Merlin Increases Its Capital By €614M To Fund New Purchases

16 April 2015 – Expansión

Yesterday, the listed real estate investment company (‘sociedad cotizada de inversión inmobiliaria’ or Socimi) Merlin Properties announced a capital increase amounting to €613.7 million. According to the Socimi, the aim of the operation is to (raise finance) to continue with its purchase of real estate assets.

The increase will be conducted through the issue of 64.6 million new shares with a nominal value of one euro and a premium of €8.50, said the company. The current shareholders, which include large funds and fund managers such as Marketfield and UBS, will have pre-emptive purchase rights. Two rights will be required to subscribe each new share. It is hoped that CNMV will publish the prospectus today following its approval.

The increase in the share capital of Merlin Properties comes less than a year after its IPO on 30 June 2014.

The company, which first floated on the stock exchange with capital of €1,250 milllion and a pre-agreement to purchase almost 900 branches and a number of banking offices from BBVA, has already invested all of its own funds and has also made use of bank financing to fund additional purchases. One of the most desirable assets in its portfolio is the Marineda shopping centre in La Coruña, which it acquired for €260 million.

Rising share price

At the General Shareholders’ Meeting, which was held just a few weeks ago, Ismael Clemente, the Chairman of the Socimi, said that the company was working on investment transactions with a value of up to €2,000 million, including office buildings, asset portfolios and shares in companies.

The Socimi closed 2014 with rental income of €56.6 million, a gross operating profit of €38 million and a net profit of €49.7 million. Yesterday, the real estate company’s shares closed at €13.10, up 0.77%.

Merlin’s recent purchases include the acquisition of an office building on Calle Alcalá in Madrid and a logistics warehouse in Coslada (Madrid), for which it paid almost €58 million in total.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Bankia Puts 40 Large Property Loans Up For Sale

7 April 2015 – Expansión

Project Commander / The bank is holding negotiations with opportunistic funds regarding the transfer of real estate loans worth €500 million.

Bankia is causing a storm amongst large overseas funds in 2015. The entity chaired by José Ignacio Goirigolzarri recently announced two large divestments aimed (precisely) at those investors; they are pioneering due to the types of assets that they include: one contains overdue mortgages and the other contains large loans to real estate companies.

In total, Bankia has put unpaid property-related loans up for sale amounting to €1,800 million. Through this strategy, the bank is seeking to reduce its balance of doubtful loans and to continue awarding real estate assets.

The most advanced transaction (in terms of progress) is the one involving the large loans (to real estate companies). Project Commander, the name of the deal being advised by Deloitte, includes 170 loans granted to 39 companies, worth more than €500 million. Of those companies, 31 are property developers and almost all of them have filed for bankruptcy or liquidation, according to sources at the overseas funds. Some of the loans were granted to companies such as the Catalan group Promociones Habitat, the same sources reported.

Exposure to land

Most of the loans are syndicated and bilateral and provide access to a wide range of assets. These include land – €200 million – most of which is rural; and industrial warehouses – €90 million -. The fund(s) that win(s) the bid will also be in a position to take ownership of office buildings, homes, a fully operational aparthotel and even a winery.

Along with the real estate assets, a small portion of the portfolio is backed by pledged shares and other types of economic rights in creditor bankruptcy.

Almost two thirds of the real estate portfolio is located in Castilla-La Mancha – mainly Toledo -, Andalucía and Cataluña.

According to the agreed timetable, the funds must present their final offers within the next two weeks and the transaction should close before the end of the month. Sources close to the process indicate that Bankia may obtain between €150 million and €200 million for Project Commander.

To secure the deal, many of the large funds have purchased real estate platforms during the last two years: Apollo (Altamira), Cerberus (Haya Real Estate), Blackstone (Anticipa), TPG (Servihabitat), Lone Star (Neinor), Centerbridge (Aktua) and Värde Partners-Kennedy Wilson (Aliseda).

These investors have already participated in some of the large real estate loan purchases. Blackstone purchased the largest portfolio ever transferred in Spain to date, Project Hercules, which comprised problematic mortgage loans from Catalunya Banc amounting to almost €6,500 million; and, more recently, Blackstone acquired a non-performing property developer loan portfolio from CaixaBank. Meanwhile, Lone Star purchased a loan portfolio from Eurohypo for €3,500 million.

Nor does the market rule out the emergence of new players such as Pimco, Chenavari and Deutsche Bank.

Meanwhile, yesterday Fitch increased the rating of Bankia’s mortgage bonds by one notch to A-.

Original story: Expansión (by Jorge Zuloaga)

Translation: Carmel Drake

Socimis Invest €420M+ In Asset Purchases In Q1 2015

6 April 2015 – El Economista

The main listed real estate investment companies (‘sociedades cotizadas de inversión inmobiliaria’ or Socimis) have continued to make purchases in 2015. During the (first three) months (of the year), they have spent more than €420 million on the acquisition of office buildings, residential complexes, logistics warehouses and hotels.

Merlin Properties, which debuted on the stock exchange in June last year, with a valuation of €1,250 million, has invested the largest amount during the first three months of the year (€146.3 million).

Since the start of the year, the company has acquired the office building located at number 8 World Trade Center Almeda Park (WTCAP) in Cornella de Llobregat (Barcelona) for €36.5 million and has spent €38.1 million on another office building located on Calle Alcalá 38-40 (Madrid), which is entirely leased to the Ministry of the Interior.

Similarly, it has acquired a logistics warehouse measuring 16,242 m2 in Getafe (Madrid) for €12.75 million, which is leased to Transportes Souto; another measuring 72,717 m2 in Vitoria for €28.58 million, leased to Norbert Dentressangle; and has spent a further €19.8 million on another warehouse located in Coslada (Madrid), measuring 28,490 square metres, which is leased to Azkar.

Following these acquisitions, Merlin’s property portfolio exceeds 717,000 m2 and generates gross annual rental income of €132.2 million.

Meanwhile, the Socimi owned by the Lar Group purchased a plot of land jointly with Pimco measuring 26,203 m2, located on Calle Juan Bravo, 3 (Madrid), where the Juan Bravo Plaza project was being carried out, led by the property developer Eurosazor, owned by Rafael Ortiz, in which Fernando Fernández-Tapias and Paloma Mateo also hold shares.

Lar España will now take over the management of this new real estate project with the objective of constructing a first class residential building in one of the “prime” (real estate) areas of the city, close to the Golden Mile. This transaction takes the Socimi’s total investment to €458.7 million in 15 deals since its IPO.

Meanwhile, Hispania, – the listed investment company controlled by Azora and in which the multimillionaires George Soros and John Paulson hold shares – has acquired a residential complex measuring 39,000 m2 in Sanchinarro (Madrid), comprising 284 homes and 311 garages, for €61.15 million.

It has also purchased an office building located on C/Príncipe de Vergara, 108 (Madrid) measuring 7,324 m2 for €25 million, as well as the three-star Hesperia Ramblas Hotel (Barcelona) for €17.5 million and the four-star Vincci Málaga Hotel for €10.4 million.

Finally, AxiaRE has acquired two office buildings in Madrid, one located in Campo de las Naciones and the other on Calle Juan Ignacio Luca de Tena, for €40.5 million in total.

Since its IPO, the company has closed 9 investment transactions valued at €464 million, through which it has acquired 18 properties, which have a combined rentable surface area of more than 402,000 m2.

Original story: El Economista

Translation: Carmel Drake

AxiaRE Increases Capital By €396M To Fund New Purchases

6 April 2015 – Expansión

The listed real estate investment company (‘sociedad cotizada de inversión inmobiliaria’ or Socimi) Axia Real Estate has announced a capital increase of around €396 million. The operation, which will involve the issue of up to 36 million shares at a minimum price of €11 per share, will allow AxiaRE to continue purchasing real estate assets.

The Socimi also announced the purchase of two office buildings in Madrid: one in the Campo de las Naciones area and another on Calle Juan Ignacio Luca de Tena. In total, AxiaRe has invested €40.5 million in these two purchases.

The real estate company has also signed bilateral financing agreements for several properties, including the offices on Luca de Tena, for which it has signed a loan with CaixaBank for €10.85 million, with a term of 13 years. It has also obtained a €50 million loan from Santander, with a seven year term, to finance the purchase of some (other) offices in Madrid, two warehouses in Guadalajara and a retail space in Tarragona.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Madrid Earns €360M From The Sale Of Public Properties

25 March 2015 – El Confidencial

The Community of Madrid sold around thirty real estate assets between 2012 and 2014, including an entire housing development and a number of buildings on Gran Via.

The sale of public properties generated income of more than €360 million between 2012 and 2014. In total, during this period, around thirty real estate assets of all types were sold, ranging from an entire housing development, to a number of buildings in the heart of Gran Via, as well as flats, plots of land and commercial premises.

The starting gun for “property” sell-off began in the summer of 2012, with the sale of a plot of land for tertiary use in Pozuelo de Alarcón for €5 million. In the same year – when Spain was on the black list of all investors – Metro de Madrid sold another plot of land that it owned on Calle Cardenal Cisneros for €2.1 million.

However, the largest transaction signed to date by the Community of Madrid did not take place until July 2013. Then, it sold a 32 home development, owned by Ivima, to Azora and Goldman Sachs for €200 million, whereby the buyers paid almost 20% more than the initial asking price (€168.9 million).

At the end of 2013, two further transactions were signed that “fattened up” the public coffers by more than €26.5 million. These involved the sale of Gran Via 18 for €18.6 million to Iberia Project Management, although the Texas Pacific Group (TPG) was actually behind the bid – that fund purchased 51% of Servihabitat Gestión Inmobiliaria from CaixaBank in September of the same year. The second sale was of Gran Via 3, which the Community sold for €8 million to Baech Bienes Inmuebles.

Then in 2014, when real estate investment in Spain really took off, more than a dozen transactions were signed; the most noteworthy was the sale of a building measuring more than 9,000 square metres for €40.2 million to Línea Directa, the insurance arm of Bankinter. Last year, Gran Via 20 was also sold to the real estate company of Caja Rural de Almendralejo, which paid almost €20 million for the property.

The final two transactions last year were closed in December: a building on the Carretera de San Jerónimo, measuring 4,500 square metres for €14.1 million and another measuring almost 3,000 square metres on Los Madrazo for €3 million; both were owned by Arproma.

The plans to sell off public assets are on-going. The Community of Madrid has placed a “for sale” sign above another 22 assets that is owns. Office buildings, residential properties, commercial premises, plots of lands, flats and individual buildings. Through these, it hopes to “fatten up” the public coffers by around €56 million, taking advantage of investors’ renewed appetite for Spain.

Nevertheless, the jewels in the real estate crown have been sold already. By price, the following assets are up for sale: an office building on General Díaz Porlier, which has been on the market since October 2013 and for which the Community of Madrid is asking €11.1 million. In terms of land, there is a plot for sale in Tres Cantos for €5.8 million and there is also a flat for sale measuring 170 square metres on Calle Fernando el Católico for €467,000.

The Community is organising public auctions to sell these assets as well as direct sales. To give more visibility to its properties, like in the past, the Community has is making use of specialist websites, such as, which lists the assets sold to date, as well as the buildings for sale and the real estate auctions that are underway.

The sale of the building next to Puerta del Sol is on standby for the moment; the Community of Madrid is asking €10.7 million for that property.

Original story: El Confidencial (by Elena Sanz)

Translation: Carmel Drake