Quabit, Idealista, Servihabitat…the First Redundancies Hit the Real Estate Sector

Real estate companies have made the first adjustments to their workforces due to coronavirus. Firms such as Quabit, Servihabitat and construction companies have raised ERTEs.

The coronavirus pandemic has begun to cause real estate companies to make adjustments. With the biggest drop in GDP in the historical series, an unemployment level of 14.4% in the first quarter alone, and some rather dismal economic forecasts for this year, companies in the sector have begun to raise employment regulation files for their workforces.

Such is the case of Quabit. The property developer led by Félix Abánades is finalising the presentation of a temporary employment regulation file (ERTE) that will affect 66% of its workforce, according to reports from Brainsre.news last Thursday.

Property Developers Launch Mega-urbanisations: Inside the Largest Residential Projects in Spain

Currently, in Spain, ten macro-urbanisations are being built with more than 300 units each. Large property developers such as Neinor, ASG and Stoneweg are behind these projects, which also include homes for rent.

Until the end of March, the date on which Covid-19 brought the habitual performance of almost every activity in Spain to a standstill, there were more than 4,800 new construction projects underway across the country, comprising 131,471 homes, according to data from the real estate big data platform Brainsre.

Of those more than 131,000 homes under construction, more than half form part of so-called large developments, i.e. projects with more than 50 units. That means that almost 800 macro-projects, comprising 75,630 homes, are being built to respond to the shortage of existing new build homes on offer. This has been reflected in the price trends, which have been growing at a faster rate than the prices of second-hand properties.

Of the 789 large developments in progress, ten contain more than 300 units. These are unique projects, located in large cities such as Madrid, Barcelona and Valencia, but there are also examples in Málaga, Bilbao and Tarragona. Together, these ten macro communities will comprise a total of 3,729 homes.

The ‘Twin Towers’ in Madrid

This is one of the most iconic real estate projects currently being constructed in the capital, in addition to being a key residential venture. It is the Skyline project and it consists of two skyscrapers that the high-end property developer Stoneweg is building in the Tetuan neighbourhood, in the north of Madrid. It will comprise 600 homes in total.

“It is a twin tower development. One of the towers is intended for sale to individuals and is being marketed by CBRE – it comprises 303 units. The second tower has been sold to M&G Investments and will initially be used for rental housing”, explains Diego Montojo, analyst at Brainsre.

With prices ranging from €300,000 to €645,000, construction work began during the first quarter of 2020 and is expected to last until the beginning of 2022. “The building work was halted by Covid-19 but no changes are currently expected to be made to the key delivery dates; in terms of the effect of coronavirus on reservations, there have been no cancellations,” says Montojo.

The largest rental project in Spain

Just one of the ten projects containing more than 300 homes is dedicated entirely to rent. That is the Barcelona Sants residence, owned by Becorp -the real estate agency created by the property developer Corp and Scranton, the investment vehicle owned by the Grifols family. It comprises 421 apartments for let. “This project is still under construction – the building work started during the second quarter of 2018 and the keys are due to be delivered in early 2021. The homes are not yet on the market,” according to the analyst at Brainsre.

Becorp’s Barcelona Sants project.

Becorp’s complex will have 12 floors and 3,956 square metres of common areas, along with swimming pools, a wellness area and coworking centre.

Neinor, the ‘king’ of the large projects

Another project comprising more than 400 units is the Sky Homes development being constructed by the listed property developer Neinor Homes in Valencia. The company led by Borja García-Egotxeaga currently has more than 960 homes under construction in the Community of Valencia, of which 417 correspond to a single project, with an investment of €86 million. “The construction work on this project started during the fourth quarter of 2019, after the license was obtained in September; the delivery of the keys is scheduled for the end of 2022”, explains the analyst from Brainsre.

Sky Homes by Neinor.

Nor is it the only major project Neinor Homes currently has underway. The company, which had almost 5,000 homes under construction until all building work was suspended by the Government, has two other developments amongst the largest in Spain. They are Bolueta Homes, in Bilbao, comprising 328 units. That is the sixth largest residential project under construction in the country. Work started there during the second quarter of 2019 and with prices starting at €235,000, this macro-project is due to be completed by the end of 2021, according to its developers.

The ninth and tenth largest developments in Spain also bear the seal of the Basque property developer (which has its origins in the real estate portfolio of Kutxabank). The ninth largest is Amara Homes, in the Madrilenian municipality of Las Rozas, comprising 316 homes. Work started on that project at the end of 2019, and with prices starting from €353,100, the company has already managed to sell 295 units. In addition, the firm is developing another project in Malaga (Hacienda Homes), comprising 308 homes and involving an investment of €65 million.

Neinor Homes had planned to deliver between 1,700 to 2,400 homes in 2020.

Project King, from ASG Homes, with 363 lofts.

Meanwhile, the Madrilenian town of San Sebastián de los Reyes is home to the fourth largest new home development in Spain: King, comprising 363 apartments. Its promoter, the company ASG Homes, started work on this macro-project last September, with the aim of completing it in early 2022. The project comprises 363 lofts whose prices start from €157,900. “To date, they have sold about 30,” says Diego Montojo.

Also in Madrid, with 334 homes, the only project carried out under a cooperative system, is ranked in fifth place, namely, Residencial Maravillas. Located in the financial centre of Madrid, a stone’s throw from Paseo de la Castellana and Nuevos Ministerios, this project has been underway for several years since Domo Gestora was awarded the land where the old Artillery Precision Workshop was located in late 2014 for €111 million.

After various legal problems obtaining the building permit, due to complaints from environmental groups, these 334 homes, which have already been assigned to the cooperative members, are expected to be completed in the third quarter of 2021.

Behind the remaining two large developments are two new property developers: AQ Acentor and Kronos Homes, which are building the AQ Turianova development, in Valencia, comprising 324 homes; and The Kube, in Tarragona, with 318 units.

In the case of the first, which is the seventh largest development under construction in Spain, 324 units are currently being built, although AQ Acentor’s plans contemplate the construction of 1,200 homes in total. Of those, 544 homes will be social housing properties. “It is a new neighborhood that is being developed in the area. The part of the development called ‘Arcos’ corresponds to private housing and the part called ‘Riodeva’ corresponds to subsidised housing (VPO),” says Montojo. With prices starting at €159,900, the building work was due to start in February 2020 and 30% of the homes have already been sold.

Meanwhile, The Kube project, by Kronos Homes, in Taragona, is the eighth largest residential project. Designed by the DNA Architects studio, 98 of the 318 homes it will comprise have already been sold. “They are deferring payments for customers who have made reservations. For 3 apartments that were about to be reserved, a discount of €20,000 euros has been applied on the condition that the buyers go ahead with their reservations during this lockdown period. In theory, they are not planning to lower their prices, since they were actually planning to raise them in a few months time,” says the analyst from Brainsre.


Property Developers Ask for the Deeds to be Signed for Finished Homes on the Coast Worth €2.5 Billion

Residential property developers on the coast have asked the Government to relax the rules on mobility so that the deeds can be signed on finished properties worth €2.5 billion.

Residential property developers on the coast have asked the Government to relax the rules on mobility so that the deeds can be signed on finished properties worth €2.5 billion.

Despite efforts to complete procedures online, the current lockdown situation is delaying the signing of the final deeds for many properties. Representatives from the residential tourism sector in Alicante held a meeting by video call this weekend with the President of the Generalitat, Ximo Puig, to convey the situation in the sector and to request support from the Administration to complete the value chain.

ASG Homes Negotiates the Sale of 1,000 Rental Homes to Institutional Investors

19 June 2019 – Expansión

ASG Homes, the property development arm of the European manager ASG, is following in the footsteps of many of the major property developers in Spain by putting up for sale 1,000 rental homes.

The announcement comes in response to interest from institutional investors in acquiring and managing portfolios of rental homes, given the booming demand in the rental market.

Specifically, ASG Homes is negotiating the sale of 3 of its developments in San Sebastián, Madrid and Sevilla, which will be worth €200 million once finished, with investment funds, Socimis and family offices.

ASG Homes had planned to hold onto the properties and manage them itself but the strong interest from investors has resulted in a change of tack. In this way, the company is emulating the strategies of several listed property developers, such as Metrovacesa and Aedas Homes.

In total, ASG Homes has a landbank spanning 500,000 m2 with the capacity to build 5,000 homes distributed across Madrid, Alicante, Estepona, Marbella, Salamanca, Barcelona, Sevilla and Valencia. It launched its business in Spain in 2013 and invests not only in the residential sector, but also in the hotel, shopping centre and office segments.

Original story: Expansión (by Rebeca Arroyo)

Translation/Summary: Carmel Drake

CaixaBank Creates a Subsidiary to Finance Loans to Property Developers

17 June 2019 – Eje Prime

CaixaBank has created a new subsidiary to finance loans to property developers. The entity will operate under the brand CaixaBank Real Estate&Homes and will seek stable agreements with established property developers such as Neinor, Aedas Homes and Vía Célere, amongst others.

In 2018, CaixaBank financed 581 real estate projects lending €2.6 billion in total, up by 13% YoY. Moreover, 84% of the developments financed by the bank last year corresponded to projects involving less than 50 homes.

Original story: Eje Prime

Translation/Summary: Carmel Drake

Spain Needs 150,000 New Homes Per Year But the Market is Capable of Delivering Only 75,000

16 May 2019 – El Confidencial

According to the experts, on the basis of the rate of formation of new households and for a healthy residential market, Spain needs to produce between 120,000 and 150,000 new homes per year. Those figures are a far cry from the 650,000 units that were constructed in 2007, just before the outbreak of the real estate crisis. Nevertheless, the latest data reveals that even 150,000 homes is too ambitious a target, at least for the next few years.

That is according to the latest Real Estate Pulsometer, compiled by the Cátedra Inmobiliaria in collaboration with the University of Málaga, which estimates that 70,400 new homes will be finished by the end of this year and 77,100 by the end of next year. In other words, half the number needed. The reason? According to José Antonio Pérez, Director General of the Cátedra Inmobiliaria, “In simple terms, the sector does not have sufficient manpower to build that many homes. There are sufficient numbers of qualified people – such as architects and surveyors -, but there is a distinct lack of basic labour, such as workmen and builders”.

Tens of thousands of jobs were destroyed in the construction sector during the crisis. At the height of the boom, the sector and its related segments employed almost 2 million people, but by 2017 (latest available data), that figure barely exceeded 800,000. In other words, almost 60% of the workers had disappeared. Most have either left the country (many were foreigners) or reinvented themselves in other sectors and are reluctant to return to construction now.

Employment in the construction sector has recovered slightly over the last three years, with almost half a million people working in the sector. But that figure is not sufficient to build the homes that the country needs, which means delays and higher construction costs.

Lack of bank financing

The situation is compounded by the lack of available land and the shortage of bank financing to launch those 150,000 homes. The banks are willing to finance just 65,000 homes per year, according to Juan Antonio Gómez-Pintado, President of Asprima (the Association of Property Developers of Madrid). Several alternative financing funds are trying to cover the gap but they are not enough.

It is also true that stagnant salaries and problems of affordability for young people are other factors at play against the construction of so many homes.

Original story: El Confidencial (by E. Sanz)

Translation/Summary: Carmel Drake

Íbero Capital Lends €80M To Property Developers to Finance 600 New Homes on the Coast

28 March 2019 – El Confidencial

Property developers are finally able to access alternative financing. Over the last 12 months, Íbero Capital Management has granted loans amounting to €80 million to various property developers to finance the construction of more than 600 homes across Spain.

In its latest operation, Íbero CM has signed an agreement with Grupo Sankar to finance six residential projects in the province of Málaga for €40 million. The projects will involve the construction of more than 400 homes, and follow three other projects to which financing was granted (to another property developer) last year in Mijas.

Looking ahead, Íbero CM expects to sign several new loan operations during 2019 to close the year with total financing granted of almost €250 million. The manager is negotiating with national and regional property developers alike in regions such as the Community of Valencia, Andalucía and Madrid.

Alternative financing for residential development projects is finally taking off after years on the fringes. Other companies operating in the sector include MCAP Global Finance, Azora and Oquendo Capital, amongst others.

Original story: El Confidencial (by E. Sanz)

Translation/Summary: Carmel Drake

CBRE: New Homes Under Construction on the Costa del Sol Will Be Sold for c. €6,000/m2

18 February 2019 – Diario Sur

Six thousand euros or one million pesetas (…). That is what the buyers of the new single-family homes in Nueva Andalucía, in Marbella, can expect to pay per square metre. The real estate consultancy CB Richard Ellis has compiled a report about the characteristics of the new build developments that are being constructed on the Costa del Sol. And, the changing trend is reaching such an extreme that the analysts involved are talking about “a new building paradigm” in the residential market on the Costa del Sol, in this cycle of reactivation of the sector. The general conclusion is simple: better quality homes are being built, with more considered designs and common services, but also with much higher prices.

The document points out that in the past, the large number of transactions were sold for speculative purposes and, therefore, fundamental questions such as finishes, orientation, views and distribution were often neglected in the developments that were put on the market (…).

But times have changed. In this new cycle, property developers are taking care of their products and focusing their attention on clients with medium/high purchasing power and primarily those from overseas. It is not so much a question of location, be it in one specific municipality or another, but rather the quality of the product. (…). Now, most of the developers are backing more contemporaneous designs, with straight lines and large windows, with some of the best finishes in the market.

Change in model

“The reality is that during the last cycle, homes were built for the average market, but following the crisis years, almost everything is now being constructed to serve a niche in the market, of average-high purchasing power, which was previously unmet demand”, explains Andrés Moreno, Director of the Valuations Department at CBRE in Andalucía (…). “Now, much more care is being taken. Everything is designed with the final purchaser in mind (…)”.

The report highlights that the Costa del Sol is consolidating its position as an exclusive and luxurious destination. And that trend means that the newest flats are far from affordable for the general public (…).

In areas around Torremolinos, there are developments with sales prices of more than €4,000/m2, when the average for the area does not exceed €2,500/m2 for second-hand properties. In the Fuengirola/El Higuerón area, new build homes are being marketed for more than €4,000/m2. Prices amount to close to €3,000/m2 in La Cala de Mijas and rise to €6,000/m2 in Nueva Andalucía and Behahavís. The average budget of these clients ranges between €500,000 and €1 million.

Original story: Diario Sur (by Ignacio Lillo)

Translation: Carmel Drake

BNP Paribas: Valencia’s Logistics Stock Set to Rise by 100,000 m2

12 February 2019 – Valencia Plaza

The logistics capacity in the province of Valencia is going to increase by 99,457 m2 this year with the launch of five new platforms located in Riba-roja, Torrent, Paterna and Loriguilla, according to the latest report from BNP Paribas Real Estate.

Moreover, there are locations that will offer the possibility of “turnkey” constructions with a total constructed surface area of more than 200,000 m2.

The purchase price of logistics space has risen to €200/m2-€220/m2 in the most sought-after locations due to the interest in the purchase of land from property developers and investment funds, in an area where available logistics space currently accounts for just 2.8% of the total, and 77% of that surface area is located in Riba-roja.

Due to the lack of availability, maximum rental prices have increased slightly to reach €4.5/m2/month in Riba-roja.

In 2018, demand for logistics space remained high and 24 operations were signed, three more than during the previous year. The most sought-after area was Riba-roja, which accounted for 30% of the space leased.

Nevertheless, last year closed with 127,502 m2 of logistics space leased, a very similar figure to the average for the last four years although somewhat lower than in 2017 (by 30,000 m2).

The fourth quarter of 2018 saw high leasing activity and accounted for 43% of all of the surface area leased during the year.

Original story: Valencia Plaza 

Translation: Carmel Drake

Izilend to Spend €200M Financing Real Estate Projects in Spain

1 February 2019 – Expansión

Izilend has arrived in Spain with the launch of a vehicle, which has funding of up to €200 million to finance real estate projects in the country.

Since September, the alternative financing firm has already undertaken ten operations worth €20 million and it plans to finance operations amounting to €50 million during the course of this year.

Izilend, which has a presence in Portugal with a real estate crowdfunding platform, forms part of the holding company FS Capital Partners, which also includes a servicer, Fintech, Finsolutia and a financial advisory company (EAFI).

Izilend is thereby joining other alternative financing platforms specialising in the real estate sector that have made their debuts in Spain in recent months, such as Íbero Capital Management, from the US investment fund Oak Hill Advisors, and the firm promoted by Azora and Oquendo.


In the case of Izilend, the firm focuses on the financing of projects amounting to between €1 million and €10 million. To date, it has financed investors, property developers, cooperatives and Socimis for projects in Madrid, Málaga, Sevilla and the Balearic Islands. The financing fund intends to continue expanding the focus and to finance different types of assets ranging from housing, offices, retail and land in the main cities of Spain and Portugal.

Francisco Jonet, one of the people responsible for Izilend’s business in Spain, explains that the company offers a solution to property developers and real estate investors to develop projects that the traditional banks are not interested in either due to the type of product, the situation of the operation or the response times.

“To date, we have financed firms ranging from small property developers to Socimis, and products ranging from land to residential blocks, located in different provinces around the country”, said Jonet.

Gonzalo Gutiérrez de Mesa, the other person in charge of the fund, forecasts that the demand for alternative financing will double over the next five years and will thereby approach the market rates in more mature countries in Europe, where this type of financing accounts for between 30% and 40% of the total market. “We are creating a new niche in which we believe there is great potential”, adds Gutiérrez.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake