Tag: MAB

Corpfin Launches A Socimi That Will Invest €100M

22 April 2015 – Expansión

New Socimi / The real estate division of the Spanish fund manager has obtained €50 million from individual investors, including one from Abu Dhabi.

A new Socimi is preparing for its stock market debut. Its name is Corpfin Capital Prime Retail Assets, a vehicle created by the real estate division of the Spanish fund manager Corpfin Capital. “Since we created a specialist fund manager for the real estate sector in September 2008, our goal has been to create a vehicle and we think that a Socimi is the perfect formula for our investors”, says Javier Basagoiti, Managing Partner at Corpfin Capital Real Estate.

The new company will, in turn, channel the investments of two other Socimis: Corpfin Capital Prime Retail II (CCPR II) and Corpfin Capital Prime Retail III (CCPR III). The first company was created in September 2013 with capital of €30 million, and CCPR III was launched in 2013 with €20 million from small investors. “We have signed a co-inversion agreement, which gives us greater purchasing power”, says Basagoiti. The €50 million obtained (to date) will be supplemented with bank financing, which has already been committed, to take the total (funds available) to €100 million. “We are not listing to obtain financing, we already have funds. But we want to ensure that our vehicle has the greatest transparency possible”.

Listing on MAB

The new Socimi will make its stock exchange debut on MAB and will be dedicated exclusively to the management of commercial property. “We will not invest more than 15% or 20% of the total in a single asset. We prefer to diversify”.

For its IPO, which is scheduled for May, the fund already has assets worth more than €50 million. “We have already invested 56% of the funds. The objective is to invest 100% before August 2016, but I think we may have completed our purchases before Christmas”. All of the assets are retail premises located on the major streets of large capital cities, such as San Sebastian. In Madrid, they own properties on streets such as Serrano (where they own number 4, which they lease to the firm Hasteens), Fuencarral (where they have numbers 37 and 74), Goya and Velázquez. “The objective is to obtain an annual return of 15%. We are a firm that adds value; we do not buy properties that are already being rented out for a return of 6%, rather we focus on off-market transactions and we (actively) manage our assets”.

Unlike the Socimis that are already listed (on the stock exchange), the share capital of Corpfin Capital Prime Retail Assets will not be owned by large international funds or a single high profile shareholder, but instead by hundreds of smaller investors. “We are not going to have an “anchor” investor. We are a boutique Socimi, which is what our investors prefer”, explains Basagoiti. The contributions to the new Socimi range between €250,000 and €500,000 from small savers and between €1.5 million and €5 million from family offices. “90% of our investors are Spanish but we also have foreigners, for example, one investor from Abu Dhabi, who is contributing just over €6 million”. Moreover, the team at Corpfin Real Estate will also participate in the share capital. “The fund manager will acquire between 2% and ·3% of the Socimi’s capital, as a means of clearly demonstrating our commitment”.

Socimis for the acquisition retail premises is not Corpfin’s only plan. “The idea is to create more specialised listed companies. I think that prime areas in the residential sector are attractive, as are medium-sized retail spaces and offices, but not entire buildings, rather mix-used properties for SMEs.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Uro Property Debuts On MAB With An Increase Of 5%

13 March 2015 – Expansión

Uro Property, the Socimi that owns one third of Santander’s bank branches and whose main shareholders are Santander, Atisha and CaixaBank, debuted on the Alternative Investment Market (Mercado Alternativo Bursátil or MAB) yesterday with an increase of 5.05%, to take its price per share to €105.05.

The company is being listed through a fixing procedure, whereby its prices are published twice a day (at 12:00 and at 16:00). At 12:00, when the shares debuted, the price increased to €102.50, i.e. by 2.5% with respect to the price of €100 that had been set for its IPO. Its price at 16:00 (the official price for the session) reached €105.05.

Thus, Uro Property ended the day with a market capitalisation of €272 million and so became the largest company trading on the MAB.

Original story: Expansion

Translation: Carmel Drake

Santander’s Landlord Finalises The Sale Of 400 Branches

5 March 2015 – El Confidencial

Uro Property, the name given to the company formerly known as Samos, will begin trading on the MAB (‘Mercado Alternativo Bursátil’ or Alternative Investment Market) with the minimum legal amount, given that its ultimate aim is to move onto the main stock market.

Another one of the Socimi giants is counting down the hours until its goes public. Uro Property, the name give to the company formerly known as Samos, and the company through which several investment funds advised by Oleguer Pujol purchased a one third stake in Santander’s branches, will list on the MAB within the next few days and will continue to put the pieces in place to fulfil its aim of listing on the main stock market, with a healthier financial structure.

With this challenge in mind, the company chaired by Carlos Martínez Campos and led by Simon Blaxland is finalising the sale of 400 of the 1,316 branches that it owns, a transaction that it is already negotiating with an institutional investor and that will allow it to repay some of its €1,424 million loans ahead of time. This debt was already financed last year, when Samos’s creditor entities, led by Santander and CaixaBank, took control of the company, by capitalising €424 million of mezzanine debt and creating Uro.

This transaction turned Santander into the main shareholder of the Socimi, with a 24% stake, whilst CaixaBank took ownership of 14.89%; BNP Paribas holds a 8.81% stake and Société Générale holds 3.14%. In addition, several hedge funds and other entities, including Barclays and Bayerische Landesbank were left with stakes of less than 1%; whilst the former shareholders, Sun Capital, now known as Atisha Holding and the Pearl Group, now Phoenix Life, hold 21.7% and 14.38%, respectively.

All of the shareholders have committed to retaining their stakes for a minimum period of 12 months, during which time Uro Property is confident that it will close a new financing deal that will allow it to reduce its spread from its current level of 300 basis points to closer to 200 basis points.

In fact, the listing on MAB is seen as another step in this process, given that by law, all of the Socimis are obliged to go public within a period of two years. Although Uro Property’s deadline in this sense does not expire until after 2015, it has chosen to go public as soon as possible precisely because it believes that its status as a listed company will facilitate its refinancing.

This explains why Santander’s landlord is going to limit its initial placement to the minimum established by law: two million euros, a paltry figure, considering that its assets have been valued by CB Richard Ellis to amount to €2,000 million and given that forecasts suggest its market value amounts to around €500 million.

An independent audit to separate the company from Pujol

Renta 4 has been hired as the liquidity provider, whilst EY has performed the valuation of the company ahead of the placement. Aware that all eyes are focused on it, given its historical ties with Oleguer Pujol, the company commissioned Deloitte to conduct an independent audit (the auditor of the Socimi’s accounts is PwC), which certified that the maximum investment made in the Socimi by the son of the former President of Cataluña amounted to €67,000.

The Socimi has signed a new lease agreement with Santander, which has committed to occupy the properties for a minimum period of 25 years, and it may extend that period by 14 more years for a third of the assets, which the bank, chaired by Ana Botín, has identified as more strategic for its business. In return, the company has been granted the right to review the portfolio each year, as well as the ability to exchange some branches for others, provided these exchanges do not represent more than 1% per year, under any circumstances.

Santander will pay Uro rent amounting to €125 million net, since the bank itself will bear all of the costs relating to the properties. This guaranteed income, together with the refinancing deal signed last year, allowed the Socimi to generate profits in 2014. Moreover, with the new financial structure that it is negotiating, which it is hoped will extend the current six year maturity period, the Socimi is confident that it will significantly improve its results; this is key for a vehicle such as this, whose main attraction is the fact that it is obliged to distribute the majority of its profits in the form of dividends.

Uro will be able to begin working on its plans to list on the main stock market and expand its portfolio of assets from 2016, in line with the steps being taken by its competitors, such as Merlin, which acquired BBVA’s offices.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Up To 15 Socimis Are Planning To Go Public In 2015

12 February 2015 – El Economista

Since the first Socimi debuted on the stock exchange – Entrecampos was the pioneer at the end of 2013 – seven companies of this kind have now floated on the stock market. And according to Jesús González Nieto, the Vice-President and CEO of the Alternative Investment Market (el Mercado Alternativo Bursátil or MAB) the number of listed Socimis will increase this year to include seven or eight more, with two of them planning to go public this quarter.

Nevertheless, market sources close to these transactions claim that the number of vehicles of this kind preparing to go public is even greater: with “up to fifteen” (currently involved in the process).

“Around fifteen Socimis are planning to go public within the next year, with assets ranging from €20 million to €400 million”, said one of the people responsible for placing the shares of these new real estate companies in the market. “Most of them are investments being made by foreign funds in Spain, which are buying up premium assets (hotels and above all, shopping centres). In parallel, there is a stream of hoteliers, who are seeing the benefits of putting their hotels into these vehicles because it allows them to dissociate the business from the properties”, he added.

According to the same source, there are two main reasons as to why non-residents above all are incentivised to constitute Socimis. Firstly, it is easier to exit an investment in one of these type of companies than it is to exit an investment in a specific building, “Socimis represent an easier way of buying (when you have a view) to sell”, he said. And secondly, there are tax advantages: Socimis are exempt from paying corporation tax, and also receive a 95% discount oon property transfer tax. For investors, however, the main appeal of these companies is that the rules require them to distribute 80% of the companies’ gross operating profits in the form of dividends, although at the moment, none of them are expected to make a profit this year.

“For these types of Socimis, those that are businesses, the average IRR of their portfolios is at least 8%”, say a number of financial sources. But amongst the fifteen Socimis that are preparing to float, there are also some property managers. As such “families are using these vehicles as a way of organising their assets to convert immovable property into movable property, whereby allowing it to be easily distributed”, they explain.

The regular stock market or MAB?

What remains to be seen is the market they will choose to list on – namely, the regular stock market or the MAB? The latter allows these types of companies to be valued on a discounted cash flow basis rather than on the basis of their NAVs (net asset values), which is the more accurate ratio used for valuing real estate assets in general and REITs (the US version of Socimis) in particular.

To date, the stats are as follows: of the seven Socimis that have debuted on the stock market in recent years, three have done so on the MAB (Entrecampos, Mercal and Promorent). And the other four have listed on the regular stock exchange: Lar España, Merlin Properties, Hispania and Axia. But, what determines whether these companies list on one market or another? “In reality, all of the Socimis that list today should do so on the MAB. Nevertheless, some of them have jumped onto the regular stock exchange because the investment funds behind them are subject to regulation 401k, which requires them to list on an official exchange, and MAB does not quality; it is regulated but not official. This means that some Socimis were forced to list on the regular stock exchange”, say market sources.

For the time being, the only thing we know about the six or eight companies on MAB’s radar (where they may list, according to comments made by MAB’s Vice President on Wednesday) are their timelines. “Two this quarter” and another “three or four before the summer”. One of them is “a very big player, with a large volume of capital”.

González Nieto explained that he regrets the slow speed of the mechanisms that process the files of these companies; a Socimi has two years from when it first registers to fulfil all of the conditions required to begin its activity, which means that this year is the deadline for those that first signed up in 2013. It is time for the interested parties to “get on with their homework if they regard it as a good opportunity”, he said.

Original story: El Economista (by C. García and J. Gómez)

Translation: Carmel Drake

Lone Star Aspires To Become The Largest Property Developer In Spain

12 February 2015 – Cinco Días

The American fund plans to make the most of the land and assets it acquired last year from Kutxabank and Eurohypo

“We are working to become the leading residential developer in Spain, the largest home builder in the country”, said the European Director of the American fund Lone Star, the Argentinian Juan Pepa, on Wednesday. “We are buying land directly”, he said, explaining that although “in 2012, everyone said that land was worthless”, we are now beginning to see opportunities for obtaining profits from its development.

“We do not regard ourselves as a foreign investor, but as an industrial agent that invests its dividends in the construction of homes”, said Pepa, claiming that 50% of the group’s efforts in Spain over the next decade will focus on the creation of thousands of jobs in the sector, which suffered significant job cuts during the crisis. Pepa was speaking at the presentation of a study conducted by PricewaterhouseCoopers (PwC) about trends in the real estate sector in Europe, which show that the appetite for residential assets is growing.

To achieve its objectives, Lone Star will rely on the two large transactions that it has signed since entering the Spanish market in 2012: the mega-purchase of Eurohypo’s assets and the acquisition of Kutxabank’s real estate arm, Neinor; these were the two largest transactions in their respective fields during the crisis.

The first transaction, signed with JP Morgan last spring, enabled Lone Star to purchase Eurohypo’s mortgage portfolio from Commerzbank for €3,500 million, when the bank valued the portfolio on its own books at €4,500 million. The acquisition will allow the fund to access significant portfolios of land and property that serve as collateral for the loans.

The second transaction, which was signed last December, for €930 million, gave the fund control of Kutxabank’s property management platform, including 90 dedicated employees, as well as 50% of the entity’s real estate assets. The assets mainly comprise land, as well as some completed developments primarily located in the Pais Vasco, Madrid, Barcelona, Murcia and Andalucía.

“The cycle in Spain is just beginning” said Juan Pepa, who spoke about a promising period lasting 10 years…; it is “becoming increasingly difficult to enter the market” and exit as a winner. “We almost missed out completely in Spain” he admits, explaining that the fund arrived in the country in 2012 but did not invest until last year, even though 2013 was “a very good year to make investments”.

For PwC partner Enrique Used, Lone Star’s project is a clear example that investments made two years ago are now beginning to bear fruit,  “cranes are the best sign that activity is returning”. In this context….we are beginning to detect interest from new investors – although interest from opportunistic funds is still evident – and the appetite for residential assets is growing, in the face of the thriving office market.

Meanwhile, the vice-president and CEO of the Alternative Investment Market (Mercado Alternativo Bursátil or MAB), Jesús González, said that he expects to see six new real estate investment companies (Socimis) float their shares before the summer.

Original story: Cinco Días (by Juande Portillo)

Translation: Carmel Drake

Armabex Launches First REIT Directed To Small Homeowners

02/01/2015 – El Confidencial

New year, new REITs. The corporate form that is revolutionizing the real estate sector will have in the first half of this year a new tenant who promises to expand the tax advantages of these companies to any small and medium-sized property owner, but who lacks the minimum capital of five million euros needed to start a company of this type.

Armabex Managers is the company whose aim is not to go to the market to raise money to invest in real estate, as has been seen up until now, but to directly capture individual properties and, with this formulated portfolio, go public. As President of Armabex, Antonio Fernández, said, “We are the first vehicle based on property raising, since the first contributions will be made only with assets, not money.”

The new REIT is launching with a Valencian investor who will provide 120 homes valued at about 10 million euros, ensuring the viability of the project; various other owners, who have already expressed interest in joining the project before beginning to trade on the MAB in the first half of the new year, will also partake. The requirements to participate in this process are to provide a preset minimum equity of 120 billion euros in available housing, either without charges or where the mortgage represents less than 50% of the property, and that have been for rent during a minimum of six months in the last year.

“The main advantage of this REIT is that it allows small and medium-sized property owners, who have either inherited their properties or are professionals who have been building an asset portfolio consisting of apartments, to liquidate and get a return without worrying about all the management problems that these properties entail,” said Fernandez.

In principle, the REIT will limit its action to Madrid, Barcelona, Bilbao and Seville, where it will have a network of real estate agents who will market the properties. In addition, each year there will be four ‘windows’ of liquidity, which will allow the entry of new members via transfers of assets and, after the first year, one window for cash investments.

REAL ESTATE SECURITIZATION

“To ensure transparency, we are in negotiations with two large real estate consultants, to select one which will be responsible for valuing properties according to clearly defined standards,” Fernandez said. These valuations are carried out each year to update the value of homes and put them in value also in terms of the ‘windows’ as they being opening each year.

Each property owner will have a share in the company based on the valuation of their assets over the total of the REIT. Alongside the annual dividend, they will benefit from the returns Armabex expects to obtain through the revaluation of assets, since the company is being created at a low point in the market — which gives the company confidence that the value of these properties will increase with time — and the management that the company will carry out by buying and selling assets.

From the third year onwards, Fernandez plans to start divestments of homes that have been provided to the company and, with the money earned, to buy other apartments, in addition to acquisitions that will take place after the second fiscal year with cash investments. “Our goal is to ensure an annual coupon of between 150 and 250 points above the ten-year bond yield plus the profit obtained with revaluation of the REIT”.

Being a listed company, the investors that provide their homes, if they need liquidity, may sell shares directly in the market, allowing them to easily monetize an asset as illiquid as housing. “Basically, this is a securitization of real estate,” said the president of Armabex, convinced that this type of product can be a solution, for example, to deal with issues based on property inheritance.

Armabex was the first firm to request the incorporation of a REIT on the MAB (Alternative Stock Exchange Market). It was in March 2013 when Armabez, as a registered advisor, coordinated Promorent’s entrance into the market, which solidified in November. Now it has decided to take a step further and create its own listed real estate investment company, acting as a consultant.

Original article: El Confidencial (by R. Ugalde)

Translation: Aura REE

MAB, The Alternative Stock Market, Is Ideal for SMEs Which Need Boost for Their Business

06/08/2014 – Expansión

From renting five apartments among friends to managing more than 24,000 properties in 106 countries. That is the story of Only-Apartments, a company created in 2003 by two architects living in Barcelona, Alon Eldar and Elisabet Cristià, the success of which has led its founders  to take the leap onto MAB, the alternative stock market, in search of finance which is intended to accelerate its growth and ignorethe Gowex fraud, which has left the alternative stock market in a difficult period. “We are the first company to be listed on the MAB alternative stock market since the scandal and we have made a very good start. Gowex is an isolated case”, assures Eldar. “It is good that MAB is in the public eye because it is a market of SMEs, ideal for people who need a boost for their business”, they recognise.

As for the motive for which they went for a listing, Eldar explains that “Only could continue to grow like it has done to date, organically, but this would put a limit to our rhythm of progress. We believe that there is an advantage to positioning ourselves as leaders in the sector and, to do that, finance is required”.

The company considered the possibility of going public on MAB after the summer but decided to do it “as soon as possible”, by means of a direct listing, without making an Initial Public Offering (IPO) of shares. ”We have decided to go public by means of a direct listing because we want the shareholders to participate in the company’s creation of value. It means sharing the business rather than selling it, which is what an IPO means”, state QRenta, the firm which has advised them in the MAB listing process.

AS for the business model, its founders explain that “Only-Apartments is not the first shared-economy company to go public, others such as Spotify have done it and successfully. There is a clear demand for this type of company linked to the collaborative economy and this concept is going to play an increasingly important role.”

Before taking the leap onto the stock market, in May, Only made a capital injection of 3.4 million euros, a rate of 1,26 euros per share. The transaction implied valuing the company at 10 million euros. “Between 2011 and 2013, our average sales were 5.1 million with a net profit of one million. We hope that in 2017 our revenues will be between 40 million and 50 million euros, and that profits will represent between 15% and 20% of those revenues,” explain the company’s management.

After the capital injection, the founding partners maintain 65% of the share capital and the rest is listed on the stock market. “Our idea is to have a second round of financing in Autumn and to do that we want the value to increase and we want to conduct this new raising of funds under the best possible conditions,” underlines Cristià. With the funds obtained, Only-Apartments plans to increase its presence in the markets of the American continent and Asia. “There is an enormous potential in both areas and also in Europe. It is a sector where only 5% or 6% of the product is on the market”, explains Eldar. His plan is to reach 300,000 apartments in the next three months.

Original article: Expansión (by R. Ruiz./C.G.Bolinches)
Translation: Aura REE

Neinver Takes Control Over Joint Venture Firm Set Up With MAB

8/04/2014 – Expansion

Neinver, outlet shopping center operator, acquired 100% of stake in a company that has been created together with MAB Development, a branch of Rabo Real Estate. The firm has been established with view to developing malls in Germany, France and the Netherlands. By now, each of the investors held 50% of the stake.

 

 

Original article: Expansión

Translation: AURA REE

The Socimi Promorent Being Sold on MAB for 1.45 Euros per Share

The Socimi Promorent´s price on the MAB (Alternative Stock Market) today is 1.45 Euros per asset. It is the second Reit company debuting on the market, after Socimi Entrecampos which was first launched on November 28th.

Promorent Socimi S.A. was established in 2012 and it belongs to the family group Pavón Olid, an old shareholder of the companies such as: Cambios Sol (now called Money Gram), Sol Telecom and a tourist bus Madrid Vision firm, Sol Open Tour, and is estimated to be worth between 5.1 and 6.5 million Euros.

Jose Pavón Olid is a shareholder of a patrimonial company, Marqués de Arlabán, situated in Madrid. He is the only administrative of many firms, among which Minas Paramesa that extracts clay and gravel, to be highlighted; Checkpoint Sol Seis, a monetary intermediation company; a cosmetics´firm Dermocosmética Gramjeña, company Aval Plus and real estate property.

The property of Promorent constitutes houses, commercial locals and building lands. The registered advisor that serves the company is Armabex Asesores Registrados and the office, Ashurst, the group set up by  Ismael Fernández Antón, the real estate partner; Javier Hernández Galante, the fiscal partner and Javier Mateos, the senior banking partner. The liquidity provider is Cortal Consors, from the BNP Group.

 

Source: Expansión

Entrecampos, the first Socimi to enter the Alternative Stock Market.

 The real estate business is taking a different shape in the market. Entrecampos will start on the next 28th November its path in the Alternative Stock Market (ASM). And it will do so with the new alternative of the Socimi (listed public limited companies for real estate investment), a financial vehicle oriented to those companies renting buildings. “We represent a very different business to the one of the real estate companies listed in the stock exchange. The rental business has already digested the crisis, decreasing the rents. It is an activity which continues to be necessary”, Ignacio Segura, managing director at Entrecampos, explains. The company will start operating at a price of 1,59 Euros per share and will have 54,6 million  bonds  (representing  a  value  around  86,8  million  Euros).  In  this  operation, Entrecampos has been assessed legally by DLA Piper and by VGM Advisory Partners as a registered counselor.

The changed to the ASM takes place after the legal reform of last December. “We have left the market when the law has allowed us to do so”, Segura declares. The change in the law made the criteria to create the socimis more flexible, improving its taxation (0% on the company tax) and opening new ways to be listed with its negotiation in multilateral management systems, which are less strict than the traditional stock exchanges. This impulse has motivated that other companies within the sector would also be working in their change to that market.

Entrecampos pretends “to consolidate, grow and prevail in time” with the listing in the ASM, Segura declares. He admits that, generally, there can be some mistrust within investors to enter a company linked to the Spanish real estate sector. However, he hopes to catch the interest of other patrimonies wishing to enter an already consolidated socimi. “The future of the socimi will be linked to the patrimonial mergers”, he comments.

Entrecampos has some presence abroad (12,8% of its properties is located in Germany). However, Segura dismisses the entrance of foreign investors. “Before working with foreign patrimony it is necessary for us to grow”, he points out.

Source: Expansión