Lar Raises Dividend by 67% and Opens the Door to Corporate Operations

9 October 2018

The socimi will distribute €75 million in 2019 / The socimi will book 115 million euros with the delivery of its luxury flat development Lagasca, in Madrid, and roughly 110 million euros from the sale of its three office buildings.

Lar España is moving forward with its plan to focus on the retail market and pay-outs to its shareholders. The company, which expects to deliver the homes in the Lagasca99 luxury development (Madrid) before the end of the year, will raise its dividend to 75 million euros in 2019, compared to the 45 million euros it distributed last May and the €30 million in 2017.

The socimi will propose a dividend equivalent to 5% of the value of its assets (NAV), which will imply an outlay of about €50 million. The company will also pay an extraordinary dividend in 2019 associated with the sale of Lagasca99 for about in €25 million.

The president of Lar España, José Luis del Valle, highlighted, yesterday on Investor Day, the socimi’s evolution and the fulfilment of its strategic plan. “In a few months, we are going to become a socimi focused exclusively on retail. With approximately 550,000 square meters of commercial space, we are the largest operator in Spain, and we also have a specialised manager who is committed to the project.”

Sale of assets

Del Valle recalled that, of the disinvestments of non-strategic assets planned for the years to 2021, the company has already executed 47% in one year for €276 million. Another €115 million will be added to that figure from for the delivery of Lagasca99 and the sale of the three office buildings that the company still has in its portfolio – two in Madrid and one in Barcelona -, which will take place between this year and the beginning of 2019, for about €110 million. As Expansión announced on October 5: “Disinvestments are taking place above the purchase price and with capital gains compared to the last valuation.”

At the same time, it will continue with its investment plan with the purchase of assets for approximately €250 million. Lar bought the Rivas Futura business park in Madrid for €62 million and the Parque Abadía shopping mall in Toledo for €14 million. “We will continue to take advantage of opportunities and, where appropriate, we will address new developments such as Vidanova Parc, in Sagunto, which opened in September and O Lagoh, in Sevilla, which will open in mid-2019,” Miguel Pereda, board member and managing director of Grupo Lar.

Regarding future corporate operations, Del Valle recalled that Lar “is in the market and attractive.” He added: “I think the best thing for the shareholder is the execution of the current business plan, but we are in the market and we can evaluate buyer interest at any time.” Among the shareholders of Lar España, the manager Pimco stands out (19.6%), along with Group Lar (its manager, with 10%); and Franklin Templeton (7.9%).

Regarding potentially negative changes to the tax regime governing socimis, Del Valle found the enactment of such a measure to be unlikely: “There is no point in undoing a formula that has worked and is not part of the problem.”

Original Story: Expansión – Rebeca Arroyo

Translation: Richard Turner

Lar Buys Adadía de Toledo Shopping Arcade for €14M

20 February 2018 – Eje Prime

The Socimi Lar España is continuing to grow its portfolio of assets. Almost a year after taking control of the Parque Abadía shopping centre for €63.1 million, the Socimi has acquired the Abadía shopping arcade for €14 million, as reported by the Group to Spain’s National Securities and Exchange Commission (CNMV).

The arcade has a surface area 6,138 m2, which, added to the footprint of the shopping complex (37,114 m2), takes the combined surface area of the site to 43,252 m2, in such a way that the Socimi has become the owner of 80% of the total surface area of Parque Abadía.

Overall, the park has a total surface area 54,100 m2 as well as a parking lot with 2,861 spaces. The shopping arcade has an occupancy rate of 92% and is home to 38 retail premises.

“This acquisition fits perfectly with the Socimi’s strategy to increase the ownership percentage of its commercial assets so that the management improvement measures that we are carrying out have the maximum impact”, explains José Luis del Valle, President of Lar España.

Lar currently owns 32 real estate assets whose value amounts to €1.536 billion, of which €1.179 billion corresponds to shopping centres located in Madrid, Toledo, the Balearic Islands, La Rioja, Vigo, Valencia, Sevilla, Alicante, Cantabria, Lugo, León, Vizcaya, Navarra, Guipúzcoa, Palencia, Albacete and Barcelona; €85 million to office buildings; €87 million to logistics assets; and €185 million to promotions under development.

Original story: Eje Prime

Translation: Carmel Drake

Lar España Raises Valuation Of Its Asset Portfolio By 20%

10 July 2017 – Expansión

After several years creating large asset portfolios, the Socimis are now immersed in the management of their portfolios. Lar España, the listed real estate investment company created by the real estate company Grupo Lar, was the first of the four largest Socimis to debut on the stock market, in March 2014, and it made its debut without any assets on its balance sheet. Three years later, the company now owns a portfolio worth €1,448.2 million, according to a statement released last week.

That figure is 20% higher than the price that Lar España paid for those assets, in other words, the Socimi has increased the value of its properties by €235 million through its management. “The increase reached at the end of this year is particularly significant – if we compare the figures with those seen at the end of June 2016, the values have risen by 9.3%”, said the company.

Type of assets

The €1,500 million in assets owned by Lar España include, above all, shopping centres, with 16 assets worth more than €1,000 million, up by 15.2% compared to their collective purchase price. In recent months, the Socimi in which the fund manager Pimco holds a stake has invested €255 million in the purchase of two shopping centres, Parque Abadía in Toledo and Gran Vía de Vigo, as well as in 22 other retail premises throughout Spain.

In the case of the office portfolio (the Socimi owns five office buildings), its value has increased by more than 27% to €178.6 million, whilst its logistics properties have appreciated in value by 31.6% to €83.3 million.

Nevertheless, the highest increases in value were recorded by the Socimi’s projects under construction: four in-progress developments are now worth €145.4 million, up by 40%. The most noteworthy of these is the Lagasca 99 development. In January 2015, Lar España decided to make an exception to its strategy of investing in rental assets by acquiring a residential plot in the neighbourhood of Salamanca in Madrid. To this end, it invested €100 million, together with Pimco, on the purchase of a plot of land with a buildability of 26,000 m2. More than half of the 55 homes on that site have already been sold.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Lar Buys A Shopping Centre & 22 Eroski Stores From Rockspring For €111M

29 March 2017 – Inmodiario

The Socimi Lar is continuing to build up its collection of assets. It has spent €111 million buying the Parque Abadía shopping complex in Toledo and a portfolio of 22 Eroski stores, from the British fund Rockspring. It has completed these purchases entirely using its own funds, just one week after securing bank financing amounting to €104 million.

Parque Abadía, which Lar has purchased for a price of €63.1 million, is the largest retail space in Castilla-La Mancha, with a gross leasable area of 54,100 m2 – of which 37,114 m2 forms the subject of the transaction – and currently has an occupancy rate of 100%. It is the most iconic retail complex in the area, with retailers of the calibre of Alcampo, Media Markt, Decathlon, Leroy Merlin and Kiabi.

The location of Parque Abadía is another one of the asset’s strong points. Specifically, it is located on the motorway between Madrid and Toledo, which makes it highly visible and means that it can be accessed very easily. Parque Abadía is just ten minutes away from Toledo’s city centre and more than 300,000 people live within half an hour of the shopping centre by car.

Meanwhile, the 22 stores that Lar has purchased for €47.6 million are completely occupied and operated by the Eroski Group. They have a combined surface area of 28,822 m2 and the portfolio is very diversified from a geographical perspective.

Ten of the stores are located in the País Vasco – the area in which the retailer has its highest market share -, seven are located in the Balearic Islands, two in Navarra, another two in Cantabria and one in La Rioja.

The incorporation of these assets into Lar’s portfolio is allowing it to grow in the retail asset space. It now owns more than €1,000 million retail assets, which account for 75% of the Socimi’s total assets.

Lar owns 31 real estate assets, whose value amounts to €1,385.7 million, of which €1,072.4 million correspond to 16 retail spaces located in Madrid, Toledo, the Balearic Islands, La Rioja, Vigo, Valencia, Sevilla, Alicante, Cantabria, Lugo, León, Vizcaya, Navarra, Guipúzcoa, Palencia, Albacete and Barcelona.

Original story: Inmodiario 

Translation: Carmel Drake

Belgian Fund Ascencio Finalises Purchase Of Parque Abadía

8 November 2016 – Expansión

The Spanish real estate market is starting to welcome new players. After two years during which opportunistic funds and Spanish Socimis have been responsible for the lion’s share of investment operations, 2016 has seen several institutional investors and companies enter the market.

Such is the case of Ascencio. The listed Belgian real estate company (SIR, according to its French acronym), which specialises in well-located commercial assets with first-rate tenants, has decided to place its focus on Spain.

After years focusing on the Belgian market (where 62% of its assets are located) and France (which accounts for 33% of its portfolio), Ascencio arrived in Spain in March with the purchase of three premises in Madrid, Valencia and Barcelona, leased to the chain Worten, owned by the Sonae group. In this first operation, Ascencio spent €27.3 million, a figure that it is going to almost triple with its second transaction in Spain, given that the Belgian firm is the favourite to buy the Parque Abadía retail complex in Toledo.

Parque Abadía, which has a surface area of 64,000 m2, is the most important retail establishment in the province. With a retail surface area covering more than 54,000 m2, its main tenants include Alcampo, Decathlon, Media Markt, C&A, Conforama, Kiabi, Merkal and Norauto. Leroy Merlin also operates and owns a store in the complex, which has a surface area of more than 9,000 m2.

Inaugurated in November 2011, the retail complex has 2,680 parking spaces. Last year, Parque Abadía received more than six million visitors, and that figure is expected to be even higher in 2016.

Several investment funds and Socimis have expressed their interest in the property. Nevertheless, Ascencio’s offer, amounting to €80 million, is the best positioned, say sources close to the process.

The vendor is the British fund Rockspring, which has been focusing its investments in Spain on logistics centres in recent months, including the purchase of assets as well as the development of new establishments.

The sale of Parque Abadía is expected to be closed before the end of the year, according to sources in the market. Ascencio currently has funds amounting to €600 million to invest in the three European markets in which it has a presence, and has named Spain as its primary focus.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake