Tag: real estate platforms

Ibercaja Outsources Its RE Management To Aktua

3 February 2016 – Expansión

Yesterday, the Aragonese group Ibercaja signed an agreement to outsource the management of its real estate assets to Aktua.

The platform, which is owned by the US fund Centerbridge, has itself been up for sale since the end of 2015. Altamira is one of the favourites in the running to acquire it.

The operation signed by Ibercaja is the first of its kind in the Spanish banking sector since 2013, when the large entities, such as Santander, CaixaBank, Bankia and Popular all sold their real estate platforms under management contracts lasting around ten years.

Those operations allowed the Spanish banks to raise capital in exchange for ceding future commissions, and transferring the administration and sale of their assets to specialist firms. Those deals allowed them to focus on their strategic business, namely: to grant loans and take deposits.

“This operation, which is going to have a positive impact on the income statement of Ibercaja Banco, aims to establish a stable partnership with a prestigious industrial partner, to strengthen the entity’s strategy of boosting the sale of its real estate assets through the retail channel and simplifying and optimising its structure in the real estate sector”, said Ibercaja in a statement.

With this operation, the financial group takes a step closer towards its future debut on the stock market in the medium term. This comes after the sale of the majority if its bad real estate loans to Oaktree last year.

Ibercaja has been advised in this process by N+1 and Baker & McKenzie, and Aktua has been advised by KPMG, as its financial and legal advisor.

Original story: Expansión (by Jorge Zuloaga)

Translation: Carmel Drake

Apollo, Oaktree & Elliott Buy 1,000 Homes & 5,000 Mortgages

7 July 2015 – Expansión

Overseas funds are becoming the new owners of banks’ problem homes and mortgages. In recent weeks, Bankia, BMN and Bankinter have all signed deals – or are close to doing so – to transfer almost 5,000 mortgages and 1,000 homes to five international funds.

According to financial sources, Apollo, Oaktree and Elliott have invested the most in the transactions, although the funds Chenavari and Ellington are also close to finalising agreements.

These sales could just be the tip of the iceberg, since many of the banks currently have divestment projects underway, with the aim of transferring more than 50,000 homes to large investors.

The largest transaction to have gained momentum in recent days is Bankia’s Project Wind – the portfolio contains 4,300 mortgages to individual borrowers and it will be sold to the funds Oaktree and Chenavari. This sale is just awaiting its formal signing and the investors are expected to pay between €250 million and €300 million for the portfolio.

New transactions

BMN has also finalised agreements in recent days, for the transfer of two portfolios. The first is Project Coronas, which contains 550 homes located all over Spain, but primarily in coastal (beach) regions. The US fund Apollo has acquired this portfolio for €16 million. It represents the fund’s first major purchase of this kind since it purchased 85% of the Altamira platform from Santander.

Moreover, the entity chaired by Carlos Egea (BMN) has also sold a portfolio of problem loans, including almost 500 mortgages, of which three quarters relate to individual borrowers and the remainder to SMEs. This project, known as Pampa, has been awarded to a fund that has so far had little presence in Spain: the US fund Ellington Management, which specialises in the purchase of overdue mortgages. This investor bought a small portfolio from Barclays in Spain a few years ago.

Meanwhile, Bankinter has closed the sale of 300 homes to the US fund Elliott. The portfolio was initially valued at €60 million. It is Elliott’s first property-related purchase; until now the fund had focused on the NPL segment through its Spanish platform Gesif.

With these kinds of transactions, overseas funds are looking to capitalise on their purchases of large real estate platforms, for which they have so far paid around €3,100 million.

With that in mind, the Spanish financial institutions have initiated the sale of other large foreclosed asset portfolios, such as Bankia’s Big Bang portfolio, with 46,000 real estate units. Sabadell and Popular will also sell portfolios of homes in the near future.

Besides the sale of mortgages and foreclosed assets, Spanish entities are selling large portfolios of loans to property developers and hotel debt, as part of their objective to continue divesting property from their balance sheets. Financial institutions such as Santander, BBVA and CaixaBank all have sales projects of this kind underway.

Original story: Expansión (by Jorge Zuloaga)

Translation: Carmel Drake

Deloitte Strengthens Its Financial-RE Team

22 April 2015 – Expansión

Deloitte hires nine new professionals / The consultancy firm has recruited a team from Quadratia, a company that specialises in the residential RE sector

Deloitte expects to see a boom in the sale of homes and land to overseas funds; and it wants to become a leader in that market. The consultancy firm has recently strengthened its financial-real estate team by hiring new professionals from the specialist company Quadratia. The new recruits include the Managing Partner of that consultancy firm, Gonzalo Gallego, who joins as a Real Estate partner in the Financial Advisory team.

This move comes as a result of the belief that following the purchase of real estate platforms, shopping centres, individual buildings and loan portfolios, the opportunistic funds are going to focus their attention on the residential market this year and next. “We are seeing an increasing focus by real estate investors on the residential market, where they are interested in buying land, homes and other properties on the coast”, said Enrique Gutierrez, partner in the Transaction and Restructuring Advisory team at Deloitte. Gutierrez is responsible for the department where increasing weight is being given to the real estate sector. The RE team at Deloitte is led by the partner Alberto Valls, who Gallego will report into. In total, Deloitte’s Transactions team comprises more than 300 professionals.

Valls explains that, in the same way as has happened with other types of assets, “history is repeating itself and there is a lot of conviction amongst opportunistic investors that now is the time to enter the residential sector”. These types of funds are specialists in acquiring assets that carry higher risk and therefore, represent opportunities for extracting higher returns. “In a year from now, higher returns will be obtained. Once the situation stabilises, other more conservative, institutional investors will enter (the market)”, he adds.

In this context, investors are focusing their attention on banking assets: “(Many of the banks’) balance sheets are still fully loaded with debt from property developers and other foreclosed assets, and there are 400 funds willing to invest in Spain. No other segment has as much potential as the residential market”, says Gallego.

The banks are adopting two approaches to unblock the real estate plughole: the sale of homes in their networks, which accelerated every month in 2014 thanks to the mortgage war; and the sale of portfolios to funds. Deloitte estimates that there have been 30 transactions involving the transfer of (property) developer loans over the last year and a half.

The consultancy firm explains that the banks take three parameters into account when they put these types of portfolios on the market: time, cost and price. If the result of this equation shows that it will be more expensive to foreclose assets in the future than sell them at a discount now, then they put them on the market.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake