Villar Mir Group Puts Inmobiliaria Espacio Up For Sale

18 September 2019 – El Confidencial

According to financial sources, the Villar Mir Group has put its land and property developer subsidiary Inmobiliaria Espacio up for sale. The objective is to raise funds to repay the group’s creditor, the Monaco-based fund Tyrus Capital, and it follows the divestment of two other non-real estate entities, Fertiberia and Ferratlántica, in August.

Savills Aguirre Newman has been engaged to coordinate the sale after valuing the entity’s land and plots at €256.88 million as at 31 December 2017. The assets may be sold as a set or piecemeal. Moreover, the company has tax credits worth between €100 million and €200 million, which is where the real value of Inmobiliaria Espacio lies.

According to the latest available data, the company reported an EBITDA of €1.61 million in 2017 and sales of €46.77 million, up by 23.2% YoY. Moreover, it has an excellent and sizeable portfolio of land for development in good locations, for which planning permission has been granted, and therefore an improvement in sales is forecast over the next few years.

Last year, Tyrus Capital lent the Villar Mir Group €360 million to refinance the debt that the traditional banks did not want to extend. The conditions of that loan are onerous – it has a two-year term (of which one year has already passed) and it carries an interest rate of between 10% and 12%. As such, the group wants to sell off its assets in an orderly fashion to repay and reduce its financing, and so time is of the essence.

Original story: El Confidencial (by Agustín Marco)

Translated by: Aura Ree

INE: Mortgage Lending Rose by 16.5% YoY to €42.7bn in 2018

27 February 2019 – La Vanguardia

Last year, 345,186 mortgages to purchase homes were signed in Spain, up by 10.3% compared to 2017, but the banks again refrained from fully opening the financing tap: the average loan amount increased by just 5.6% to €123,727, according to data presented on Wednesday by Spain’s National Institute of Statistics (INE).

The growth in the average amount is only slightly higher than the increase in house prices (which rose by 3.9% on average last year, according to data from the Ministry of Development, albeit by much more in the large cities and their metropolitan areas, where the bulk of demand is concentrated). “The banks are adopting a conservative strategy, that’s for sure”, said Oscar Gorgues, Manager of the Chamber of Urban Property in Barcelona – “because they are still very mindful of the excesses of the boom years. For that reason too, we can say that the real estate market is healthy and there is no risk of a bubble”.

The data from INE shows that after five years of recovery in the real estate sector, the number of mortgages granted is still 71% lower than the 1.24 million mortgages granted by the banks in 2007, the last year before the burst of the real estate bubble.

According to real estate firms, the caution on the part of the banks means that the main factor causing families, and especially young people, to rent, is the fact that it is impossible for them to obtain a mortgage loan. By contrast, according to the real estate firm Forcadell, around one third of homes are now purchased without a mortgage, in operations undertaken by investors (…).

According to data from INE, the value of all of the new mortgages constituted to purchase homes last year amounted to €42.7 billion, up by 16.5% compared to 2017, due to the combined effect of increases in the number of operations and the average loan amount (…).

Original story: La Vanguardia (by Rosa Salvador)

Translation: Carmel Drake

Vitalia Buys 2 Plots for the Construction of Private Nursing Homes

5 February 2019 – Alimarket

The nursing home management group Vitalia Plus has confirmed to Alimarket its intention to continue incorporating new projects and acquiring residences in operation in Spain. In recent days, Vitalia has signed agreements for the purchase of two plots of land in Valencia and Salamanca, cities where the firm has not had a presence until now. In the case of Salamanca, Vitalia is planning to build a private nursing home in the city with 130 beds and 30 day spaces. Meanwhile, in Valencia capital, the group will build 128 residential spaces and 30 day spaces. Two other plots are expected to be added to those two new projects, whose purchase the group is currently negotiating in two other Spanish cities.

The new projects form part of a second phase of investments planned by Vitalia, worth more than €100 million, which the group will finance with own funds (more than €50 million) and a €50 million loan, requested recently from the European Investment Bank (….).

Currently, besides the new homes announced in Valencia and Salamanca, Vitalia has 22 other nursing homes in different phases of completion – including the Vitalia Expo in Zaragoza, Vitalia Toledo and the expansion of one of its centres in Teruel (…) – which contain 3,443 beds in total (3,701 beds including the new projects in Valencia and Salamanca). These centres will be added to the 44 nursing homes that the group manages in Spain, with 6,461 beds (…).

Since March 2017, the group Vitalia Plus has been controlled by the investor CVC Capital Partners (which owns an 80% stake), whilst the investor Portobello Capital owns 10% and the executive President and founder José María Cosculluela Salina holds the remaining 10%. In 2017 – the most recent data available – Vitalia recorded a consolidated turnover of €91.05M with 2,850 workers.

Original story: Alimarket (by Eva de Frutos)

Translation: Carmel Drake

Thomas Cook Signs a €51M Loan with CaixaBank to Finance Hotel Purchases

4 February 2019 – Hosteltur

Thomas Cook today announced that its joint venture with LMEY Investments, called Thomas Cook Hotel Investments (TCHI), has obtained a second round of financing amounting to €51 million thanks to an agreement with CaixaBank. The funds will be used to acquire hotels in Spain and the Mediterranean.

Thanks to that agreement, the joint venture’s funds to purchase hotels have increased by €91 million over the last three months, following the agreement signed with Piraeus Bank, according to reports from HostelTur news (…).

Those funds will be used to invest in opportunities that arise in Spain and the Mediterranean area. In fact, TCHI has also announced the acquisition of one 250-room hotel in the Canary Islands and another 300-room hotel in the Balearic Islands. In total, the seven hotels that the company currently owns represent assets worth €250 million and contain 2,200 rooms.

The fund has the objective of owning between 10 and 15 hotels over the next two years. A channel for more hotel acquisitions has been identified by the company and the team is focused on executing the expansion plan for the coming years.

TCHI was created in March 2018 to support the growth of the Thomas Cook’s own brand hotel portfolio as part of its strategy to take greater control over its hotel inventory and the customer experience (…).

Original story: Hosteltur 

Translation: Carmel Drake

GMP Signs Spain’s First “Green” Loan with BBVA: €68M for Castellana 77

9 December 2018 – Eje Prime

The Spanish real estate sector has obtained its first green loan. Specifically, the Socimi GMP, controlled by the Montoro family, has signed a loan of that type with BBVA to finance the project to renovate Castellana 77, an office building in the Azca area. In total, the real estate company has received €68 million.

Specifically, the Socimi acquired the building from BBVA in 2015. GMP has recently completed work to renovate the property. The company’s commitment to obtain the loan has been established around the fact that the money will be used to promote sustainability, according to Expansión.

GMP, which has the Singapore sovereign fund (GIC) amongst its reference shareholders, has been working for a while to create a portfolio of sustainable buildings. 80% of its assets have the Leed stamp and, last June, one of the jewels in its crown, the former Torre BBVA, obtained the Well Oro certificate, becoming the first property in Spain to merit that distinction.

During the first half of 2018, the Socimi saw its profits soar by 81% to exceed €110 million. The company recorded revenues of €49.5 million between January and June, down by 0.8% compared to the same period in 2017.

Currently, GMP has a portfolio of sixteen assets, which sum a total of twenty-seven buildings and a gross leasable area (GLA) of 360,000 m2. All of them are located in Madrid, along with the 65,105 m2 of buildable space that the group owns, concentrated in the urban developments of Valdebebas and Las Tablas. The company’s portfolio of projects also includes a residential tourist development in Alicante, which is called Las Colinas Golf&Country Club.

Original story: Eje Prime 

Translation: Carmel Drake

Meridia III Buys a Logistics Platform in Madrid for €15M+

5 December 2018 – Eje Prime

Meridia III has added another asset to its logistics portfolio. Meridia Capital’s Socimi has acquired an industrial platform in Alcalá de Henares (Madrid) for €15.25 million, according to a statement filed by the company with the Alternative Investment Market (MAB).

The warehouse has a surface area of 26,400 m2 and is located on the Corredor de Henares axis, the place that accounts for the largest volume of logistics stock in the whole of Spain.

The Socimi, which debuted on the stock market at the end of 2017, has financed the operation using a €10.3 million loan with a term of seven years, according to a statement filed by the company with the stock market regulator. Moreover, with this acquisition, the logistics portfolio of Meridia III now spans almost 100,000 m2.

In recent months, the company has also been undertaking some significant investments in the Spanish office market, such as its purchase in March of a building in the financial district of Madrid for €26.5 million. That property, which has a surface area of 7,500 m2, is located at number 4 Calle Juan Hurtado de Mendoza, close to Paseo de la Castellana. Moreover, in Barcelona, the Catalan manager leased its new building in the 22@ district to the international consultancy firm Everis.

On the other hand, according to the company’s latest accounts, Meridia III recorded a loss of €522,124 to June, which means that said indicator had decreased by 76% with respect to the first half of 2017. In addition, the company recorded revenues of €8 million during the first six months of the year, whereby doubling its turnover in comparison with the same period a year earlier.

Moreover, the company completed a €14.2 million capital increase at the end of November. The company’s new shares are going to be issued for a nominal value of €13 million plus an issue premium of €1.2 million.

Original story: Eje Prime 

Translation: Carmel Drake

CaixaBank & Allianz Grant a €135M Loan to Finance Caleido

20 November 2018 – Expansión

CaixaBank and Allianz have granted a €135 million loan to finance the construction and operational launch of Caleido, a project led by Inmobiliario Espacio, the property developer of the Villar Mir Group, and MegaWorld Corporation, the business conglomerate owned by the Philippine multi-millionaire Andrew Tan.

Caleido, which will constitute the so-called Fifth Tower in Madrid, is going to comprise a vertical 35-storey building, which will contain the facilities of Instituto de Empresa, and a second horizontal building at the base comprising four above ground floors and standing 17 metres tall in which Quirón Salud is going to manage an advanced medical centre. Moreover, Caleido is going to include an extensive commercial and services area, as well as lots of green space for Madrid and its citizens.

The loan, which has a 10-year term, will finance the construction period until the hand over of the property, in the final quarter of 2020, as well as seven years of operation.

The property developers have explained that the aforementioned agreement will cover the financing needs of Caleido, with a total estimated investment of approximately €300 million.

“This operation strengthens the confidence that financial institutions have in the project and the great expectations that are being generated around its construction. In this way, the technical solvency of the project is clear, as is its future management and operation”, said the property developers.

Caleido – designed by the architecture studios Fenwick & Iribarren and Serrano Suñer Arquitectos – will be located in the epicentre of the new financial district of Madrid and will serve to eliminate a scar from the north of the Spanish capital, connecting Paseo de la Castellana and Anida de Monforte de Lemos, as well as revitalising the current business complex.

The project is being built on some plots owned by the Town Hall of Madrid, granted to Espacio Caleido through a concession arrangement for the construction and operation of the project for the next 75 years. In exchange, Espacio Caleido will pay an annual fee of €4 million. The launch of Project Caleido will generate around 2,400 jobs during the construction period and another 3,992 jobs once it is operational.

Original story: Expansión (by R.A.)

Translation: Carmel Drake

Santander Awards the Management of Popular’s €5bn Portfolio to Blackstone

12 November 2018 – Expansión

Santander and Blackstone have reached an agreement whereby the US fund, through the real estate servicer Aliseda, has taken on the management of a portfolio of assets from Popular amounting to €5 billion, which Santander is retaining on its balance sheet. The portfolio includes real estate assets and loans linked to the retail segment and Santander is retaining ownership of 100% of the assets. They were left out of the transfer of Popular’s assets to Quasar, the joint venture that the bank and Blackstone launched last year.

Santander transferred the bulk of Popular’s damaged portfolio to Quasar (€30 billion gross, linked primarily to property developers), along with 100% of the share capital of Aliseda. Blackstone controls the management of Quasar and 51% of the shares and Santander the remaining 49%. The bank has this stake valued at €1.7 billion on its balance sheet.

“The assets under management have been classified into two different groups, to reflect their owner: the Santander Group portfolio, owned by Popular (and now absorbed by Santander) and the Popular portfolio, owned by Project Quasar 2017”, according to the annual accounts of Aliseda. Specific teams have been configured within the servicer to manage Santander’s assets.

As at June, the latest available disaggregated figures, the entity chaired by Ana Botín still had a portfolio of foreclosed assets amounting to €10.5 billion gross. They have been cleaned with €5.2 billion in provisions (48.9%), which brings their net value to €5.4 billion. Nevertheless, in September, it sold a portfolio of properties worth €1.5 billion to Cerberus. In addition, Santander has loans to property developers amounting to €5.7 billion. Of the total, €1.8 billion are doubtful balances, with a default rate of 32%.

Santander currently has agreements with three servicers (Altamira, Aliseda and Casaktua). It paid those three companies almost €460 million in management commissions last year.

Meanwhile, Aliseda, which is now controlled by Blackstone and Santander, has rescinded the syndicated loan that it signed in 2015. At the time, the funds Värde Partners and Kennedy Wilson owned 51% of the real estate manager’s share capital and Popular owned the remaining 49%.

Following the acquisition of Popular by Santander, the entity chaired by Ana Botón repurchased the 51% stake held by Värde Partners and Kennedy Wilson, as a step prior to the transfer of 100% of Aliseda to Quasar.

“According to the syndicated financing contract subscribed on 27 November 2015, the cancellation of the loan has been formalised, following the repayment of the principal and outstanding interest, and of the cancellation penalty for the overall amount of €266.03 million”, said Aliseda’s report.

The bank with the greatest share of the loan was Popular itself (33.33%), with an outstanding balance of €87.86 million at the end of 2017. Bankia, Santander, Sabadell and Bankinter, with shares of 10%, had outstanding balances of around €25 million each. ING (€24.3 million), Crédit Agricole (€23.3 million) and BBVA (€17.5 million) completed the group of banks in the syndicate.

The interest rate on the loan, conditioned on the debt ratio and the gross result of the company, was six-month Euribor plus a spread of between 2.75% and 3.50%.

Following the change of ownership of Aliseda and its senior management team, the servicer paid compensation for redundancies of €1.4 million last year. It also paid €5.64 million for a remuneration plan that granted certain executives the right to receive remuneration in the event of a change of control of the company.

Original story: Expansión (by M. Martínez)

Translation: Carmel Drake

Spain’s Banks Must Pay the Mortgage Tax from Now On

10 November 2018 – Expansión

The Royal Decree approved by the Council of Ministers last Thursday, which modifies the Law governing the Tax on Property Sales and the Documentation Registration Tax (ITP and AJD), comes into force today, following its publication in the BOE. The Decree establishes that the banks, and not the customers, are responsible for paying those taxes.

From today, the purchaser of an asset or right, and in his/her absence, the persons who initiate or request the notarial documents, or those in whose interest they are issued, shall be subject to the tax. When it comes to loan deeds with mortgage guarantees, the bank shall be considered the taxpayer.

In terms of new features, the Royal Decree introduces a new article in the exemption section, which means that “loan deeds with mortgage guarantees, in which the borrower is one of the persons or entities listed in section A) above” shall not be subject to the tax.

Those entities include the State and regional and institutional Public Administrations and their organisations for welfare, culture, Social Security, teaching and scientific purposes. Financial institutions will not be allowed to deduct this payment from their Corporation Tax charge from 2019 onwards, given that tax changes are applied to complete fiscal years. The tax that the banks will have to pay will amount to €2,500 on average per loan and will, according to the Minister for Finance, María Jesús Montero, contribute to the collection of €2 billion every year for the regional coffers.

The Government justifies the “urgent” need for “regulation” to dissolve the “legal uncertainty” created by the Supreme Court following its ruling to force banks to pay the tax, before resolving a few days later that it was returning to case law and therefore obliging citizens to pay it. “This succession of events has led to a situation of legal uncertainty, which affects the mortgage market as a whole, and which must be addressed immediately”.

Original story: Expansión

Translation: Carmel Drake

Elix Buys a Building in Barcelona for €4.1M

26 October 2018 – Eje Prime

Elix VRS is continuing to grow its portfolio as a listed company. The Socimi, led and founded by Jaime Lacasa and Jorge Benjumeda, has acquired a building in Barcelona for €4.1 million, according to a statement filed by the company with the Alternative Investment Market (MAB).

The purchase of the property, located on Calle Consell de Cent of the Catalan capital, has been financed in part by the company’s own funds (45%) and in part by a loan (55%). The loan, granted by CaixaBank, has a five-year term and a quarterly repayment schedule.

This operation follows the acquisition of four buildings in the centre of Barcelona that the company carried out in August for €34 million. The new assets of Elix VRS, controlled primarily by the property developer Elix and the funds KKR and Altamar, are located in iconic areas of the Catalan capital.

During 2018 and after just one year of life, the Socimi already has 25 projects underway in Madrid and Barcelona. With this volume of operations, the real estate company is going to put more than 300 homes on the market. Six of these projects are new build and the other 19 are renovations.

Elix’s plans involve buying around forty buildings by 2021 to subject them to comprehensive renovations and place the homes on the rental market once they have been renovated. These rents will fee the Socimi, which plans to rotate the portfolio of assets that it builds every three years.

Original story: Eje Prime 

Translation: Carmel Drake