Pryconsa Acquires RC5 in Madrid from Mahou

30 September 2019 – Pryconsa, the Colomer family’s real estate developer, has finalised its acquisition of the RC5 plot of land from the Mahou brewery in its Operación Calderón. Market sources state that the negotiated sales price was around 3,000 euros per square meter, for a total of more than 55 million euros.

Mahou opted to go with Pryconsa since its offer of payment was seen as better, though the cooperatives were able to pay slightly more.

Mahou is selling off three plots of land by the former stadium in Madrid: RC5, RC1 and RC2. Pryconsa acquired the first, which has a buildable area of 18,508 square meters. The developer plans to build houses for sale, not for rent.

Original Story: El Confidencial – Elena Sanz / Ruth Ugalde

Adaptation/Translation: Richard D. K. Turner

Castlelake Acquires Land for 1,000 New Homes in Valencia

27 September 2019 – The US fund Castlelake, the majority shareholder of Aedas Homes, has acquired sufficient land, 100,000 square meters, to develop 1,000 homes in Quart de Poblet (València) from the real estate developer Grupo Ática.

Grupo Ática owned 60% of the total land in the new development, enough to build 1,400 homes out of a total of 2,300.  After the sale Ática will still own land for 400 homes, all of which will be subsidised (VPO). The two firms declined to reveal details of the transaction.

The remaining 40% of the land is owned by: Metrovacesa, with 6%; Dosval, with 3%, and the Quart de Poblet City Hall with 11%. Small property owners account for the remaining 20%.

Castlelake’s investment in the new development is expected to exceed 28 million euros, with €23 million in infrastructure works.

Original Story: Valencia Plaza – Estefanía Pastor

Adaptation/Translation: Richard D. K. Turner

Acciona Acquires a Plot of Land in Valdebebas as Ferrovial Looks to Sell Another

17 September 2019 Madrid’s real estate sector has seen a series of major transactions in recent months. In the most recent, Acciona acquired a 31,700-m2 plot of land from the company Celteo Business, including 26,018 m2 for residences and 5,755 m2 for stores. According to market sources, the conglomerate paid 2,000 euros/m2, a two-fold increase over the average price just five years ago. The deal, which totalled approximately 63 million euros, secured enough land to build about 260 homes.

Ferrovial, for its part, has decided to wrap up its development business and is looking to sell a plot of land just in front of the Cercanías train station. The firm is asking for about 2,000 euros per square meter or roughly 54 million euros for a 27,200-m2 plot of land. The land consists of 22,700 m2 for residences and 4,500 m2 for stores and would fit about 230 new homes.

Before sales begin on the Madrid Nuevo Norte development, Valdebebas is one of the few areas in Spain’s capital offering new housing. “Valdebebas is the only option for many families looking to buy a newly-built home… while it is also one of the few areas with finalist land for developers,” says Samuel Population of CBRE.

According to a study by Foro Consultores, there are currently 11 new developments underway in the area, totalling 857 new homes, almost half of which have already been sold.

The prices of the homes, according to the same firm, range between 450,000 and 650,000 euros, with the average price per square meter between 3,800 and 3,700 euros.

Original Story: El Confidencial – Elena Sanz

Adaptation/Translation: Richard D. K. Turner

Villar Mir Sells Land and Development Rights to Two Apartment Blocks in Málaga to Aquila Capital

17 September 2019 Inmobiliaria Espacio, a subsidiary of the Villar Mir Group, has reached an agreement with the German fund Aquila Capital to sell the land and projects for two 450-flat apartment buildings, each more than 120 meters high, part of the Martiricos project in central Malaga.

The Espacio Medina company, 70% owned by Villar Mir and 30% owned by Afinipo, of Unicaja, initially led the Martiricos development.

In addition to the two apartment buildings, the development includes an office building, a subsidised (VPO) 224-flat housing block and 50,000-m2 of green areas. The project’s estimated investment is expected to reach 240 million euros.

The agreement includes the land where the two towers will be built and the associated project. Villar Mir will remain responsible for the urbanisation works. The two firms declined to reveal the amount of the sale.

Original Story: Expansión – Rocío Ruiz

Adaptation/Translation: Richard D. K. Turner

Egusa Sells 52,000 M2 of Land To Quabit in Valencia for €26.3 Million

16 September 2019 – A state-owned company, Egusa, in Alboraya, Valencia, will transfer the lands of Port Saplaya to the developer Quabit to settle debts of 26.3 million euros. The 52,000 square meters of land is enough to build 500 new homes.

