Villar Mir Group Puts Inmobiliaria Espacio Up For Sale

18 September 2019 – El Confidencial

According to financial sources, the Villar Mir Group has put its land and property developer subsidiary Inmobiliaria Espacio up for sale. The objective is to raise funds to repay the group’s creditor, the Monaco-based fund Tyrus Capital, and it follows the divestment of two other non-real estate entities, Fertiberia and Ferratlántica, in August.

Savills Aguirre Newman has been engaged to coordinate the sale after valuing the entity’s land and plots at €256.88 million as at 31 December 2017. The assets may be sold as a set or piecemeal. Moreover, the company has tax credits worth between €100 million and €200 million, which is where the real value of Inmobiliaria Espacio lies.

According to the latest available data, the company reported an EBITDA of €1.61 million in 2017 and sales of €46.77 million, up by 23.2% YoY. Moreover, it has an excellent and sizeable portfolio of land for development in good locations, for which planning permission has been granted, and therefore an improvement in sales is forecast over the next few years.

Last year, Tyrus Capital lent the Villar Mir Group €360 million to refinance the debt that the traditional banks did not want to extend. The conditions of that loan are onerous – it has a two-year term (of which one year has already passed) and it carries an interest rate of between 10% and 12%. As such, the group wants to sell off its assets in an orderly fashion to repay and reduce its financing, and so time is of the essence.

Original story: El Confidencial (by Agustín Marco)

Translated by: Aura Ree

Atlético de Madrid Expects to Close the Sale of the Calderón Plots in Early 2019

20 November 2018 – Eje Prime

Atlético de Madrid is proof of the importance that property can have when it comes to financing activity. The football club has decided to take out a mortgage backed by the Wanda Metropolitano stadium to secure its €200 million refinancing with Inbursa, the financial entity controlled by Carlos Slim, according to reports from Palco 23. The intention of the Board of Directors is to convert that debt into a long-term liability and obtain better conditions than those signed when the financing plan for the new stadium was modified. In parallel, the club is preparing the sale of the plots of land on the site of the Vicente Calderón, scheduled for the beginning of 2019.

The €200 million refinancing plan and the sale of the plots alongside the Manzanares River are closely linked. Two years ago, the Mexican bank offered the financing necessary to finish the building work at the Wanda Metropolitano, after FCC, the construction group that it also controls, refused to charge for its service through the delivery of units for urban development at the Vicente Calderón.

The contract allowed the parties to cancel the loan with the sale of the plot or with the payment of annual instalments for four seasons, which made the repayment of the loan very short term, in the middle of the expansion of the sports area. In the end, the club has committed to extend the term and so the liquidity injection that will result from the sale of the Calderón will not be used to repay the debt, but rather to make more resources available for the club’s daily operations, as well as for new projects and to access to the transfer market,  if necessary.

Sources at the club indicate that the second real estate operation will probably not be signed until next year, after the municipal government of Madrid failed to provide its definitive approval of the urban planning project until last week. “We think that the uses will be converted into plots and registered in the name of the club at the beginning of 2019, which is when we will proceed with the sale”, they said.

Obtaining all of the permits is the guarantee that the property developers will be able to undertake their projects without any problems. The definitive plan establishes 33,339 m2 for residential use, with a buildability of 132,344 m2; of that capacity, 13,234 m2 in total will be reserved for social housing properties. Tertiary use land will span 14,705 m2, with 13,893 m2 for public amenities and just over 73,000 m2 for green space and others.

The new owners will have to assume the urbanisation costs of €42.22 million, including the €22 million required for the demolition of the former Atléti stadium, without affecting the M-30 road, which passes under one of the stands. It is unknown whether the football club and the Mahou brewery or the future owners will assume that price, and what impact that will have on the final sales price (…).

Original story: Eje Prime (by M. Menchen)

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

Socimi Tander Signs a €55M Loan to Finance New Purchases

11 June 2018 – Eje Prime

Tander Inversiones wants to continue nurturing its asset portfolio and for that it requires capital. The company, owned by a fund in which the Canadian manager Première Alliance holds a stake, has just signed a €55 million loan to carry out new purchases, according to explanations provided by Clara Casales, Property Manager of the Socimi, speaking to Eje Prime.

Last week, the company agreed, under the framework of its Ordinary General Shareholders’ Meeting “to repay and cancel the debt that it has subscribed to date, also cancelling all of the guarantee instruments relating to it, with the aim of refinancing, expanding and unifying the company’s debtor position under a new financing arrangement amounting to €55 million”, explain sources at the Socimi.

Tander will allocate these new funds to the purchase of new assets in the Spanish market. The Socimi has established an investment plan of up to €25 million for 2018 with the aim of expanding to more cities in Spain, with Madrid as a priority, according to comments made to Eje Prime. Tander’s objective is to purchase between three and four assets this year.

The Socimi concentrates its current investments in Barcelona, where it has five assets in prime areas of the Catalan capital. The sixth asset in the portfolio with which it leapt onto the Alternative Investment Market at the beginning of 2018 is located in Santander. When it rang the bell, the value of Tander’s portfolio amounted to €80.3 million.

Now, Tander’s aim is to expand its investments to the main cities in Spain. Some of the areas that the Socimi is analysing include Bilbao, Valencia, Sevilla and San Sebastián, although it is also interested in Málaga and A Coruña. Tander is analysing different operations, but it does not have anything identified yet.

From Vía Laietana to Paseo de Gracia

Tander’s current portfolio in Barcelona is distributed around the main shopping area of the Catalan capital. The Socimi’s largest asset is an office space at number 6-20 Calle Casp, which has a surface area of 3,457 m2. It houses the offices of Cadena SER, owned by Grupo Prisa, just above the Teatro Tívoli.

Very close by, at number 15 Paseo de Gracia, the manager owns a retail premise measuring 527 m2, which is currently leased to FC Barcelona, which has opened a flagship store there. On the same street, at number 27, the Socimi leases a 792 m2 store to the Cos brand, part of the H&M group.

Tander completes its portfolio in the central area of Barcelona with part of number 47 Vía Laietana, an office building in which the Socimi leases 1,100 m2 to Banco Sabadell. This financial institution also leases a 155 m2 branch at number 171 Travessera de Gracia, which is also owned by Tander Inversiones.

Original story: Eje Prime (by Custodio Pareja)

Translation: Carmel Drake

Santander & Blackstone Hold Onto the Real Estate Company GAC40

18 May 2018 – Voz Pópuli

Project Quasar Investment, the company created by Santander and Blackstone to bring together Banco Popular’s real estate assets worth €30 billion, has absorbed the company ‘Gestión de Activos Castellana 40’ (GAC40), whose debt amounting to €220 million Popular forgave on 30 December 2014, a move that caught the attention of the European Central Bank.

According to sources familiar with the operation, GAC40 filed for creditor pre-bankruptcy after it found itself in the cause of dissolution, but that measure was cancelled after the formal agreement was reached to transfer Popular’s assets to Project Quasar Investment in March. Sources consulted describe the operation as a “bargain”, given that Santander and Blackstone have effectively acquired GAC40’s assets at a discount of almost 69% and without the burdens that was weighing it down.

The Hispania Buildings in the centres of Murcia and Alicante are just two of the assets owned by GAC40. The company also owns the following shopping centres: La Fuensanta in Móstoles (Madrid); Juan de Borbón (Murcia); and Hispania, in Orihuela. Moreover, it has one supermarket in Totana (Murcia) and another one in Vinarós (Castellón), as well as a hotel in Cartagena. Although most of the properties are occupied, the mortgage charges that had been hanging over them since the real estate boom meant that their sale was unfeasible, according to the sources consulted.

The properties form part of Grupo Hispania, which the businessman Trinitario Casanova, the same person who agreed the sale of Edificio España in Madrid to the Riu group last year, sold in 2008 to José Ramón Carabante – the former shareholder of real estate companies from the boom and the founder of the only Spanish team to have operated in the Formula 1 arena, Hispania – for €650 million.

Carabante abandoned the management of Grupo Hispania in 2011 and was replaced by José Fernando Martínez Blanco, an expert in the liquidation and restructuring of companies. According to the sources consulted, Martínez Blanco was appointed by Banco Popular to acquire Carabante’s companies.

Martínez Blanco changed the registered name of the companies acquired from Carabante to ‘Gestión de Activos Castellana 40’ (GAC40) in 2012. The firm was weighed down by a debt amounting to €562.5 million, with Banco Popular as the main creditor. Until the absorption of GAC40 by Santander and Blackstone, Martínez Blanco had continued as the administrator of the company.

Forgive and refinance

GAC40 has remained active all these years thanks to financial support from Popular, which has been forgiving and refinancing the company’s debt year after year.

On 30 December 2014, Banco Popular’s Board of Directors decided to waive GAC40’s debt. That decision caught the attention of the European Central Bank, which conducted an inspection and identified “deficiencies” in the authorisation of the operation, as this newspaper reported.

The most recent refinancing of GAC40’s debt happened a month after the intervention of Banco Popular and its sale to Santander. On 6 July 2017, the company agreed “as the primary financial creditor”, to “convert the debt into a participation loan amounting to €19.4 million”.

With that debt conversion agreed just a month after Popular’s intervention, GAC40 was able to correct the critical situation that it found itself in. According to the company’s accounts for 2016, to which this newspaper has had access through Insight View, the company was in cause of dissolution with a negative goodwill balance of €221 million and financial debt of almost €250 million.

Original story: Voz Pópuli (by Alberto Ortín)

Translation: Carmel Drake

Record Financing Deal: Testa Raises €0.8bn From 16 Banks

15 December 2017 – El Confidencial

Testa has managed to close new financing amounting to €0.8 billion and, in a move that has made the deal remarkable, has not had to use any of its buildings as collateral.

As El Confidencial revealed, the entity in which Santander, BBVA, Merlin and Acciona hold stakes, was negotiating to refinance all of its debt so as to be well positioned to make its debut on the stock market and to have a sizeable sum to make new purchases.

In the end, according to financial sources, the Socimi has obtained the backing of 16 financial entities for the largest unsecured loan ever granted to a company in this sector in Spain. The new loan will be structured in three tranches, whose maturity dates will range between two and five years.

The first, amounting to €0.35 billion, is a bullet loan, which will be repaid in its entirety upon maturity, in December 2022; the second, for the same amount, is a 2-year bridge loan, which the company plans to refinance with a bond; and the third, a line of credit amounting to €0.1 billion has a mortgage guarantee over five years.

The entities that have participated in this financing are Banco Sabadell, Santander, Barclays, BNP Paribas, Caixabank, Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, ING, JP Morgan, Mediobanca, Natixis and Société Générale.

Following this agreement, Testa’s leverage ratio has increased from 15% to just under 35% and all of its debt is now corporate.

The Socimi is working with a view to making its debut on the main stock market in the spring. It will make that move with a portfolio comprising 9,219 homes dedicated exclusively to rent, spread over 111 buildings and worth almost €2.2 billion.

Nevertheless, thanks to the signing of this new financing, the Socimi now has fresh money to take on new acquisitions before its stock market debut, in line with the purchase that it announced in September of 135 homes from BuildingCenter, the real estate subsidiary of CaixaBank.

65% of Testa’s portfolio is located in Madrid, San Sebastían accounts for 7%, Barcelona 5%, Valencia 4%, Mallorca 3% and other locations the remaining 15%.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Metrovacesa Prepares Stock Market Debut for February 2018

23 November 2017 – Eje Prime

The stock market is getting ready to welcome yet another real estate group. Metrovacesa, the property developer controlled by Santander and BBVA, will make its debut on the stock market in February 2018. The company has convened an Extraordinary Shareholders’ Meeting for 19 December to approve its return to the trading floor. Moreover, the company is currently negotiating a syndicated loan amounting to €250 million to finance future operations.

According to the information included in the meeting invite, the shareholders will also have to approve a ‘contra-split’ of their shares, equivalent to one new share for every 45 existing shares. They will also be asked to approve some new corporate by-laws for the company and to fix the number of directors along with their policies and remuneration plans.

Metrovacesa stopped trading in 2013 after an exclusion bid was presented by the financial institutions that ended up controlling the real estate company following the process to refinance its debt.

Currently, its capital is shared between Banco Santander (61.1%), BBVA (29.64%) and Banco Popular (9.21%), which will divest their shares with the stock market debut.

Following a capital increase amounting to €1.108 billion, which was completed by the contribution of assets from the three banks, Metrovacesa has assets worth more than €2.6 billion and a land portfolio that exceeds 6 million m2, on which 40,000 homes may be built.

Before the stock market debut, the shareholders are going to undertake another non-monetary capital increase amounting to €316.7 million, which will be submitted for approval at another shareholders’ meeting, to be held this Friday, on the first call, or this Saturday, on the second.

Loan for €250 million  

In addition, Metrovacesa is negotiating a syndicated loan with various banks. The initial idea was to structure it into two tranches: one amounting to €220 million, to be used to fund the distribution of a dividend before the company’s debut on the stock market; and another for €180 million, aimed at financing the property developer’s future operations.

According to sources familiar with the process, this first proposal has been rejected by the main entities invited to form part of the syndicate, which have asked Santander and BBVA to lower their dividend expectations. Meanwhile, Metrovacesa is preparing a new proposal that will likely decrease its debt balance by between €250 million and €400 million and eliminate the amount allocated to remunerate the shareholders.

Original story: Eje Prime

Translation: Carmel Drake

NH Early Redeems A Bond Issue To Reduce Its Debt By €100M

31 October 2017 – Expansión

The NH hotel chain has reduced its debt by €100 million after early redeeming the entirety of a debt obligation issue made in 2013. The issue, amounting to €250 million in total, was due to mature in 2019.

NH has explained that the redemption will be performed on 30 November and will be charged against available cash and, temporarily, through short-term credit lines. Following the operation, the company’s long-term gross financial debt will stand at around €740 million.

The hotel group has explained that this operation will allow it to achieve a net interest saving of around €9.6 million between 30 November (2017) and 1 November 2019, the obligations’ maturity date.

“The redemption and cancellation of the obligations represents a significant milestone in the company’s strategic plan, and seeks to reduce the gross amount and average cost of its indebtedness over the long-term, as well as to prolong its average life”, says NH.

Specifically, with this redemption and without considering the temporary use of short-term credit lines, the average cost of NH’s debt will reduce from 4.2% to 3.8%, whilst its average life will lengthen from 4.4 years to 4.7 years.

Moreover, as a consequence of this redemption, the syndicated credit line signed in 2016 for a limit of €250 million will continue to be available in its entirety, and its maturity is extended automatically until 2021.

In this way, NH is finalising the process to refinance its long-term debt and will hold onto a €250 million convertible bond, which is due to mature in November 2018, as medium-term debt.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Vía Célere Engages Lazard To Prepare Its IPO

29 June 2017 – Expansión

Vía Célere is accelerating its process of debuting on the stock market. The real estate developer, controlled by the US private equity fund Värde, has engaged the bank Lazard as an advisor for its debut on the Madrid stock exchange.

Moreover, the firm chaired by the businessman Juan Antonio Gómez-Pintado (pictured above) is making contact with some of the placement entities of the operation, which is forecast to take place in the spring of next year, although a firm date has not yet been set.

The real estate developer, which owns a portfolio of more than 10,000 homes, plans to debut on the market with a capitalisation of more than €1,000 million, in an operation that will allow the US fund to undo positions at the same time, which will serve to raise financing to allow it to continue to grow.

Värde acquired a controlling stake in Vía Célere from Juan Antonio Gómez-Pintado – who has continued as the President of the company – in February for €90 million. The US fund carried out that operation a year after launching the real estate firm Dospuntos, which it constituted using assets from Parquesol – a subsidiary that the SanJosé group ceded to its creditors under its own refinancing framework at the end of 2014. The merger between the two groups was approved by the General Shareholders’ Meeting of Dospuntos in April.

Shareholders

Besides Värde, the following players also hold stakes in Vía Célere’s share capital: the funds Attestor and Marathon, which are the second- and third-largest shareholders, respectively, as well as Barclays and Bank of America.

The integration of Vía Célere and Dospuntos resulted in the creation of one of the major property developers in the sector, with a land portfolio spanning more than 1 million m2.

The company owns assets worth more than €700 million and has own funds worth €400 million. Its plans for the next three years include starting to build 4,491 homes and completing 2,494 units, according to data provided by the company in April.

Värde – one of the most active players in the Spanish real estate market in recent years – is also the majority shareholder of another property developer – Aelca, which purchased the Avintia group for €50 million in June 2016, and which controls 40% of La Finca Global Assets, which, in turn, owns the business park of the same name, together with the García Cereceda family.

With this operation, Vía Célere will follow in Neinor’s footsteps, after it debuted on the stock market in March, to become the first property developer to debut on the stock exchange in ten years, following Realia’s IPO in 2007. The property developer backed by Lone Star debuted on the stock market at a price of €16.46 per share and currently has a market capitalisation of €1,440 million.

Vía Célere’s debut on the stock market is likely to be followed by that of Aedas. That real estate firm, which is controlled by the fund Castlelake and led by David Martínez, engaged Goldman Sachs and the law firm Linklaters in April, to prepare its debut on the stock market, which is scheduled for October.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Slim Commissions Sale Of Torre Realia In Barcelona For €140M

7 June 2017 – El Confidencial

(…). Torre Realia BCN is the jewel in the crown of FCC’s subsidiary in Cataluña and, moreover, it is located in a thriving area which has been witness to some of the most interesting real estate operations of recent times: Plaza Europa, the new business district within the Catalan capital’s area of influence.

With this cover letter, the group controlled by Carlos Slim has decided to put the skyscraper on the market and has engaged JLL and BNP Paribas to find a buyer, according to several sources close to the operation.

A spokesman for Realia refused to confirm the operation, which has reportedly been orchestrated directly by Gerardo Kuri Kauffman, one of the right-hand men of the Mexican magnate in Spain and the CEO of the real estate company.

The decision to sell this genuine trophy asset comes just after the real estate company signed a new syndicated loan amounting to €582 million, aimed at refinancing the €678 million debt that expired in April and which threatened the viability of the group.

To finish sorting out the financial situation, the company was also planning to sell the Los Cubos building in Madrid, an operation that never ended up being closed due to Slim’s high price expectations.

New business district

Realia is hoping to obtain €140 million for this sought-after property, which measures 112 m tall, over 24 storeys, with a gross leasable area of 31,960 m2 and 399 parking spaces. It is aware of the growing interest that exists amongst the large real estate companies to establish themselves in the new business district.

The skyscraper is, precisely, one of the most iconic buildings in this thriving area and is the image that identifies the zone. The property houses the headquarters of KPMG in Barcelona and has seen its value rise in recent months, thanks to the wave of operations that have taken place in this enclave and the growing number of large corporations that are moving their headquarters to this new financial district, in L’Hospitalet de Llobregat.

The main player in two of the operations that are transforming the area is the Puig family, one of the most important corporate sagas in Cataluña, which has completed a double whammy, by teaming up with Colonial to promote a 14,000 m2 tower in Plaza Europa 46-48, which is right opposite Grupo Puig’s headquarters, a building that it has just purchased from BBVA for around €60 million.

Arcano has also been active in the area with its acquisition of an office building located at Plaza Europa 22-24 for €13 million. That property has a gross leasable area of 7,335 m2, plus another 452 m2 of storerooms, 83 of its own parking spaces and 164 administrative concession parking spaces, which it plans to completely remodel after the summer.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake