Tag: office

Axiare Seeks Tenant For Its Newly Renovated Office In Madrid

21 December 2016 – Expansión

The Socimi in which Colonial owns a stake has put the office building that it owns on c/Ramírez de Arellano up for rent. The property, which has a surface area of 10,515 m2, has been undergoing renovations for the last year.

The Socimi Axiare Patrimonio has accelerated its investments as 2016 draws to a close. The company, which has a significant cash balance after doubling in size last year, has closed acquisitions amounting to around €180 million in the last month and a half, including the purchase of the corporate headquarters of both Cuatrecasas and McKinsey. It is also negotiating the purchase of the Vocento group’s offices for another €35 million, say sources in the sector.

Besides expanding its real estate portfolio, which is worth more than €1,200 million, the Socimi is working to improve its assets and to that end, has invested tens of millions of euros over the last few months. These projects include the building on Ramírez de Arellano, 15. Axiare acquired the building last year for €16.5 million and in May 2016, the Socimi whose largest shareholder is the real estate company Colonial, engaged the consultancy firm Colliers to undertake the complete renovation of the property, which was completed just two weeks ago. “The complete renovation, which was designed and executed by Colliers International, has transformed Ramírez de Arellano, 15, into a modern and functional building, with high quality specifications that fulfil the most demanding requirements in terms of sustainability, energy efficiency and technology”, say sources at the consultancy.

After 8 months of construction work and an investment of around €3 million, the new office building has a surface area of 10,515 m2, spread over seven floors and 108 parking spaces, distributed over two underground parking floors”. There is a lot of interest for the office given its location, in the Arturo Soria neighbourhood, where the A-2 highway meets the M-30 ring-road”. The objective is to lease it in its entirety to a single company looking to locate its corporate headquarters there, according to the heads of the project.

During 2016, Axiare has signed 24 lease contracts covering a gross leasable area (GLA) of more than 100,000 m2. That figure that will soon increase by another 11,000 m2 (…).

The arrival onto the market of the office on c/Ramírez de Arellano comes at a time of shortage of office products in certain areas of Madrid, which has driven by rents in the prime area of the capital. In this way, prices in the CBD (central business district) increased by 6% YoY during the third quarter to amount to €27.5/m2/month, whilst theoretical prices in the prime areas outside of the M-30 ring-road and in secondary areas rose by 4% on average.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Al Breck’s Socimi Debuts On The MAB With 300 Rental Homes

30 November 2016 – Cuatro.com

The Socimi RREF II Al Breck will debut on the MAB today (Wednesday 30 November) at a price of €5.40 per share.

The fund Al Breck will debut its new Socimi on the Alternative Investment Market (MAB) today, Wednesday 30 November. The Socimi was constituted with a stock of around 300 rental homes, located in the centre of Madrid. The fund acquired the properties from the Spanish fund Segurfondo Investion in December 2014.

The firm, known as RREF II Al Breck Socimi, will debut on the stock market at a price of €5.40 per share, which represents a company valuation of €28.8 million, according to the BME.

Specifically, the new Socimi owns a stock of 293 homes located in the centre of Madrid (in the following neighbourhoods: Centro, Salamanca, Chamberí and Chueca), as well as in La Moraleja (Alcobendas) and in towns close to Alcobendas and Torrejón de Ardoz. It also owns twelve retail premises and one office.

According to the prospectus for the IPO, the market value of this portfolio of assets, calculated by an independent firm, amounts to €110.52 million.

On the other side, the company’s debt amounts to €70.03 million, and comprises a participative loan granted by the parent fund, i.e. a liability equivalent to 63% of the value of the portfolio. In addition, all of the homes are mortgaged in favour of Banco de Sabadell, the entity that financed their acquisition.

The Socimi will debut on the stock market with a business plan that involves generating value from its portfolio, in other words, forecasts selling all of the homes within a five-year period, which will end in December 2020.

Aggressive strategy

Specifically, the plan involves investing in improvements in the homes “to increase returns and improve occupancy rates to stable levels, implementing an aggressive rental strategy that includes, where necessary, lowering rents and making concessions to tenants to improve their cash flows”.

Subsequently, “once the occupancy rates have increased, we will ensure they remain stable and start to progressively increase rental income, in accordance with the improvements made at the properties and market prices”.

Finally, the Socimi expects “to optimise the value of the portfolio by selling the assets either individually or in batches, when demand and price make such a decision worthwhile and only after the minimum holding period of three years (applicable to all Socimis) has been exceeded”, according to the prospectus.

Original story: Cuatro.com

Translation: Carmel Drake

Lar España Plans To Invest At Least €240M In 2017

7 October 2016 – Expansión

Lar España has the capacity to invest at least €240 million in 2017, according to comments made by the Socimi in a presentation to analysts.

The company will also have a further €300 million available from the possible sale of its non-commercial assets between 2017 and 2018, meaning that it will not have to resort to the market or to a capital increase to raise funding. Lar, like all of the other Socimis, is obliged to rent out its assets for at least three years. After that period, the firm may divest its properties to release cash to make new purchases.

Lar explained to the market that the luxury housing development Lagasca 99, located in the heart of the Salamanca neighbourhood in Madrid, will be ready for sale during the first quarter of 2018. Similarly, the firm owns several non-commercial assets, specifically offices in Madrid (Egeo, Arturo Soria, Torre Spínola and Eloy Gonzalo) and Barcelona.

In July, the Socimi completed a capital increase amounting to €147 million. A month and a half later, it signed the purchase of the Gran Vía de Vigo shopping centre for €141 million. At the time, the company reported that, including that asset, it had identified opportunities in the market amounting to €838.5 million.

The value of the almost 25 real estate assets in the group’s portfolio amounts to €1,191 million, according to the latest available valuations. Of that figure, 76% relates to retail and commercial development assets, 13% are offices, 6% are logistics assets and 5% are residential properties.

Lar España, which is managed exclusively by the Lar Group, has indicated that it plans to reduce its management fees by adopting a new policy. The group also said that it plans to launch value adding initiatives aimed at increasing the appeal of its assets and improving their occupancy rates and rents.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Mutua Madrileña Buys Office Building In Madrid For €30.8M

27 July 2016 – Expansión

The insurance company Mutua Madrileña has acquired the former headquarters of Fórum Filatélico from Credit Suisse’s real estate fund for €30.8 million. The operation has been performed entirely using its own funds.

The property in question is an office building in the heart of Madrid’s financial district. Located at number 51 on Calle José Abascal, next to Paseo de la Castellana, the building has a surface area of 3,600 sqm spread over seven floors, and 62 parking spaces.

According to the company, the operation forms part of its strategy to dynamically manage its assets, which also includes the possibility of making acquisitions as and when attractive opportunities arise. On the buy side, Mutua Madrileña has been advised by the law firm Pérez-Llorca and, on the sell side, Credit Suisse has worked with CBRE as real estate advisor and Eversheds Nicea as legal advisor.

The real estate market

The building will be rented out in its entirety and, in order to increase its value, the company will undertake renovation work, to equip it with the latest technology in terms of efficiency and sustainability.

Mutua Inmobiliaria , which includes the company’s property investment area, considers that the office rental market in Madrid is in full recovery.

The insurance company has not acquired any new properties for almost 10 years. The last purchases it made for its real estate portfolio were the so-called Pirámide and the Torre de Cristal, also on Paseo de la Castellana. (…).

Original story: Expansión (by Inma Benedito)

Translation: Carmel Drake

Zriser Group Sells Generali Building In Valencia For €30M

25 May 2016 – Levante-EMV

The Valencia-based Zriser Group, the investment vehicle owned by the siblings Pablo and Ana Serratosa, has sold the Generali building for €30 million to the businessman Juan Luis Gómez—Trénor, founder of the former Colebega bottling plant and shareholder of Coca-Cola European Partners with a 8.5% stake.

The property was designed in 1930 by the architect Luis Bonetm, a disciple of Gaudí and one of the construction directors at the Sagrada Familia. The building has a surface area covering 6,079 sqm across six floors, containing offices and commercial premises, and its main tenant is the law firm Garrigues.

The Zriser Group purchased the building, located in La Plaza del Ayuntamiento 27, from Generali Seguros for €21 million in 2011, which means that it has obtained a capital gain of almost 50% in five years.

Sources at the investor group declined to provide any information about the buyer or the consideration paid for the operation on the grounds of confidentiality. However, other sources familiar with the sale confirmed that the proceeds amounted to around €30 million and that the purchaser is Juan Luis Gómez-Trénor. The transaction comes at a time when the real estate sector in Valencia is in full recovery.

Luxury development

In just a few days, the Serratosa’s investment group has placed 33 of the 34 homes in its first housing development on the market in Valencia. Zriser is going to construct luxury homes at number 11 on Avenida de Francia in Valencia, next to Hotel Barceló.

Despite the sale in 2011, the insurance group Generalia has continued to occupy the building in La Plaza del Ayuntamiento, as a tenant alongside the law firm Garrigues. The Zriser Group already owns another office building, Edificio Alameda, which it acquired in 2009, for €24.3 million. Moreover, it owns another property on La Alameda (which it leases to PricewaterhouseCoopers) and another one on Alfahuir.

Original story: Levante-EMV

Translation: Carmel Drake

Q1 2016: Colonial’s Net Profit Rose By 131% To €11M

13 May 2016 – Expansión

Colonial closed the first quarter of the year with an attributable net profit of €11 million, up by 131% compared with the same period in 2015, after increasing its revenues from rental income by 20%. The real estate company generated €66 million from renting out its offices, which are primarily located in the major business districts of Madrid, Barcelona and Paris.

The company highlighted that it leased 40% more office space during the quarter, specifically, 45,000 sqm during the three months to March, which represents half of its objective for 2016 as a whole.

The greatest increase was recorded in Barcelona, where Colonial renewed the lease contract of the building that houses Gas Natural’s headquarters, measuring 22,400 sqm, and where it also leased out almost 3,000 sqm to the audit firm Grant Thornton.

Colonial’s share price increased by 0.32% yesterday to €0.633.

Original story: Expansión (by J.O.)

Translation: Carmel Drake

Office Rents Rose By 5% In Q1 2016

11 May 2016 – Expansión

The reactivation of the real estate market is also being reflected in the office segment. The average price of offices in Spain increased by 5% during the first quarter of the year, according to a report about the sector by the real estate portal misoficinas.es. The report indicates that the market is continuing its positive trend, but “in moderation”. Searches for offices centre around Madrid and Barcelona, which account for 75% of the total, and the prices of offices sought, at the global level, have increased with respect to the same period in 2015, by 7.81% in terms of the minimum price and by 2.81% in terms of the maximum price.

In Madrid, potential tenants focus on the financial district, Alcobendas and the west, which account for 90% of all searches. Users searched for office spaces that are 5% larger than in the same period last year in the centre of the capital. Also in the capital, the rental price of offices sought rose by 6.71% during the first quarter, to reach €12.31/sqm. The size of the spaces being sought in Madrid also increased, up from 585 sqm to 805 sqm.

In Barcelona, the size of the spaces being sought also increased, to reach maximums of 500 sqm during the first quarter, compared with 416 sqm during the same period in 2015. Nevertheless, the report noted a decrease of 5.47% in terms of the average price demanded, with the average price for office space amounting to €9.29/sqm. In this way, the average cost of leasing an office in Madrid is now 32.5% higher than in Barcelona, whereby increasing the differential between the two cities, up from just 17.4% in 2015.

In the rest of Spain, the average price sought rose from €5.86/sqm in 2015 to €6.01/sqm in 2016. The size of space sought also increased, given that in 2015, potential tenants wanted 211 sqm on average compared with 223 sqm in 2016.

Original story: Expansión

Translation: Carmel Drake

Hispania Prepares To Convert Itself Into A Socimi

22 February 2016 – Expansión

First full year of operation / The real estate company quadrupled its net profit in 2015, to €73.4 million and will bring forward its dividend payment to this year.

Hispania Activos Inmobiliarios, the real estate company owned by the billionaire George Soros, is preparing to convert itself into a Socimi, after closing 2015 with a net profit of €73.4 million, which represented a four-fold increase in its earnings compared with 2014.

The company, which has maintained its status as a public company until now, in order to benefit from maximum flexibility to invest and create its asset portfolio, announced on Thursday that it will propose its conversion into a Socimi at its next shareholders’ meeting. The real estate company, which was constituted in January 2014 and which has been listed on the stock exchange since March last year, current owns one subsidiary 100% – Hispania Real – which is already registered as a Socimi.

Dividends to be paid sooner than expected

The company, which is managed externally and exclusively by Azora, also communicated its intention to bring forward its dividend payment to 2016. The real estate company closed 2015 with a gross operating profit (EBITDA) of €10 million, compared with the negative balance of €2.5 million it recorded a year earlier.

Last year, it generated net rental income of €38 million, compared with €9 million in 2014. By division, hotel revenues amounted to €16.69 million, plus €4.29 million from hotels under management. Hispania’s hotel portfolio closed the year with 8,234 rooms across 27 hotels, plus two shopping centres.

Meanwhile, the revenues from the office segment amounted to €12.15 million. The company owns a total gross leasable area of 53,621 m2 spread across 25 assets.

In the housing segment, revenues amounted to €4.66 million. Hispania manages a residential portfolio that includes four assets, one in Barcelona (the Isla del Cielo homes) and the other three in the Community of Madrid (Sanchinarro, San Sebastián de los Reyes and Majadahonda). In total, the company’s residential asset portfolio contains 684 homes (200 in Barcelona and 484 in Madrid). The group explained that it purchased 33 assets with an acquisition value of €841 million last year, including the formalisation of the two phases of operation Bay with the Barceló Group, which has a total portfolio value of €458.6 million.

Moreover, since its debut on the stock exchange, the real estate company has invested in 58 assets, with a consolidated value of €1,425 million, according to a valuation performed by CBRE.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Caja Madrid’s Former HQ Is Up For Sale

5 November 2015 – Cinco Días

The former headquarters of the Caja Madrid is up for sale. La Fundación Montemadrid has engaged Irea to search for a buyer for the historical building, located a short distance from the Puerta del Sol in Madrid.

La Fundación Montemadrid, formerly known as ‘Fundación Obra Social y Monte de Piedad de Madrid’, plans to sell the whole property, excluding the premises where Monte de Piedad undertakes its activity, which will be made independent from the rest of the building. In total, the property has a surface area of 25,000 m2, which maybe used as a hotel, retail or office space.

Sources in the market consider that it is likely that the building will be converted into a “luxury five-star” hotel, which may also include some retail space.

If the building is converted into a hotel, then it would be highly coveted by international operators, at a time when Spain is under the spotlight thanks to the decision by Four Seasons to operate the hotel in the Canalejas Complex, and the purchase of the Ritz by Mandarin and Olayan. Meanwhile, in the Plaza Mayor, the Portuguese group Pestana is planning to open a five-star hotel in the Casa de la Carnicería.

Domestic and international investors, both hotel chains and investment funds have already expressed their interest in the property, which could represent the gateway into Madrid for franchises such as Hyatt, Kempinski, Hilton, W and Shangri-La. The future hotel would have around 200 rooms, as well as terrace space measuring 3,000 m2, one of which would be on the roof, with panoramic views of the city. The price of the property could exceed €100 million, and the buyer would also have to factor in the cost of the refurbishment.

No architectural protection

One of the features of the property is the lack of architectural protection, with the exception of the baroque doorway that overlooks the Plaza de las Descalzas. This makes the building a unique opportunity in the centre of the capital, according to market sources, vis-à-vis the Canalejas project, which is being developed by Villar Mir, whose construction has been unblocked this week by the courts, and Edificio España, acquired by the Chinese group Wanda, which had requested permission to dismantle the protected façade of that building brick by brick, to then rebuild it. That request was rejected by the Local Historical Heritage Commission of Madrid. Market sources believe that the operation could be closed by the end of this year or the beginning of 2016, and that the property, if it does end up being converted into a hotel, would open its doors in 2018, after the Four Seasons.

Original story: Cinco Días

Translation: Carmel Drake

German Fund ‘Freo’ Plans To Invest €120M In Spain

3 November 2015 – Expansión

The German fund, Freo Group, plans to invest €120 million in the Spanish real estate market over the next year. To this end, it has opened a subsidiary in Spain, headquartered in Barcelona, and today, it will open an office in Madrid.

Freo Group is a private capital fund manager that also has its own investment vehicle. Founded in Frankfurt twenty years ago, the group has offices in Europe’s major cities and is currently expanding its operations into the USA. The group focuses on the investment, development and management of real estate assets.

The change in the cycle in Spain’s economy has encouraged the group to invest here now and it has hired Daniel Mayans (pictured above, right), the former Asset Management Director at GE Capital Real Estate in Spain, as the CEO of the Spanish subsidiary.

The management team of the Spanish subsidiary will focus on buying office buildings in Madrid and Barcelona, although they do not rule out the acquisition of shops and other retail premises. “Between 40% and 60% of our purchases will be financed through bank debt”, said Daniel Mayans. The period between the purchase and subsequent sale of these assets will be between five and six years.

Original story: Expansión (by Marisa Anglés)

Translation: Carmel Drake