Tag: rent

# Of Estate Agents Grow With A Vengeance In The Community Of Madrid

19 September 2017 – Real Estate Press

The resurgence of real estate activity in Spain, and in particular, in the Community of Madrid, has given rise to a significant increase in the number of companies in the sector, which have grown by 18.5% since 2014. Currently, the Community of Madrid has 31,384 real estate companies and 33,616 real estate related premises. In other words, one for every 192 inhabitants.

So far this year, 41,641 homes have been sold in Madrid, up by 17% compared to a year ago, and up by 30% compared to two years ago. Moreover, prices rose by 10.9% in the second quarter of 2017 with respect to the previous year. In addition, rental prices have risen by 11% over the last year.

Jaime Cabrero, President of the Official College of Real Estate Agents in Madrid, says that “Normally, when the sales market is strong, the rental market is weaker, and vice versa, but now both sectors are booming”. He added that “Naturally, we are seeing an increase in (the number of) real estate companies (…); there are 33,616 estate agent premises”, which is a high number of establishments dedicated to real estate activity.

According to figures from the Central Directory of Companies, compiled by Spain’s National Institute of Statistics (INE), over the last three years, the number of estate agent premises has risen by 5,377. The increase in the number of companies, many of which have more than one branch, amounts to 4,912. Logically, this activity has an impact on employment. During the second half of 2017, the sector provided work to 29,300 people, according to the INE’s Active Population Survey, 8,800 more than in 2014 and the highest figure for the last decade.

In fact, the real estate activity category includes all companies dedicated to the sale, purchase or rental of all kinds of properties, including “lessors, agents and brokers”, as well as other key services, such as appraisal. The category also includes companies dedicated to construction, which then carry out the maintenance and rental of buildings, as well as managers of real estate properties. The sub-category containing the latter – “real estate activities on behalf of third parties” – grew by 1,773 companies between 2014 and 2017, to exceed 10,000 in total.

Original story: Real Estate Press

Translation: Carmel Drake

Rents In Azca’s Towers Exceed Those In The Cuatro Torres

12 September 2017 – El Economista

The Cuatro Torres skyscrapers, to the north of Madrid, are no longer casting a shadow over Azca, which is establishing itself as the iconic business district in the city. With views overlooking the Paseo de la Castellana and just a stone’s throw from the Santiago Bernabéu Stadium and the Nuevos Ministerios transport hub, this business centre has managed to renew itself, to avoid being left behind compared with other areas of Madrid. So much so, that the rents for its recently renovated skyscrapers are 16.6% higher per square metre than the most expensive space in the Cuatro Torres, to the north of the city.

Castellana 81, the historical headquarters of BBVA, leads the ranking in terms of rental prices in Madrid, given that its empty space is being marketed for between €27 and €35 per square metre per month. This tower, designed by the prestigious architect Sáenz de Oiza, has been subjected to a comprehensive renovation by its owner, the Socimi GMP, which spent €30 million renovating one of its most iconic properties in Azca and on Madrid’s skyline.

The asset, which became a multi-tenant property when it first came onto the market, has already managed to conquer new companies following the departure of the banking entity, which moved to its own financial city, in Las Tablas, to the north of Madrid. Thus, in the last few months, rental contracts have been signed with Teka and Hays.

At the forefront of design

Castellana 77, which is also owned by the Montoro family’s real estate company and the Singapore sovereign fund, GIC, has been the subject of another of the major renovation projects that has been carried out in Azca and which has positioned the business district at the forefront of design. Its façade is covered with slats that protect it from direct sunlight and which are lit up at night in a diverse range of colours.

The tenant that decides to lease the office space in this building, which spans 16,200 m2 over 18 floors, will be able to choose the colour of the tower, which has more than 200 parking spaces as well as charging points for electric cars. With these features, this property has the second highest rents in Azca, which range between €28 and €33 per square metre per month.

And it is followed closely by Torre Europa, which housed the headquarters of the professional services firm KPMG for many years. Following the move of that consultancy firm to the Cuatro Torres, the tower has been renovated to turn it into the first intelligent and connected office building in Spain. Infinorsa, the majority owner of this skyscraper, which overlooks the Santiago Bernabéu, has invested €20 million on a facelift of the façade, which had not been changed for 30 years, and above all, on the renovation of the interior, which has given a radical about-turn to the essence of this 121m-tall tower (…).

Rents in this tower now range between €27 and €32 per square metre per month. Its renovation has already captivated one of the large international law firms, Freshfields (…). The US firm AOL has also decided to move its Spanish corporate headquarters to Torre Europa, as well as a pharmaceutical company (…).

Torre Picasso, the tallest skyscraper in Azca, at 156m, has not undergone such a comprehensive renovation as its neighbours, but following the departure of the consultancy firm EY to Torre Titania, 15,000 m2 of space there was left vacant. Some of that space in the tower owned by Pontegadea – the investment arm of Amancio Ortega – will be leased to Deloitte, which will thereby become its largest tenant. After several improvements to the property, the highest floors are now being marketed for €31/m2/month (…).

Rents in the Cuatro Torres barely reach €30/m2/month

Nevertheless, in the new financial district located in the north of Madrid and known as Las Cuatro Torres, only one of the towers manages to charge a rent of €30/m2/month, even though the buildings are much younger, given that they were inaugurated between the years 2008 and 2009.

Office space in Torre Espacio ranges between €29 and €30 per square metre per month. The Philippine group Emperador, which owns this skyscraper (…) renewed the image of the tower at the end of last year and launched a new marketing plan with the aim of finding tenants for the 8,800 m2 that were vacant in the building at that time.

Next in the ranking is Torre Cepsa, for which Amancio Ortega (…) paid €490 million last year. It is occupied almost in its entirety by the oil and gas company whose name it bears; the cost of the 15,000 m2 of space that is available ranges between €23 and €28 per square metre per month.

Meanwhile, Torre de Cristal, the tallest skyscraper in Spain, at 210m, is the most affordable of its neighbours, since its available space is being marketed for between €25 and €27 per square metre per month. Last year, KPMG left the Azca area and moved to this property, where it leases around 23,000 m2 (…).

Next door is Torre PwC, leased to the consultancy firm whose name it bears and the five-star hotel Eurostars. Its owner is the Socimi Merlin Properties (…) and PwC reportedly pays €19/m2/month.

The Cuatro Torres complex is now getting ready to receive a fifth tower, Torre Caleido. That property, which is currently being constructed (…), will be leased to IE Business School and Grupo Quirón-Salud (…), who will reportedly pay between €15 and €18 per square metre per month (…).

Original story: El Economista (by Alba Brualla)

Translation: Carmel Drake

Tinsa: House Prices Rose By 6.1% YoY In Large Cities In April

10 May 2017 – Expansión

House prices are continuing to rise sharply, boosted by an acceleration in the large cities and in the Balearic and Canary Islands, according to the latest estimates from the appraisal company Tinsa. Specifically, the price per square metre of properties rose by 2% in April with respect to the same month last year, according to figures published yesterday.

Although those figures are seven-tenths lower than those registered in March for the country as a whole, we cannot speak of a slowdown, given that the general trend over the last few years has been increasingly bullish. Moreover, the data also reveals a growing acceleration in several key markets, such as the large cities, where prices rose by 6.1%, and the Balearic and Canary Islands, where property prices rose by 4%.

In this way, the rise in house prices in Spain’s provincial capitals and large cities has accelerated by six-tenths with respect to the same month last year, to reach its highest rate since the outbreak of the crisis. This increase is being spearheaded by some of the prime areas of Madrid and Barcelona, where supply is constrained and demand is rocketing. Nevertheless, over the last few months, the price rises have been spreading to more and more neighbourhoods, given the strong buyer pressure in the most sought-after areas.

Meanwhile, property prices in the Balearic and Canary Islands are rising at a rate of 4%, driven by two main factors. On the one hand, the high level of demand from overseas buyers. On the other hand, the purchase of homes as investments, given that owners can rent them out easily for short-stays for most of the year, which raises their yields. Prices in these regions have fallen by 27.8% since 2007, i.e. by one-third less than the average.

On the other hand, this situation contrasts with the weakness in house prices along the Mediterranean Coast, in metropolitan areas and small towns, where there the stock of homes for sale is greater and demand is lower. (…).

Two speeds

(…). By way of illustration, house prices in the Mediterranean region are still 46% lower than their peak levels of 2007. (…).

In metropolitan areas, prices are still falling, with a decrease in property prices of 2.6%. That data also represents a slowdown of more than two points with respect to last month and is a kick in the teeth for a market that has seen its price plummet by 45.9% since the real estate bubble burst. The reason is precisely due to the fact that the crash in the market made house prices in the centre of large cities more affordable, which meant that most buyers did not have to move tens of kilometres away to buy a home.

Original story: Expansión (by P. Cerezal)

Translation: Carmel Drake

Aguirre Newman: Inv’t In Shopping Centres Amounted To €3,500M In 2016

8 May 2017 – Iberian Property

Total investment in shopping centres in 2016 amounted to €3,500 million, an increase of 59.1% compared to 2015 and the highest on record, according to the Estudio de Mercado Centros Comerciales 2016/2017 published by Aguirre Newman.

During the first trimester of 2017, elevated investment activity continued, with more than €1,000 million invested in transactions involving shopping centres.

Thanks to this level of investment, in 2016, the shopping centre segment was the second most dynamic real estate market, after offices, for the second year running. As regards the kind of buyer, institutional investment funds were the most active, accounting for more than 52% of the total volume, as were the Socimis, with more than 38%. The remaining activity was undertaken by real estate companies and private investors.

In 2016, more than 35 investment transactions were closed, seven of which involved portfolios. The main transaction involving a single asset took place in Barcelona, with Deutsche Bank’s purchase of the shopping and entertainment centre Diagonal Mar, for just over €490 million. Also, the purchase of Metrovacesa by Merlin Properties had a very significant impact on the shopping centre figures, accounting for around 28% of the total transaction amount.

During 2016, there was a slight containment of initial yield rates “due to the positive macroeconomic environment and the perception of a potential return to an upswing in rents”, according to Aguirre Newman. In the case of “gold” shopping centres, transactions closed in a punctual manner, below 4%, a record low for yields in this market.

The report from Aguirre Newman also points out that new supply incorporated into the 2016 market covered a gross leasable area (GLA) of more than 273,000 m2. The main shopping centres inaugurated in 2016 were Parque Nevada (Granada) and FAN Mallorca Shopping (Palma de Mallorca). Of the 273,000 m2 of new space, 17% was the consequence of the expansion of existing shopping centres.

Original story: Iberian Property

Translation: Carmel Drake

Madrid Seeks To Attract Companies Leaving UK Post-Brexit

3 May 2017 – Mis Oficinas

Madrid hopes to fill 80,000 m2 of office space following the United Kingdom’s exit from the European Union.

According to eleconomista.es, the capital of Spain is positioning itself as one of the possible destinations for companies deciding to abandon the United Kingdom due to Brexit. To this end, the Spanish real estate sector is optimistic, given that Madrid has available office space amounting to more than 60,000 m2 (thanks to buildings such as BBVA’s former headquarters) and in turn, is planning to increase the volume of office space on Paseo de la Castellana.

Spain offers a significant advantage in terms of the competitiveness of its rents, given that the costs of its offices, as well as its shared expenses, are some of the lowest in Europe, alongside Luxembourg and The Netherlands, which, due to their size, do not have sufficient office space available.

Despite this, many companies argue that Spain needs to improve its administrative arrangements if it wants to attract large businesses. According to them, the Government should accelerate the granting of licences to expedite the construction of offices and increase tax credits to facilitate the launch of companies in the country.

Spain is sixth in the ranking of the most attractive countries in the world to invest large fortunes. The ranking is led by the United Kingdom, the USA and Germany. This is the first time that Spain has featured in the Top Ten, which could influence the decision of these companies.

Original story: Mis Oficinas

Translation: Carmel Drake

Idealista: 12% Of Rental Homes Leased In <2 Days In Feb

24 March 2017 – Inmodiario

Rental homes on the market for less than 48 hours accounted for 12% of all rental operations closed in Spain during the month of February, according to a study published by Idealista. More flats than ever are now being advertised on the residential rental platform, however, the extensive demand is still not being fulfilled.

The incidence of immediate rentals is not homogenous across all of Spain’s autonomous regions. The pressure from demand is the greatest in the Balearic Islands, where 19% of the homes that were rented in the islands during the month of February were advertised on Idealista for less than 48 hours. It is followed by the Community of Madrid (18%), Navarra (17%), Cataluña (12%), Euskadi (12%), (the latter two are in line with the national average), and below that are Aragón (11%), Andalucía (9%), the Canary Islands (9%) and Galicia (8%).

The bottom end of the table is propped up by Cantabria, the Community of Valencia, Castilla-La Mancha (7% in all three cases), Castilla y León (6%), Extremadura (5%), Asturias, La Rioja and Murcia (4% in all three regions).

The provincial capitals are the areas where demand for rental properties tends to concentrate, therefore the immediate rental rates there are generally higher.

Orense is the city that recorded the highest percentage of immediate rentals as a percentage of total operations, with 33%. It was followed by Albacete and Málaga, with rates of 27%, and then Pamplona and Palma de Mallorca (25% in both cases). Next came the city of Barcelona, where properties involved in 21% of all rental agreements signed had been on the market for less than 48 hours, followed by Ávila (20%) and Madrid (19%).

Nevertheless, the study revealed that the immediate rental phenomenon does not exist in at least 12 Spanish provincial capitals, namely: Teruel, Segovia, Pontevedra, Palencia, Lugo, Lleida, Huesca, Huelva, Girona, Cuenca, Ciudad Real and Castellón.

Of the provincial capitals that do experience the phenomenon, Oviedo and Córdoba saw the lowest incidence of immediate rentals (4% in both cases), followed by León, Granada and Badajoz (5% in all three cities). Moreover, like in the case of the provincial capitals, the main cities in the country have different immediate rental rates depending on the district in question.

In Barcelona, for example, Sant Andreu is the neighbourhood where the most immediate rentals were signed in February: 40% of all the homes that were rented there had been on the market for less than 48 hours. It was followed by Nou Barris (38%), Horta Guinardó (31%) and Gràcia (27%). By contrast, the lowest immediate rental rates were recorded in Sarrià Sant Gervasi (8%), Sant Martí and Ciutat Vella (21% in both cases).

In Madrid, by contrast, the district most affected by this immediate rental phenomenon was Villaverde (31%), followed by San Blas (29%), Latina (28%), Arganzuela, Puente de Vallecas, Usera and Villa de Vallecas (26% in all four cases).

Analysis of the prices of the homes that are being immediately in Spain reveals that one third (33%) cost less than €500/month, whilst 46% ranged between €500/month and €750/month. (…).

Finally, most of the homes that were rented in a matter of hours had a surface area of less than 80 m2: 11% measured less than 40 m2; 31% measured between 41 m2 and 60 m2; and 30% measured between 61 m2 and 80m2. (…).

Original story: Inmodiario

Translation: Carmel Drake

Grupo Ortiz To Partially Spin Off Its RE Business

9 February 2017 – Cinco Días

A new company is getting ready to join the fruitful world of the Socimis. Grupo Ortiz, a Madrid-based construction company founded in 1961, is working with the financial group Arcano to prepare for the debut of its real estate business on the Alternative Investment Market (MAB). The new company will own the Group’s real estate assets, which are all rented out, according to sources familiar with the operation.

Through this transaction, the company is looking to bring assets amounting to around €150 million to the market, along with associated debt amounting to €55 million. Moreover, the company chaired by Juan Antonio Carpintero is looking to take advantage of the future listed company to secure other investors for his business, and Arcano will act as advisor. Both companies declined to comment on the operation.

The intention of the construction group is to open up the Socimi to other investors and whereby partially sell off part of the new company, but to retain ownership of at least 30% of the capital. The company is currently undergoing a process of internationalisation, and sources close to the group indicate that these resources could be reinvested in new opportunities.

The market expects the new Socimi to be constituted within the next few months. Experts in the sector say that the objective, given Grupo Ortiz’s portfolio of assets, is to offer to pay a quarterly dividend, which could exceed 5% p.a.

The portfolio will initially comprise several office buildings, plus more than 340 rental homes, a parking lot on Calle Ortega y Gasset in Madrid with 800 parking spaces, as well as retail premises and warehouses, most of which are located in Madrid and the surrounding area. According to the Group’s website, Ortz has 36,000 m2 of tertiary assets leased out and 1,445 social housing properties, owned by Madrid’s Housing Institute (Ivima) and the Municipal Housing Company (EMV).

It also has 24,000 m2 of office space leased out in Madrid, primarily in the area around La Gavia (Ensanche de Vallecas). According to its annual accounts for 2015 (the latest available), the real estate business generated revenues of €55.34 million.

The group’s total turnover amounted to €376 million in 2015, with an EBTIDA of €41.22 million. Although the firm started out as a construction company, it has since diversified and now operates four divisions: concessions, energy, services and real estate.

The Socimi structure allows those who adopt its tax regime to enjoy exemptions from corporation tax in exchange for the compulsory payment of dividends to their shareholders each year (who do pay tax). The structure has served to boost the Spanish real estate market, with the backing of international funds, and many large property owners have also benefitted from these structures. Around 30 Socimis are currently listed on the MAB.

Grupo Ortiz launched its international activity in Peru in 2010. It currently has operations in Colombia, Peru, Mexico, Panama and Algeria, with energy projects in Italy and France, photovoltaic solar plants in Guatemala, Honduras, Chile, El Salvador and Japan and other integrated water management projects in Romania.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Goodman Starts Work On Third Logistics Facility In Barcelona

2 February 2017 – Eje Prime

The Goodman Group, which specialises in the promotion and management of logistics real estate, has started construction of its third real estate development at the Can Margarit industrial estate in Sant Esteve Sesrovires, near Barcelona.

The plans involve the development of an industrial centre covering 10,000 m2 for Leventon, an international company dedicated to R&D, and the production and marketing of disposable medical devices – it is a subsidiary of WerfenLife.

The building will also house a module for logistics space measuring 7,000 m2, available for rent. The construction work, which has started this month, is due to be completed in the summer.

This new development will be Goodman’s third project in the Sant Esteve Sesrovires area, where the company has just inaugurated a 40,000 m2 distribution centre for Decathlon. This represents the largest logistics development undertaken in Barcelona in the last six years.

By the end of March, Goodman will have completed its second development at Can Margarit II: a 28,760 m2 logistics facility. Once the construction work has been completed, Goodman will have built 85,000 m2 of capacity in total on this industrial estate in the last two years.

Original story: Eje Prime

Translation: Carmel Drake

Fotocasa’s Owner, Schibsted Spain, Buys Habitaclia

17 January 2017 – Inmodiario

On Monday, Schibsted Spain announced its acquisition of the real estate portal Habitaclia. In this way, Schibsted Spain, owner of other portals including Fotocasa, has strengthened its leadership position in the real estate classified adverts sector.

