19 May 2017 – El Economista
Arcano is preparing to launch its second real estate fund following the success of its first vehicle, through which it managed to raise €80 million to acquire assets in Spain.
In this case, the objectives of the firm are more ambitious – it hopes to raise between €100 million and €125 million, according to Eduardo Fernández-Cuesta, Partner at the management company.
“Arcano’s platform was essential when it came to obtaining capital for the first fund”, explained the Director, who said that the process was complicated, given that it was the first time that it had operated in that field, but that it was supported by the firm and its own experience with other kinds of assets, such as private equity and European corporate debt (where it already manages assets worth more than €3,000 million).
Since Arcano Spanish Opportunity Real Estate Fund launched its operations “€60 million has been invested or committed to date, and by the end of the year, we expect to have disbursed the remaining €20 million (from the first fund)”, said Fernández-Cuesta.
Just like in the case of the first fund, the new vehicle will focus on value-added operations, “given that it is a niche in the market that we think we can do it better, focusing on operations of between €10 million and €15 million”.
The firm, which seeks “a net return of 15 percent” operates mainly through off-market transactions with private owners, as well as with financial institutions.
“We will likely begin raising capital (for the second fund) from September onwards, but it will depend on how the investments that we have left to close in the first fund are going at that point”, said the Director.
With the first fund, Arcano invests in value-added operations in all types of properties, with a clear focus on residential assets in Spain’s main cities and along the Costa del Sol, without forgetting other assets including office buildings, logistics assets, retail premises and shopping centres, provided they are opportunities that generate value within the fund’s investment philosophy.
“In this way, Arcano covers a gap in the real estate sector in Spain by concentrating on value-added and medium-sized operations (between €5 million and €25 million in equity) with a clear local focus”, explained the firm.
Original story: El Economista
Translation: Carmel Drake