17 January 2020 – El Confidencial
Amenabar Promociones has signed the largest build-to-rent operation to date in Spain with the fund Ares. Together, they are going to invest more than €110 million in the construction of more than 400 rental homes in Valdebebas, Madrid.
The homes are going to be built on a plot that Amenabar acquired at the end of 2019 from Ferrovial for €56 million. The Basque, family-owned, property developer made its debut in Madrid’s residential market five years ago and handed over more than 1,000 new homes last year. In 2020, it plans to increase that figure to almost 1,600, a volume that it hopes to maintain for the next couple of years, which will see it outperform many of its listed competitors.
With this operation, Amenabar is following in the footsteps of companies such as Aedas, Metrovacesa, Quabit, Momentum and Urbas, which have all committed to projects in the build to rent sector in recent months.
Meanwhile, Ares has become one of the most active funds in this segment of the market. For example, Aedas is going to build 500 rental homes for Ares (€70 million); and Metrovacesa is going to construct another 121 homes for the fund (€29 million).
The appeal of the segment lies in the attractive returns that rental homes are currently generating. In Q2 2019, the average gross yield on rental homes across Spain amounted to 3.9%, according to official data from the Bank of Spain, which is much higher than the return on bonds and other prime real estate assets, such as offices and high street premises. Moreover, various cities and neighbourhoods offer even higher returns e.g. Madrid Capital (5.06%) and the Villaverde neighbourhood (8.43%).
Original story: El Confidencial (by E. Sanz)
Translation/Summary: Carmel Drake