Argia’s Bankruptcy Leads to Oviedo’s Largest Ever Land Auction

10 December 2017 – El Comercio

The bankruptcy of the property developer owned by the businessman Blas Herrero, Argia Inversiones Inmobiliarias, and the lack of interest in most of its assets from its banker, Liberbank, have made way for the city’s largest-ever auction of private land. In total, 159 lots worth more than €30 million will go under the hammer, ranging from buildable estates in Cerdeño, to buildable land in Prados de la Fuente, to around fifty finished homes also in Prados de la Fuente.

In reality, the investments are very recent. Herrero did not seek to obtain any returns from the land and housing sectors in Spain until 2005 when he took control of Inverural Capital and turned it into Argia Inversiones Inmobiliarias. After a few years of activity, the company stopped filing its annual accounts – in 2009 – and went off the radar.

In Oviedo, the firm had promoted one of the largest plots of land in Prados de la Fuente, under the commercial name Galana Residencial. The work on that group of buildings…did not go well…The first buyers reported problems with the finishes, as well as humidity in the garages and the poor quality of the padel court.

Eight years after the homes were handed over, 51 apartments in different parts of the development are now going on the market, with appraisal values ranging from €155,484 for a first floor 3-bedroom property to €250,000 for homes that are bigger and higher up (…).

House prices in the city of Oviedo in Q3 2017 amounted to €1,264/m2, according to the appraisal company Tinsa. In YoY terms, they rose by 1.5%, but the number of transactions was still very low and, in 2016, prices fell by 0.8% in YoY terms. Since the middle of 2008, each homeowner in Oviedo has lost 37% of his/her property value, on average (…).

Volatility and low returns are two of the factors that have ended up causing the Asturian businessman Blas Herrero to surrender his real estate ambitions just ten years after launching them and after more than five years of unremarkable activity. In 2015, Argia Inversiones Inmobiliarias filed for voluntary creditors’ bankruptcy. The liquidation plan…was approved in January.

A peaceful end is anticipated with the voluntary auction that is due to be held on 20 December. The 159 lots, which will be bid for independently, include some mortgage charges in favour of Liberbank, who has most at stake in terms of the success of these disposals (…).

Prices and lots

The data is not encouraging. In the last year – between July 2016 and June this year – 633 homes were sold across the whole of Asturias (…). The figures indicate that the crisis is still on-going. A decade ago, the General Council of Notaries recorded three times as many real estate transactions per year. Moreover, some of the lots are far from the reach of most (…). Specifically, three plots from the special plan are together worth €10.5 million (…).

Original story: El Comercio (by Gonzalo Díaz-Rubín)

Translation: Carmel Drake

Buyers Willing To Pay 30%-50% More For Homes With A View In Barcelona

19 December 2016 – Inmodiario

Good views are a key component of the appraisal value of luxury homes in Barcelona. They account for between 30% and 50% of a property’s value, depending on the type of skyline on offer, in such a way that south-facing homes with views of the sea are worth up to twice as much as properties with similar characteristics without any views.

In this sense, of the 600 properties in Barcelona that are worth more than €2 million, 301 are located in the neighbourhood of Sarrià-Sant Gervasi, i.e. 50.1% of the total. That district is followed by El Eixample (with 103 properties or 17.2% of the total), Les Corts (with 102 or 17%), Ciutat Vella (with 42 or 7%), Sant Martí (with 14 or 2.3%), Sants-Montjüic (with 9 or 1.5%) and Horta Guinardó (with 2 or 0.5%). None of the properties in Nos Barris and Sant Andreu are worth more than €2 million, given the low price per square metre of homes in those neighbourhoods, and the limited supply and demand for luxury properties there.

“Our buyers want to make their idealistic visions of Barcelona a reality. For them, the city is all about beauty, art, sun and sea. They come here for those reasons and they want their homes to fulfil those criteria of exclusivity”, said Emmanuel Virgoulay, Partner at Barnes International, the master franchise network in Spain.

Besides good views, other important factors that influence a property’s appraisal value are: its location, its size, its condition and its layout (whether or not it needs to be renovated), the monthly maintenance charge and the circumstances in the real estate market at the specific time when the sale is completed.

The apartments that cost more than €2 million range between 150 m2 and 350 m2 in terms of size, whilst the houses in the same price bracket range between 400 m2 and 1,000 m2 in terms of constructed surface area, plus any land. These types of properties tend to have large lounge-dining areas, 4 or 5 bedrooms, three bathrooms, lifts, high ceilings, large terraces, good sound proofing, a lot of light, a concierge/porter service and parking spaces. They also have special security systems and some offer a 24-hour security service.

Original story: Inmodiario

Translation: Carmel Drake