Tag: Leganés

AP67 Acquires Four Plots of Land in Madrid for €4.6 Million

9 October 2018

The socimi, which is listed on the MAB, is expanding its portfolio of assets in the area of Leganés, where it focuses most of its operations. The lands the socimi acquired have several possible uses, including industrial, commercial, offices and residential.

AP67 is continuing to pursue its strategy of investing in a good-sized portfolio of assets in Leganés. The socimi, which went public in May, just acquired four plots of land in the southern city of Leganés, part of greater Madrid. The total investment reached 4.6 million euros, according to the company’s announcement to the Mercado Alternativo Bursátil (MAB).

With this operation, the real estate manager, controlled by the architects Álvaro Rubio and Francisco Escudero, founders of the Akydeko studio, has added a variety of types of assets to its portfolio. In total, the plots of land have an area of ​​more than 8,500 square meters.

The largest plot of land is located at 7 Calle Rey Pastor de Leganés, where AP67 acquired a 4,899 square-meter plot of industrial land for 625,000 euros. In the Sector Partial Plan 4 of Leganés, the socimi paid 2.6 million euros for a 3,360-square-meter plot of land for commercial and office use.

Finally, on 40 and 48 Calle Juan Muñoz, Rubio and Escudero’s firm acquired two small plots measuring 400 square meters and 39 square meters, respectively. The socimi paid 1.3 million euros for the two.

The purchases were made with equity and a mortgage loan signed with Banca Pueyo for 1.34 million euros. “With these acquisitions, the company continues to meet its investment objectives and expand its portfolio of assets,” the socimi announced. AP67, which debuted on the MAB valued at 34 million euros, aims to double the number of assets it currently has in the next few years.

Original Story: EjePrime

Translation: Richard Turner

Construction Costs Soar & Feed the ‘Boom’ in House Prices

9 September 2018 – El Confidencial

“A year and a half ago, I asked for a quote from a small construction company for a building project in Leganés. I drafted the plans, obtained the permit from the Town Hall and when I spoke to the construction company again about starting the work, they quoted me 35% more than we had originally agreed. It was crazy. And something similar has just happened on another project in Móstoles. I signed a building contract with another construction company two months ago, the work starts next week, but they can’t stick to the price we agreed because they can’t manage to hire workers for that price”.

The speaker is a property developer from Madrid, who prefers to remain anonymous so as to not generate hostility amongst construction companies. Over the last few months, he has suffered as a result of the significant rise in construction costs. There are severe labour shortages, which are causing prices to rise, given that the cost of construction materials, although increasing slightly, has remained much more stable.

The increase of 35% is not generalised across Spain, but it is starting to become quite frequent in cities such as Madrid, Barcelona and Málaga where real estate activity has recovered more strongly than in other parts of the country, according to the experts consulted.

To give us an idea, according to a study prepared at the beginning of the year by ACR Grupo, residential construction costs have risen by 17.5% in the last 24 months, and by 12% in the last year alone. After 2007, and coinciding with the crisis, those costs decreased by 20% and remained almost flat for more than five years until two years ago, when the long lethargy was finally broken.

This higher cost of labour has a direct impact on house prices. According to the experts consulted, a 40% increase in construction costs results in a 20% rise in house prices. And, if the price of land represents around 35% of the total cost of the construction, then construction costs now account for around 50%. “Why do you think that prices are rising so quickly in Madrid and Barcelona? The price of land is soaring and now this unexpected enemy has arrived on the scene”, said the same developer.

In the Spanish capital, prices are out of control in certain areas, with price rises of up to 20%. “…”. “Within a given development, a home that used to cost €400,000 is now being sold for almost €500,000. The increases are not only due to the fact that there is a lot of demand and limited supply, but also because if the properties aren’t sold at those prices, then the project is not profitable. Some of the listed property developers have already warned that they will not be capable of building as many homes as they had planned. We will see in a few months time whether they are going to be able to fulfil their sales forecasts”, add sources from a construction company.

Although property developers have recognised this problem publicly for months, they are also convinced that it has gotten worse over the last nine months (…).

Destruction of the production fabric

The lack of skilled labour is evident. Plumbers, framers, electricians, bricklayers, etc…And like in any market, scarcity causes increases. Many of those who used to earn their living building homes at the height of the boom have changed jobs or left the country and have no intention of returning.

The figures speak for themselves. In 2008, the year the bubble burst, 600,000 new homes were completed in Spain. Now, that number barely reaches 50,000 units. Moreover, that decrease in activity has led to the disappearance of more than 12,600 companies linked to the sector since 2012, around 6,800 construction companies and 5,700 real estate firms, according to data from PwC.

That destruction of business fabric has resulted in an enormous number of unemployed people. Whilst a decade ago, the number of wage earners linked to the construction sector amount to 2 million people, in 2017 the number barely exceeded 800,000. In other words, almost 60% of the workers have disappeared (…).

“The main problem is that people who worked in the sector before and who have now found work now elsewhere do not want to return because of the fear of another crisis…”.

The problem goes far beyond the increase in prices that the property developers end up passing onto end buyers. The severe labour shortage, together with the lack of financing, puts in danger the sector’s estimates in terms of their forecasts for the construction of homes necessary for a healthy real estate market. And no solution for that problem is likely to be found in the short term (…).

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

Lanca Invests €2.5M in the Construction of a Logistics Warehouse for Iparvending Group

14 June 2018 – Eje Prime

The real estate company Lanca is strengthening its logistics business. The company has just completed the construction of a logistics warehouse at number 35 Calle Eduardo Torroja, on the Butarque Industrial Estate in Leganés.

The Basque real estate group has been working for the Iparvending Group once again, investing €2.5 million in the construction of a turnkey industrial warehouse for the leading automatic food distribution group. The operation has been brokered by Inverpremium.

Work on the asset was completed in April. The Basque real estate group is continuing with its strategic expansion plan to 2020, looking for new real estate investment opportunities involving premises, offices, industrial warehouse and plots of land.

Original story: Eje Prime

Translation: Carmel Drake

Hermes Properties Buys 2 Plots in Madrid from Sareb for €4M

5 June 2018 – Eje Prime

Hermes Properties is making its debut in Madrid. The company has purchased two plots of tertiary land with a surface area of 4,000 m2 in Madrid from Sareb for €4 million. The operation has been carried out through its second real estate investment vehicle, called Hermes II.

Specifically, the plots are located next to the Islazul Shopping Centre in Madrid, located in the Ensanche de Carabanchel, between the districts of Carabanchel, Latina, the Toledo motorway and the M40 motorway, on the border of Madrid and Leganés.

The plots have been previously leased to two operators, namely, Burger King and Carl’s Jr, who will undertake construction work imminently to open two restaurants in free-standing and unique buildings with drive-thru services.

Original story: Eje Prime

Translation: Carmel Drake

ECI Prepares To Sell Its 2 Stores In Parquesur (Madrid)

13 July 2017 – Voz Pópuli

El Corte Inglés is preparing to sell its stores in the Parquesur shopping centre, in Leganés (Madrid), according to financial sources consulted by this newspaper, under the framework of its asset sale policy to reduce debt. The group chaired by Dimas Gimeno occupies two spaces in Parquesur – which is owned by Unibail Rodamco – one for fashion and accessories, and the other for sports and leisure goods and the supermarket. El Corte Inglés assured this newspaper that no operations are currently active and that, in any case, it has remained as the tenant of other real estate assets despite divesting them.

According to real estate sources, the retail leader in Spain plans to sell various assets worth up to €150 million. Its portfolio of assets for sale includes not only the stores in Parquesur, but also others located in Burgos, Valencia and Madrid.

Leading this process is a stalwart of the Spanish company, Carlos Muñóz Gordobil, whom the sources consulted define as “a tough nut” and “old school operator”. The real estate sources argue that the prices that El Corte Inglés is asking for these buildings, which it considers to be non-essential, are too high.

The same sources indicate that El Corte Inglés’ real estate business is still weighed down by the purchase it agreed in 2014 to buy a plot on Paseo de la Castellana, adjacent to the centre that the group has in the area, which Adif sold through an auction. According to these sources, who are experts in the real estate sector, the figure paid by El Corte Inglés, €136 million, was “over the top”, as it exceeded the second highest offer submitted by more than €40 million. According to El Corte Inglés, the purpose of that purchase was to create its largest shopping centre in Spain, exceeding the one located in El Bercial (Getafe), which has a surface area of 180,000 m2.

In 2015, El Corte Inglés recorded profits of €158.13 million, up by 33.9% compared to the previous year and its turnover grew by 4.3%, to reach €15,219.84 million. Although the company has improved its revenues and has significantly decreased its debt, it still has to make some changes to facilitate negotiations with its creditor banks and secure better financing conditions, explained the financial sources consulted.

Four years ago, the retail group held debt amounting to €5,000 million, which put its business model in danger, and which essentially force it into a restructuring process in 2013. The sale of 10% of its capital to a sheik in Qatar, agreed in 2015, for €1,000 million; the sale of 51% of its financing arm to Santander in 2013; and the issue of promissory notes amounting to €300 million at the end of 2015, and of bonds through Hipercor, are just some of the measures taken by El Corte Inglés to reduce its debt to below €4,000 million.

Original story: Voz Pópuli (by Alberto Ortín)

Translation: Carmel Drake

Sambil Plans To Open 6-8 Shopping Centres In Spain

29 September 2016 – Mis Locales

The Venezuelan Sambil Group plans to open a network of between six and eight shopping centres in Spain and does not rule out expanding its business to other markets in Europe.

Nevertheless, before embarking on its new projects, the company will focus on establishing what is, for now, its only centre in Spain: the Sambil Outlet in Leganés (Madrid), which will open its doors on 24 March 2017, after more than four years of construction work. It will become the largest outlet and leisure space in Spain with a gross leasable area of 43,000 sqm.

The new centre, which will open on a site on the ill-fated M-40 and in which Sambil has invested around €55 million, will create around 1,500 jobs and require additional investment of between €25 million and €30 million to equip the premises for each brand.

According to Cohen (Director General of the Sambil Group), the company has chosen Spain to make its first foray into Europe because it was “ideal” from both a cultural and language perspective, as well as because it has a lot to offer in the corporate field and is attractive again for overseas investors.

“It is a rapidly-growing, mature and legally secure market, which needs entrepreneurship”, said Cohen, who stated that the country “has all of the tools to continue outperforming other markets around the world”.

The Executive highlighted that a company such as his, which is family based and has its headquarters in Venezuela, does not travel “7,000 kilometres” to open one shopping centre, and he added that in Spain his company’s focus is very much placed on the most populous cities -Barcelona, Sevilla, Bilbao, Valencia, etc-.

Although the group is strongly committed to the “outlet” format, it does not rule out opening “traditional” shopping centres in some of the cities, although, in both cases, they would be accompanied by leisure and restaurant facilities.

In this sense, he highlighted that the Sambil Outlet will have the largest wind tunnel in Europe and the most modern cinema screens, which will be run by the Odeon chain, which is working to make cinema-going more “accessible”.

Moreover, it will house the largest Simply (Alcampo) supermarket in the Community of Madrid.

The company thinks that between 5 and 6 million people will pass through the doors of its centre in Leganés during its first year of activity. It has faith in the success of the “outlet” format combined with leisure, which is currently fashionable in countries such as the USA (…).

“Post-crisis, the Spanish consumer is much more rational than emotional” stated the Director of Sambil in Spain, Arnold Moreno, who confirmed that the centre will open with an occupancy rate of at least 80%.

Sambil Outlet will have stores from discount brands such as For&From (the Inditex group’s footwear label), Mango, Fifty Factory (Cortefiel), Décimas and Xti, as well as “low cost” fashion stores.

The Sambil Group has constructed more than 500 residential buildings and offices and owns a portfolio of eight hotels and thirteen shopping centres – ten located in Venezuela, one in the Dominican Republic and one in Curaçao.

Original story: Mis Locales

Translation: Carmel Drake

Spain’s Largest Outlet Centre Will Open In March 2017

19 September 2016 – El Economista

Sambil Outlet, the largest outlet and leisure centre in Spain, located in Leganés (Madrid), will open its doors at the end of March next year, after an investment of €55 million and more than four years of work to prepare it for occupancy.

The new facilities, which will include the largest wind tunnel in Europe and will have a gross leasable surface area of 42,000 sqm, will open on the site of the ill-fated “M-40” shopping centre, which had remained closed for years before it was acquired by the Venezuelan group Sambil at the end of 2012.

“Fortunately, the project is going well despite the economic fluctuations in Spain. When we first got involved, the crisis was still very much alive”, explained the Director of Sambil España, Arnold Moreno, in an interview. He also said that the objective is to open the centre with an occupancy rate of at least 80%.

Sambil Outlet, which will provide direct employment for around 1,000 people, will generate another 1,500 indirect jobs and will house brands such as Inditex (with a shoe store), Mango, Fifty Factory (Cortefiel), Xti and Mustang. It is the Venezuelan group’s first project in Spain, but it will not be its last.

“It is our first foray into Spain. Financially, it would not be feasible for us to have just one centre in the country, given that our headquarters are located more than 7,000 km away”, said Moreno, who also indicated that his company is considering several alternatives in this regard.

Logically, in terms of possible locations for a new Sambil outlet, “we are looking at other major cities”, such as Barcelona, Valencia, Sevilla and Bilbao, but given that we are a family company and not an investment fund, we are being “very cautious”.

“We are convinced that, following the crisis, the Spanish population is demanding an excellent price/quality relationship, it wants smart purchases. There has been a change in this respect, people are taking more care with their spending”, said Moreno, who, by way of example, explained that in the last year just two new shopping centres have been opened compared with 150 outlets (where surplus high-end branded products are sold at low prices).

As for the extent to which the economic situation in Venezuela may affect the firm’s expansion in Spain, Moreno explained that, although it may weigh down on future operations, we have “been experiencing shortages for seventeen years, this situation is nothing new for us”.

“Our local businesses are still functioning but a very low efficiency because the country has a lot of economic, political and social problems”, he lamented. The Sambil group specialises in the construction of office buildings, homes, hotels and shopping centres.

Original story: El Economista

Translation: Carmel Drake