Tag: Los Cubos building

CBRE: Office Leasing in Madrid Records Best Third Quarter for a Decade

17 October 2018 – Real Estate Press

The office market in Madrid recorded its best quarter of the year between July and September with almost 142,000 m2 of office space leased. That figure makes it the sector’s best third quarter for a decade, according to the latest data published by the real estate consultancy CBRE.

“Leasing figures during the third quarter are traditionally characterised by less activity due to the holiday period, so this latest data highlights the strength of the office market in Madrid”, says José Mittelbrum, National Director of A&T Investor Leasing Offices at CBRE España. “Looking ahead to the end of the year, it is very likely that, if some of the large deals currently active in the market are closed, then 2018 will see office leasing figures in Madrid very similar to those of 2017, which amounted to more than 600,000 m2, figures that have not been seen since 2007”, added Mittelbrum. Since January, almost 400,000 m2 of office space has been leased, the best figure since 2008.

Increase in rents

The increase in demand, boosted by demanding occupants with respect to the quality of the properties, and the reduction of the available supply, especially in renovated buildings and new properties in the central business district (CBD), led to a YoY increase of 9% in prime rents during the third quarter of the year to around €33/m2/month.

Empty space in high-quality Grade A buildings has decreased by 26% over the last year, which has led to situations of competition between several candidates for the same building.

Since the lowest point of the previous cycle, prime rents have grown by 35%. Other submarkets are also rising: average rents, calculated on the basis of actual operations, between July and September, increased in all submarkets with increases of more than 30% in the CBD and Secondary Centre (inside the M-30) and of between 15-20% on the Northern (A-1) and Eastern (A-2) axes of Madrid. Rising rents and the prospect that this trend will continue is one of the reasons why the office market in Madrid is the priority objective for a large number of domestic and international investors.

Notable operations

Madrid Norte saw significant activity in the last quarter, with two high-profile operations: the rental of the Oxxeo building in Las Tablas to Cap Gemini (9,300 m) and the rental of 7,000 m2 in Torre Chamartín by Deloitte; both new build properties.

The Public Sector reaffirmed its return to the Madrilenian office market, by closing two of the ten largest operations in the third quarter, namely, the rental of 4,200 m2 in the Agustín de Foxá, 25 building by the Ministry of Finance and of 2,400 m2 in Fray Luis de León, 11 by the Community of Madrid.

Finally, the flexible space operators continued their expansion: WeWork moved into Castellana, 77 to occupy more than 4,600 m2 in that building, the first to obtain the WELL Qualification in Spain. It is worth highlighting that so far this year, 10% of the office space leased in Madrid was taken up by flex-space companies, compared with 4% in the third quarter last year.

Available supply

At the end of September, the available surface area in the Madrilenian office market amounted to around 1.22 million m2, equivalent to 9.7% of the total stock of offices in the capital, compared to 11.7% a year earlier.

Over the coming months, investors’ commitment to reposition existing offices means that iconic buildings are going to come onto the market such as the Los Cubos building in Plaza de España and the Axis building in the heart of Plaza de Colón (…).

Original story: Real Estate Press

Translation: Carmel Drake

Change of Heart: Slim Suspends Sale of Torre Realia in Barcelona

15 January 2018 – Eje Prime

Carlos Slim has changed his mind about Torre Realia in Barcelona. The real estate company owned by the Mexican magnate has decided to suspend the sales process of its most iconic asset in the Catalan capital, according to explanations provided by sources close to the process. Realia has received offers for more than the asking price (€140 million), however, the company has decided not to sell, citing changes in the company’s strategy.

Last June, Realia entrusted JLL and BNP Paribas with the mandate to sell this asset, equivalent to Torre Kio in Madrid. The tower is located in one of the fastest growing areas of the Catalan capital in terms of the office sector, in Plaza Europa, which is set to become the city’s new business district.

Although sources at the group claim that the decision is linked to a change in strategy, given that the offers that Realia had on the table were “higher than the price set by the real estate group”, it seems that the political situation and the climate of instability may have also been triggers for Slim’s group to decide to postpone the sale to a later date.

Realia’s trophy asset in Barcelona has 24 floors and a surface area of 31,960 m2, as well as 399 parking spaces. The property, which comprises two buildings, was designed by the architect Toyo Ito, in collaboration with Fermín Vázquez, from the B720 Arquitectos studio. Torre Realia is 110 m tall and its ground floor houses a shopping arcade that joins the two towers.

In terms of its real estate activity, at the end of the first half of 2017, Realia primarily owned offices and shopping centres for rent, which spanned a combined surface area of 405,842 m2 and had an occupancy rate of 93.5%. Moreover, at that time, it also owned an asset measuring 18,324 m2, in the form of the Los Cubos building in Madrid, which it ended up selling to the French group Therus for €52 million.

Realia’s stock of offices for rent spans a surface area of 226,729 m2, with an occupancy rate of 94.7%. Moreover, the company owns 41 residential plots for family homes, destined for self-promotion, which it has put up for sale. Realia’s current land portfolio spans a buildable surface area of 1,851,392 m2, of which 49% is located in Madrid and the central region of Spain, according to data from the group.

Plaza Europa, on the rise

The sale of Torre Realia comes at a time when the area in which it is located is enjoying a real boom. As the headquarters of KPMG in Barcelona, Realia’s asset has seen its value rise in recent months thanks to the large number of operations that have been closed in this enclave and to the growing number of large corporations that are moving their head offices to this new financial district, in L’Hospitalet de Llobregat.

One of the main players in the area is the Puig family, which has joined forces with the Catalan Socimi Colonial to build a 14,000 m2 tower at Plaza Europa 46, right opposite Grupo Puig’s corporate headquarters, which it just purchased from BBVA for around €60 million.

Original story: Eje Prime (by Custodio Pareja)

Translation: Carmel Drake

Realia Sells ‘Los Cubos’ Office Building To Therus For €52M

23 October 2017 – Expansión

The real estate company Realia, owned by Inmobiliaria Carso and FCC, which are both controlled by the Mexican businessman Carlos Slim, has sold the office building known as Los Cubos, located in Madrid, for €52 million.

The buyer is the French real estate company Therus, which is co-investing with the British investment group Henderson Park, according to several sources.

The property, which owes its name to its unique architecture, has a leasable area of 18,324 m2 and 334 parking spaces.

The real estate company put this building, located in the vicinity of the M-30 ring road, up for sale at the end of last year, as reported by Expansión at the time. The building has been vacant since the end of 2015. Before its sale, the company considered renovating it on several occasions to improve its appeal in the market.

In the end, Realia has sold the building for €52 million, compared to the initial asking price of €57 million. The sale of Los Cubos is the latest in a long line of high profile real estate investment operations closed in Spain in recent months. The investment volume in the real estate sector during the 9 months to September amounted to €10,300 million.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Realia Negotiates Sale Of Los Cubos Building For €55M

7 September 2017 – Eje Prime

Realia, the real estate company owned by Carlos Slim, is on the verge of signing a new operation in Madrid. The Mexican magnate’s company is negotiating with Therus Invest to sell the Los Cubos office building for €55 million.

The fund, led by Olivier Crambade, specialises in value-added operations, as well as in the renovation and repositioning of buildings that have already been constructed, according to El Confidencial.

The property has a gross leasable area of 18,324 m2 and 334 parking spaces. The asset, which is completely ready to operate as an office, has been vacant for two years.

Last autumn, Therus completed the sale of Project Helios to the Socimi Hispania. That project comprises office buildings in the Madrilenian district of Campo de las Naciones, for which the group paid €32 million.

Original story: Eje Prime

Translation: Carmel Drake

Slim Commissions Sale Of Torre Realia In Barcelona For €140M

7 June 2017 – El Confidencial

(…). Torre Realia BCN is the jewel in the crown of FCC’s subsidiary in Cataluña and, moreover, it is located in a thriving area which has been witness to some of the most interesting real estate operations of recent times: Plaza Europa, the new business district within the Catalan capital’s area of influence.

With this cover letter, the group controlled by Carlos Slim has decided to put the skyscraper on the market and has engaged JLL and BNP Paribas to find a buyer, according to several sources close to the operation.

A spokesman for Realia refused to confirm the operation, which has reportedly been orchestrated directly by Gerardo Kuri Kauffman, one of the right-hand men of the Mexican magnate in Spain and the CEO of the real estate company.

The decision to sell this genuine trophy asset comes just after the real estate company signed a new syndicated loan amounting to €582 million, aimed at refinancing the €678 million debt that expired in April and which threatened the viability of the group.

To finish sorting out the financial situation, the company was also planning to sell the Los Cubos building in Madrid, an operation that never ended up being closed due to Slim’s high price expectations.

New business district

Realia is hoping to obtain €140 million for this sought-after property, which measures 112 m tall, over 24 storeys, with a gross leasable area of 31,960 m2 and 399 parking spaces. It is aware of the growing interest that exists amongst the large real estate companies to establish themselves in the new business district.

The skyscraper is, precisely, one of the most iconic buildings in this thriving area and is the image that identifies the zone. The property houses the headquarters of KPMG in Barcelona and has seen its value rise in recent months, thanks to the wave of operations that have taken place in this enclave and the growing number of large corporations that are moving their headquarters to this new financial district, in L’Hospitalet de Llobregat.

The main player in two of the operations that are transforming the area is the Puig family, one of the most important corporate sagas in Cataluña, which has completed a double whammy, by teaming up with Colonial to promote a 14,000 m2 tower in Plaza Europa 46-48, which is right opposite Grupo Puig’s headquarters, a building that it has just purchased from BBVA for around €60 million.

Arcano has also been active in the area with its acquisition of an office building located at Plaza Europa 22-24 for €13 million. That property has a gross leasable area of 7,335 m2, plus another 452 m2 of storerooms, 83 of its own parking spaces and 164 administrative concession parking spaces, which it plans to completely remodel after the summer.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Realia’s Profits Rose Almost 7-Fold In 2016 To €115.7M

28 February 2017 – Expansión

Realia recorded a net profit of €115.7 million in 2016, compared with €17.2 million in 2015, which represents an almost seven-fold increase in earnings, according to a report submitted yesterday by the real estate company to Spain’s National Securities and Exchange Commission (CNMV).

Sources at Realia explained that this evolution in profit reflects the impact of a series of extraordinary items, including a positive variation in the value of its real estate investments, amounting to €49.2 million.

In addition, the company recorded a positive impact of €113 million, due to discounts associated with the refinancing of the residential debt and loan acquired by Inversora Carso from the bad bank Sareb.

During 2016, the group generated total revenues of €97.2 million, up by 2.4% compared to 2015, driven by an increase in revenues from promotions and land (+€7.1 million) and despite a decrease in rental income (-€4.8 million) after the Los Cubos building in Madrid was vacated – that property is now up for sale.

Meanwhile, the gross operating income (EBITDA) amounted to €41.8 million in 2016, compared with €40.5 million in 2015, which represents an increase of 3.3%.

Original story: Expansión

Translation: Carmel Drake

Realia Puts “Los Cubos” Building Up For Sale For €57M

2 November 2016 – Expansión

Realia, the real estate company controlled by Carlos Slim, has decided to cash in one of its most iconic assets. The company has put the office building known as Los Cubos, in Madrid, up for sale.

The property, which owes its name to its unique architecture, has a leasable surface area of 18,324 m2 and 334 parking spaces. The building has been empty since the end of 2015.

Its location, alongside the M-30 and next to the headquarters of companies such as Iberia and Alstom – which occupy an adjacent office complex owned by Colonial – and its unique design make it attractive in the market, even though it does not have any tenants, say sources in the market.

Realia has decided to put the property on the market for €57 million – in other words, for around €3,000/m2 -, although it is also considering a possible project to renovate it, according to sources in the sector. Realia bought the building, which was constructed in 1981, in July 2004 from the insurance company Allianz for €60 million.

Possible interested parties include large Socimis such as Axiare, Hispania and Lar España, which have experience buying and renovating empty properties of this kind, as well as international funds looking for investment opportunities in Spain, who are struggling to find available properties in the centre of Madrid and Barcelona, say real estate sources.

This is Realia’s first divestment in the Spanish market in recent years. In 2014, the real estate company sold its stake in the French Socimi Siic de Paris. Realia received €559 million from the sale of its 59% stake, which it used to reduce its debt by around €1,000 million.

As at 30 September 2016, the group’s financial debt amounted to €900 million, down by 20% compared with the same time last year.

During the first nine months of the year, Realia generated revenues of €71.7 million and profits of €89 million. Excluding extraordinary items, its recurring profit amounted to €17.6 million.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Realia Multiplies Profits By 9x To €130M In H1

28 July 2016 – Expansión

Realia generated net profit attributable to the parent company amounting to €130 million during the first half of the year, which represents an increase of almost 9x with respect to the €14.9 million registered in the same period last year.

This strong increase in earnings comes even though gross operating profits (EBITDA) rose to a lesser extent, by 3%, to €19.7 million, and operating income fell by 1% to €49.6 million.

In a statement to Spain’s National Securities and Exchange Commission (CNMV), the company explained that the net result reflects a positive impact of €113 million thanks to discounts associated with the refinancing process.

Specifically, €72 million came from the refinancing of residential debt, and a further €41 million was financed by a shareholder loan acquired by Inversora Carso from Sareb.

Without these items, to which a positive impact of €9.3 million can also be added, arising from the variation in the value of real estate investments, the net attributable profit would be €11.1 million, compared with €6 million in the same period in 2015.

Realia’s real estate assest have a combined surface area of 404,807 sqm, whilst the occupancy rate of its assets amounts to 91.8%, up from 90.6% in the first half of 2015.

The slight decline in half yearly income was due to a 6% decrease in contributions from the real estate business, which fell by €2.6 million, due to the empty Los Cubos building.

Debt

The company also recognised net financial debt amounting to €890 million at the end of H1 2016, down by 18% compared with the end of H1 2015.

Realia reduced its gross financial bank debt by €762 million to €927 million as at 30 June 2016, down by 45% compared with the same period last year.

The net financial result amounted to €109.1 million, after applying the discounts amounting to €113 million, explained the company in information sent to the market supervisor.

Original story: Expansión

Translation: Carmel Drake