The beachfront property has an excellent location and good medium-term development capacity. Quabit plans to reactivate the project for the property and begin development with three years. The projects will include common shopping areas and gardens.

Original Story: Eje Prime

Adaptation/Translation: Richard D. K. Turner

Community of Madrid Sells Seven Plots of Land

20 August 2019

The government of the Community of Madrid sold seven plots of land for 7.2 million euros in July. That single sale was more than was sold in the entire last four years. Obras de Madrid had only managed to sell land worth €2.9 million in land over the last three years. This year’s buyers included Mercadona, a company that builds funeral homes, logistics and real estate firms. The regional government is looking to raise more funds through the sale of another 18 plots of land.

Mercadona acquired the most expensive asset, paying €2.541 million for a 4,200-square-meter plot of land, located in the neighbourhood of Ciudad Jardín, in Arroyomolinos.

Original Story: El Confidencial – David Fernández

Adaptation/Translation: Richard D. K. Turner

Atlético de Madrid Sells Last Plot of Land by Former Stadium

5 August 2019

Atlético de Madrid has finalised the sale of the last of the three plots of land it owned by its former stadium in the Mahou-Calderón area of Madrid. The football club chose to sell the land to Vivenio for approximately 75 million euros.

The 6,544-m2 plot of land, denominated RC4, has a residential building area of 27,000 square meters. Vivenio, a socimi controlled by the Dutch fund APG and Renta Corporación, intends to develop rental housing on the property.

Original Story: Expansión – Rocío Ruiz

Adaptation/Translation: Richard D. K. Turner

Pryconsa and SVPGlobal in Talks to Acquire Land from Atlético de Madrid

30 July 2019 – Richard D. K. Turner

Pryconsa, the Colomer family’s developer, and SVPGlobal, which owns the Benidorm highrise, are bidding to take the last of the three plots being sold by Atlético de Madrid’s Operación Calderón. The first two plots of land went to a joint venture by Azora and CBRE GI, in a deal worth just over 100 millions of euros.

Stoneweg’s partnership with Hines had been seen as likely to win the bidding for the last plot of land, but an unexpected offer from Vivenio and the Dutch fund APG surpassed their bid at the last moment. Talks with Vivenio subsequently broke down when the firm was unable to secure the necessary financing.

Somewhat late to the party, Strategic Value Partners (SVPGlobal) and Pryconsa have both also now also expressed interest in submitting bids. The firms are analysing the asset, which Atlético de Madrid is selling for €3,150/m2. Bids are expected this week.

If neither of the two manages to reach an agreement with the football club, Atlético de Madrid is expected to go back to Stoneweg-Hines and Vivenio for final proposals, looking to finalise a deal shortly.

Original Story: El Confidencial – Ruth Ugalde / Elena Sanz

Land Expropriations Will Be Cheaper After Latest Law Reform

3 February 2016 – Cinco Días

After everything that has happened in the real estate sector since property prices and the production of housing came crashing down, perhaps few will remember the major impact that resulted from the approval of the Land Law (8/2007 and RDL 2/2008). The new legislation was created with the aim of stopping judges from using their discretion in administrative litigation cases, so as to prevent them, in certain cases, from assigning fair values to plots of land subject to expropriation, on the basis that, spurred on by strong demand during the boom times, the values being assigned were leading to a speculative phenomenon that was having serious repercussions on the accounts and financial viability of numerous companies.

In this way, the legislator reduced the categories into which land had been divided historically and established the existence of just two classes: urban (plots) and rural (all others). As such, if land that had been used for agricultural production until that time, was going to be expropriated for the construction of a highway, then it would be valued as rural land (…) and not on the basis of the value of the asset to be constructed on it. (…).

In October last year, the new revised draft of the Land Law was approved, which is going to have an even greater influence of the original objective (to lower the cost of expropriations) and which is going to govern the conditions surrounding urban land in a more specific way. In terms of the valuation framework, it is based on a ruling issued by the Constitutional Court in 2014, which declared that setting the location coefficient (correction factor) at a maximum of two was null and unconstitutional.

In other words, the original law established that rural plots could be assigned a location coefficient to correct the value obtained by capitalising the income from the land. In these cases a correction coefficient (up to a maximum of two) could be applied, if the plots were located near to an urban centre or a centre of production or had certain environmental characteristics…. This represented a relief, in the event of an expropriation valuation, for those plots of land that many developers had stockpiled in outlying metropolitan areas of large cities in the hope of obtaining huge profits and which saw their value fall sharply as a result of the new legislation in 2008.

Nevertheless, the high court declared that the coefficient limit of two was unconstitutional and argued…that “it was not justified by the Law or by the preamble and could end up being whimsical, and prevent the real value of the land from being obtained. The court considers that…this limit is contrary to article 33.3 of the Constitution”. That article refers to the fact that “nobody can be deprived of their assets or rights, except on justified grounds for the public good or in social interest, provided proper compensation is paid and in accordance with the provisions of the law”. (…) .

According to Andrés Lorente, Director of Land at Tinsa, the method for valuing rural land involves dividing the land yield (calculated by capitalising the income from the land) by a capitalisation rate and applying that correction factor based on location to the result, where appropriate, where the correction factor may not exceed two.

“The provisions established in the new revised draft reflect higher rates, which means that the resulting land valuations could be significantly lower than those calculated under the previous legislation. Whereas before, the internal yield of the secondary market for public debt with a term of between two and six years was taken as the reference rate, now the average interest rate over the last three years on the State’s debt over 30 years is taken (3.663%)”, say sources at Tinsa.

As such, since the applicable rates have risen significantly, so the resulting land valuations are significantly lower. There are even cases in which expropriations now, under these new rules, result in a cost for the Administrations that is between five and six times lower than it would have been under the legal framework in force in 2008, says Lorente.

Original story: Cinco Días (by Raquel Díaz Guijarro)

Translation: Carmel Drake

Sareb Sold 5,000 Assets In H1 2015, A Decrease Of 38%

3 July 2015 – El Economista

Sareb’s Chairman, Jaime Echegoyen (pictured above) has revealed that the entity sold 5,000 properties during the first half of 2015, which represents a sales rate of 28 units per day, with the majority of its activity concentrated in the retail market.

These figures show that the so-called ‘bad bank’ reduced its sales rate by 38.27%, with respect to the same period last year, when it sold 8,100 properties during the 6 months to June, i.e. 45 properties per day. Sareb has set a sales target of 15,000 properties for 2015.

According to Echegoyen…60% of the 5,000 properties sold during the first half of the year came from the balance sheet of property developers, as a result of agreements to facilitate the sale of homes that had been held as collateral for loans. (…).

The head of the ‘bad bank’ highlighted that the majority of the company’s debtors are small and medium-sized companies “which, in many cases, need support to settle the debtor position that they hold”. In this sense, he reiterated that Sareb “is not a bank” and therefore it cannot offer new financing, but it can collaborate by affording borrowers time and flexibility. Thus, during the first few months of the year, the company has evaluated more than 2,500 proposals from debtor companies to arrive at sale, restructuring and refinancing agreements.

Sale of land

Although the volume of property sales decreased during the first six months of the year, the volume of land sales increased, by 43% with respect to the same period last year, to reach 23, whilst the income from these transactions grew four-fold.

Moreover, Sareb closed 14 transactions in the tertiary sector, i.e. double the number recorded during the same period last year, with growth in income of almost 50%.

Echegoyen acknowledged that Sareb’s activity in the institutional market during the first half of the year “has been moderate” and he announced that the company intends to continue its divestment initiative during the second half of the year, with the launch of several loan portfolios, linked to different kinds of collateral, such as land, work in progress properties and logistical assets.

The Chairman of the ‘bad bank’ indicated that the current environment in the real estate sector “is very different” from that seen in 2012 and 2013, since the volume of transactions is beginning to grow, and prices are stabilising and have even started to recover in certain parts of the country, both for new and second-hand homes.

Social purposes

“Moreover, the recovery is not limited to the market for homes, but rather it is affecting other segments as well, such as land and tertiary assets, which is positive for us given the large range of real estate assets in our portfolio”, he added. In this sense, Echegoyen revealed that the bank plans to exploit this ‘stock’ of assets to deepen its commitment to society and he indicated that they are working to expand their social initiatives through other types of assets, beyond housing. (…)

Original story: El Economista

Translation: Carmel Drake