Iberdola Injects €617m Into Its Real Estate Arm

3 February 2015 – Cinco Días

The company has conducted a capital increase of €154 million.

Iberdrola has recapitalised the debt that it held with its real estate subsidiary, Iberdrola Inmobiliaria. The energy group has injected €616.7 million into its subsidiary through a capital increase of €154.2m and an issue premium, explained the company. In this way, Iberdrola Inmobiliaria “cleans up its balance sheet and is made stronger to face its new challenges”.

The group’s real estate subsidiary, chaired by Ignacio Sánchez Galán, recorded losses of almost €70 million in 2013 and turnover of more than €45 million, according to the most recent company accounts filed with the Companies Registry. The company held debt, primarily with its parent company, amounting to more than €500 million, according to those accounts.

Iberdrola Inmobiliaria was created in 1993 from the merger of Iberdrola’s real estate companies. During the 1990s, it grew its business as a residential developer. By the end of the decade, it had focused on three main areas: the development of housing; the development and operation of rental property; and the management and development of land.

During the years leading up to the burst of the real estate bubble, the company undertook some major investments and also launched businesses overseas. In 2006, it invested €240 million in the construction of a shopping centre in Valencia, together with local constructors, Gesfesa and Valencia Residencial. That same year, it approved a €200 million investment in the Porta Firal project, located at the entrance of the Gran Via Fair (in l’Hospitalet), which was in the middle of its own enlargement program.

In 2007, it recorded turnover of almost €400 million and approved a €300 million investment in a geographic expansion plan. In July of that year, it acquired a 35% stake in the tourist resort Puerto Peñasco (in the state of Sonora, on the west coast of Mexico) for €43.12 million. In 2008, it bought residential land in Bulgaria for €44.6 million for the development of a tourist resort.

The economic crisis thwarted the expansion plans of the energy company’s real estate subsidiary, which nevertheless continued to operate throughout the worst crisis to hit the Spanish real estate sector in decades. In 2010, Iberdrola injected €400 million into the subsidiary, in a similar operation to the one just undertaken. In 2013, it acquired a minority stake in Sareb.

Original story: Cinco Días (by Alberto Ortín Ramón)

Translation: Carmel Drake

Alfa Inmobiliaria’s Branch Network Grew By 4% In 2014

20 January 2015 – El Mundo

Alfa opens 12 new estate agencies in Spain and seven overseas.

Madrid and Valencia are the regions with the highest demand for new real estate agencies.

Alfa Inmobiliaria has announced that its estate agent network grew by 4% in terms of office numbers in 2014. The chain has 184 agencies, of which 108 are located in Spain and 66 overseas.

The new offices are mainly located in Madrid and Valencia, the areas in which demand for housing has increased over the past year. Jesús Duque, Vice President of the Company, says that “the sector has began its recovery. 2014 was the first year of net growth in terms of office numbers since 2009”.

Currently, Alfa Inmobiliaria employs 265 workers in Spain across its office network. Alfa Inmobiliaria provides real estate “packs” to self-employed people looking to start a business; the packs include 35,000 homes, both for sale and for rent, a methodology for working, the support of the brand and the ability to agree joint operations to facilitate work.

In this way, the company facilitates the entry into the business of any entrepreneur willing to risk the minimum capital, supplying him/her with all of the knowledge and tools necessary. And, when the time comes, Alfa supports his/her transfer to an office. The franchisee him/herself determines the speed of each step, which may vary depending on previous experience and the business skills acquired, but he/she will always be supported by the team at Alfa Inmobiliaria.

Original story: El Mundo

Translation: Carmel Drake