Tag: rental income

Elix VRS Purchases a Building in Barcelona for €4M

3 December 2018 – Eje Prime

Elix Vintage Residencial Socimi is continuing to back Barcelona. The company, led by the businessmen Jaime Lacasa and Jorge Benjumeda, has purchased a building in Barcelona for €4 million, according to a statement filed by the company with the Alternative Investment Market (MAB).

The purchase of the asset, located on Calle Tamarit in the Catalan capital, has been financed in part (42.5%) by own funds and in part (57.5%) by a loan. The loan, granted by CaixaBank, has a duration of five years with a quarterly repayment schedule.

This operation follows the purchase of another residential property that the Socimi carried out at the end of October. On that occasion, Elix VRS acquired a building on Calle Consell de Cent for €4.1 million, according to a report filed by the company with the MAB. Moreover, in August, the firm purchased a portfolio of four assets in the centre of the Catalan capital for €34 million.

The Socimi, controlled primarily by the property developer Elix and the funds KKR and Altamar Capital Partners, has a portfolio containing more than 25 assets located in Madrid and Barcelona. The company’s plans involve purchasing around forty buildings between now and 2021 to subject them to comprehensive renovations and then put the homes up for rent. That rental income will sustain the Socimi, which plans to rotate its portfolio of assets every three years.

Elix VRS made its debut on the stock market in July. The company, which is headquartered in Barcelona, was created with a share capital of €100 million, the majority of which was contributed by KKR and a group of international and domestic investors including Altamar and Deutsche Finance Group. The rest of the shares are owned by Jaime Lacasa and Jorge Benjumeda, the founders of the Socimi.

Original story: Eje Prime (by B. Seijo)

Translation: Carmel Drake

Témpore Finalises Purchase of 1,100 Flats from Sareb worth €160M

31 October 2018 – Eje Prime

Témpore Properties is shopping at home. The Socimi, listed on the MAB, is finalising the acquisition of a portfolio of 1,110 homes from Sareb worth €160 million. The company, created by the bad bank, is planning to sign the operation before the end of the year, according to explanations provided by its CEO, Nicolás Días Saldaña, during the Investment in the real estate sector through a Socimi listed on the MAB day, organised by Renta 4 and the CEOE.

The Socimi, which specialises in the rental market, will use own funds to complete the purchase of this package, through which it will benefit from the right of first refusal that it has over Sareb’s assets.

This privilege reflects the interest that the bad bank has in ensuring that Témpore achieves portfolio growth over the next few years to become a reference play in the rental segment and debut on the main stock market before 2021, with a portfolio worth €500 million.

On the other hand, the Socimi is working on the sale of 20% of the company’s dispersed assets. The aim of that plan is to raise capital to use to make new investments in developments and entire blocks.

Currently, Témpore has 1,330 homes in its portfolio and generates revenues from rental income of around €7 million. The Socimi has an occupancy rate of more than 90% and obtains an average gross yield of 4.1% from its assets. The management company’s delinquency rate is 3%.

Original story: Eje Prime

Translation: Carmel Drake

Ores Signs a €35M Loan to Finance New Purchases

11 October 2018 – Eje Prime

Ores is obtaining more fuel to continuing buying Spanish real estate. The Socimi, controlled by Bankinter, has signed a mortgage loan amounting to €35 million, which will facilitate “the execution of the company’s business plan with respect to future acquisitions”, according to a statement filed by the real estate manager with the Alternative Investment Market (MAB).

The company has formalised with a loan with a Spanish bank, whose identity the company declined to disclose. The loan term expires on 11 October 2023 and the principal will be returned with a single bullet payment. The loan has been structured in the following way: €28.1 million at a fixed rate of 1.79% and €6.9 million at a rate of 3-month Euribor with a floor of 0%, plus a spread of 1.35%.

The capital inflow to Ores arrives just in time. At the end of the first half of the year, the Socimi had already achieved more than 90% of its total investment target and it only had €30 million left for purchases.

Between January and June 2018, Bankinter’s Socimi obtained net income of €8 million and a gross operating profit (EBITDA) of €6.3 million. Nevertheless, the company saw its net profit fall during the first six months of the year, with losses amounting to €3.9 million.

During the first half of the year alone, Ores completed the acquisition of thirteen new assets in Spain and Portugal. The company disbursed €117.5 million for those properties, exceeding its forecast investment target by 10%. Similarly, the group, together with Sonae Sierra, purchased the Millenium de Madrid retail park for €31 million in July.

Ores currently has thirty assets in its portfolio, worth €328 million, which generates a gross annual income of €19.4 million. With these latest operations, the Socimi is on track towards the target established when it was created in December 2017 of investing €400 million in high street retail premises, supermarkets, retail parks (up to 20,000 m2), bank branches and unique assets with long-lasting rental contracts and solvent tenants.

Original story: Eje Prime

Translation: Carmel Drake

Hispania Signs €340M Financing Agreement with BNP Paribas

26 September 2018 – Hosteltur

Hispania Activos Inmobiliarios has signed an agreement with BNP Paribas to open a financing line amounting to €340 million to finance and/or refinance its debt, according to a statement filed by the Socimi today with Spain’s National Securities and Markets Commission (CNMV).

In the relevant fact, the company reports that on 25 September 2018, it signed the aforementioned agreement with the entity “under market terms, amounting to €340,000,000, to finance and/or refinance debt held by the group’s entities upon their maturity, plus commissions, costs and expenses”.

This new financing arrangement will expire on 16 February 2020, although it may be extended twice by the company for one year each time.

Hispania recorded a net profit of €71.9 million during the first half of this year, 55% less than during the same period in 2017 when it earned €161.4 million. That decrease was basically due to the recognition of a provision for the fees to be paid to Azora, the former manager of the group. As Hosteltur reported, the relationship between the two entities was terminated on Monday, with Concha Osácar and Fernando Gumuzio, the owners of Azora, leaving the Board of Directors of the Socimi.

Blackstone, the new owner of Hispania, has paid €224 million to the manager by way of compensation for the early termination of Hispania’s asset management contract, which covered its hotels, offices and residential buildings. The indemnity amount was calculated on the basis of the manager’s base fees (€33.6 million) and success fees (€190.8 million), according to the terms specified in the “Termination Letter”, following the success of the takeover bid launched by the US fund for 100% of the Socimi.

Nevertheless, in terms of the results during the first half of the year, Hispania’s operating profit grew by almost 16%, to €57.1 million, whilst its revenues amounted to €85.3 million, which represents an increase of 9.8%.

Revenues from rental income amounted to €80.9 million, up by 14%. Of that amount, €67.9 million corresponded to hotels, €11.3 million to office buildings and €1.7 million to homes.

At the end of the first half of the year, the gross value of Hispania’s assets amounted to €2.818 billion, which represents an increase of 60.8% with respect to their acquisition price and of 43.3% compared to the total investment.

Original story: Hosteltur

Translation: Carmel Drake

Catalana Occidente Injects €31M into its Real Estate Subsidiary to Buy Assets

20 September 2018 – Eje Prime

Catalana Occidente has given a boost to its real estate subsidiary to handle new purchases. Grupo Catalana Occidente Activos Inmobiliarios has carried out a capital increase amounting to €31.1 million, which has been fully subscribed by several group companies. Those funds have been earmarked for the acquisition of the WIP office building and the Bellesguard Tower, both located in Barcelona, according to sources at the company speaking to Eje Prime.

With this operation, the real estate arm of the insurance group is dealing with the strong investment activity in the real estate sector, with a cumulative investment of more than €200 million in two years. Following the increase, the share capital of Grupo Catalana Occidente Activos Inmobiliarios is set at more than €69 million.

In July, Catalana Occidente purchased the WIP office building from the property developers Castellví Group and the funds Stoneweg and 1810 Capital for €20 million. The property, located at number 121 Calle Ciutat de Granada, in the 22@ district of Barcelona, has a surface area of 4,400 m2 and is leased to the multi-national WeWork.

WIP is located next to two other buildings, Luxa Silver and Luxa Gold. They have a surface area of 10,000 m2 and 7,000 m2, respectively, and have formed part of Catalana Occidente’s asset portfolio since September 2017. The group spent €90 million on the purchase of the Luxa office complex, which is leased to Amazon and WeWork.

These three new buildings have been added to the one that the company purchased at the beginning of last year, also in the 22@ technological district, when it acquired the La Llave de Oro building, which houses the Atos headquarters, for €21 million.

A clear commitment to the office market

The other asset behind this capital increase is the Bellesguard Tower, a modernist building located in Barcelona and constructed by Antonio Gaudí. In July, Catalana Occidente reached an agreement to acquire that property, owned by the Guilera family, for €30 million.

The operation responds to the group’s intention to “add value to the company, and is exceptional nature”, according to a statement from the insurance company, which also plans to finance the conservation and restoration of the tower, which is open to the public.

At the end of 2017,  Catalana Occidente had real estate assets worth more than €1.17 billion. Its portfolio mainly comprises offices (95%), a strategy that seems to have a lot of potential. In fact, in the last two years alone, the company has spent €208 million on the purchase of six business buildings located in prime areas of Madrid and Barcelona.

Original story: Eje Prime (by B. Seijo)

Translation: Carmel Drake

Blackstone Offers €3bn+ for Santander’s Ciudad Financiera HQ

10 September 2018 – El Confidencial

Santander’s Ciudad Financiera, the operating headquarters of the bank chaired by Ana Botín in Boadilla del Monte (Madrid), is being put up for auction five years after its owner, the company Marme Inversiones 2007, owned by several investment funds, filed for bankruptcy. After an arduous legal process whereby the bankruptcy administrator and the court managing the liquidation has released the asset, the central offices of Spain’s largest financial institution have been put on the market in search of a buyer.

According to financial sources close to the process, one of the most interested parties is Blackstone, the US hedge fund that has become Santander’s largest real estate partner after it purchased half of its portfolio of toxic assets last year. The US fund is negotiating the finishing touches for the presentation of its offer for the building where the bank employs almost 7,000 employees, including the office of the President, Ana Botín. According to the same sources, Blackstone is debating whether to participate in the auction by itself or to team up with the other creditors that supported the purchase of the Ciudad Financiera in 2008.

Of those, the presence of ING, HSH Nordbank, CaixaBank and Bayeriche Landesbank stand out, which 10 years ago granted a €1.575 billion loan to Propinvest to acquire Santander’s largest real estate asset on a “leaseback” basis. Other entities also participated in that loan including Deutsche Postbank, Royal Bank of Scotland and Raffeisen Zentralbank, which in 2011 started to sell its stake in the loan to vulture funds at significant discounts on the nominal value, when the owner started to realise that it could not afford to pay the debt.

One of the players that purchased that debt was Blackstone, together with other similar funds, such as Centerbridge and Avenue Capital. According to other sources, those investors are seriously considering submitting a joint offer on 17 September, the date on which the interested parties have to appear before the judge. That date is the one that has been set for the binding offers for all of the assets to be processed. If none are received, which is unlikely, then the Ciudad Financiera will have to be split up and sold off piecemeal.

According to these sources, Blackstone is now the main candidate, after two Arab groups placed tentative offers on the table that never proved successful due to legal wrangling and the lawsuits filed by some of the creditors, such as the Iranian Robert Tchenguiz. The investor, who owns several properties in London and is known for his idle lifestyle, was another person to take advantage of Propinvest’s bankruptcy to acquire debt at low prices and whereby become a significant creditor. Nevertheless, his problems with the Law – he ended up being arrested – have ruled him out of the process to take ownership of all of the Ciudad Financiera.

Arab interest

The player that came very close to acquiring Santander’s headquarters was AGC Equity Partners, a Kuwaiti fund with €3 billion under management, which received approval from Mercantile Court number 9, which was leading the bankruptcy of Marme. But its bid, which amounted to €2.5 billion, now needs to be updated, given that, according to various sources, the debt alone of the special purpose vehicle reached €2.8 billion, including senior and mezzanine. Therefore, the offers must exceed at least €3 billion, which means that this auction is going to turn into one of the largest real estate operations of the year.

The attempt by AEG, which was suspended when Ana Botín exercised the right of first refusal over Ciudad Financiera, came at the same time as the bid from Aabar, a company from Abu Dhabi, owned by IPIC, the owner of Cepsa, now renamed Mubadala. According to those sources, that fund is no longer interested in the auction and Santander has no intention of exercising its preferential right, as acknowledged by official sources at the Spanish entity.

The main attraction of Ciudad Financiera is that Santander, which financed the first operation with a loan amounting to €304.6 million to pay the VAT on the purchase, has committed to remain as the tenant of the property for the next 40 years, which means that the rental income is guaranteed.

Original story: El Confidencial (by Agustín Marco)

Translation: Carmel Drake

Testa’s Sales Soar But Profits Fall Due to Extraordinary Expenses

7 September 2018 – Expansión

Testa – the residential rental Socimi – has closed the first quarter of the year with a net profit of €8.94 million, down by 81% YoY, due to extraordinary expenses, such as the €107 million it paid to Merlin for the cancellation of management contracts. Excluding those extraordinary items, and others such as variations in asset values, the funds generated from operations (FFO) – equivalent to the firm’s operating cash flow or the recurring profit – increased by 60% to €19.58 million.

In terms of gross revenues from rental income, the company generated €36.98 million, which represented an increase of 69% with respect to the same period as last year. That increase was due to an improvement in the occupancy rate, growth in the number of homes in the portfolio and an improvement in annualised rents (GRI). On a like-for-like basis, revenues grew by 9%. Net rental income, after deducting direct operating costs, amounted to €28.47 million, up by 75%.

Testa Residencial, which had initially scheduled its stock market debut for June, decided to delay its listing plans for the main stock exchange and debut on the Alternative Investment Market (MAB) instead. The company, in which Santander (36.9%), BBVA (25.2%), Acciona (20%) and Merlin Properties (17%) all hold stakes, owns 10,615 homes with a gross asset value (GAV) of €2.637 billion. Moreover, it recently agreed the purchase of a group of 549 rental homes in the province of Madrid for €66.8 million.

Original story: Expansión (by R. Arroyo)

Translation: Carmel Drake

Colonial Earns €254M in H1 Following the Integration of Axiare

30 July 2018 – Eje Prime

Colonial recorded a net attributable profit of €254 million following the merger of Axiare. That represented a decrease of 42% for the Catalan real estate company, although it did increase its net recurrent profit, which excludes the impact of the merger, by 12% to €41 million, according to a statement filed by the company with Spain’s National Securities and Exchange Commission (CNMV).

The Socimi led by Pere Viñolas recorded revenues from rental income of €170 million to June, up by 21%. Meanwhile, the value of Colonial’s asset portfolio amounted to €11.19 billion, up by 29% with respect to the same period last year.

In terms of its value on the stock market (the group is listed on the main exchange), the new Colonial, following the integration of Axiare, achieved a market capitalisation of more than €4.4 billion at the end of the first half of the year.

Original story: Eje Prime

Translation: Carmel Drake

Única Purchases a Portfolio of 5 Assets from AM Locales for €4.6M

27 July 2018 – Idealista

The Socimis are trading assets. Única Real Estate is getting out its chequebook for the first time since it made its debut on the Alternative Investment Market (MAB) to purchase a package of five commercial establishments from the Socimi AM Locales Property for €4.6 million. The assets are located on the main commercial thoroughfares of Madrid and Móstoles.

Única Real Estate is going to add to its portfolio a store at number 30 Calle Goya, another at number 31 Calle Augusto Figueroa and a third at number 310 Calle Alcalá, all in Madrid. In Móstoles, the assets are located at number 23 Avenida Dos de Mayo.

The total price of the premises described amounts to €4.6 million, and they span a combined constructed surface area of approximately 805 m2. “This purchase has been financed using own funds and with a mortgage loan from Bankinter for €2 million”, explain sources at the group.

Única Real Estate owns 35 retail premises in the Community of Madrid, with a combined value of €32.5 million, that generate annual rental income of more than €1.9 million. Currently, the Socimi’s capital is owned by 53 shareholders, including the company’s executives.

The Socimi, specialising in retail premises, has set itself the objective of investing at least €10 million each year on the purchase of new establishments in the Community of Madrid and other large Spanish cities. Única Real Estate, which made its stock market debut in June with a price of €25.25 per share, is also planning to undertake new capital increases over the coming months.

Meanwhile, AM Locales Property made its MAB debut last summer with a portfolio of 40 properties. The Socimi started its activity in 1990 and since then, has been undertaking a variety of real estate acquisitions in Spain. The company’s assets are, for the most part, commercial premises. Its properties are managed by Inversiones GB Balboa, which is controlled indirectly by the company (100%).

Original story: Idealista (by Custodio Pareja)

Translation: Carmel Drake

Catalana Occidente Buys its 4th Building in 22@ District for €20M

25 July 2018 – El Economista

The Catalana Occidente Group is building up its portfolio in the 22@ district, the fastest growing office area in Barcelona, where it has just acquired a property for €20 million, according to confirmation provided by various sources to this newspaper.

The building in question is a WIP project, which was owned, until now, by its developers, the Castellvi group and the funds Stoneweg and 1810 Capital Investments. This is not the first operation that the investors have closed with the Catalana Occidente Group, which in September last year also acquired the Luxa office complex, in one of the most important operations of the year in the Catalan capital’s office market.

In that case, it paid €90 million for the two independent buildings spanning 10,000 m2 (Luxa Silver) and 7,000 m2 (Luxa Gold) – plus almost 300 parking spaces – which are leased to Amazon and WeWork. The latter has also just signed a lease contract to occupy the neighbouring WIP building, which has a surface area of 4,400 m2 and which is located at number 121 Calle Ciutat de Granada.

These three newly built and avant-garde design buildings join the other properties that the group purchased at the beginning of last year, also in the 22@ technological district, when it acquired the headquarters of Atos, together with La Llave de Oro, for around €21 million.

RE assets worth €1.17 bn at end of 2017

The Catalana Occidente Group owned real estate assets worth more than €1.17 billion at the end of 2017, mainly offices, which account for 95% of its estate. In this way, in the last two years, its investment strategy in the real estate sector has focused on the purchase of corporate buildings located in prime areas of Madrid and Barcelona. In its latest purchase, the company has been advised by the real estate consultancy firm Cushman & Wakefield.

Currently, the group is not investing in the residential market or in the development of land, although it is active with projects to renovate and reposition its portfolio.

Original story: El Economista (by Alba Brualla)

Translation: Carmel Drake