Tag: logistics centres

Juan Bravo 3 Plot Worth 7% More Than 12 Months Ago

6 March 2016 – El Confidencial

The recovery of the real estate market is starting to be reflected in the income statements of real estate companies and Socimis, especially in the value of their assets. According to information submitted to Spain’s National Securities Market Commission (CNMV) by Lar España, the famous plot of land located on Calle Juan Bravo, 3, which is going to be home to the most exclusive luxury housing development in the capital, has risen in value by 7% in the last year.

The Socimi has owned 50% of the land, alongside the US manager Pimco since the beginning of 2015, when both companies joined forces to buy Eurosazor (the development company created by Rafael Ortiz and the businessman Fernando Fernández Tapias) which owned the 26,203 m2 plot on Juan Bravo, 3 and another 5,318 m2 plot on Claudio Coello, 108.

Lar and Pimco acquired both residential assets for €120 million, in such a away that the purchase amounted to €60 million for each plot. Six months later, in June 2015, the consultancy firms JLL and C&W valued the plots at €61.3 million, and by the end of last year, that figure had increased to €64.35 million, up by 7.1%. This increase in value is explained not only by the recovery of the residential market, but also the scarcity of plots of land and new homes on the market in the neighbourhood of Salamanca, the most sought-after by wealthy individuals, both domestic and international – especially Venezuelans.

This increase in value has been generalised for the whole of the Socimi’s portfolio. The value of the assets acquired between its debut on the stock exchange and 31 December 2015 amounted to €898.9 million, in other words, €46.2 million more than their combined acquisition prices, which represents an increase of 5.4%. By type of asset, besides residential, Lar’s shopping centres have increased in value by 4.4%, its office are up by 6.6% and its logistics centres are up by 11.1%.

Juan Bravo, 3 is, nevertheless, one of the most important assets in the portfolio, at least from the media’s point of view, given that the market has been waiting for work to begin there for more than a decade. (…).

The demolition work is about to begin

Now… the project is increasingly closer to becoming a reality, after it recently received the licence from the Town Hall of Madrid that will allow it to demolish the basements and consolidate the land. This is the first step to obtaining the construction permit and, therefore, the definitive launch of the project, which will be designed by the Madrilenian architecture firm Rafael de La-Hoz (see photo above).

Although the details of the project have not been revealed yet, all indications are that around one hundred homes measuring between 250 m2 and 450 m2 will be constructed on the 2,250 m2 plot of land, which has a buildable capacity of 26,000 m2. Prices could reach, on average, €10,000/m2, with the most affordable homes averaging around €8,000/m2 and the most elite averaging around €14,000/m2. (…).

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

ECI Puts 200 Properties Up For Sale For €1,000M

1 March 2016 – Expansión

Launch of Operation Batman / At the end of March, the retail giant will start to sell off dozens of logistics assets, supermarkets, offices and plots of land, in an effort to reduce its level of debt.

El Corte Inglés is making progress with its plan to divest its non-strategic real estate assets, in an effort to reduce its debt, with the launch of a huge real estate asset sales process. The retail giant is planning to put the For Sale sign up over a batch of 200 properties with an approximate value of €1,000 million.

This batch of assets includes up to 102 supermarkets – some of which are operational, whilst others are closed – , 32 logistics assets, which cover a surface area of 500,000 m2 and several plots of land. It also includes 50 high street retail outlets, with a combined surface area of 180,000 m2, and 20 office properties located in Madrid and Barcelona.

The process, dubbed internally as Operation Batman, is being coordinated by Morgan Stanley, which has collaborated with the El Corte Inglés in other operations. Meanwhile, Clifford Chance is responsible for providing legal advice.

According to sources close to the operation, the company intends to put this portfolio of assets up for sale at the end of this month. For the time being, the company has commissioned the valuation of the properties, with a view to receiving the first non-binding offers on 16 May and the definitive offers by the middle of July. The objective of Dimas Gimeno, the President of the El Corte Inglés, is to complete the asset sales before August.

The upcoming operation is attracting growing interest in the market. Most of the large funds, insurance companies and even some of the larger Socimis have expressed their interest in participating in the auction.

The company will accept offers for all of the properties, as well as for separate lots, if the potential purchaser is interested in buying, for example, only those assets linked to the logistics operations, the supermarkets or the offices. El Corte Inglés is not including the joy of its logistics crown in the lot: its megacentre in the south of Madrid. Nor is it willing to divest Torre Titania, or its historical headquarters in Hermosilla. (…).

Original story: Expansión (by R. Ruiz/A. Antón)

Translation: Carmel Drake

Who Are The New Property Owners?

20 April 2015 – Expansión

Plans / International funds and Socimis are the main players in the sector

Apollo, Blackstone, Cerberus, HIG, Hispania, Intu, Lone Star, Merlin and Oaktree have gone from being virtually unknown names to being the key players in the Spanish property market (in a matter of months).

Over the last year and a half, large international funds have been investing hundreds of millions of euros in the purchase of property in Spain, both directly as well as through listed real estate investment companies (Socimis).

Värde, Apollo and Lone Star all burst into the market by purchasing real estate platforms from financial institutions. The latter has said that it wants to become the largest land developer in Spain and to that end, it is considering purchasing not only portfolios of land but also small and medium-sized (land) developers. Lone Star has already purchased the real estate arm Neinor from Kutxabank for €930 million, as well as Eurohypo’s loans in Spain for a further €3,500 million.

HIG and Castlelake are looking to buy land in Spain too.

Another investor that is backing Spain with more strength than ever is Blackstone. The largest fund manager in the world has purchased 1,860 homes for rent, as well as a group of office buildings, located in Madrid and Barcelona. One of the players that is most interested in the office market is the Spanish fund Meridia Capital, led by the former Sareb (director) Juan Barba; it has purchased a portfolio of office buildings from General Electric. It is competing against IBA Capital – the French manager has created a Socimi, which has not yet been listed, with headquarters and commercial buildings.

Along with these offices, the other assets that are sparking the most interest amongst investors are shopping centres. Green Oak has already invested €160 million together with Baupost on the acquisition of 6 properties from Vastned. The British group Intu wants to become the leading player in this segment in Spain and to that end, it paid €451 million for Puerto Venecia. Oaktree spent €100 million on Gran Vía de Vigo.

Other important players in this new era for the real estate sector are Socimis. Axia RE, Hispania, Lar España and Merlin have invested almost €3,000 million in assets, which include hotels, offices, logistics centres and warehouses. This last type of asset is attracting considerable interest. The fund Colony has just formed a partnership with the Spanish company Neinver to purchase 16 logistics warehouses.

Finally, in the hotel segment, Cerberus and Orion have purchased Sotogrande, the real estate subsidiary of NH for €225 million.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake