Savills: Cataluña will Add 340,000 m2 of Logistics Land to its Stock by 2020

7 December 2018 – Eje Prime

Cataluña is going to increase its stock in the logistics market. Over the next two years, the region is going to add 340,000 m2 of industrial land to its portfolio, of which 275,546 m2 will be incorporated in 2019, according to data from the consultancy firm Savills Aguirre Newman.

Next year alone, nine assets will be debuted, which will be available as leased spaces spanning a combined surface area of 164,746 m2. For 2020, several projects have already been signed with logistics operators, to incorporate 68,500 m2 into the logistics sector. In this sense, the consultancy firm expects to increase the signing of at-risk projects with a leading role for overseas funds, which are taking positions in land and investment operations.

This year, the Catalan logistics market has increased its stock of new surface area by 459,112 m2, a rise of 8.5% with respect to the previous year. It is an increase that responds to the strong performance of the sector, which closed the third quarter with 493,615 m2 of space leased, up by 56% compared to the same period in 2017. Those figures invite Savills Aguirre Newman to predict that 600,000 m2 of space will have been absorbed in total by the end of the year.

During 2018, some major logistics projects have been launched in the region, such as the 81,000 m2 complex built in La Bisbal del Penedès. That space is 68% occupied by ID Logistic, which has Kiabi as a tenant. Moreover, Sesé Logística and the e-commerce group Vente Privee have absorbed 50,000 m2 of space each.

The first ring and the centre are the preferred areas

By volume of operations, the first ring and the prime-centre are the two areas that have recorded the most activity during 2018. Those two areas registered joint growth of 50% during the third quarter, with 375,000 m2 of surface area leased.

The third ring was the only area that reduced its activity during the third quarter, with a decrease of 11.69%. Nevertheless, it will be the area that accounts for the greatest availability of consolidated warehouses in 2019, with three assets that will account for 52% of the total.

In terms of rents, rental prices have grown by 6.5% on average this year, whilst the availability rate in Cataluña currently amounts to less than 3%. In this regard, professionals from the sector who participated in a conference organised by the consultancy firm emphasised the need for public institutions to collaborate with the private sector for the development of new industrial and logistics areas.

Warehouse measuring between 2,500 m2 and 5,000 m2.

Currently, the most sought-after warehouses by the logistics market in Barcelona are assets measuring between 2,500 m2 and 5,000 m2. 31% of the spaces leased this year have involved warehouses of that size, compared with 27% of operations that have been signed for assets with surface areas of between 5,000 m2 and 10,000 m2.

The strong performance of the Catalan logistics segment is also being replicated in Madrid. In the vicinity of the Spanish capital, 637,000 m2 of space had been leased by the end of the third quarter, up by 4% compared to the same period last year.

Original story: Eje Prime

Translation: Carmel Draje

Lar Spends €6M on Renovation of Megapark Barakaldo Shopping Centre

10 April 2018 – Eje Prime

Lar is giving one of its assets a makeover. The Socimi owned by the Lar España group has started work on the complete renovation of the Megapark Barakaldo shopping centre, for the first time since its construction in 2004, which will involve an investment of €6 million, according to a statement issued by the group.

The shopping centre, which is owned by Lar España Real Estate Socimi, has been managed by Neinver since 2016. Neinver, which is directing the renovation work, is one of the leaders in the development and management of outlet centres in Spain and the second largest operator in Europe.

The renovation of Megapark is going to be carried out in two phases. Firstly, work will be undertaken in the retail space; this has already begun, without affecting the daily activity of the centre, and is due to be completed in November 2018. Subsequently, work will begin on the leisure area to modernise and unify its image with the rest of the park.

“During this first phase, the renovation of Megapark Barakaldo’s retail area will be reflected primarily in a more current image, which is going to be accompanied by the renovation of all of the façades, outdoor spaces and common areas”, explain sources at the group. For this, an urbanisation plan has been developed, which includes introducing urban design furniture and children’s areas.

The general remodelling of the centre is also being accompanied by the renovation of some of the retail stores such as those of Mediamarkt, Kiabi, Merkal and Forum, as well as the expansion of the Conforama store by 1,200 m2 to reach 6,200 m2.

Megapark Barakaldo is located fifteen minutes from the centre of Bilbao and is the only retail and leisure area of its kind in a 400 km radius. In 2017, it received more than 10 million visitors and it has a surface area of 128,000 m2.

Original story: Eje Prime

Translation: Carmel Drake

Sareb Sells Parque Corredor Shopping Centre to Redevco & Ares

2 January 2018 – El Confidencial

In the end, there will be a sale. Sareb has managed to reach an agreement with Redevco and Ares to sell them the Parque Corredor shopping centre, in an operation that is expected to be closed within the next few days, according to sources familiar with the transaction. This deal will fire the starting gun for the complete transformation of the Madrilenian shopping centre.

As El Confidencial revealed, the entity chaired by Jaime Echegoyen had joined forces with Perella to complete one of the operations that has been on Sareb’s desk for the longest, but which has never ended up being signed (until now) for various reasons, including the dispersed shareholding of Parque Corredor and the divergent interests of those shareholders.

The sum of Sareb and Perella’s forces guaranteed that Redevco and Ares would take a majority stake in the shopping centre, given that the former holds 40% of the share capital and the latter holds 20%. But, more support was always needed to enable it to undertake a complete transformation and whereby compete with the neighbouring Open Sky, a shopping centre that is currently being constructed just four kilometres away.

In the end, both El Corte Inglés, the owner of just under 4% of Parque Corredor, which has an outlet store there, and Alcampo, owner of just over 20%, have decided to join the sale initiated by Sareb, according to the same sources (…).

The offer from Redevco and Ares values the whole centre at around €200 million, an amount that will be added to the planned investment of €20 million required to renovate the centre. The renovation project that has been entrusted to the Chapman Taylor studio.

Parque Corredor is a shopping centre giant with a retail surface area of 123,000 m2 and 180 stores, located in the Madrilenian town of Torrejón de Ardoz. Its tenants include the Spanish firm Mango, the Swedish retailer H&M, the Irish firm Primark and the French retailer Kiabi, all direct rivals of Zara.

This shopping centre went through its toughest time four years ago when Inditex decided to vacate because of the poor upkeep of the complex. Nevertheless, in recent times, confidence in the centre has been returning, with some of the retail group’s brands opening stores there, such as Bershka, Pimkie and Stradivarius. To date, there is no sign of the flagship brand Zara returning just yet.

Sareb has been advised in the operation by Knight Frank, Perella has received the services of Cushman & Wakefield, whilst Redevco and Ares have been working with Deloitte.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Madrid & Valencia Led The Logistics Market In October

6 November 2017 – Cadena de Suministro

The month of October was marked by the developments carried out by Mercadona, Grupo Lar and Inditex in the Community of Valencia; as well as by the transfer of DB Schenker’s operations in Madrid, Invesco’s new development in Getafe and Neinver’s purchase of a 40,000 m2 site (also in Madrid).

The Spanish logistics market is continuing to perform well, as demonstrated by the increase in demand in Madrid (+57%) and Valencia (+35%) during the 9 months to September. It is precisely in Valencia where, in October, TH Real Estate acquired the logistics platform that serves Carrefour.

Meanwhile, in the Spanish capital, Neinver incorporated 40,000 m2 of logistics space into its portfolio, located in an industrial estate in the town of Getafe; and in Zaragoza, Ibercaja sold two warehouses, measuring 15,926 m² and 11,170 m² in PlaZa to Savills Investment Management.

At the international level, one of the most noteworthy operations last month was the purchase of IDI Gazeley by Global Logistics Properties for €2,400 million. The acquisition of Logicor also pushed ahead, for which China Investment will pay €12,250 million, in a deal that has finally been approved by the European Union.

New developments

In terms of new developments, Madrid and the Community of Valencia headed up the leaderboard once again. Mercadona formalised its purchase of a 358,270 m2 plot in Parc Sagunt, where it is going to build its largest logistics centre in Spain, whilst Lar España committed to starting work soon on the construction of its logistics park in the Valencian town of Cheste.

Meanwhile, Inditex plans to expand its facilities in the Alicante town of Elche, where it has a platform dedicated to footwear. In the same way, it plans to open a new centre in Marchamalo, in the Corredor del Henares area, at the end of 2018.

In Madrid, the operator DB Schenker moved and unified the operations of all of its divisions into a new location in Vicálvaro, where the Port Authority of Valencia is considering establishing an intermodal logistics platform.

Meanwhile, Invesco started building new facilities on the Puerta Mayor Los Gavilanes Business Park, in the town of Getafe. In terms of Barcelona, which saw less activity in the logistics market in October, Kiabi announced it is about to start operations at its new centre in La Bisbal de Panadés.

In other geographic regions, the Ministry of Development found a definitive location for the logistics platform in Talavera de la Reina, Toledo. Moreover, the Junta de Andalucía announced that it will spend some of its budget for 2018 on turning the autonomous region into a logistics hub, capable of leveraging the traffic that connects Europe with the North of Africa and America.

Operations involving logistics clients

One of the most important developments undertaken by the business sector in Spain in October was the opening of Elektro 3’s logistics platform in Tarragona, with a surface area of 16,000 m2, and of Covestro’s platform in the same province. Moreover, the Construction Platform was opened in the Madrilenian town of Pinto, spanning 33,000 m2 and the equivalent version was opened in Froiz, Vigo, measuring 1,700 m2.

Construction work also started at Berlys’ new plant for frozen products in the Navarran town of Tajonar as well as on the plant for Frutas E. Sánchez in Mercamadrid, which will be operative from Q1 2018 and November 2018, respectively.

In this context, the spare parts distributor Diesel Technic announced that it will move its warehouse from Alcalá de Henares to the Casablanca II de Rockspring platform in Torrejón de Ardoz; and the Zaragoza-based company Casa Matachín said that is planning to invest €21 million on the construction of a logistics platform in PlaZa.

Original story: Cadena de Suministro

Translation: Carmel Drake

Flagship Stores Become The Bastion Of Large Retailers

19 October 2017 – Expansión

The unstoppable rise of e-commerce, the tsunami of digitalisation and the new buying habits of consumers have revolutionised the retail sector forcing operators to adapt to the new times to stay competitive.

The e-commerce sector is now turning over €24,000 million per annum in Spain, with a growth rate of 20% p.a. In this context, consumers are increasingly using the internet to manage their purchases, resolve queries and optimise their visits to stores. As such, they are visiting stores less frequently but they are spending more time there when they do go, according to a report from CBRE about the retail sector.

In this context, large international brands are backing the flagship store model as a gateway into Spain; and operators that have traditionally based themselves on the outskirts of cities are now moving into flagship stores in the centre. By way of example, the French firm Kiabi opened a store on Paseo de Gràcia a few months ago. In the same way, operators who have traditionally had stores in retail parks are now making space for themselves in the city centre, such as Media Markt, which opened two stores in the centre of Barcelona in 2016. Before the summer, the electronics firm also opened its new its flagship store in Plaza del Carmen, Madrid, just a stone’s throw from Gran Vía.

Ikea is joining this trend too, with a store on Calle Serrano; as is Leroy Merlin, which is planning to open a shop on Calle Fontanella, next to Plaza de Catalunya in Barcelona

Interest in Spain

“Physical stores are still the favourite channel for consumers, but it is harder to get people out of the house. To attract them, retailers are opening large flagship stores focused on the shopping experience and expanding the range of services, supported by new technologies that allow marketing strategies to be customised”, explains Gonzalo Senra, National Director of Retail at CBRE España (…).

Given the interest from large brands in Spain and encouraged by the upwards cycle of the economy and the improvement in consumption, many overseas institutional investors have decided to back the Spanish market. For example, the US investor Hines has purchased four important prime premises in Madrid and Barcelona in the last year.

These types of investors are the main buyers of flagship stores in well-located premises, involving investment volumes of more than €20 million. Moreover, sources at the consultancy firm have noted a change in the trend in this market with the entry of several insurance companies bidding for large prime assets.

By contrast, the market for smaller acquisitions is dominated by Spanish private investors and family offices – they tend to be particularly interested in assets worth less than €10 million.

Overall, investment in high street premises amounted to €800 million in 2016. The rate of investment continued during the first half of this year, with an investment volume of €515 million, according to data from the consultancy firm (…).

The high level of demand has accentuated the typical shortage of well-positioned products and resulted in a reduction in returns. According to the report, the downward trend in yields continued in 2017 to reach 3.25% in some cases for the most prime products in Madrid and Barcelona (…).

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Luxury Brands Flood Barcelona’s Paseo De Gracia

22 September 2017 – Eje Prime

Paseo de Gracia is getting ready to renew its portfolio of brands. The street, one of the most sought-after in Spain for international luxury, will see the arrival of three new firms over the next few months. According to modaes.es, Christian Louboutin and Isabel Marant will both open their second stores in the Spanish market, whilst Fendi is going to make its debut in the country.

Those three firms will soon play their part in a busy year for Paseo de Gracia. On Tuesday, the Barcelona street witnessed the public opening of Uniqlo’s first establishment in Spain, whilst a week ago, Kiabi was in the limelight, when it opened a store at number 11.

In February, H&M opened its largest establishment in the Spanish market on Paseo de Gracia in the Generali building, and in April, Sandro, owned by the French group SMCP, opened its first store on the street at number 37.

Isabel Marant, who already has one store in Madrid, has signed the lease at number 32 on Paseo de Gracia, after the investment fund BMO Real Estate Partners decided to split the premises occupied by Adolfo Dominguez in two.

The arrival of Isabel Marant in Barcelona comes just a few months after the investment fund Montefiere Investment acquired 51% of the share capital in the French company, with the aim of accelerating its development and geographical expansion (…).

Meanwhile, Christian Louboutin will take over the Starbuck’s store on the avenue. The US coffee chain currently occupies number 97 on Paseo de Gracia, next door to the multi-brand business Santa Eulalia and the firm Jimmy Choo.

The footwear brand launched its first establishment in the Spanish market in 2009. Christian Louboutin opened a 150 m2 store at number 13 on Calle Claudio Coello in Madrid.

The third operation on Paseo de Gracia is going to star the French giant LVMH. Fendi has signed the lease of number 38 on the Barcelona street, a property that has been on the market since March last year, when Hugo Boss moved to another site.

According to Cushman & Wakefield, after Portal de L’Angel, Paseo de Gracia is the second most expensive commercial street in Barcelona for opening a store. The price per square metre amounts to €230/month, compared to €270/m2/month on Portal de L’Angel, which retains its position as the most expensive street in Spain.

Original story: Eje Prime (by I. P. Gestal)

Translation: Carmel Drake

Large Retailers Compete For City Centre Premises

14 September 2017 – El País

Retailers that typically occupy out-of-town stores only, brands such Ikea, Decathlon, Media Markt, Leroy Merlin and Kiabi have done an about turn with their strategies. Now, they want to take their products to the heart of cities to reach clients who are not visiting them on the outskirts. They are occupying the few large retail premises that are available close to the major commercial thoroughfares of Madrid and Barcelona. They are not pushing up the rental prices of these properties yet; in fact, they are investing between €1 million and €5 million on renovation work. But they will.

The main retail areas in the centre of Madrid and Barcelona have new tenants. The so-called out-of-town retailers, which, until recently, could only be found in retail parks on the outskirts are undertaking a new urban strategy. They want to approach a new group of customers, those who want to avoid using their cars and it wants to lock them in. This week, Decathlon announced that it will open three stores in the heart of Madrid, where Leroy Merlin will also set up shop in 2018, following in the wake of Ikea (which inaugurated its store on c/Serrano in May), Kiabi (which has just done the same in Barcelona on Paseo de Gracia) and Media Markt, the first to arrive in the centre of both cities (as well as in Valencia).

The trend started two years ago in major European cities and comes in response to a move by the population towards the centre and to the fact that e-commerce is requiring companies to respond rapidly to their clients. That means being close to them, explains Robert Travers, Director at the real estate consultancy Cushman & Wakefield (…).

The strategy of these chains is to open stores on the main commercial thoroughfares of large cities in smaller spaces than those they occupy in the out-of-town retail parks, but of considerable dimensions given that they are in the centre. “They are not looking for prime locations, but rather premises very nearby, because they cannot afford the rents of operators such as Zara, Mango and H&M. Instead they pay around 30% less because their margins are smaller”, says Travers. They need streets with high footfall and premises measuring at least 1,000 m2 or 2,000 m2, with open-plan floors; such features are very few and far between in the best shopping areas.

For the time being, the arrival of these brands has not had any impact on rental prices, given that, according to Sergio Fernandes, the Director of Retail at the consultancy firm JLL, the availability of these kinds of properties on the main commercial thoroughfares is very limited and the operators that demand them are also very few. “Only the leaders of each sector are brave enough to make the move. For the time being, we are seeing only six or seven brands”, he says. Examples include Aki, Bricor, Verdecora, Sport Zone and Kiwoko Mundo Animal. Nevertheless, “they are managing to make use of certain properties that would otherwise go unoccupied as they are not in the right locations for the fashion brands”, says David Barragán, Director of Retail at the real estate firm Aguirre Newman (…).

The search is not easy, according to estate agents and retail chains (…). The negotiations are intense and prolonged because the premises need renovating and the brands demand grace periods whilst the construction work takes place, which tenants typically pay. Rental contracts are being signed for periods of between seven and 20 years.

But it is worth it. The pilot store that the Swedish chain Ikea has opened in Madrid is performing better than expected. In fact, some of the new formulas that it offers have already been extended to its other stores (customisation of fabrics, dressers and doors). Nevertheless, Ikea is still assessing whether or not to open more central stores with this format, which combines sales and entertainment (…).

Original story: El País (by Claudio Álvarez)

Translation: Carmel Drake

Lar Buys A Shopping Centre & 22 Eroski Stores From Rockspring For €111M

29 March 2017 – Inmodiario

The Socimi Lar is continuing to build up its collection of assets. It has spent €111 million buying the Parque Abadía shopping complex in Toledo and a portfolio of 22 Eroski stores, from the British fund Rockspring. It has completed these purchases entirely using its own funds, just one week after securing bank financing amounting to €104 million.

Parque Abadía, which Lar has purchased for a price of €63.1 million, is the largest retail space in Castilla-La Mancha, with a gross leasable area of 54,100 m2 – of which 37,114 m2 forms the subject of the transaction – and currently has an occupancy rate of 100%. It is the most iconic retail complex in the area, with retailers of the calibre of Alcampo, Media Markt, Decathlon, Leroy Merlin and Kiabi.

The location of Parque Abadía is another one of the asset’s strong points. Specifically, it is located on the motorway between Madrid and Toledo, which makes it highly visible and means that it can be accessed very easily. Parque Abadía is just ten minutes away from Toledo’s city centre and more than 300,000 people live within half an hour of the shopping centre by car.

Meanwhile, the 22 stores that Lar has purchased for €47.6 million are completely occupied and operated by the Eroski Group. They have a combined surface area of 28,822 m2 and the portfolio is very diversified from a geographical perspective.

Ten of the stores are located in the País Vasco – the area in which the retailer has its highest market share -, seven are located in the Balearic Islands, two in Navarra, another two in Cantabria and one in La Rioja.

The incorporation of these assets into Lar’s portfolio is allowing it to grow in the retail asset space. It now owns more than €1,000 million retail assets, which account for 75% of the Socimi’s total assets.

Lar owns 31 real estate assets, whose value amounts to €1,385.7 million, of which €1,072.4 million correspond to 16 retail spaces located in Madrid, Toledo, the Balearic Islands, La Rioja, Vigo, Valencia, Sevilla, Alicante, Cantabria, Lugo, León, Vizcaya, Navarra, Guipúzcoa, Palencia, Albacete and Barcelona.

Original story: Inmodiario 

Translation: Carmel Drake

Belgian Fund Ascencio Finalises Purchase Of Parque Abadía

8 November 2016 – Expansión

The Spanish real estate market is starting to welcome new players. After two years during which opportunistic funds and Spanish Socimis have been responsible for the lion’s share of investment operations, 2016 has seen several institutional investors and companies enter the market.

Such is the case of Ascencio. The listed Belgian real estate company (SIR, according to its French acronym), which specialises in well-located commercial assets with first-rate tenants, has decided to place its focus on Spain.

After years focusing on the Belgian market (where 62% of its assets are located) and France (which accounts for 33% of its portfolio), Ascencio arrived in Spain in March with the purchase of three premises in Madrid, Valencia and Barcelona, leased to the chain Worten, owned by the Sonae group. In this first operation, Ascencio spent €27.3 million, a figure that it is going to almost triple with its second transaction in Spain, given that the Belgian firm is the favourite to buy the Parque Abadía retail complex in Toledo.

Parque Abadía, which has a surface area of 64,000 m2, is the most important retail establishment in the province. With a retail surface area covering more than 54,000 m2, its main tenants include Alcampo, Decathlon, Media Markt, C&A, Conforama, Kiabi, Merkal and Norauto. Leroy Merlin also operates and owns a store in the complex, which has a surface area of more than 9,000 m2.

Inaugurated in November 2011, the retail complex has 2,680 parking spaces. Last year, Parque Abadía received more than six million visitors, and that figure is expected to be even higher in 2016.

Several investment funds and Socimis have expressed their interest in the property. Nevertheless, Ascencio’s offer, amounting to €80 million, is the best positioned, say sources close to the process.

The vendor is the British fund Rockspring, which has been focusing its investments in Spain on logistics centres in recent months, including the purchase of assets as well as the development of new establishments.

The sale of Parque Abadía is expected to be closed before the end of the year, according to sources in the market. Ascencio currently has funds amounting to €600 million to invest in the three European markets in which it has a presence, and has named Spain as its primary focus.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Veracruz Properties Acquires Parla Natura Shopping Centre

4 August 2016 – Mis Locales

Veracruz Properties has acquired the Parla Natura shopping centre (in Madrid) in an operation advised by Cushman & Wakefield and Savills, marking a new milestone in the sale and purchase of shopping centres in Spain.

Opened in 2009, Parla Natura has a gross leasable area of 18,000 sqm spread across twelve stores, which are leased to brands such as Decathlon, Aki and Kiabi, as well as 1,200 parking spaces. Moreover, its location is unbeatable, given that it is easily accessible from the A-42 motorway that links Madrid and Toledo.

Salvador González, Director of Retail Investment at Savills, commented that “Investor appetite for retail parks in Spain is still very strong, primarily due to the product’s future potential both in terms of revenues and profitability. At Savills Spain, we have always been committed to the retail park sector, and proof of that is the strong track record of transactions that we have advised in this segment. We have successfully closed this operation, together with Cushman & Wakefield.

Rupert Lea, Head of Retail Capital Markets at Cushman & Wakefield Spain explained that: “The sale of Parla Natura is another example of the strong interest that international investors, in this case, from Latin America, have in the retail sector in Spain. Together with our co-agents, Cushman & Wakefield, we have successfully closed another transaction for our client”.

Original story: Mis Locales

Translation: Carmel Drake