Tag: Julián Cabanillas

CaixaBank Repurchases 51% of Servihabitat from TPG for €176M

8 June 2018 – Expansión

The financial institution, which until now owned 49% of the real estate firm, is going to restore control of 100% of the firm four years after it sold the majority stake to TPG.

CaixaBank has announced an agreement with the fund TPG to repurchase 51% of the real estate manager Servihabitat for €176.5 million. With this operation, which will return full control over the real estate subsidiary to the financial institution, CaixaBank wants to enjoy “greater flexibility and efficiency in the management and marketing” of its real estate assets “as well as a reduction in its costs”.

The operation, which still needs to be approved by the competition authorities, will have a negative impact of around 15 basis points on CaixaBank’s first level capital ratio (CET1 fully loaded) and of around €200 million on the bank’s income statement this year.

Nevertheless, the entity chaired by Jordi Gual expects the impact to be positive over the next few years, amounting to around €45 million per year.

The financial institution sold 51% of Servihabitat to TPG in 2013, in an operation that valued the real estate subsidiary at €370 million and which generated a gross gain of €255 million for CaixaBank, which retained control of the remaining 49%.

The agreement between CaixaBank and TPG included a clause whereby Servihabitat would manage La Caixa’s real estate assets for a decade. Less than five years after that agreement was announced, CaixaBank has decided to recover 100% of the share capital of its real estate servicer.

In January, Iheb Nafaa was appointed as the CEO of Servihabitat to replace Julián Cabanillas, who had been linked to the firm for two decades, and who had served as the most senior executive for the last twelve years.

Nafaa is an Engineer in Statistics, Econometrics and Finance from the École Nationale de la Statistique et de l’Administration Économique in París (France) and has extensive experience as a director of companies such as BNP Paribas, GE Capital and Gescobro.

Original story: Expansión (by J. Díaz)

Translation: Carmel Drake

Servihabitat: House Sales Will Rise By 15.2% In 2017

12 July 2017 – Expansión

According to the “Residential Market in Spain” report compiled by Servihabitat Trends, the analysis platform backed by Servihabitat, house prices are forecast to rise by 4.1% on average this year and the number of sales operations is set to increase by 15.2%, to exceed 465,000.

In addition, the number of new house starts is expected to grow by 15.3% and the number of finished properties will increase by 20.2%, whilst the stock of new homes looks set to decrease by 17.8%.

According to the report, the residential market is showing clear signs of recovery this year.

The CEO at Servihabitat, Julián Cabanillas, has said that “all indicators show that the sector is enjoying sustained and established growth, albeit at different rates. The process of normalisation in the market, with an increase in pressure from demand and the consequent increase in prices, is not happening in a homogeneous way across the country”, he explained.

According to Servihabitat, demand is continuing to rise due to job stability, an increase in household incomes and an increase in the volume of loans granted.

Moreover, demand for investment is growing – it already accounts for between 20% (primary residences) and 22% (holiday homes) of all operations.

The volume of supply of new homes is also continuing its rising trend.

The number of new homes started will increase by 15.3% this year, to 75,500 and the number of finished homes will rise by 20.2% to 48,500.

In terms of construction permits, the figure is expected to amount to almost 116,000 this year, which will represent a rise of 25.9%.

The stock of new homes is set to decrease by 17.8% to amount to 324,000.

According to Cabanillas, the technical stock will amount to between 160,000 and 170,000 homes.

The pressure exerted on demand will drive up prices but in a moderate and non-homogenous way.

This year, the average value of a home is expected to rise by 4.1%.

Cabanillas rules out the possibility of a real estate bubble building in the short and medium term because “the fundamentals are nothing like those that existed before the crisis”.

In terms of the rental market, the report reveals that rental prices rose by between 4% and 5% during the first half of 2017.

Increases of between 2.5% and 5% are expected during the second half of the year, depending on the location of each property.

Servihabitat renders services for the integral management of financial and real estate assets.

Original story: Expansión

Translation: Carmel Drake

Servihabitat: House Prices Will Rise By 4.3% In 2017

7 December 2016 – Expansión

(…) According to Julián Cabanillas, CEO of Servihabitat, the findings from his company’s latest report show that “the trend  (in terms of house prices) will continue to rise in 2017, but at a more moderate rate”.

According to Servihabitat’s forecasts, house prices will rise by 4.6% this year and by 4.3% next year; moreover, all of the other indicators in the sector will continue to make significant improvements. For example, the stock of unsold new homes will decrease in 2017 to 315,000, the lowest figure since 2006, before the real estate bubble burst. In addition, the ratio of the number of years’ salary it takes to pay for a home will amount to six years – three years fewer than in 2007.

During 2016, the construction of new homes will soar by 20% and the gross rental yield (excluding capital gains) will rise to 5.4% (10% if we include capital gains over one year, which the Bank of Spain does in its calculations).

In 2016, property will register its highest price increases since the outbreak of the crisis. The rise of 4.6% predicted by Servihabitat is the highest annual figure since 2007. In 2017, the increase will slow down slightly (by three tenths of one per cent), but residential property prices will increase in every autonomous region. Extremadura will lead the price rises, with an increase of 7.3%. It will be followed by Aragón (+6.9%), Navarra (+6.7%), La Rioja (+6.2%), Murcia (+5.6%), Balearic Islands (+5.4%), Canary Islands (+5.4%), Community of Valencia (+5.4%), Castilla-La Mancha (+5.1%) and Asturias (+4.5%).

Thus, house prices will increase by more than average in ten autonomous regions next year, including Cataluña (+4.3%), and will increase by less than average in six regions, namely: Andalucía (+0.7%), Galicia (+1.2%), País Vasco (+1.5%), Cantabria (+3%), Madrid (+2.4%) and Castilla y León (+4.1%).

Three speeds

Cabanillas points out that the housing market is now operating at three speeds. “The first involves areas where demand is high and supply is at “technical levels””. That is the case in Madrid and Barcelona, where many more homes are being sold than in the rest of the country. (…).

The second speed is happening in “areas where demand is increasing and stock exists”, said the CEO of Servihabitat. In cities such as Málaga, Sevilla and Zaragoza, as well as in the vacation markets of the Balearic and Canary Islands and in the more traditional areas of the Mediterranean Coast. (…).

Nevertheless, residential prices are still recovering at a slower speed in many autonomous regions (the third segment), given that there, prices “are still decreasing (due to the crisis effect) or are stable, because the demand potential is much more contained and/or considerable volumes of stock are still available”.

To this end, it is worth nothing that 72% of the homes sold in Spain in 2016 had a price of less than €150,000. (…).

In this context, there are also considerable disparities in terms of the returns offered from leasing properties in the different regions. For example, buying a home and putting it up for rent would generate a return of 6.9% in Madrid, 5.8% in Cataluña, 4.1% in Galicia and 3.9% in País Vasco. (…).

Clearly, all of the regions offer more attractive average gross returns from rental than those generated by other investments, such as public debt and deposits. Not in vain, the average rental price will rise by more than 10% this year, according to Servihabitat, which highlights the seven most thriving markets in Spain at the moment, namely: Málaga, Balearic Islands, Barcelona, Girona, Alicante, Madrid and Murcia. (…).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake

Servihabitat’s Revenues Rose By 17% To €248M In 2015

12 July 2016 – Expansión

Servihabitat, the real estate company controlled by the fund TPG (51%) and partially owned by CaixaBank (49%), closed 2015 with a turnover of €248 million, up by 16.7%. The company led by Julián Cabanillas sold more than 21,100 units during the year. The firm also increased its portfolio of assets under management by 15.2% during the year, to 230,661 units, which have a combined value of more than €50,000 million.

The increase reflects the incorporation of assets previously owned by Sareb and the signing of contracts with other corporate clients, beyond the La Caixa group. In addition, Servihabitat manages financial assets worth €20,000 million. The growth in the business has resulted in several new hires; the firm now employs 453 people, up by 32%.

Original story: Expansión

Translation: Carmel Drake

Servihabitat: House Prices Will Rise By 6% In 2016

18 November 2015 – Expansión

According to Julián Cabanillas, the CEO of Servihabitat, the volume of house sales could reach half a million units in 2016.

This data indicates that we can expect an acceleration in the level of activity in the sector with respect to this year. The company expects 2015 to close with an increase in house prices of between 2.3% and 2.6% and the sale of around 400,000 homes.

During an informative event organised by Europa Press, Cabanillas echoed the messages of the President of Merlin Properties, Ismael Clemente, and the CEO of Neinor Homes, Juan Velayos, in highlighting the trend towards recovery in the real estate sector. (…).

“In the absence of externalities, we are facing a positive cycle, at least in the real estate sector, where we should have a strong tail wind for an extended period”, said the President of the Socimi, who said that the current expansion of the sector could last for up to seven years, “if it is properly managed”.

In terms of the segment for the development and sale of homes, “it has taken a bit longer to get going, but their ducks are now all in a row”, said the CEO of Neinor Homes. “We expect to see a flurry of activity over the next few years”, he said.

Nevertheless, Velayos considers that one of the challenges facing the sector, which could strenghthen this recovery, is for developers to stop being so “self-centred” and to think less about supply and more about demand, in terms of the types of homes that citizens actually want. According to his predictions, the sector is facing some “important challenges”.

In this sense, the CEO of Servihabitat said that the stock of unsold homes accumulated during the crisis is reducing at annual rates of 30% and that now certain areas are experiencing significant demand, including parts of Madrid and Barcelona, “where clients are no longer able to find the real estate products they are looking for”.

Moreover, he said that the “rental market is here to stay”, highlighting that the percentage of households that live in homes under lease arrangements has risen to represent 21% of the total, from 15% before the crisis. And he predicts that this figure will continue to rise.

Cabanillas attributed this increase in demand for rental housing to changes in social and family structures, as well as to the need for labour mobility and the fact that, after what happened with the crisis, citizens are more reluctant to get themselves into debt.

“These changes are going to force the sector to change and adapt”, said the CEO of Servihabitat. “Increasingly, more Spaniards can afford to take out a mortgage, but they are not doing so because owning a house is not something that they are even considering. In the same way, they are increasingly less likely to want to own a car, they would rather just rent one”.

Original story: Expansión

Translation: Carmel Drake

Servihabitat Makes Profit Of €82M In First Year With TPG

19 May 2015 – Expansión

Manages assets worth €60,000 million / The platform owned by TPG and CaixaBank is starting to selling homes from Sareb (which the bad bank inherited from Abanca) and wants to be an active player in M&A activity in the sector.

Servihabitat has closed its first year as an independent entity of CaixaBank with a positive balance and the aim of leading the M&A activity in the real estate platform sector in Spain. The property management firm – which is jointly owned by TPG (51%) and the Catalan group (49%) generated revenues of €212 million in 2014 and an EBITDA of €82 million.

The CEO, Julián Cabanillas, explained that these figures are “considerably higher” – by 25% in the case of revenues – than last year but are not comparable, since Servihabitat was incorporated as a radically new company in 2014. It went from being the owner and manager of real estate assets – foreclosed assets and loans from CaixaBank – to being only the manager of the assets.

Cabanillas highlights that the entry of TPG into the platform’s share capital “opened us up to the market and allowed us to have multiple clients”. In fact, during the last year, Servihabitat has reduced its dependency on its second shareholder to 60% of its assets under management, primarily thanks to the contract awarded by Sareb.

The platform was one of four that won portfolios – together with Haya Real Estate, Altamira and Solvia – for the management of assets from Sareb. This year, Servihabitat has been responsible for managing properties and loans from Abanca – formerly NCG -, Liberbank and Banco de Valencia.

It already administered Banco de Valencia’s assets following the acquisition of the former subsidiary of Bankia. The platform is in the process of migrating the rest of the properties and loans, and in fact, it started to sell homes from the former NCG two weeks ago. The remainder of the real estate loans from the Galician savings banks will be in its system by the summer, and the homes and loans that Liberbank transferred to Sareb, by the end of the year. According to Cabanillas, the transfer of the assets from Sareb is happening in an “ideal” way. “We have a lot of experience in this kind of process” adds the CEO.

Including these assets under transfer, Servihabitat now manages almost 200,000 homes and real estate loans, whose gross book value amounts to almost €60,000 million.

Together with the assets from CaixaBank and Sareb, Servihabitat has also started to administer homes and loans from funds, such as Elliott and from family offices.

Lines of business

To continue growing as an independent platform, Cabanillas is evaluating new lines of business, such as asset management (the construction of large buildings, commercial and hotel developments). Currently, Servihabitat is active in the following areas: the management of homes and loans; advising investors; rental; and the development and management of land.

Another one of the axis of the platform’s strategic plan is the possibility of forming part of the consolidation that the sector is expected to undergo over the next few months, which companies such as Altamira, Haya Real Estate, Aktua and Anticipa, amongst others, will participate in. Cabanillas does not rule out making any purchases to gain “efficiency” but he doesn’t expect that any transactions will be closed until 2016.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake