Tag: pension funds

Patrizia Finalises Acquisition of Logistics Portfolio from BentallGreenOak

10 December 2019 – Patrizia has finalised its acquisition of a major portfolio of logistics and industrial assets, including 42 buildings and projects under development in Europe. Of those, eleven, or almost a third, are located in Spain.

The company agreed to pay the US fund BentallGreenOak €1.2 billion euros for the portfolio, which includes 309,000 square meters of space in Spain, out of a total of 1.4 million square meters of pre-existing space for rent, and another 138,000 additional square meters under development.

A group of institutional investors including both a Danish and a Korean pension fund, alongside Patrizia’s Logistik-Invest Europa II fund.

Original Story: Expansión – Rebeca Arroyo

Adaptation/Translation: Richard D. K. Turner

Real Estate Investment Cycle Undergoes Change in Profile

20 July 2019 – Richard D. K. Turner

The real estate investment cycle in Spain is beginning to change as the funds that first acquired land and homes for rent from Sareb and the banking sector start to finally unload those initial acquisitions.

The new investors are generally conservative investment funds looking for large portfolios of long-term rental properties in Spain. These more conservative funds, such as the Dutch fund APG and AXA IM, seek returns of between 3.5% and 5%. The capital entering the market is often being deployed by insurers and pension funds, which look for stable, long-term income flows from their investments.

Another changing aspect of the market is the increased interest in turn-key projects. Such a structure allows investment funds to accelerate their business plans and improve results. Aedas Homes and Metrovacesa are considered two of the major players in the market.

Original Story: El País – Inmaculada de la Vega

 

Blackstone Prepares a Series of Portfolio Sales Following its 6-Year Spending Spree

27 March 2019 – El Confidencial

The US fund Blackstone, which has been so busy on the buy side in recent years, is getting ready to put the for sale sign up, over some of its assets at least. It is preparing the sale of several portfolios, including the Socimi Corona, the homes of Fidere and also some of the former assets of Popular that it acquired from Santander.

Several sources have confirmed that the US fund is currently designing portfolios for sale in order to rotate some of the €20 billion in property that it now owns in Spain. Most of the portfolios are expected to be small, between €50 million and €300 million, although the fund is reportedly also working on some larger deals that could reach €600 million. The plan is to put the portfolios on the market before the summer.

Blackstone’s target market includes pension funds and insurance companies, which operate with lower costs of capital and which, therefore, can afford to pay more. It already trialled that strategy with the sale of Hispania’s offices to Zurich, to great success. But Blackstone will also target other funds looking to grow or complement their existing investments.

Despite this vendor activity, the US giant is still committed to buying assets in Spain. It simply wants to rotate its most mature assets, given that it started making investments in the country in 2013.

Original story: El Confidencial (by R. Ugalde and J. Zuloaga)

Translation: Carmel Drake

Meridia’s Socimi Invests €26.5 Million in an Office Building in ​​Madrid’s Financial District

26 March 2018

Meridia’s socimi is growing its participation in the office sector. The fund, led by the Catalan executive Javier Faus, bought 90% of an office building in Madrid’s financial district. The group is in negotiations to acquire the remaining 10% in the coming days. The total price for the property is expected to involve an investment of 26.5 million euros.

The building has 7,000 square meters of area, according to Meridia Real Estate III Socimi, the company through which the fund is finalising the deal. Merida is financing the purchase with equity and a seven-year loan, granted by a Spanish financial institution, of 17 million euros.

Meridia’s socimi listed on Spain’s Alternative Stock Market (MAB) on December 29, the 47th socimi to join the MAB and the last in 2017. The socimi’s shares started trading with a market value of one euro per share, giving the company a capitalisation of 78.5 million euros. The company, which was established last year, is the fund’s third investment vehicle, created by Faus in 2001.

The vehicle has attracted the attention of various investors since its inception. The last to announce its interest in the socimi was the Puig family, which owns the Puig perfume and fashion group. The group acquired 5.25% of the socimi’s capital through its real estate investment firm Inmo.

In addition to the Puigs, its main shareholders include: the institutional investor Dreof, based in New York, which holds 18.39% of the group, a church pension fund, with 15.75%, the European institutional investor Periza Industries (1.13%), the Israeli Harel investment and financial services group (11.98%) and Credit Suisse (7.88%).

The rest of the socimi’s capital is in the hands of two local family offices: Anangu Grup, the principal holding of the Catalan company Eurofred (6.56%) and the Puig family’s Inmo (5.25%). According to a document sent to the Alternative Stock Market, the president of Meridia, Javier Faus, personally owns 5.21% of the socimi.

Original Story: EjePrime – C. Pareja

Translation: Richard Turner

Bonavista to Invest €100M in Luxury Homes in Barcelona

5 December 2017 – La Vanguardia

The property developer Bonavista Developments will invest €100 million over the next three years in luxury housing in Barcelona. It will focus on both new-building developments and renovation projects, primarily in the upper area of the Catalan capital, as well as in El Eixample.

Specifically, the company has recently started work on the renovation of a building at number 34 Calle Girona in Barcelona. It has also launched two new build developments on the beachfront in Gavà Mar (Barcelona) and Calle Saüc in the Barcelona neighbourhood of Sarrià, according to a statement issued by the company on Tuesday.

Until now, the most iconic project carried out by Bonavista Developments has been the renovation of the modernist Casa Burés building, which involved an investment of €40 million and which is expected to be completed in 2018.

Bonavista Developments, associated with the British fund Europa Capital, focuses on both domestic and international clients and has identified the figure of a new buyer who spends periods of between two and three months in Barcelona.

The partners of Bonavista Developments, founded in 2014, are Jacinto Roqueta, Àlex Miquel and Marcus Donaldson, and the company manages the investments of Europa Capital, a British manager controlled by the Japanese group Mitsubishi Estate, which channels investments from institutions, such as insurance companies and pension funds, from Europe and the USA.

Original story: La Vanguardia 

Translation: Carmel Drake

Interview With Arcano Bosses: Álvaro De Remedios & Jaime Carvajal

19 September 2017 – Expansión

Interview with Álvaro de Remedios (pictured above, left) and Jaime Carvajal (pictured above, right), President and CEO of Arcano / The executives are committed to backing the Spanish economy and do not believe that Cataluña will break the rule of law.

In 2003, after a lifetime as an investment banker, Álvaro de Remedios (Madrid, 1968) decided to found Arcano and he was soon joined by Jaime Carvajal (Madrid, 1964). Both shared the vision of accompanying their clients throughout the transaction process and of placing the knowledge of senior executives at their disposal. Fourteen years later, Arcano has 15 partners, a workforce of more than 140 people, offices in Madrid, Barcelona and New York, and it has added the management of alternative assets and real estate advice to its core investment banking business.

Q: The boutique advisors have completed quite a few high-profile operations in recent months.

Jaime Carvajal: It is a world that is growing. The bankers at boutique firms have a lot of experience and the teams are more senior than in the large investment banks, in general. But sometimes, it is good to have both profiles involved in an operation. For this reason, Jefferies makes so much sense for us.

– What fruits are being born from the alliance with Jefferies?

Álvaro de Remedios: We are Jefferies’ partners in Spain. We benefit from its status as a global bank with an international presence and a great sectoral specialisation, and they benefit from our local presence and closeness to the market. Apart from the fact that we have business cards with different logos on them, we act as a single firm. We signed the alliance more than two years ago. The first year was spent understanding each other’s businesses, and during this second year, we have participated in several operations together (…).

Q: Do you expect to see an upturn in corporate operations?

Á.R: Yes, we think so, although that could just be our perception and not the view shared by the sector. We have closed around 30 advisory operations in the last 18 months. We are all very busy.

Q: Are the prices of operations rising due to the high degree of liquidity?

Á.R: There is a lot of liquidity and prices are clearly rising, but there is one key element that is different to before the crisis and that is the fact that financings are much more prudent than before. Prices are higher, but they are not off the scale, and financing is more conservative because investors are being cautious. The scars from the crisis are still there and that is a lesson.

Q: Are investors willing to earn less in this environment?

J.C: The very low interest rates have forced a change in expectations and has resulted in the arrival of new investors, such as infrastructure and pension funds, which are willing to forgo profitability in exchange for assuming lower risk. That is what is driving up prices.

Q: Is the real estate market at its peak in Spain?

Á.R: We are not betting on a rise in interest rates or an increase in prices; we bet on our own added value: we buy a building, we do it up and that is how we generate returns. Our expectation is that prices are not going to grow by much more in the real estate market, but, with our strategy, we are still generating returns (…).

Q: Is the economic outlook bright?

J.C: At Arcano, we started to back the Spanish economy in 2012 and we continue to do so. There are no significant risks threatening the economy: the banking system is robust and the problem of Popular has been resolved. The only clear problem is the inevitable increase in interest rates, but that is not going to happen in the short term, at least in Europe (…).

Original story: Expansión (by S. Arancibia, I. Abril and A. Stumpf.)

Translation: Carmel Drake

Experts Rule Out Risk Of RE Bubble In The Short Term

10 May 2017 – El Confidencial

The fact that the Spanish real estate market is enjoying happier times is more than clear. And all of the players in the sector are aware of the fact: property developers, consultants, construction companies…Nevertheless, the “overheating” that some say is threatening certain segments of the market, is falling well short of a full-blown real estate bubble, for the time being at least. At least that is according to the speakers who participated in the “Real Estate Investment Opportunities” day organised by El Confidencial and Colonial.

Real Estate Market Forum

Indeed, Juan José Brugera, President of Colonial – which is currently evaluating its transformation into a Socimi – stated that the market is “a long way from a bubble. What we are seeing is the launch of projects”. In this sense, he pointed to the German market by way of example. “It is very stable. (…) What you have to do is take a risk and invest. With this stability in terms of value, your investment will be rewarded”.

In his opinion, “a bubble is something else. It is an excessive value, but, one of the characteristics of the European property sector is that financing is very tight in terms of size and type. I don’t see a bubble, what I see is a more professional management of the assets, where the ability to generate value is what will determine prices, provided the markets are not affected by global circumstances”.

The CEO of the consultancy firm JLL in Spain, Enrique Losantos, also rules out the risk of a bubble. “Given current prices, you could be forgiven for thinking that the market is overheating, but the fact is, there is still a long way to go, especially for those investors who know how to extract value from the portfolios of assets that are coming onto the market and which should be invested in and managed to adapt them to the demands of the current market. These players will be able to obtain returns, even in the double digits (…)”.

Who will control the large rental stock?

Meanwhile, Ignacio de la Torre, Chief Economist at Arcano, said that “there is not a bubble at the moment, but if we continue at this rate, there will be one”, especially in the residential market. He highlighted the significant interest that certain assets have sparked in Spain, such as, for example, rental homes, especially amongst institutional investors. “When everything was clogged up, it seemed like Spain was going to go bankrupt, but then investors with large risk appetites entered the market to inject liquidity and the economy started to work again. Now, those hedge funds are starting to recycle the assets they bought and as the market for rental homes increases, so institutional investors are entering the segment, which is what is happening in other countries too. In the future, insurance companies and pension funds are expected to become the owners of the large stock of rental housing in Spain. (…).

Original story: El Confidencial (by E. Sanz)

Translation: Carmel Drake

Eurofund Capital & Patron Acquire 3 Shopping Centres

6 April 2017 – Inmodiario

The European investment funds Eurofund Capital Partners and Patron Capital have strengthened their presence and operations in Spain with the acquisition of three shopping centres: El Mirador, located in Cuenca; Los Alcores, in the town of Alcalá de Guadaira (close to Sevilla); and Alzamora, in Alcoy (Alicante).

Over the next few months, it will invest approximately €13 million in these centres to renew their retail offering, as well as to incorporate new domestic and international firms in the sector, and to increase the leisure and restaurant offer.

El Mirador de Cuenca is one of the iconic shopping centres in Castilla La Mancha and has no competitors in Cuenca. Inaugurated in 2002, it has a gross leasable area of 16,400 m2 and is home to more than 60 stores, including several high profile brands such as H&M, Cortefiel and Carrefour.

Los Alcores forms part of the Parque Guadaira retail area, next to the town of Alcalá de Guadaira. With a gross leasable area of 12,400 m2, its tenants include firms such as H&M, Lefties, Bershka and Stradivarius (…).

Meanwhile, the Alzamora shopping centre is also the main operator in the Alcoy area. It has a gross leasable area of 16,000 m2 and houses a wide range of retail (Zara, Massimo Dutti, Springfield) and leisure firms (cinemas, gym).

This is the second joint operation by Eurofund Capital Partners and Patron Capital in Spain, following their acquisition in July 2015 of the Dolce Vita Odeón shopping centre in Narón, near Ferrol, where it is carrying out a complete refurbishment both inside and outside the property, which, including the improvements made over the last two years, amount to €10 million (…).

Patron Capital and Eurofund

Patron Capital is an institutional investor specialising in real estate assets. It currently manages assets worth more than €5,000 million belonging to sovereign funds, universities, pension funds, private foundations and individual investors from the USA, Europe, Asia and the Middle East. Patron is headquartered in London and manages its investments in Spain from its offices in Barcelona. (…).

Meanwhile, the Eurofund Group has developed the shopping resort concept in Spain, which has had enormous success in Puerto Venecia (Zaragoza), winning the MAPIC prize in 2013 for the best shopping and leisure centre in the world. (…).

Original story: Inmodiario 

Translation: Carmel Drake

Millenium Group Resumes Its Hotel Socimi’s Activity

15 March 2017 – Cinco Días

The Millenium group has resumed its plans to launch a hotel Socimi. Following a break caused by the absence of a Government and the misgivings of some of its investors, the company has returned to the project.

The aim of the firm led by Javier Illán, which has now constituted the Socimi Millenium Hotels Real Estate, involves listing the company on the stock market in 2019, whereby maximising the term permitted for that purpose. Meanwhile, the vehicle is working hard to secure high profile investors and acquire hotel establishments.

Millenium plans to raise around €400 million from investors and expects that its Socimi will have a market valuation of between €650 million and €700 million when its debuts. For the time being, the company does not have a registered advisor for its debut on the stock market, but it has received support from investors who have participated in its investments since 2000, including large homegrown and overseas real estate mutual institutions and pension funds.

For new investors, Millenium has established a minimum entry ticket of €5 million. Moreover, it has not ruled out the possibility of allowing hotel owners to take a share in its share capital in exchange for “gifting” the property to its portfolio. Regarding the debut on the stock market, the company may open up another stock tranche, with a lower minimum investment of around €250,000, to give liquidity to its shares.

The vehicle is expected to acquire around thirty hotels, including those that the group already owns, such as the Hesperia on Paseo de la Castellana, the Hotusa in Plaza de Castilla and the Tryp Chamberí, all in the centre of Madrid.

The Socimi will acquire urban and vacation hotels, however, Javier Illán states that they are also analysing cities that receive lots of tourist visitors. Besides Madrid and Barcelona, he points to other major capitals such as Málaga, Sevilla, Córdoba, Granada, Bilbao, San Sebastián and Valencia. The Canary Islands and the Balearic Islands, together with the Costa del Sol, will be its areas of focus in the vacation segment, all areas that have been under the spotlight of domestic and international investors alike, over the last year.

This year, Illán hopes to close around ten acquisitions on which he expects to spend around €200 million. He also acknowledges that the company is holding talks with all of the hotel chains interested in operating lease contracts.

For the time being, none of these operations has materialised and the hope is that they will be completed one by one and not in batches to avoid acquiring unwanted assets.

The Director also assures that he intends for 70% of the portfolio of establishments to require investment for their repositioning and refurbishment (value added, in English), which whereby differentiates it from the model adopted by Hispania in the vehicle that it created together with Barceló: Bay.

The group, which specialises in the development of luxury residential properties and commercial premises is carrying out detailed analysis with a view to creating a Board of Directors for the Socimi, which will mainly comprise independent directors.

Original story: Cinco Días (by L. Salces and A. Simón)

Translation: Carmel Drake

Banco Sabadell Launches Fund To Invest In Parking Lots

29 April 2016 – Expansión

Banco Sabadell is exploring new ways of diversifying the investments of its private banking clients in the current low interest environment. The financial entity has just created a private equity fund called Parking Rotation Capital FCR, a vehicle through which it will invest in the purchase of short-stay car parks in Spain and Portugal.

The fund, which has already been registered in the CNMV, will be managed by Sabadell Inversión and is starting life with a committed capital of more than €31 million. This figure has been contributed by the clients of Sabadell Urquijo Banca Privada and by pension funds, says Cirus Andreu, Director of Investments, Products and Analysis at Banco Sabadell.

“We are launching this fund in order to offer better returns to our private banking and institutional clients”, says Andreu. The objective is to reach yields equivalent to those generated by other private equity investments, rather than those currently being generated by fixed income.”We expect to see very low interest rates until 2018, which means that we need to diversify portfolios and invest in liquid positions, with maturity horizons of seven to nine years”, explained the Executive of Sabadell, who hopes to achieve yields of more than 8% through this new vehicle.

The idea is that Parking Rotation Capital FCR will co-invest in the car park sector with two other Spanish funds so as to be in a position to invest in larger operations. Thus, Sabadell has joined forces with the financial services firm Altamar Capital Partners, founded by Claudio Aguirre, and with Firmium Capital, a new investment company, which has created a division specialising in car parks with funds raised from high net worth individuals and institutional investors.

Sabadell, Altamar and Firmium expect to spend €150 million on the acquisition of short-term car parks that are already operating and that have extensive future operational time horizons. They are looking for urban car parks that generate cash flows and recurrent yields.

According to Cirus Andreu, the car park ownership market in Spain is very fragmented, which means there is a great opportunity for a specialist fund to lead the concentration of the sector. During the first phase, it will optimise the commercial and operational management of the parking lots and, over the medium term, it will group together assets into different portfolios for their subsequent sale to wealthy investors.

Experience

Firmum’s partners include the son of Juan Abelló, Cristian Abelló Gamazo – who was a Director at Saba, the leading company in the sector -, Bernardino Díaz-Andreu, who has spent his professional career at Torreal – owner of 20% of Saba -; Estanis Jasinski, who comes from UBS; and Fernando Pire Abarca, who led the car park division at the Isolux Corsan group. The partners of Firmum have been involved in the purchase of 34,000 parking spaces in total.

Meanwhile, in September 2015, Altamar Capital Partners launched Altamar Infraestructure Income FCR, a fund that expects to raise €400 million to invest in infrastructures and “real assets” to combat the volatility of other financial assets and circumvent the low interest rates.

Original story: Expansión (by Sergi Saborit)

Translation: Carmel Drake