Tag: prime area

Valencia’s Logistics Market will Incorporate 6+ New Platforms in 2019

14 May 2019 – Valencia Plaza

The logistics real estate sector in Valencia is on a roll. At least that is according to a study conducted by Triangle Real Estate Management, which highlights the plentiful supply in the province, in particular in the Riba-Roja and Cheste areas.

Construction is currently underway on three new logistics platforms, spanning 53,000 m2 in total, in the town of Riba-Roja, which are expected to be completed in Q3 2019. Moreover, work has already been finished this year on three other logistics properties in Paterna, Torrent and Loriguilla, with a combined surface area of 40,000 m2.

In addition, there are eight other projects in the pipeline to build turnkey properties, spanning a total surface area of 261,123 m2, which will be ready 9-12 months after they have been signed.

Stock of properties

On the other hand, the report details that the total stock of properties available for storage in the Valencia area spans a surface area of more than 2.5 million m2, of which 60% is located in the Valencia Logistics Corridor, comprising the municipalities of Riba-Roja, Loriguilla and Cheste. However, most of the available surface areas are “old, small properties”.

Land under development

The Valencian logistics market also has 6 million m2 of land available for development, in other words, land that is buildable and classified as industrial but pending the completion of one or more urban planning procedure. 75% of that land will be developed over the long-term, in other words, in more than 5 years time.

Rental prices

Market prices have risen in recent months due to the shortage of supply. Asking prices in the prime areas along the A-3 (Riba-Roja, Cheste, Loriguilla and Quart de Poblet) amount to €4.5/m2/month, compared with €4.25/m2/month in the area around the Ford Almussafes factory and €3.75/m2/month in secondary areas and places such as Sagunt.

Original story: Valencia Plaza (by Begoña Torres)

Translation/Summary: Carmel Drake

Is Málaga the Silicon Valley of the South? Its Offices Generate Yields of 7.25%

7 January 2019 – Eje Prime

Málaga is positioning itself as the possible Silicon Valley of the south of Spain. The second most populated city in Andalucía and the only Spanish city in the Top 10 for the best quality of life in Europe, according to Eurobarómetro, has attracted several technology giants in recent years. The interest from these companies in moving to the area and the lack of available space have driven up prime yields in the office market in Málaga to 7.25%, making it the most profitable place to own an office in Spain, according to data from CBRE.

The international consultancy highlights that Málaga is “consolidating its position as a city of reference in Spain in the development of the technology sector”. Oracle, Accenture, Microsoft, Huawei, Ericsson, Indra, Atos and Cisco, amongst others, have all opened offices in the city. The meeting point for these companies is the Andalucía Technology Park (PTA), recently included in the catalogue of European Digital Innovation Hubs, compiled by the European Commission, and which recorded a turnover of €1.9 billion in 2019, up by 8%.

In addition, the province is home to other smaller clusters, such as Málaga SmartCity and the ‘Polo de Contenidos Digitales de Málaga’, the first hub with those characteristics in Spain and which aims to accelerate projects and companies related to the digital sector.

The increase in demand for offices in the city also comes in response to the future forecasts for growth in the region. In fact, Oxford Economists names Málaga as the city where the economy is going to grow by the most in Spain over the next decade. The good connectivity of the province abroad and tourism are some of the factors driving those predictions.

In recent years, Málaga has enjoyed a facelift in recent years with improvements in its infrastructures, and the airport and port as anchors for tourism and business. In addition, the population has increased to 570,000 inhabitants in recent years and there are now more than 40,000 companies, of which 87.1% specialise in services.

These drivers have reactivated the office market, which has taken advantage of the boost in demand, on the rise since 2015. Rentals cost €17/m2/month in the city’s best buildings and the occupancy rate in the prime area exceeds 90%.

The shortage of competitive products in terms of location, finishes and facilities, has driven the increase in yields. In comparison with Madrid and Barcelona, the variation in prime yields is great, improving the yields of 3.25% and 4% that were being registered in the two major Spanish capitals at the end of the third quarter 2018.

Moreover, the office market in Málaga also generates higher yields than the market in Bilbao, although it is not far behind with average yields of 7%, as well as those in Sevilla and Palma, which do not exceed 6.75%. The yields in Valencia and Zaragoza amounted to 5.25% and 6%, respectively, in September last year (…).

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake

Twin Peaks Buys Plot of Prime Residential Land in Pozuelo (Madrid)

4 June 2018 – Eje Prime

Pozuelo de Alarcón has land for sale and nobody wants to miss out on the chance to acquire a slice of it. The Madrilenian town, the richest in Spain in terms of income per capita, has had a large portfolio of land up for sale for a few months now, and the family office Twin Peaks has opened the bidding in the flurry of purchases that are expected to be signed soon. The family office has acquired a plot of buildable land owned until now by Banco Santander.

The plot in question is included in the Arpo Partial Plan, the name given to the whole portfolio. Definitive approval is expected to be given for the reparcelling and urbanisation of the plots soon, which will allow investors to start building the first homes on the site. As such, the operation by Twin Peaks comes as it tries to position itself ahead of the great appetite from international funds, which are already working on buying plots on this site, according to El Confidencial.

In fact, Oaktree is already very close to sealing two operations with Iberdrola for the acquisition of plots located on the perimeter of Arpo. For Twin Peaks, the land attached to its real estate portfolio will allow it to continue growing in the luxury market in Madrid. In Barcelona, the other major Spanish city in which the firm has a presence, it acquired an asset on the central Paseo de Gracia last November for €25 million.

Pozuelo is a prime and very attractive market for property developers and funds in the residential boom that the Spanish capital is experiencing. Its high rents and ability to generate high yields are a showcase for luxury in the sector, which has seen how in just two and a half years, land prices in this municipality have risen by 20%, boosted by demand and, above all, by the shortage of buildable land available for development in Madrid.

Property developers such as Metrovacesa, which owns land spanning 46,000 m2 in Pozuelo alone worth €25 million, Vía Célere and iKasa already have important projects in place in this prime area of the Spanish residential market.

Original story: Eje Prime

Translation: Carmel Drake

MGS Acquires 6,700m2 of Buildable Land in Sant Cugat del Vallés (Barcelona)

 8 May 2018 – Eje Prime

MGS has secured a plot of land in a prime area of Barcelona. The insurance company has purchased a plot with a buildable surface area of 6,700 m2 in Sant Cugat del Vallés. The acquisition of this asset (…) forms part of the company’s real estate investment plan.

The company, which specialises in the supply of insurance products, has been increasing its activity in the real estate sector in recent months, where it is undertaking purchases to increase its portfolio. This operation has been advised by BNP Paribas.

The National Director of the Land Department at the consultancy firm, Araceli Burgos, highlighted that this operation, involving land that may be used for alternative investments, “shows that this market is reaching the same level of maturity that has already been achieved in the rest of Europe”.

Original story: Eje Prime 

Translation: Carmel Drake

BNP Paribas: Record-Breaking 39,500 m2 of Office Space Leased in Valencia in 2017

22 March 2018 – Eje Prime

Offices are breaking records in Valencia. The leasing of office space in the Mediterranean city reached a historical high in 2017, amounting to 39,500 m2, according to a report compiled by BNP Paribas Real Estate. Moreover, the good behaviour in terms of demand led to a slight upward trend in rental prices, which are now approaching €14.50/m2/month in the most iconic buildings of the old town, around the Plaza del Ayuntamiento.

“Since the end of 2013, the final year of the economic recession, demand has behaved in a positive way”, explain sources at the consultancy firm. The activity drivers that have grown by the most in recent months have been the construction sector, together with the services and industrial sectors.

“Demand has not focused on a particular area, given that between 8,000 m2 and 12,000 m2 of office space has been leased in each of the four areas that comprise the market.” In the prime area, 8,300 m2 of space was leased, a much higher figure than the average for the area over the last ten years (3,000 m2)”, they maintain.

“The good results in terms of space leased in recent years, coupled with the lack of new build projects, are generating a considerable reduction in terms of the availability rate in the Valencian market, which, at the end of 2017, decreased to 10.4%, over a total stock of 774,000 m2, which means that currently, there is 80,546 m2 of space available in the market”, conclude the sources at BNP.

Original story: Eje Prime

Translation: Carmel Drake

Portal del l’Ángel is Still Spain’s Most Expensive High Street: €280/m2/month

19 February 2018 – Eje Prime

The retail sector strengthened its market during 2017. During the second half of the year, it saw growth in the demand for rental properties of 14%, whilst the number of premises for sale rose by 9%. Of all of the high streets across the land, Portal de l’Ángel in Barcelona retained its position as the most expensive in Spain, with an average rent of €280/m2/month, ahead of the Madrilenian street Calle Preciados, where the average price of a retail premise stands at €270/m2/month.

Last year, €4 billion was invested in the Spanish retail sector, in contrast to the crisis that the same market is currently experiencing in the USA. The reasons for the growth in Spain include, amongst other aspects, the strong economic outlook, the boom in commercial tourism and the dynamism of retail trade, according to a report from the real estate consultancy firm Forcadell.

The upward trend, which has now seen two years of increases, is encouraging demand for retail assets. Nevertheless, in cities such as Barcelona, the supply of premises for rent remains at very low levels, above all on the first and second line, which has led to a reactivation of the third line, according to the report.

This lack of commercial space has resulted in a scarcity of prime assets in the Catalan capital. Some companies have already chosen to move to less central locations or to opt for other formats to invest in retail.

Between June and December, the restaurant sector was the segment that grew by the most in the commercial sector in Barcelona, followed by the fashion operator segment, which increased its commitment to flagship stores and showrooms, and the food retail market, which is immersed in a process of positioning itself close to its customers. The profile of investors in retail in the city are Socimis and foreign investment funds.

Investments in Barcelona  

One of the most noteworthy operations closed during the second half of 2017 in Barcelona saw the opening of Uniqlo’s flagship store on Passeig de Gràcia, the Japanese firm’s first store in Barcelona, which spans a surface area of 1,800 m2.

On the same street, Adolfo Domínguez is also going to open a mega-store measuring 682 m2, whilst nearby, on Rambla de Catalunya, the French lingerie brand Etam has inaugurated a store measuring 500 m2. Finally, Leroy Merlin is finalising the opening of an establishment measuring 2,450 m2 on Calle Fontanella, near Plaça de Catalunya, scheduled for before the spring.

Original story: Eje Prime

Translation: Carmel Drake

C&W: 876,000 m2 of Logistics Space was Leased in Madrid in 2017

9 January 2018 -Eje Prime

The logistics sector is starting 2018 with a bang. The industrial sector is soaring, after breaking records last year, with the leasing of 876,000 m2 of space in Madrid, its strongest location. That figure represents an increase of 80% with respect to 2016 and is the highest recorded in the last decade, exceeding even the 800,000 m2 of space that was leased in 2007, according to data from the real estate consultancy Cushman & Wakefield.

Similarly, the number of operations signed in relation to the purchase of warehouses and logistics centres amounted to 66, whereby exceeding the 50 recorded in 2016, and the average size of the surface area leased was 15,000 m2.

The areas bordering the A-2 and the A-4 were the most sought-after, as reflected by the influence that they had on the total volume of space leased in Madrid as a whole: the first area accounted for 60% of all operations, whilst assets located along the road to Valencia accounted for another 26% of transactions.

That significant increase in the sale of logistics land also resulted in a rise in prime rents. 2017 closed with an average price per square metre of €5.25/m2.

Meanwhile, in Barcelona, 450,000 m2 of logistics space was leased during 2017, which represents a decrease compared to 2016 when 645,000 m2 of space was leased, primarily because two large operations were registered during that year, with the arrival of Amazon and Mango, which incorporated warehouses with surface areas of 200,000 m2.

In the Catalan capital, by contrast, prime rents rose by 12.5%. The latest data shows an average price per square metre of logistics space of €6.25/m2 in the Mediterranean city. That rate is the highest of any of the capital cities in Southern Europe and is one of the highest on the continent. London is still the most expensive enclave for leasing warehouses and logistics centres with a price per square metre of around €15/m2.

Original story: Eje Prime

Translation: Carmel Drake

Andbank Launches Fund To Invest In Galician Real Estate

13 November 2017 – La Voz de Galicia

(…) The real estate market in Spain is back with a vengeance, above all in the central areas of large cities where, due to a lack of (past) activity in the property development sector, there is now insufficient supply to cover the growing demand (…).

And this business opportunity has not passed unnoticed for the financial sector, which, in an environment of low-interest rates and minimal profitability on the most conservative products, has launched a series of investment vehicle. Their objective is to buy buildings in prime areas, renovate them and then sell the resulting homes on to individuals, whereby generating high returns for investors.

This model, which was first tested, successfully, in Madrid and Barcelona, is now being introduced in Galicia, with the help of Andbank. The entity, specialising in private banking, has launched a real estate investment vehicle, Seagull Real Estate, which is going to acquire residential buildings in the central areas of A Coruña and Vigo, undertake comprehensive renovation work and then sell the homes (individually, in order to maximise prices).

According to Rubén Casales (pictured above), Director of Andbank’s branch in A Coruña, this is the first product that focuses exclusively on the Galician market, and it is being born with the objective of securing investment of €20 million (minimum of €250,000), which it will use to perform between five and ten operations, given that in order to minimise risk, external financing should not exceed 50%.

The appeal of this product for savers is an expected return of 14%, well above the yields they can expect to achieve on fixed income and other conservative products and, which Casales justifies due to the illiquidity of the fund, which obliges investors to maintain their investment for at least five years.

For the execution of this project, Andback has teamed up with two local partners: Ünique Singular Properties and Desarrolla. The first is the only Galician real estate agency specialising in prime residential assets and is the market leader in unique properties; it will help identify investment opportunities and will be responsible for selling the homes once they have been renovated. The second is a construction company known for its renovation work and with a great deal of activity in the autonomous region, which will take care of giving the properties a facelift.

More than 50 properties

According to Andbank, there are lots of investment opportunities: “We have identified some very interesting buildings due to their architectural uniqueness”, says Luis Touriño, territorial director of the entity in Galicia. (…). The bank currently has a team of eight people analysing more than fifty properties, of which between eight and ten will be selected.

Casales explains that the response from investors is proving positive, and so they hope to be able to launch the vehicle before the end of the year (…).

The launch of this fund is another sign of the investor interest in the Galician real estate sector, which, although somewhat lagging behind other parts of Spain, has resumed its upwards path. This news follows the announcement by a group of Galician real estate companies linked to the trade association Fegein that they are going to create a Socimi, which will manage assets in Vigo, Santiago and the north of Lugo, and which seeks to trade on the MAB.

Original story: La Voz de Galicia (by Gabriel Lemos)

Translation: Carmel Drake

Trajano Iberia Goes Shopping For Offices, Retail & Logistics Assets

31 May 2017 – Eje Prime

Trajano Iberia, the Socimi managed by Deutsche Bank (…) is drafting a roadmap for its upcoming acquisitions, which will see it buy assets worth up to €100 million in Spain and Portugal, according to a statement issued by the Socimi. The company highlighted that it is looking for commercial properties, “primarily, offices, retail premises, shopping centres and logistics assets”.

Madrid and Barcelona will be in the spotlight of Trajano Iberia, which began to trade on the Alternative Investment Market (MAB) back in July 2015. The group has set itself the objective of spending “between €10 million and €100 million” on the acquisition of assets over the next few months.

The type of properties that Trajano Iberia wants to incorporate into its asset portfolio include: offices that need refurbishing or that are empty in prime and semi-prime areas of Barcelona and Madrid; prime offices and retail assets in Lisbon and Spain’s secondary cities; prime shopping centres in Spain’s secondary cities; and prime logistics centres located in the vicinity of transport hubs.

In this way, Trajano Iberia will be able to diversify its range of assets, given that until now, it has been more focused on buying large shopping centres in major cities in Spain and Portugal. One of the Socimi’s most recent purchases was the Alcalá Magna shopping centre, in Alcalá de Henares (Madrid), for which it paid Incus Capital €100 million. (…).

As at the end of 2016, the asset portfolio of the Socimi, chaired by José Moya Sanabria, was valued at more than €200 million and comprised four properties. The Socimi, which plans to increase its portfolio to more than €300 million before the end of the year, acquired its first property in October 2015 (…). A month later, in November, Trajano added the Nosso shopping centre, located in the Portuguese city of Vila Real to its collection of assets, for which it paid €54 million. Then in 2016, the Socimi acquired the Manoteras office building in Madrid, for €45 million. In the middle of last year, the group also bought the Plaza logistics park in Zaragoza, for €43.8 million.

Since its constitution in March 2015, Trajano Iberia has raised funds amounting to approximately €95 million. The administrators and managers of the company estimate a maximum investment period of 2 years (…).

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Gesvalt: Rental Prices Rise In Spain’s Prime Retail Spaces

31 March 2017 – Eje Prime

Rental prices in the retail market continued to rise in 2016. Rental prices on the prime high streets of the main urban areas in the country experienced a change in trend after an increase in their prices. High streets such as Portal de l’Àngel in Barcelona and Gran Vía in Madrid now have monthly rental costs of €270/m2 and €230/m2, respectively, according to the Market Study of Commercial premises, prepared by the valuation specialist Gesvalt.

Although the retail sector still represents a very attractive market, its volume decreased with respect to 2015, primarily due to the boom in the Socimis, which last year focused their attention on actively managing their portfolios, rather that making new investments like the year before.

In the Catalan capital, streets such as Paseo de Gracia, Rambla Cataluña and Avenida Diagonal saw prices stabilise at their 2015 levels. In Madrid, rental prices rose slightly with respect to 2015, with Calle Preciados once again the high street that recorded the most expensive prices in the capital, with rents of €255/m2/month. In Madrid, the significant increase in rents on Gran Vía saw prices rise from €205/m2/month to €230/m2/month last year.

In Valencia, rents in the prime areas rose by between 5% and 10%, and Calle Colón was the city’s most expensive street, with rents of up to €160/m2/month on its most exclusive stretches. In the city of Palma, prices remained stable with respect to the previous year on the city’s three prime streets.

“Meanwhile, it is worth noting the low and almost zero availability of large and flagship stores in all of the prime areas, due to the significant demand for that kind of property from the large brands”, said the study.

Sandra Daza, Director General at Gesvalt, said that, based on the results obtained, it is clear that “commercial premises are still the most profitable assets in Spain”. And she added that “buying a commercial property in a prime area in Spain and then leasing it out would currently generate a gross return of between 4.5% and 6%.

Original story: Eje Prime

Translation: Carmel Drake