Tag: public administration

High Land Costs Drive up House Prices in the Balearic Islands

27 February 2019 – Diario de Mallorca

The property market in the Balearic Islands is experiencing the perfect storm. Very high land prices are driving up the cost of the few new homes that are being built. As such, local residents are facing serious difficulties when it comes to affording a home.

Not only are land prices high; in many cases, the plots are owned by large business groups, which are opting to hold onto them to benefit from further capital appreciation rather than develop or sell them immediately. What’s more, the few new homes that are being developed are very expensive, beyond the reach of most local families.

These factors are compounded by the complete failure on the part of the public authorities to construct any social housing in recent years, which only serves to aggravate the housing shortage in the market.

There is a great deal of demand, not only from local families, but also from foreigners, who want homes of their own on the island, and from seasonal workers moving from other parts of the country. Moreover, supply is limited and as such, prices are soaring. This situation is made worse by the fact that many overseas buyers and renters can afford to pay more than most islanders, which is driving out the locals.

All in all, it’s a gloomy picture for island residents.

Original story: Diario de Mallorca (by F. Guijarro)

Summary/Translation: Carmel Drake

Valencia CF Expects to Receive c. €100M from Sale of Mestalla Plot

4 June 2018 – Expansión

Valencia Football Club (Valencia CF) is making progress with the financing for its new football stadium. Market sources estimate that the club could receive proceeds of more than €100 million from the sale of the land on which its current Mestalla stadium is located, a site between the sought-after avenues of Aragón and Suecia.

The sale of that plot, known as the old Mestalla and with buildability for residential and tertiary use, could materialise before the end of 2018, taking advantage of the good times in the real estate market. The plot measures 12,000 m2 and has a buildable surface area of 70,000 m2.

That amount would allow Valencia CF to partially finance the completion of the construction of its new site, where it has fixed assets in progress worth €115 million, and to reduce the debt that it currently holds with financial institutions and which amounts to around €185 million. It also holds liabilities with the public administrations.

The work on this construction site began in August 2007 but was suspended in February 2009, which means that the project has been paralysed now for almost a decade. Since then, several attempts have been made to restart it, but those efforts have always been postponed due to the need for financing.

The club has decided to accelerate its plans to move to the future Mestalla and push ahead with the reduction in its debt and the clean up of its balance sheet to focus on its sporting efforts. Only the arrival in December 2014 of the Singaporean magnate Peter Lim saved the team from bankruptcy, which has recorded losses of €60.2 million in total over the last three years, in large part due to this real estate expenditure. Losses are also forecast for this year.

In this context, the President of Valencia CF, Anil Murthy, now considers that “the real estate market has evolved enough to meet our objectives”. Thus, the club is going to continue working with the Town Hall to process the amended licences to start the building work.

Inauguration: in 2021

Murthy said that for this process, Valencia CF has engaged Deloitte, which will be its comprehensive advisor in all aspects financial, real estate, technical and economic relating to the entire process necessary to move to the future stadium within the timeframes set out in the Valencia Strategic Territorial Action Plan.

In addition, Deloitte will be responsible for the business plan and sale of the tertiary space in the new stadium, which will have more than 40,000 m2 of buildable space available for commercial use (…).

Original story: Expansión (by E. S. Mazo & R. Arroyo)

Translation: Carmel Drake

A French Group Competes with Ifema to Resurrect Madrid’s Palacio de Congresos

2 January 2018 – El Confidencial

The French group GL Events (which manages more than 40 centres around the world specialising in business events, fairs and conferences) and Feria de Madrid (Ifema) are bidding hard to resurrect the abandoned ‘Palacio de Exposiciones y Congresos’ in Madrid, located at number 99 Paseo de la Castellana, right opposite the Santiago Bernabeú stadium. In July, the French group notified Turespaña (which forms part of the Ministry of Energy, Tourism and the Digital Agenda) that it was willing to invest €40 million in a first phase to restore the property and make it viable in exchange for a 30-year concession.

GL Events has already met with experts from the Secretary of State for Tourism’s team and its Chairman is expected to travel from France to Madrid over the next few weeks to meet with the Secretary of State herself, Matilde Pastora Asían González. Nevertheless, sources close to El Confidencial have reported that Ifema (a consortium between the Town Hall of Madrid, the Community of Madrid, the Chamber of Commerce and Industry and the Fundación Obra Social y Monte Piedad de Madrid) have taken the lead in this race and have already signed a pre-agreement with the Ministry of Tourism to invest more than the French firm has offered in exchange for managing the property for 50 years.

Madrid Foro Empresarial, which has been asking the public administrations to bring the complex back to life for some time now, given that the capital “needs more spaces to promote new fairs and conferences”, is now asking Turespaña “to convene an international public tender to allow the property to be managed by the best conference operator possible (…)”.

If Ifema does end up taking over the management of the property on Paseo de la Castellana, then it would have a monopoly on the Community of Madrid’s event, fair and conference spaces. Besides the exhibition halls that it already manages in Campo de las Naciones, Ifema has also signed another agreement with the capital’s Town Hall to operate the Palacio Municipal de Congresos, located right next to Ifema’s facilities, for 25 years (…).

In this way, Ifema would control all of the larges spaces in the capital: the exhibition halls, the municipal hall (‘el Palacio Municipal’) and the conference hall (‘el Palacio de Congresos’) on the Castellana. But as Marc Rodríguez, Director General of GL Events in Spain, (…) explained, his firm is still planning to present its proposal to operate the Madrilenian hall if a public tender is organised in the end. “We are a solvent financial operator with experience in the sector. Our construction project would last for 18 months and our initial investment would be €40 million”. The French group recorded revenues of €953 million in 2016 and employs almost 4,000 people. It also manages the Centro de Convencions Internacional de Barcelona (CCIB), whose concession period ends in November 2021 (…).

Original story: El Confidencial (by David Fernández)

Translation: Carmel Drake

Valencian Gov’t Receives 13 Offers for Land Next to Terra Mítica

7 December 2017 – Eje Prime

The Valencian Government has already managed to generate investor interest in the plots of land next to the region’s theme park, Terra Mítica, in Benidorm. The public administration has received thirteen offers for eight of the nine plots that it has put up for auction with a sales value of €26.35 million.

For those plots, which together span a combined surface area of 2.79 million m2, the ‘Sociedad Proyectos Temáticos de la Comunidad Valenciana’ (SPTCV or Company for Theme Park Projects in the Community of Valencia) has received proposals from ten companies, according to a report from the regional government itself. More offers may still be received over the next few days, through other public registers or by registered post, according to Expansión.

The transfer of land will be carried out with the right of use already granted to several companies for the next few decades. Such is the case of the Villaitana (Meliá) and Asia Garden (Barceló) hotels, as well as the land that is currently occupied by the Terra Natura theme park.

Original story: Eje Prime

Translation: Carmel Drake