Sonae and Bankinter to Launch Second Socimi, This Time in Portugal

11 December 2019 – After the success of their jointly-controlled socimi in Spain, Sonae and Bankinter are planning on launching a new investment vehicle in Portugal in 2020. The new socimi will have an initial investment capacity of 100 million euros and will eventually seek a stock market listing in Portugal.

The new socimi reportedly will not focus on any single type of real estate asset. Instead, it will invest in a wide range of assets, from commercial real estate to offices, along with logistics assets and other investments.

The two firms’ socimi in Spain mainly invests in commercial real estate and is aimed at Bankinter’s private banking clients. Ores currently controls a portfolio 34 assets with a combined market value of over 357 million euros and an annual gross income of 21 million euros.

Original Story: Idealista – Custodio Pareja

Adaptation/Translation: Richard D. K. Turner

Sire Acquires Portfolio of Logistics Assets in Zaragoza

5 December 2019 – Strategic Industrial Real Estate (Sire), a joint venture managed by Arrow Capital Partners, has acquired a portfolio of logistics assets in Zaragoza. The deal, in conjunction with Cerberus, includes 38,536 square meters of gross leasable area worth 20 million euros. Savills Aguirre Newman and Latham & Watkins advised on the acquisition.

Sire has €2 billion to invest in European logistics and industrial assets.

Original Story: Eje Prime

Adaptation/Translation: Richard D. K. Turner

Berkshire Hathaway HomeServices Teams Up with Larvia to Sell Luxury Homes in Spain

8 October 2019 Berkshire Hathaway HomeServices, Warren Buffet’s real estate agency network, began operating in Spain last week through an alliance with Larvia. To begin with, the two firms will focus on the luxury market.

The two firms are forecasting revenues of approximately 5 million euros in the joint venture’s first year of operation. Berkshire Hathaway HomeServices Larvia also plans on increasing that figure to €65 million over the next five years.

Original Story: El Español / E.E. / Agencias

Adaptation/Translation: Richard D. K. Turner

Altamar and Healthcare Join to Create Healthcare Activos Yield

10 September 2019- Healthcare Activos, which specialises in investing in the healthcare real estate assets, and Altamar have joined to create Healthcare Activos Yield. The vehicle, which will invest in the Iberian Peninsula, has 20 assets in its portfolio, all of which are leased long-term to European operators, and an initial investment of more than €250 million.

Healthcare Activos Yield intends to grow its portfolio by acquiring additional assets. Healthcare-based real estate assets in Spain are currently worth approximately €20 billion. Market sources forecast growth of around 3% per year over the next 15 years.

Original Story: Expansión

Adaptation/Translation: Richard D. K. Turner

Berkshire Hathaway Teams Up With Larvia to Enter Spain’s Real Estate Brokerage Market

16 July 2019 – Richard D. K. Turner

Warren Buffett’s Berkshire Hathaway, the largest real estate brokerage in the United States, will form a joint venture with Larvia’s Petrus brokerage in an attempt to replicate its success in the US.  The American firm followed its usual strategy of teaming up with a local company with in-depth knowledge of the market.

Berkshire will focus on the upper-end of the market, with flats in Madrid costing at least 600,000 and single-family homes above €2 million. The new company will also focus on homes in areas nearby golf courses, in central Madrid, Barcelona and the Canary and Balearic Islands. Larvia’s existing network of offices in Madrid and Barcelona will start off as a basis for the new partnership, with plans to double or triple their presence in Spain by early 2021.

Original Story: Expansión


Slovak Developer J&T Wins Bid for Acquisition of GranCasa and Two Other Shopping Centres

7 August 2018

The Bratislava-based firm has allied itself with Sonae in the acquisition of the Zaragoza complex and others in Bilbao and Santander.

The Slovak real estate firm J&T is preparing for its arrival in Spain with the purchase of three shopping centres, including GranCasa, Zaragoza, in an operation with the Portuguese group Sonae Sierra, estimated at 500 million euros. Sources in the sector confirmed yesterday that J&T, in alliance with Sonae, had outbid the German company ECE for the three complexes and that it will finalise its purchase of the portfolio after completing the corresponding due diligence. The assets also include the Max Center in Bilbao and the Valle Real in Santander.

Sonae, under pressure by its partner in the three centres, CBRE Global Investors, was obligated to sell, though maintaining its intention of continuing to hold a stake. The newspaper Expansión reported yesterday that the Bratislava-based J&T owns 90% of the joint venture created for the purpose with Sonae, while Sonae owns the remaining 10%. Their proposal is said to value the portfolio at approximately 525 million euros, a figure that exceeds ECE’s competing bid. Sonae declined to issue a statement regarding the potential acquisition, limiting itself to saying that “we only discuss finalised transactions.”

The Portuguese group Sonae Sierra took over 50% of GranCasa in 2002, five years after its inauguration, and has been responsible for its management since 2003. The shopping centre located in the Actur, Zaragoza, has more than 200,000 square meters, 80,000 of which are for commercial activity where 170 stores are in operation. There is also a Hipercor, which is not included in the transaction.

GranCasa recently underwent a 12-million-euro investment in a new leisure and restaurant area, which was inaugurated in June. The new space, which measures 10,132 square meters, increased the mall’s offerings to a total of 21 restaurants and five kiosks, complementing existing leisure facilities that include a cinema and gym. The shopping mall’s managers noted that major restaurant chains are or will be maintaining a presence there, including VIPs Smart, Gino’s, The Strad Club, KFC, Muerde la Pasta, Fran Beer and Frutolandia, among others.

Referring to that investment, Alexandre Pessegueiro, head of Asset Management at Sonae Sierra, said GranCasa’s new leisure and restaurant area “is a clear example of how to anticipate changes in consumer models in a sector such as restaurants, in which customers demand an increasing level of differentiation and quality.”

The other two complexes included in the transaction are Max Center, a shopping centre that opened in Bilbao in 1997, and which underwent remodelling in 2000. The shopping mall tenants include Inditex, H&M, Cortefiel, Foster’s Hollywood and La Tagliattela. The centre also has a cinema (Cinesa) and a leisure space next door, Max Ocio.

The third asset is Valle Real, a commercial centre in Santander that opened in 1994 and that in addition to having some of the above brands as tenants, also has a hypermarket of the French chain Carrefour.

The Buyers

J&T Real Estate is a well-regarded Slovak real estate company that has 21 years of experience. The company is headquartered in Bratislava, has 300 employees and a presence in five countries.

Sonae Sierra, which will hold onto 10% of the group, provides services to investors and develops real estate projects anchored in the retail sector. It owns more than 40 shopping centres with a market value of around 7 billion euros and has 83 managed and/or leased shopping centres with 2.5 million square meters of gross leasable area and about 9,300 stores. Sonae currently works with more than 20 co-investors and joint ventures, associating with operators and fund managers for each venture.

Original Story: Heraldo – Luis H. Menéndez

Photo: Guillermo Mestre

Translation: Richard Turner

Cerberus Wins Bid To Manage & Sell Bankia’s Expanded Real Estate Portfolio

5 March 2018 – La Información

Cerberus has fought off competition from Lindorff to become one of the new Bankia’s partners, responsible for managing and selling its portfolio of foreclosed assets, which now exceeds €5 billion. The group chaired by José Ignacio Goirigolzarri has opted to continue with its existing partner in the end, to the detriment of the partner that has been working with BMN since 2014, for reasons that may go beyond the mere economic bid offered by both, indicate reliable sources.

Bankia’s alliance with Cerberus dates back to 2013, when it acquired its real estate firm Habitat on which it built Haya Real Estate, the servicer, which is now finalising its debut on the stock market after having also been awarded contracts to manage the portfolios of BBVA, Liberbank, Cajamar and Sareb (…).

At that time, almost all of Spain’s financial institutions opted to divest their “servicers” in light of the need to accelerate the sale of their toxic assets and the large appetite of specialist funds to grow in size and contracts. BMN’s story is similar. In 2014, it sold its real estate asset company Inmare to Aktua for €40 million. Aktua was Banesto’s former real estate servicer company, which Lindorff acquired from Centerbridge Partners in a close battle with Apollo and Activum SG Capital Management in 2016.

The Norwegian fund, which is itself currently immersed in an integration process with Intrum Justitia, thus took over the management of the real estate assets of the banking group led by Caja Murcia, as well as of those transferred by BMN to Sareb. The entity now also works for Ibercaja and with certain portfolios from entities such as Santander.

Haya Real Estate and Lindorff’s contracts with their respective clients are similar because they both impose a decade-long period of exclusivity, forcing Bankia to review its position following the absorption of BMN, just like with other types of joint ventures. The bank is going to proceed first to break the contracts and indemnify each partner for a sum estimated to amount to €100 million, according to Expansión, and then it plans to close a new agreement with the winning party. Both partners may have submitted similar bids although it is understood that Aktua offered an exclusively commercial service whilst the agreement with Haya Real Estate included the absorption of the workforce.

The transfer of employees

The new Bankia Group’s property portfolio has a gross value of €5.1 billion, as at the end of 2017, compared with €3.5 billion registered a year earlier excluding BMN’s exposure. The entity has a cushion of provisions that covers 35.9% of its portfolio value in such a way that it could afford to dispose of the portfolio at 64.1% of its initial value without incurring losses. The bulk – 62% – are homes associated with foreclosed mortgages and another 16% are properties received for debt in construction or property development – 48% of that proportion corresponds to land -.

BFA’s subsidiary reduced its problematic assets by 9.9% YoY last year – excluding the incorporation of BMN’s exposure onto its balance sheet – thanks, above all, to sales amounting to €427 million (€5.55 million corresponded to gains) and a 15.3% reduction in doubtful risks.

With the integration of BMN, the bank is being forced to review and rethink all of the contracts where exclusive suppliers operate in both networks. It has already resolved one relating to life insurance, which will see it discontinue BMN’s relationship with Aviva – it will pay that firm €225 million by way of compensation – in favour of Mapfre, which was also victorious in 2016 when the bank came across another duplicate alliance, for the first time (with the same British insurance company, which was also a historical ally of Bancaja). It still needs to settle a similar agreement with Caser, and put the finishing touches to its deals with Lindorff and Cerberus.

Original story: La Información (by Eva Contreras)

Translation: Carmel Drake

Santander, BBVA & Sabadell Start To Build Homes Again

11 May 2015 – Expansión

Property development / The large financial institutions are constructing homes once again in light of the improved macroeconomic outlook, demand in certain areas and the aim of generating profits.

Real estate development is no longer a forbidden phrase in the world of banking. Several major banks have decided to resume the construction of new homes in light of the macroeconomic improvement and the need to capitalise on property inherited from the crisis.

Entities such as Santander, BBVA, Sabadell and Popular are now not only focusing on selling the homes that were foreclosed during the crisis, they have also started to construct new developments over the last few months. Most of these developments are located in Madrid, Barcelona and to a lesser extent, on the coast, where there is still a large stock of homes to sell.

Another catalyst of this new trend has been the reduction in the losses recorded by the real estate arms of these banks. During the first quarter, Santander’s real estate division lost €95 million, the smallest loss since it was created three years ago; and BBVA recorded a loss of €154 million, 37% lower than during the same period in 2014.

Thanks to this, the group chaired by Francisco González announced on Friday that it is studying 25 developments to construct 2,000 homes, and that it has already started another 12 developments to construct 630 million. This statement was made by Lorenzo Castilla, Commercial Director at BBVA Real Estate-Anida: “This is not about filling Spain with cranes, but rather about projects that make sense”, who spoke during Madrid’s International Real Estate Fair (Salón Inmobiliario Internacional de Madrid or SIMA).


Full balance sheets

As the BBVA director indicates, financial institutions still had more than €83,000 million foreclosed assets (on their balance sheets) at the end of 2014, of which more than €31,000 million related to land and €4,000 million to buildings under construction.

To reduce this burden, the entities are nowadopting two strategies: the sale of homes through their commercial networks, a channel that has accelerated over the last year; and the transfer of portfolios and joint ventures with institutional investors.

For the time being, the entity that has announced the most ambitious housing development plan has been Santander, which reported that it is developing 300 real estate developments, at its most recent results presentation.

Banco Sabadell is also stepping on the accelerator in this sense. Its real estate arm, Solvia, currently has 1,400 homes under construction, primarily in Madrid, Andalucía and Valencia.

Aliseda, the real estate company that renders services to Popular, has also announced an ambitious plan to enter the market for real estate development.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake