El Corte Inglés Sells a Store in Valencia to Corpfin Real Estate

11 October 2018 – Expansión

The distribution group is finalising the sale to Inbest, a vehicle owned by Corpfin, of two premises, joined together to form a 7,000 m2 centre, on the Valencian street of Calle Colón.

El Corte Inglés is taking another step forward in its non-strategic asset divestment policy to reduce its debt. To this end, it is finalising the sale to Corpfin Real Estate of two premises converted into a single commercial space, located in Valencia, for more than €90 million, according to market sources speaking to Expansión.

The premises, both located on Calle Colón – one of the main commercial thoroughfares in Valencia – have a combined surface area of 7,000 m2.

It is the second operation that the two groups have signed in recent months, after they reached an agreement in the summer to sell two more retail premises on Gran Vía in Bilbao and Calle Princesa in Madrid, with a combined surface area of 8,800 m2, for €93 million. Like in those cases, this latest operation will be executed using the sale & leaseback formula, which means that El Corte Inglés will remain as the tenant following the sale, and the operation will not affect the business or its employees in any way.

This operation will allow El Corte Inglés to reduce its debt, which currently amounts to €3.65 billion, and to optimise its resources. The premises that have been sold in Valencia belonged at the time to a real estate portfolio that the group purchased from Marks & Spencer when the British firm left Spain. The stores are very well located but they are also some of the firm’s smallest premises in the city, where it has four large department stores on: Avenida de Francia, Pintor Sorolla-Colón, Ademuz and Nuevo Centro.

Meanwhile, the operation allows Corpfin Real Estate to continue growing Inbest’s asset portfolio. At the beginning of this year, the manager launched this vehicle comprising several Socimis, which it was thought may debut on the stock market possibly before the summer. This vehicle was created with the aim of investing €400 million, between capital and financing, before 2021, although, with this operation, it has now almost fulfilled that objective.

In addition to the premises acquired from El Corte Inglés, Inbest has reached an agreement to purchase the commercial area in Edificio España from RIU for around €160 million. Similarly, this summer, it purchased a store measuring 1,500 m2 on Calle Triana, in Las Palmas de Gran Canaria, from an Indian family.

Original story: Expansión (by R. Arroyo & V. Osorio)

Translation: Carmel Drake

Apollo Engages Goldmans to Sell Altamira for c. €600M

8 October 2018 – Eje Prime

Apollo is getting down to work to divest Altamira and, to this end, has engaged Goldman Sachs to execute the mandate. The US fund renewed its contract with the investment bank and has now distributed the sales document for the servicer to potentially interested parties for an amount that ranges between €500 million and €600 million.

The real estate asset and loan manager, Altamira, is primarily owned by Apollo, which holds 85% of its share capital, whilst the remaining 15% stake is in the hands of Santander. The intention of the fund is to officially launch the sale over the coming weeks and to close the operation during the first quarter of 2019, according to reports from Expansión.

Just over a year ago, Altamira’s portfolio was valued at close to €1 billion, but the amount has varied depending on the assets under management at any given moment. At the end of 2017, the package of assets that the company had under management amounted to €50 billion.

Similarly, the principal value of the servicer is the long-term contract that it has with Santander, as well as the contract for the management of assets owned by Sareb. Potential buyers of Altamira include funds such as Deutsche Bank, Bain Capital, Kennedy Wilson, Baupost and Castlelake.

Original story: Eje Prime

Translation: Carmel Drake

Meliá Sells 3 Hotels to Socimi Atom for €73.4M

13 July 2018 – Expansión

Meliá Hotels has announced an agreement with the Socimi Atom Hoteles, in which Bankinter holds a stake, for the sale of three hotels in Sevilla, Santa Cruz de Tenerife and Fuerteventura for €73.4 million.

The transaction, which will generate a net accounting profit of €6.6 million, includes the hotels Meliá Sevilla, Sol La Palma (Santa Cruz de Tenerife) and Sol Jandía Mar (Fuerteventura), respectively.

The establishments will continue to be operated by Meliá by means of variable rental contracts (25% of the total revenues) for periods of 5 years, with a maximum of 4 extensions at the discretion of Meliá and up to a maximum of 25 years.

The operation values each room at €66,000 and represents an EBITDA (result before depreciation and amortisation) multiple of 13.9 times.

As part of the agreement, Atom undertakes to invest €20.2 million in the three hotels, whereby allowing their “repositioning”. Thus, the price per room after the investment will amount to €83,000.

The hotel chain has said that this sale forms part of its “strategy to adapt the attributes of the brands of all of the establishments operated by the company”.

Original story: Expansión (by D. B.)

Translation: Carmel Drake

An Israeli Investor Acquires Tauro Real Estate for €180M

26 April 2018 – Eje Prime

The Spanish real estate sector is crossing borders and, in this vein, the latest investment in a domestic player comes from Israel. The multi-millionaire Teddy Sagi (pictured below), owner of Camden Market in London, has purchased the fund Tauro Real Estate, which owns 600 homes in Madrid and Barcelona. The operation, which has been closed for around €180 million, has been carried out through a British company owned by Sagi, Globe Invest.

Tauro’s shareholders have obtained gains of 100% from the sale of the company. Led by José María Xercavins, the Spanish fund had been controlled until now by businessmen from a number of sectors including publishing, with Roberto and Marco Drago, from Grupo De Agostini; and José Creuheras, a partner of the Italians as President of Planeta; and the food sector, represented by Albert Costafreda, formerly the owner of Panrico, and Silvio Elías, one of the former owners of Caprabo supermarkets, according to Expansión.

Tauro has grown its portfolio in less than four years through the purchase of assets, primarily from banks, in which it has invested up to €160 million. It owns 350 homes in Madrid and the remaining 250 properties are located in Barcelona. In the Catalan capital, its tourist apartments stand out since they account for 30% of the flats that Tauro owns in that city.

Sources at the Spanish company say that the sale was not sought, but rather is the consequence of an offer received, which changed the long-term plans that the owners had for the company. For their part, Tauro’s shareholders are already looking at the market with the intention of launching a new real estate investment vehicle.

Original story: Eje Prime

Translation: Carmel Drake

ECI & Matutes Negotiate the Sale of Ayre Hotels for €200M

12 January 2018 – Expansión

Advanced conversations / The retail giant and hotel chain want to cash in on the sale of a hotel portfolio comprising five establishments and more than 800 rooms.

El Corte Inglés and Grupo Matutes want to take advantage of the good times that the tourist sector is enjoying and the investor appetite for the real estate market to sell some of the assets in the Ayre chain – a brand of urban hotels, which they jointly control (50:50) – and make some money.

Specifically, the groups are finalising the sale of a portfolio comprising five hotels, with more than 800 rooms, located in Madrid, Barcelona, Oviedo and Córdoba, worth around €200 million, according to sources in the sector. Those sources indicate that the two companies have already received several offers and that the operation could be closed during the first quarter of the year.

Ayre was created in 2006 as the urban brand of the Palladium Hotel Group – then known as Fiesta and belonging to the Grupo Empresas Matutes (GEM) –. At the end of that year, El Corte Inglés purchased a 50% stake in the chain, through Parinver, its holding company. The retail group classified that acquisition as an operation of a financial nature at the time.

Currently, the urban chain Ayre owns 10 hotels in Madrid, Barcelona, Sevilla, Valencia, Córdoba and Oviedo. Last summer, the companies decided to put half of the assets up for sale and reposition at least two of the other establishments – the hotels in Valencia and Sevilla – under the Only You brand, the premium sub-brand of Ayre.

The company that owns Ayre is FST Hotels, controlled equally by Fiesta Hotels & Resorts (Grupo Matutes) and Parinver (El Corte Inglés). FST Hotels, which is headquartered in Palma de Mallorca, closed 2016 with turnover of €49.4 million, up by 14% and a net profit of €4.2 million, up by 100% compared to 2015, according to the most recent accounts filed with the Commercial Registry.

The President of the Company is Abel Matutes Juan, whilst Florencio Lasaga, the director of El Corte Inglés and President of the Ramón Areces Foundation (its largest shareholder) serves as the Vice-President. FST Hotels also has Jesús Nuño de la Rosa, the CEO of El Corte Inglés, on its Board, as well as Carlos Martínez Echevarría and Cristina Álvarez Guil, both directors of the retail group; and Abel Matutes Prats, Director General of Palladium, amongst others.

The operation forms part of the strategy of Grupo Palladium, whose objective is to grow through hotel management, and move from being an owner to a manager, in line with other Spanish chains. Palladium, which is headquartered in Ibiza and is more than 40 years old, has 50 hotels in six countries – Spain, Mexico, Dominican Republic, Jamaica, Italy and Brazil – and operates three other brands besides Ayre: Palladium Hotels & Resorts, Fiesta Hotels & Resorts and Ushuaïa.

Meanwhile, El Corte Inglés would add the sale of this hotel portfolio to the list of non-strategic divestments that the group has undertaken in recent months: in November, it reached an agreement with the fund GPF to sell it the management of its Motortown workshops, located in 55 of its shopping centres; in October, the company chaired by Dimas Gimeno sold 40% of Torre Serrano to Infinorsa for €50 million; and in September, it sold off a logistics warehouse in La Bisbal del Penedès (Tarragona). The group has also sold buildings in Madrid, Barcelona and Sevilla, amongst other cities, in recent months.

Original story: Expansión (by R. Arroyo and V. M. Osorio)

Translation: Carmel Drake

Pontegadea Segregates its RE Rental Activity in Spain

2 January 2017 – Eje Prime

Pontegadea, the real estate investment vehicle owned by Amancio Ortega (pictured below) is starting the year by reorganising its business. The company has segregated its property rental activity in Spain into the company Torre Norte España, now Pontegadea España, which has also increased its share capital by €100 million.

According to a statement published in the Official Gazette of the Mercantile Registry (Borme) on Tuesday, the new real estate subsidiary will group together most of Ortega’s assets in Spain, worth more than €1.6 billion. The portfolio includes Torre Cepsa, designed by the architect Norman Foster.

Specifically, Pontegadea will own Pontegadea España as a subsidiary. The founder of Inditex will unify almost all of his real estate business in the Spanish market into that company.

In parallel to this asset reorganisation, the company Partler 2006, which sits under the umbrella of the Pontegadea group and which owns 9.284% of Inditex, has merged by absorption with RL30 Inversiones, owner of the building on Gran Vía, 32, which is home to one of the largest Primark stores in Europe.

The reorganisation of the Inditex founder’s real estate assets is a formal matter from a legal point of view with the aim of simplifying its structure that has been based on rapid growth, according to Europa Press.

Pontegadea Inmobiliaria already owns specific companies in the other countries in which it has a presence, such as in the USA, France, the UK and Korea, which group together the real estate activities of the founder of the textile giant in each case.

Original story: Eje Prime

Translation: Carmel Drake

Onix Capital Buys Former ‘Páginas Amarillas’ HQ In Madrid

21 November 2017 – Expansión

The firm Onix Capital, in which several wealthy South American families own a stake, has reached an agreement with the former owners of the company to purchase the building, located on Avenida de Manoteras in Madrid.

Another office building in Madrid has changed hands. In this case, the star is a property located on Avenida de Manoteras, in the north of the capital, which, until just a few days ago, was home to the corporate headquarters of Páginas Amarillas (the Yellow Pages) in Spain.

The building used to be owned by the fund Hibu Connect, which sold the company that created the famous yellow coloured telephone directory in May (it now specialises in advising SMEs) to the firms Metric Capital Partners and Evolvere Capital. Following that corporate operation, the owners held onto the property, but they have sold it to a new owner six months on.

The architect of the purchase has been the firm Onix Capital Partners. “We are a group specialising in the real estate sector, with 30 years of experience in Argentina”, explained Martín Kielmanowicz, Vice-President of Onix Capital Partners. Our investors are Latin American families, above all from Argentina, and institutional groups (…).

In fact, the Páginas Amarillas building is the third purchase that this group of investors has made in Spain. Its first operation involved the acquisition of Edificio Montepríncipe, located next to Santander’s Ciudad Financiera, in Boadilla del Monte (Madrid). For that property, which is leased to the financial institution to house its IT services, Onix paid almost €80 million. Last year, the investor group also reached an agreement with Allegra Holding, the investment arm of the Losantos family, to purchase HP’s headquarters in Las Rozas.

“At the beginning, we focused on core properties, with long-term lease contracts and good tenants but, with such intense competition for those kinds of assets, we have now branched out to look at new options”, explained Kielmanowicz.

In this way, the Páginas Amarillas building appeared on the firm’s radar. It is one of the most well-recognised properties in the area thanks to its original design. Its surface area spans 12,000 m2 and it has 200 parking spaces. “The property is currently spread over five floors, but following the renovation, we hope to increase the height and extend the space to 13,000 m2”, said the Vice-President of Onix.

Following the completion of the purchase last week, the employees of Páginas Amarillas have now left the property, which will be renovated in its entirety to attract a new tenant. To this end, the Argentinian manager has engaged the architecture studio B720 Fermín Vázquez Arquitectos, which will take care of the complete refit of the building (…).

The renovation of the property will begin before the end of the year, with the aim of putting it on the market at the beginning of 2019. Onix will invest €35 million in total on the purchase and the renovation (…). “Behind the investment are five Latin American families and the Onix management team also holds a percentage stake”, he added.

The firms JLL, Knight Frank, Baker Mckenzie and Uría Menéndez have all participated as advisors to the operation.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Aena Submits The Only Bid To Manage ‘Ghost’ Airport In Murcia

31 October 2017 – Expansión

Yesterday, Aena came to the rescue of the international airport for the Region of Murcia with a multi-million euro offer to take over its operation, management and conservation for a period of 25 years. This ghost infrastructure was planned before the crisis by the regional government and a consortium of companies led by Sacyr, at a cost of €270 million. Nevertheless, the outbreak of the crisis submerged the installation into a tsunami of financial and legal problems, which prevented it from being opened even after the construction work had been completed, in 2012.

Five years later, in April, the regional executive opened a tender process, with a budget of €600 million. Aena, in which the Spanish State holds a 51% stake, was the only company that expressed interest in managing the infrastructure and it formalised its offer yesterday. Sources close to the bid say that the amount offered by Aena falls well below the tender price.

In all likelihood, the airport manager’s plan will involve moving operations from the San Javier military airport, 30 km away, to Corvera. The new president of Aena, Jaime García-Legaz, who has only been in the job for two weeks, has focused on the need to secure the management of the Murcian airport. “We are going to make an offer to win that is profitable for Aena”, he said last week in meetings held with the group’s personnel (…). García-Legaz is Murcian, but the offer had already been prepared by his predecessor, José Manuel Vargas.

Currently, 400 employees work at San Javier airport, of whom 72 form part of the workforce, which would be affected by the move. The managers themselves have reviewed the facilities in recent weeks to check that everything is in order so as to start the operation in the most agile way possible.

Some sources say that the first flights could begin next summer (2018). “The main objective should be to secure Iberia or another major airline to turn the airport into a key infrastructure hub”, they add.

The arrival of one or more large companies is key if the reduction in passenger numbers at the Murcian airport is to be plugged. Since 2007, traffic volumes have fallen by half, from 2 million users to 1 million in 2016, proceeding from low-cost airlines such as Easyjet, Ryanair and Norwegian. And that decrease has happened despite the recent investment of €70 million made by Aena to construct a second runway. The airport has a single domestic route, connecting with Madrid, and 19 international routes, primarily to/from the United Kingdom. 92% of users are foreigners visiting the region for tourist purposes.

By contrast, the aerodrome in Alicante – 90km away – has seen its user number increase from 9 million to 12 million during the same period. Corvera is now adding capacity to manage a visitor flow of 3.5 million each year. If Aena does end up winning the contract to manage the installation, Corvera would become the 47th airport that the group manages in the country. The company has the capacity to welcome 330 million travellers, 30% more than the 230 million that used its airports in 2016.

Sources at Aena highlight that the airport in Murcia would generate profits for the group (…).

The Region of Murcia’s Ministry of Development will convene a meeting on Friday to analyse Aena’s offer and proceed to award the contract to manage the airport “as soon as possible”.

Original story: Expansión (by Víctor Martínez)

Translation: Carmel Drake

Santander Unblocks Sale Of Ciudad Financiera After AGC’s Mega-Offer

15 September 2017 – Voz Pópuli

The soap opera involving the sale of Santander’s Ciudad Financiera is closer than ever to being resolved. The Arab fund AGC Equity Partners, Santander and the majority of the creditors have reached an understanding to unblock the process, which has been stalled for three years, after the company that administers Santander’s global headquarters, Marme Inversiones 2007, filed for bankruptcy.

The key has been the size of the new offer presented in recent months by AGC, amounting to around €2,800 million, according to financial sources consulted by Vozpópuli. With this proposal, all of the creditors would receive the amounts due to them and there would even be some funds left over to share out amongst Marme’s original shareholders: the property magnate Glenn Maud and the fund Aabar Investments, controlled by IPIC, which owns Cepsa.

AGC has already informed the judge handling the bankruptcy – at Mercantile Court number 9 in Madrid – that the situation is now ready to be unblocked. But the magistrate has left everything hinging on the Provincial Court, which still has to resolve several prior appeals. Various sources consulted indicate that these resolutions could be resolved by the end of this year or the beginning of 2018. Then the formal auction of the company that owns the Ciudad Financiera could be launched, with AGC as the main favourite, assuming no last minute surprises.

Santander’s role

One of the keys behind sorting out the sale of the Ciudad Financiera is that Santander has withdrawn an appeal that threatened to perpetuate the bankruptcy process. In this way, the bank chaired by Ana Botín, advised by Clifford Chance, decided to submit a letter alleging that the Marme liquidation plan was not taking into accounts its right to sound out the market (for potential buyers).

In addition, Santander engaged Goldman Sachs to look for offers that would better fit with their interests. Paradoxically, the firm that is now best positioned to win – AGC – is the same one that blocked the bank’s appeal. According to legal sources, Santander pays an annual rent of around €110 million for the property and the rental contract runs until 2048, neither of which would vary under the new owner. But there are other clauses in the agreement that would be changed in favour of Santander.

The final stumbling block is the position of two of the players that invested in Marme Inversiones after it filed for bankruptcy: Aabar Investment, which purchased the shares of one of the original shareholders, the British businessman Derek Quinlan, and which would like to buy the Ciudad Financiera itself; and the Luxembourg company Edgeworth Capital, led by the controversial Iranian banker Robert Tchenguiz.

Sources close to the process think that it will be hard for their appeals to gain traction in the face of AGC’s willingness to repay all the creditors; something that no other investor has offered until now. The other recent offers amounted to between €2,400 million and €2,500 million.

Origin of the problem

Marme Inversiones 2007 filed for bankruptcy in 2014 after it was unable to pay its debts. The company was created in 2008 with very heavy financial burdens, at the worst time, shortly after the bankruptcy of Lehman Brothers. Marme paid €1,900 million for Santander’s headquarters in Boadilla del Monte.

Now the situation is just the opposite. The good times in the market mean that obtaining financing is cheaper than it has been for the last decade, something that AGC wants to take full advantage of to seal this complex operation.

Original story: Voz Pópuli (by Jorge Zuloaga)

Translation: Carmel Drake

Vocento Finalises Sale Of Its Madrid HQ To Axiare

15 December 2016 – Cinco Días

Axiare has put its foot down on the accelerator to complete several purchases during the final month of the year. In addition to its acquisition of the headquarters of Cuatrecasas and McKinsey in Madrid, the Socimi is now finalising the purchase of the building from where Vocento operates its business in Madrid. The operation will be closed imminently, for around €35 million, according to several sources familiar with the operation.

Vocento is following the strategy of moving from being the owner of the property to becoming the tenant, in exchange for making some money. Currently, the group has debt amounting to €128.5 million, according to data submitted to the CNMV relating to the third quarter.

The building, located on Calle Juan Ignacio Luca de Tena (the historical director of the ABC newspaper and member of its founding family) has been home to the newspaper since 1989, when it abandoned its headquarters on Paseo de la Castellana, where the ABC Serrano shopping centre is now located.

The holding company has negotiated a rental contract with the Socimi, which allows its companies to continue to occupy the headquarters in Luca de Tena for five years. In addition to ABC, Vocento has several online businesses, such as Infoempleo; several influential regional newspapers resulting from the merger of Prensa Española with Grupo Correo; a number of magazines; and the Colpisa agency, amongst others.

The building is located at exit Km 7 on the A-2 motorway. This area of the capital has been enjoying a busy few months, with Popular constructing its new corporate headquarters on the adjoining plot of land, and the University Clinic of Navarra building its first major hospital in Madrid just a few metres away, which is expected to open next year.

Through this acquisition, Axiare Patrimonio adds another new building to its growing portfolio, which comprises offices, retail and logistics assets. The Socimi, which debuted on the stock market in 2014, has now accumulated assets worth €1,230 million in just over two years. These types of listed real estate investment company have beneficial tax regimes, whereby they do not pay corporation tax, but they are obliged to distribute dividends on an annual basis. (…).

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake