Tag: mixed use

Dragados is Asking for c. €180M for 88,000 m2 Buildable Plot in Tetuán (Madrid)

6 August 2018 – El Confidencial

A new and powerful land operation is taking shape in the centre of the Spanish capital. The star is Dragados, one of the heavyweights in the construction sector in Spain. The subsidiary of ACS has been trying to sell several plots, which together span a buildable surface area of just over 80,000 m2, on Paseo de la Dirección in the Tetuán district in the north of Madrid and just 2 km from the Cuatro Torres, for almost a year. And this area has just received the green light from the Town Hall of Madrid, which approved a Partial Plan on Tuesday that will undoubtedly favour land transactions since it means the urban planning risk has disappeared.

According to the sources consulted, the plots have been on the market for a year, but the high price expectations of Dragados – which amount to around €180 million – have prevented the sale from being closed, until now. Large property developers, investment funds and family offices have all expressed their interest. The construction company is being advised by Colliers International, which declined to comment on the deal.

On the table is a real gem, given that the plots are all finalist, in other words, ready to be built on. Such assets are in very short supply inside the M-30. Specifically, the site comprises two plots for the construction of private housing and two other plots for the construction of social housing properties (VPPL) and mixed-use assets (offices and tertiary).

For the former, which have a buildability of around 40,000 m2, Dragados is asking for around €2,500/m2 (…), in other words, around €100 million, which would make it one of the largest land operations in the capital in recent months. “That price would mean selling the future homes at prices of around €5,000/m2, which is way above current market prices in the area”, say the same sources. House prices in the area amount to around €2,400/m2 – €3,000/m2, depending on the types of homes.

For the plots to be used for social housing and offices – which also have a buildability of approximately 40,000 0m2 – the vendor’s price expectations amount to around €80 million. Despite the boom in the capital, these figures exceed the prices that the potentially interested parties are willing to pay.

Ten years in the making

With the approval this Tuesday from the Town Hall of the new planning order for the area, it seems that finally, and after more than a decade, work is going to begin on this ambitious urban remodelling project. It will involve the construction of around 2,000 new homes, most of which will be protected in some way (VPPB and VPPL), including two rehousing buildings and several 25-storey towers. To put that into context, the Cuatro Torres have between 45 and 58 floors (…).

Historically, Paseo de la Dirección has been a downtrodden area in the north of Madrid with numerous substandard homes that would benefit greatly from the definitive launch of Madrid Nuevo Norte – formerly Operación Chamartín – just 2km away. What’s more, the site is very close to the capital’s financial district par excellence, Azca, as well as to Plaza Castilla, the hub for much of Madrid’s land transport network (…).

Original story: El Confidencial (by E. Sanz & R. Ugalde)

Translation: Carmel Drake

BMO Debuts its New RE Vehicle in Spain with €1bn to Invest

15 May 2018 – Eje Prime

BMO Real Estate Partners is backing Spain with its new real estate investment vehicle. The international fund has just launched Best Value Europe II (BVE II), which will specialise in the high-street retail market. One of the company’s first purchases has been a prime asset in Madrid, which it bought together with another commercial premise in Verona (Italy): for the two properties, BMO paid €39 million.

Nevertheless, BMO’s new vehicle has the financing to spend a lot more. The fund’s initial plan involves creating a portfolio of assets worth €500 million, a figure that it plans to double to €1 billion over the medium-term, according to Business Inmo.

After its initial purchases in Madrid and Verona, the fund has also just closed its third acquisition in Lisbon. BMO has paid €15.2 million for that asset, which is located on Avenida da Liberdade, the main commercial thoroughfare in the Portuguese capital. The property, which has been completely renovated, is designated for mixed use as offices and retail space, and has a total surface area of 2,104 m2.

The path that BVE II will follow will be similar to that of the first vehicle that BMO launched for this market and which focused on finding high street premises on the most prime streets of the main European capitals. The predecessor of this new company has now invested more than 90% of its funds; it owns a portfolio containing 12 assets worth more than €700 million.

Original story: Eje Prime

Translation: Carmel Drake

Aena: Countdown to the Real Estate Megaplan

1 March 2018 – Expansión

Business / Aena is going to market 2.7 million m2 of land in Barajas over 40 years and 1.8 million m2 of land in El Prat over 20 years.

The starting gun has been fired for Aena’s real estate megaplan. The President of the firm, Jaime García-Legaz, confirmed the details of the project yesterday to analysts. It forms one of the pillars of the new strategy that the group is preparing for the period 2018-2021, which will be published within the next few weeks. Aena is going to launch a tender to hire an investment bank to design the process and determine the capex required and the formula to maximise the value. The airport manager, which spent €1.4 million in 2017 on the development of its plans for the project, will kick off in Madrid and Barcelona, where it owns the majority of its plots.

In Barajas (Madrid), it is going to market 2.7 million m2 of land over 40 years for a mixture of uses. According to its estimates, the maximum development potential is 3.6 million m2. Meanwhile, in El Prat (Barcelona), the term will last for 20 years and will span 1.8 million m2 of land, also for various uses, and including the construction of loading and logistics areas. According to the first estimates in the market, the capex associated with this project is going to amount to several hundreds of millions of euros per year.

“Real estate development is one of the main strands of the strategic plan together with the internationalisation of Aena and the dividend policy”, confirmed García-Legaz yesterday. On Tuesday, to coincide with the results announcement, the group announced the distribution of a dividend amounting to €6.50 gross per share, 80% of its profits in 2017, up by 69.7% compared to the previous year. “The Board considered what was appropriate, taking into account the increase in cash generation and the leverage level; and it is applicable to 2017”, he said. And for the future? “The policy will be reviewed with the new roadmap, but the Board’s philosophy involves returning to shareholders all of the free cash flow that is not required for operations overseas or capex over the next few years”, he said. The State is the primary shareholder of Aena with a 51% stake.

The K Factor

Meanwhile, the results for 2017 include a difference amounting to €57.8 million between the maximum annual revenue per passenger set by Dora – the airport framework applicable until 2021 – and actual revenues. That adjustment, known as the K factor, is going to have to be incorporated into the review of the tariffs for 2019. As a result, “the airport charges could be flat” when the forecast was a decrease of 2.2%. This year, Aena forecasts that air traffic is going to continue to rise, with growth of 5.5%.

Original story: Expansión (by Y. Blanco)

Translation: Carmel Drake

Socimi Trajano Buys Building In Bilbao For €40M

6 October 2015 – Expansión

The Socimi Trajano Iberia, managed and promoted by a division of Deutsche Bank, has purchased the Echevarría building, in the centre of Bilbao, for €40 million and has set itself the objective of investing €190 million in assets located in Spain and Portugal.

The property is located on Calle Alameda de Urquijo, 4, in the main shopping and business district of the city, according to a statement from the company, which debuted on the Alternative Investment Market (‘Mercado Alternativo Bursátil’ or MAB) on 30 June this year.

The mixed-use property has a leasable area of 8,927 m2 and is rented out in its entirety. Specifically, a retail store occupies the ground and first floors (3,846 m2) and the remaining 5,081 m2, distributed over 6 floors, are leased as offices.

As part of its strategy, Trajano Iberia is planning to make investments amounting to approximately €190 million in real estate assets in the tertiary sector in Spain and Portugal.

The primary focus of its investments will be offices in semi prime areas of Madrid and Barcelona and prime areas of secondary cities, as well as shopping centres and retail parks, where those assets have a leadership position. It will also analyse investments in logistics assets, mainly along the Madrid-Barcelona and País Vasco-Valencia corridors.

The company is managed by the real estate division of Deutsche Asset & Wealth Management and has secured funding amounting to €94.8 million since it was created.

Original story: Expansión

Translation: Carmel Drake