“Habitaclia is a well-known real estate portal in the Mediterranean area. The portal has managed to grow in an extraordinary way in a highly competitive environment, basing its success on a detailed understanding of the needs of users and advertisers. Habitaclia is a great company and we are really happy that it has joined the Schibsted Spain family” said Frode Nordseth, CEO of the company.

Following this latest acquisition, Schibsted will offer its users more than 1,500,000 properties to buy and rent each month, from more than 15,000 estate agents and individuals. Moreover, the acquisition will allow advertisers to reach a larger audience in a simpler way.

Schibsted Spain owns a group of portals that receive more than 180 million visits per month, of which 35 million relate to the real estate sector. As a result of the purchase of Habitaclia, the group’s traffic will increase by more than 15%.

Habitaclia will operate as an independent brand within the Schibsted Spain group, retaining its offices and incorporating its more than 80 employees into Schibsted’s workforce. Fotocasa and Habitaclia will continue to operate independently, although certain processes will be established to enable both brands to learn from the strengths of the other.

“We are very happy to be joining the Schibsted family. Schibsted Spain has extensive experience and knowledge about the management of classified advert portals across multiple sectors. We are certain that Habitaclia will be able to benefit from this experience to offer greater value”, explained Javier Llanas, CEO at Habitaclia.

Habitaclia’s turnover amounted to €6.8M during the first three quarters of 2016, which represents an increase of 36% compared to the previous year. The firm has an EBITDA margin of more than 30% in its main region of operation (Cataluña, Balearic Islands and Andorra). This acquisition will increase Schibsted Spain’s total turnover by 8%, resulting in combined revenues of more than €88 million during the first three quarters of 2016.

Besides fotocasa, Schibsted also owns InfoJobs, Coches.net, Vibbo and Milanuncios.

Original story: Inmodiario

Translation: Carmel Drake

Isak Andic Sells Mango Logistics Centre To VGP For €150M

21 December 2016 – Expansión

Isak Andic has decided to re-launch his property company Punta Na and turn it into a real estate firm specialising in flagship stores (iconic shops located on major shopping streets). To this end, Andic has signed a deal to generate cash from the sale of one of his major non-retail real estate assets: the Mango logistics centre, located in the Barcelona town of Lliçà d’Amunt.

This modern logistics complex, measuring 180,000 m2, is where the Catalan textile group stores all of the products from its hanging garment range for distribution to its stores and online. Inaugurated at the beginning of this year, the centre is expected to by fully operational by the beginning of 2017.

Moreover, the acquired property has the potential to be extended by another 80,000 m2 in terms of gross leasable area (GLA). Once it is complete, the Mango building will occupy a surface area of around 260,000 m2, comprising the logistics centre and office space.

Punta Na used to be the owner of this complex, as well as of the adjoining plots of land measuring 150,000 m2, on which VGP could construct 100,000 m2 of gross leasable space for use by other companies.

In total, the Belgian firm (which is headquartered in Brussels) will pay €150 million for the centre and the plots of land, according to a statement made today to the country’s stock market regulator.

Punta Na

Like other large fortunes, the founder of Mango, Isak Andic, has invested some of the profits obtained from the textile group into his real estate business. Through his property company Punta Na, Andic owns properties worth hundreds of millions of euros, including some premises leased to the textile company itself, as well as others leased to competitors, such as the Inditex group, in a similar fashion to Amancio Ortega and his real estate company, Pontegadea.

Until a few months ago, Punta Na did not employ any senior management personnel. Nevertheless, in November, the firm recruited Miquel Roig as its CEO, with the aim of professionalising the management of the company and making it grow.

The company’s plan involves using the funds obtained from the sale of the logistics assets to VGP to expand its portfolio of flagship retail premises, according to sources close to the company.

Last year, Punta Na earned €205,000 compared with €50 million the year before.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake