October 2013 and for which the Community of Madrid is asking €11.1 million. In terms of land, there is a plot for sale in Tres Cantos for €5.8 million and there is also a flat for sale measuring 170 square metres on Calle Fernando el Católico for €467,000.

The Community is organising public auctions to sell these assets as well as direct sales. To give more visibility to its properties, like in the past, the Community has is making use of specialist websites, such as, which lists the assets sold to date, as well as the buildings for sale and the real estate auctions that are underway.

The sale of the building next to Puerta del Sol is on standby for the moment; the Community of Madrid is asking €10.7 million for that property.

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake

Lack of Control And Maintenance In Subsidized Dwellings Sold to a Vulture Fund

26/08/2014 – El Diario

The sale of 3.000 subsidized houses by the Community of Madrid to Goldman Sachs evoked serious tension among the estate’s inhabitants. Specifically, they complain that since Encasa Cibeles was named by the fund to manage the units, everyone has started to notice increase in squattering, abrasiveness and damage inside the development. 

In October 2013, the tenats found out that Madrid´s Housing Insitute (or IVIMA by its acronym in Spanish) had sold their homes to a vulture fund. Since then, many left their apartments to look for a private landlord instead of a public one. The dwellings got almost immediately taken by over 100 families. Meanwhile, the remaining tentants are trying to regain the previous rental conditions they agreed upon with the IVIMA.

The housing crisis occured in the Ensanche de Vallecas neighborhood, situated between the Eduardo Chillida and the Gran Vía del Sureste streets in Madrid. The real estate development was launched as a subisidized unit. The Madrid´s Institute offered most homes in the framework of the rent-to-buy contracts to young people who, on the news of the owner switch, terminated them.

Currently, around 150 homes are occupied by illegal inhabitants. ‘I have applied for a subsidized apartment several times, without any success. In my opinion, giving my family a place to live in is no crime. We are poor’, explains one of them.

Majority of the rental agreements are valid until July 2015. Those, whose contracts have already expired heard at Encasa Cibeles that ‘it is not an NGO’. In reponse to complaints issued by the affected families, the IVIMA said ‘once the housing developments sold to private hands, the public service regulations are no longer in force’.

Meanwhile, Encasa Cibeles announces it will fight with squattering by installing anti-burglar doors and sending security service to the developments.

In reality, ‘cases of receiving an eviction notice are much more common than seeing the families living illegally leave’, a tenant says. Removing squatters takes much more time. They wish the IVIMA came back and set rents at below the 600 Euros imposed by the company of Goldman Sachs.

Together with the rise in illegal occupancy, neighbours started to notice more acts of vandalism. ‘Broken panes, locks, and stolen garage videocameras are just examples of the damage’, says one of the tenants who is going to move out in September.

Original article: El Diario (by Laura Olías)

Translation: AURA REE