Tag: Poland

Offices & Logistics Assets will Drive Spain’s Real Estate Sector over the next 5 Years

20 September 2018 – Eje Prime

Spain is consolidating its position as one of the most powerful real estate markets in Europe. The Spanish real estate sector has been strengthened in recent years by the creation of employment and, in particular, by investments undertaken in the office and logistics segments. Looking ahead, it is expected that the scarce supply of these assets will lead to a rise in prices, especially in Madrid.

The sector expects the office business to maintain an upward trend over the next five years in light of the outlook for the creation of employment in Barcelona and Madrid. During this period, both cities are predicted to generate around 200,000 to 300,000 jobs, respectively.

Good news is also expected in the logistics sector. Above all thanks to the boom in e-commerce, the market for industrial centres and warehouses in Spain is currently one of the most powerful in Europe. Despite the great demand for assets, in cities such as Barcelona and Madrid, the rate of available stock stands at just 4%, which is pushing rental prices up. For DWS, the challenge until 2022 will be to “adapt existing buildings to the new needs of companies”.

In terms of the rest of Europe, an increase of 2% per year is expected in the prime office market. Together with Madrid and Barcelona, other areas that will see an increase in demand for such spaces until 2022 include Berlin and the financial district of Paris.

Logistics will be, undoubtedly, the most dynamic segment of the European real estate sector over the next five years. It is expected that, in light of an availability rate for industrial spaces of 5% in most of the large cities, rents will rise by 2.2% per year, on average. Germany, the UK and Poland are expected to lead that growth.

Original story: Eje Prime 

Translation: Carmel Drake

Acciona Buys More Land on which to Build 4,500 Homes

27 February 2018 – Europa Press

Acciona has accelerated its property development and house sales businesses by investing in the purchase of developable land, in such a way that it now owns a portfolio of land on which to build around 4,500 homes, which it plans to continue increasing.

The group chaired by José Manuel Entrecanales (pictured above) forecasts that the resumed real estate activity will start to contribute to the income statement next year.

Two years ago, Acciona took the decision to recover its real estate division with the aim of generating value from the assets that it still held in the sector in light of the reactivation that the business was starting to show in Spain following the crisis.

Thus, in terms of its real estate assets, the company merged its rental homes into Testa Residencial, the Socimi in which Santander, BBVA, Merlin Properties and now the group itself hold stakes, and which is planning to make its debut on the stock market next quarter. Moreover, it is proceeding with the sale of the rest of its assets (hotels and offices) on an individual basis.

In terms of its property development activity, Acciona resolved to return to building on the land portfolio that it had, whereby taking advantage of the recovery in the sector.

Nevertheless, the company has given a boost to that initial business plan and has dived into the purchase of new land. Specifically, over the last year, the firm has purchased plots worth €82 million with capacity for the development of around 1,400 homes.

In this way, Acciona currently has a land bank for the construction of 4,500 apartments, more than triple the amount that it had a year ago.

Nevertheless, the group has expressed its interest in continuing to invest in land both in Spain as well as in the other two markets where it has a presence in the real estate sector: Mexico and Poland, according to the company’s Director of Corporate Development, Juan Muro Lara.

The group calculates that it will allocate around 20% of its average annual investment, which amounts to between €900 million and €1 billion to the development of this revived business, including both the purchase of land and the construction of homes.

Original story: Europa Press

Translation: Carmel Drake

Azora Postpones the Liquidation of its European RE Investment Fund

6 March 2018 – Expansión

Strategy / The manager is asking the shareholders of Azora Europa 1, including Sabadell, Bankia, Abanca, Manuel Jove and the President of Ebro Foods, Antonio Hernández Callejas, to extend the divestment period.

With renowned shareholders, the firm Azora Europa 1 has convened an Extraordinary General Shareholders’ Meeting on 21 March, where it is going to address a change of strategy. The company was created by the heads of Azora in 2005 with the aim of looking for real estate investment opportunities. Two years later, when the real estate bubble burst in Spain, the firm started its journey with investments from Sabadell, Bankia, Kutxabank and Abanca, the businessman Manuel Jove – President of the holding company Inveravante and founder of the real estate company Fadesa –, and the President of the listed company Ebro Foods, Antonio Hernández Callejas.

Azora Europa 1 chose Eastern Europe as its primary investment destination and rental properties as its main asset. Thus, between 2008 and 2015, Azora Europa undertook 10 real estate projects in Poland and another one in the Czech Republic. During that period, Azora’s fund closed its investor period with a total volume of €410 million, of which €140 million corresponded to own funds.

Ten years after its launch, its directors terminated the fund’s journey and requested authorisation from its shareholders to initiate the divestment process. Nevertheless, one year on, the company has taken a step back from that initial plan and is going to ask its investors to postpone its complete liquidation. The fund, which at its height accumulated a dozen properties, two for residential use and the rest for office use in Poland and the Czech Republic, has decided to divest the residential complexes and the Galerías Louvre in Prague, and exclusively hold onto its office portfolio in Poland. The reason given is the high returns offered by those assets, say sources at Azora. It is a portfolio leased almost in its entirety and which includes, amongst others, the headquarters of BNP Paribas Fortis in Krakow and the Harmony Office Centre in Warsaw, whose main tenant is Millennium Bank.

Now, the heads of Azora (the company that also manages the Socimi Hispania) are going to have to obtain approval from their shareholders, on 21 March, to extend the initial divestment period. At the meeting, the subject of a capital reduction will also be addressed, for a maximum amount of €6.16 million.

Valuation

According to the latest published accounts, Azora Europa 1’s real estate investments were worth €260.7 million as at December 2016, compared with €269.5 million a year earlier. In 2016, the fund recorded revenues of €30.6 million, of which €12.8 million proceeded from the sale of properties (compared with €1.8 million generated from the same concept a year earlier). In that year, Azora Europa 1 recorded losses of €3.73 million, primarily due to provisions recorded for the impairment of tax credits.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake