19 February 2018 – El Confidencial
The most coveted property developer of recent times may change hands within the next few days. Levitt is holding advanced talks with Q21 Real Estate, a company created by the joining of forces between the former Grupo Pinar and the US fund Baupost, to close its sale this week and, in any case, before the end of February, according to several sources familiar with the operation.
The agreement will put an end to almost two years of to-ing and fro-ing with different interested parties in acquiring the property developer, a reference player in the market for premium homes, and will also create a new giant in the sector within the convulsive Spanish residential market.
As El Confidencial revealed, it was in 2016 when Levitt first started to listen to offers as a formula for dealing with its problem of generational succession, following the death of the group’s founder and alma mater, José María Bosch Aymerich, without any direct descendants.
Owner of one of the best land portfolios in Madrid, with land in locations such as Alcobendas, Las Rozas, Pozuelo and Boadilla del Monte, Levitt has proved tempting over the past two years for giants such as Goldman Sachs, Apollo, Värde and even the fund Baupost itself, which was on the verge of acquiring the property developer last year.
But on the home straight, those negotiations were called off due to differences over price, as well as over the continuity of the project and Levitt’s team. After closing that door, the fund found another window open through Q21, the property developer that has placed a better offer on the table than the one put forward by the US fund, and one that ensures the survival of Levitt.
Who is Q21?
Constituted in July 2014, Q21 Real Estate has a brand that is still new and a workforce of just 17 employees – both features have facilitated its agreement with Levitt, with which it shares its vision of high-quality developments.
Currently, Q21 has nine developments underway, mostly in the Community of Madrid (Boadilla del Monte, Valdebebas, Getafe and Mostoles), but also in Málaga and Valencia. Altogether, the firm is working on 1,500 homes.
With assets worth €6.3 million and net equity of €3.58 million in 2016 (the last year for which audited figures are available), Q21 generated revenues of €5.27 million, an operating profit of €3.5 million and a profit of €2.76 million.
Its numbers are well below those recorded by Levitt, whose turnover amounted to €62 million and net profit €6.3 million. Moreover, Levitt owns a portfolio worth €200 million, its brand is recognised in the market and its history spans almost fifty years in Spain after it arrived in 1971 to introduce the US residential urbanisation model.
Original story: El Confidencial (by R. Ugalde)
Translation: Carmel Drake