Realia to Invest €16M in the Construction of 85 Flats in Tres Cantos (Madrid)

9 May 2019 – Idealista

The property developer Realia has announced that it is launching a new line of business dedicated to the rental of residential homes. In this way, it is following in the footsteps of its rivals in the sector, such as Grupo Lar, amongst others.

The group led by the Mexican magnate Carlos Slim has purchased a plot in Tres Cantos (Madrid), where it is going to invest €16 million in the construction of 85 homes.

As at the end of March 2019, the company had a stock of 546 units (homes, premises and offices) that were either finished or in progress and pending delivery. In the residential sector, it had three developments underway (in Palma de Mallorca, Sabadell and Alcalá de Henares) plus a construction licence to start work on 45 units in Valdebebas (Madrid).

Realia’s land portfolio spans more than 5.7 million m2 and the company registered a net profit of €5.02 million during Q1 2019, up by 18.1% YoY.

Original story: Idealista 

Translation/Summary: Carmel Drake

Realia Adopts RICS Standards for its Asset Valuations

21 March 2019 – Eje Prime

The Board of Directors of Realia has unanimously approved the decision to change the valuation method for its assets linked to property development to bring it in line with market practice.

The listed real estate company has notified the National Securities and Exchange Commission (CNMV) that it will adopt the July 2017 professional standards of the Royal Institution of Chartered Surveyors (RICS) from the end of H1 2019 onwards.

The company closed 2018 with a profit of €40.2 million, up by 31.8% and a portfolio valuation based on market value of €1.84 billion, up by 3.1% YoY.

Original story: Eje Prime 

Translation: Carmel Drake

Busining Leases 4,900 m2 in one of the Kio Towers to Open a Coworking

20 February 2019 – Eje Prime

Busining is going to create a new business centre in Torre Realia The Icon, one of the former Kio Towers in Madrid. The company, which specialises in coworking spaces, has leased 4,900 m2 of space from Realia, the owner of the property. The space is distributed over five floors in the iconic building located at number 216 Paseo de la Castellana where it is going to open offices and meeting rooms. The operation has been advised by Cushman&Wakefield.

The tower, known as The Icon, is one of the most iconic buildings in the Spanish capital and is considered to be the first skyscraper in the world to be built at a sloping angle. Its architect, Philip Johnson, was the first recipient of the Pritzker award.

With this operation, Busininng, which has five business spaces in Madrid, is expanding its offer in the business district of the Spanish capital. “This new operation is another example of the consolidation and growth of the coworking phenomenon in the Spanish market”, said Ignacio Oyarzun, Associate in the Business Space area at Cushman & Wakefield.

Original story: Eje Prime

Translation: Carmel Drake

Realia Completes its €149M Capital Increase

2 January 2019 – Eje Prime

Realia has completed its capital increase. The real estate firm owned by the Mexican magnate Carlos Slim has completed its €149 million capital increase with a final injection of €42.1 million, according to a statement filed by the company with Spain’s National Securities and Market Commission (CNMV).

In its latest expansion phase, the company has issued 175.4 million new shares in total, for a nominal value of €0.24 and an issue premium of €0.61 per share. The company’s share capital has thereby been consolidated at €197 million, divided into 820 million shares.

Since Slim took control in 2015, Realia has undertaken three capital increases in total. The latest is the operation closed today, which was approved in November to try to decrease the company’s debt, which amounts to €672 million, and to provide a financial boost to its real estate businesses.

Slim controls 70.76% of Realia’s capital, 33% in a direct way and 36.98% through the construction group FCC, which is also led by the Mexican businessman. The real estate company also has an asset portfolio spanning approximately half a million square metres, which includes one of the Kio Towers in Madrid.

Original story: Eje Prime

Translation: Carmel Drake

Realia Launches a €149M Capital Increase

15 November 2018 – El Economista

Realia has launched a capital increase amounting to €149 million, with preferential subscription rights, through which Carlos Slim is going to make a new capital injection into the real estate company that he controls in Spain.

This increase follows another two that the firm has carried out since 2015, when the Mexican magnate took control of the company and which have been used to clean up the firm and reduce its debt.

By virtue of the new operation, Realia is going to issue 175.45 million new shares at €0.85 per share, a price that represents a discount of 7.5% with respect to the firm’s current share price, which closed trading on the stock market on Thursday at €0.923.

The operation is going to be launched once approval has been received from Spain’s National Securities and Markets Commission (CNMV). Current shareholders will have preferential subscription rights, which means that they may request new shares at a rate of three new shares for every eleven that they already own.

Carlos Slim controls 70.76% of Realia’s share capital, 33.8% in a direct way and 36.9% through FCC, a construction group that he also controls. The Mexican businessman has participated in all of the capital increases that Realia has undertaken until now.

Realia is launching a new capital increase after reactivating its construction and house sale business, which has been suspended since the start of the crisis.

The company also has a portfolio of assets spanning a surface area of around 500,000 m2, comprising office buildings and shopping centres, including one of the Kio Towers in Plaza Castilla, Madrid.

The real estate firm, which has suspended its dividend since 2009, closed the first nine months of this year with a profit of €24 million and a turnover of €70 million. The firm has total debt amounting to €672 million.

Original story: El Economista 

Translation: Carmel Drake

Realia Starts Building Homes with the Launch of 5 Developments

1 July 2018 – Expansión

The real estate company controlled by Carlos Slim has resumed its property development business with the launch of five new promotions, comprising 594 homes that, when they are handed over, will generate revenues of €208 million.

Realia is planning to continue to launch new developments on the portfolio of land that it owns, but it is also investing in new plots, such as the one it purchased recently from the Ministry of Defence in Alcalá de Henares (Madrid) for €27.5 million.

This is the first acquisition of land that the company made since the Mexcian magnate took control, which saw it join the wave of investments that companies in this area are undertaking in the land segment in light of the reactivation of the sector.

Nevertheless, after Realia stopped building homes at the beginning of the crisis, it now has a land portfolio spanning 1.85 million m2. The company says that it now has some of these plots under development in Madrid, Cataluña and Levante, areas that currently account for the greatest demand in terms of housing.

The real estate company includes the launch of new developments as a key strategy in the new phase that it is undertaking following the clean-up carried out since Slim acquired his share capital

This week, at its General Shareholders’ Meeting, Realia said that it is “ready” for the new real estate cycle, following the reduction and restructuring of its debt and the cutback in expenses, measures that it considers “are already reflected in the income statement”.

Original story: Expansión

Translation: Carmel Drake

Realia Refinances the €120M Debt Owed by its Property Development Arm

22 June 2018 – Eje Prime

Realia has today refinanced the debt owed by its property development arm, amounting to €120 million. The liability was due to mature on 30 June 2018, according to a statement filed by the real estate company, in which FCC and Carlos Slim hold stakes, with Spain’s National Securities and Exchange Commission (CNMV).

The new financing is due to mature on 31 December 2020. Realia has also indicated that “(the new financing) has been subscribed under competitive market conditions”. At the end of 2017, the company had gross bank debt amounting to €763 million, down by 10% compared to a year earlier.

Realia ended the year 2017 with a net profit of €30.5 million, 73.7% less than in 2016. The decrease was caused by the extraordinary results registered in 2016 due to discounts associated with another debt refinancing.

Original story: Eje Prime 

Translation: Carmel Drake

Realia Buys Land & Reactivates Its Property Development Business

12 March 2018 – Expansión

Realia, the real estate firm controlled by Carlos Slim (pictured below), has acquired a plot of land in Alcalá de Henares (Madrid), with a buildable surface area of 44,755 m2, from the Ministry of Defence for €27.5 million. This is the first land acquisition that the company has undertaken since the Mexican magnate took control of the entity, and sees it join the wave of investments that companies in this segment are making in land in light of the reactivation of the sector, reports Europa Press.

In the case of Realia, the land purchase forms part of the reactivation of its construction and house sale activities, which it had suspended, firstly due to the crisis and, subsequently due to the process to restructure and clean-up the company. In this way, it is going to allocate this land to undertaking one of its first three housing developments. The other two, which are going to be built on the portfolio of land that the company already owns are located in Sabadell (Barcelona) and Palma de Mallorca.

Strategy

Realia’s strategy to resume its property development activity involves analysing new build construction projects in “areas where demand is consistent and the supply is very low or new”, such as specific areas of Madrid and Barcelona and “certain other places with the same market characteristics”, according to a statement made by the firm in its annual report for 2017.

That is one of the company’s main objectives for 2018, together with the improvement in margins through the streamlining and optimisation of expenses, and the recovery of prices.

Original story: Expansión

Translation: Carmel Drake

Spain’s Large Property Developers Own Land to Build 100,000 Homes

5 February 2018 – Expansión

Metrovacesa, Aedas, Neinor, Vía Célere, Aelca, Quabit, Realia and Insur own land spanning more than 15 million m2, which they want to use to take advantage of the new real estate cycle.

The upturn in the residential sector is consolidating and the large property developers want to take advantage of the new cycle to obtain returns from the portfolio of land they have accumulated in recent years. The new generation of property developers Metrovacesa, Aedas, Neinor, Vía Célere and Aelca, and some of the listed survivors of the crisis, such as Quabit, Realia and Insur, now own land spanning more than 15 million m2 with the capacity to build more than 100,000 homes over the next few years.

Metrovacesa, controlled by Santander and BBVA is the property developer with the largest portfolio of land on its books. Following a capital increase amounting to €1.108 billion last June, undertaken through the transfer of assets from its main shareholders, the firm owns 6 million m2 of land, with the capacity to build 37,500 homes. As at 30 September, the firm owned a portfolio of residential land with a gross value of €1.9 billion, of which €1.3 billion corresponded to developable land.

Currently, the company has 51 projects under development to build 2,263 homes and it plans to reach cruising speed in 2021, with the delivery of between 4,500 and 5,000 units per year.

Stock market debuts

Metrovacesa, which plans to debut on the Madrilenian stock market tomorrow (Monday) with a market capitalisation of €2.5 billion, says in its IPO brochure that it does not need to acquire additional land to fulfil its annual house building objectives for the next eight years.

The next firm by volume of land is Aedas. That company, in which the US fund Castlelake holds a stake, owns land spanning 1.5 million m2 with capacity for 13,270 homes. The property developer, which started to trade on the main stock market in October, invested €124 million in land purchases in 2017 alone for the construction of 3,159 homes.

The strategy of the firm led by David Martínez involves reaching its cruising speed in 2022, when it expects to record revenues of more than €1.0 billion and handover more than 3,000 homes per year.

The other listed property developer, Neinor, which was the first to make its debut on the stock market in March 2017, owns land spanning 1.3 million m2, worth €1.3 billion and with the capacity for more than 12,000 homes, according to the most recent public information as at 30 September.

Specifically, during the first nine months of last year, that property developer acquired 24 developable plots for the construction of more than 3,000 homes for €275 million.

The firm led by Juan Velayos will launch 2,500 homes during 2018, will begin construction on another 5,000 units and will hand over more than 1,000 homes this year. In 2020, Neinor expects to reach its cruising speed and hand over between 3,500 and 4,000 homes per year.

Some of the most active property developers in the purchase of land and launch of new developments also include Vía Célere and Aelca, both of which have plans to debut on the stock market soon. Vía Célere owns land spanning 1.43 million m2, with capacity for 12,200 homes. The company chaired by Juan Antonio Gómez-Pintado invested €227 million in land last year.

The other property developer controlled by Värde, Aelca, owns a portfolio of developable land spanning 1.28 million m2 for 12,566 homes. The firm expects to launch 49 new developments in 2018 and will have 86 residential projects underway at different stages of completion.

Meanwhile, the listed property developers that survived the crisis, Quabit and Insur, own land with the capacity for 6,720 and 4,691 homes, respectively. Quabit plans to invest €670 million in the purchase of land until 2022, when it will reach cruising speed with the hand over of 3,000 homes per year, whilst Insur will invest €80 million in purchases until 2020 in order to hand over 600 homes per year.

In terms of the residential business of Realia, the firm controlled by Carlos Slim owns a land portfolio spanning 1.85 million m2, of which 25% is developable (…).

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Change of Heart: Slim Suspends Sale of Torre Realia in Barcelona

15 January 2018 – Eje Prime

Carlos Slim has changed his mind about Torre Realia in Barcelona. The real estate company owned by the Mexican magnate has decided to suspend the sales process of its most iconic asset in the Catalan capital, according to explanations provided by sources close to the process. Realia has received offers for more than the asking price (€140 million), however, the company has decided not to sell, citing changes in the company’s strategy.

Last June, Realia entrusted JLL and BNP Paribas with the mandate to sell this asset, equivalent to Torre Kio in Madrid. The tower is located in one of the fastest growing areas of the Catalan capital in terms of the office sector, in Plaza Europa, which is set to become the city’s new business district.

Although sources at the group claim that the decision is linked to a change in strategy, given that the offers that Realia had on the table were “higher than the price set by the real estate group”, it seems that the political situation and the climate of instability may have also been triggers for Slim’s group to decide to postpone the sale to a later date.

Realia’s trophy asset in Barcelona has 24 floors and a surface area of 31,960 m2, as well as 399 parking spaces. The property, which comprises two buildings, was designed by the architect Toyo Ito, in collaboration with Fermín Vázquez, from the B720 Arquitectos studio. Torre Realia is 110 m tall and its ground floor houses a shopping arcade that joins the two towers.

In terms of its real estate activity, at the end of the first half of 2017, Realia primarily owned offices and shopping centres for rent, which spanned a combined surface area of 405,842 m2 and had an occupancy rate of 93.5%. Moreover, at that time, it also owned an asset measuring 18,324 m2, in the form of the Los Cubos building in Madrid, which it ended up selling to the French group Therus for €52 million.

Realia’s stock of offices for rent spans a surface area of 226,729 m2, with an occupancy rate of 94.7%. Moreover, the company owns 41 residential plots for family homes, destined for self-promotion, which it has put up for sale. Realia’s current land portfolio spans a buildable surface area of 1,851,392 m2, of which 49% is located in Madrid and the central region of Spain, according to data from the group.

Plaza Europa, on the rise

The sale of Torre Realia comes at a time when the area in which it is located is enjoying a real boom. As the headquarters of KPMG in Barcelona, Realia’s asset has seen its value rise in recent months thanks to the large number of operations that have been closed in this enclave and to the growing number of large corporations that are moving their head offices to this new financial district, in L’Hospitalet de Llobregat.

One of the main players in the area is the Puig family, which has joined forces with the Catalan Socimi Colonial to build a 14,000 m2 tower at Plaza Europa 46, right opposite Grupo Puig’s corporate headquarters, which it just purchased from BBVA for around €60 million.

Original story: Eje Prime (by Custodio Pareja)

Translation: Carmel Drake