Tag: rental price

Mastercard & Commerzbank Move Into Torre de Cristal

13 September 2016 – El Confidencial

The Cuatro Torres district is the new “City” in Madrid and is one of the areas where the leading real estate players have been operating with the most intensity over the last two years. The company chaired by Ignacio Garralda, Mutua Madrileña, fired the starting gun in February 2015, when it signed an agreement with KPMG to lease 18 floors in the Torre de Cristal, a third of the entire building, in an operation that allowed it to boost its occupancy rate from 42% to 70%.

Just four months later, Grupo Villar Mir put Torre Espacio up for sale, which the Philippine Group Emperador ended up buying for €558 million. By then, the skyscraper where PwC has its headquarters – the black tower that is also home to the Eurostars Hotel – had already changed hands, thanks to Merlin’s acquisition of Testa, and the sheikh Khadem al Qubaisi had already started putting the feelers out to sell Torre Cepsa, the skyscraper for which Amancio Ortega has offered to pay €490 million, according to El Confidencial.

Amidst this game of Monopoly being played out at the north of Paseo de la Castellana, two overseas financial entities, Mastercard and Commerzbank, have decided to transfer their offices to Torre de Cristal, the highest building in Spain, which measures 250m tall and contains 52 floors.

The credit card company has already moved into the skyscraper, whilst the German bank is currently undertaking refurbishment work ahead of its move before the end of the year.

But these two entities are not the only ones who have decided to move into the building owned by Mutua Madrileña. In recent months, following the arrival of KPMG with its 1,900 professionals, Torre de Cristial has seen a significant increase in the number of itstenants, after sealing several agreements with companies such as Red Hat, Cerner and Gesternova, which has allowed it to increase its occupancy rate to more than 82% and lease out a further 5,000 sqm.

Hardly any free floors left

The direct impact of the appetite for these skyscrapers from tenants and owners alike means that there are hardly any free floors left in the Cuatro Torres district (…).

Tower Sacyr (now owned by Merlin) is the only fully occupied tower, but it had to drastically reduce its rental prices to reach an agreement with PwC in 2011, during the worst years of the crisis, in order to acheive that.

Bankia also demanded that Cepsa occupy 100% of Torre Foster, but the oil company has now decided to put eight vacant floors up for rent. Those floors have a surface area of 13,000 sqm, a figure that is slightly higher than the 10,200 sqm that is also being marketed in Torre Espacio, the skyscraper where the main tenant is Grupo Villar Mir, which occupies half of the building.

These numbers show that the average occupancy figure for the Cuatro Torres district now exceeds 80%, a ratio that it has reached at a time when Azca, the traditional financial district in Madrid, is seeing a significant number of its properties undergo profound transformations.

The Cuatro Torres area will be further consolidated as a business centre with the upcoming construction of the so-called Fifth Tower, a skyscraper being developed by Grupo Villar Mir, in partnership with the fund Corestate, which Instituto de Empresa will occupy along with the health group Quirón, according to experts.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Office Rents Rose By 5% In Q1 2016

11 May 2016 – Expansión

The reactivation of the real estate market is also being reflected in the office segment. The average price of offices in Spain increased by 5% during the first quarter of the year, according to a report about the sector by the real estate portal misoficinas.es. The report indicates that the market is continuing its positive trend, but “in moderation”. Searches for offices centre around Madrid and Barcelona, which account for 75% of the total, and the prices of offices sought, at the global level, have increased with respect to the same period in 2015, by 7.81% in terms of the minimum price and by 2.81% in terms of the maximum price.

In Madrid, potential tenants focus on the financial district, Alcobendas and the west, which account for 90% of all searches. Users searched for office spaces that are 5% larger than in the same period last year in the centre of the capital. Also in the capital, the rental price of offices sought rose by 6.71% during the first quarter, to reach €12.31/sqm. The size of the spaces being sought in Madrid also increased, up from 585 sqm to 805 sqm.

In Barcelona, the size of the spaces being sought also increased, to reach maximums of 500 sqm during the first quarter, compared with 416 sqm during the same period in 2015. Nevertheless, the report noted a decrease of 5.47% in terms of the average price demanded, with the average price for office space amounting to €9.29/sqm. In this way, the average cost of leasing an office in Madrid is now 32.5% higher than in Barcelona, whereby increasing the differential between the two cities, up from just 17.4% in 2015.

In the rest of Spain, the average price sought rose from €5.86/sqm in 2015 to €6.01/sqm in 2016. The size of space sought also increased, given that in 2015, potential tenants wanted 211 sqm on average compared with 223 sqm in 2016.

Original story: Expansión

Translation: Carmel Drake

Spain’s Rental Market Has Gold Mine Potential

26 October 2015 – Expansión

Spain is a country of property owners, in which less than 20% of homes are allocated for rent. That percentage is a far cry from the figures recorded in major European countries such as Switzerland, Austria, Denmark and Germany (where the rental market accounts for at least 35% of all homes). The rental market began to take off in Spain when the crisis forced thousands of families out of the market for buying properties and into the rental market, but it still has a long way to go.

Companies in the sector see this as a great business opportunity in Spain, according to comments made last week at the Barcelona Meeting Point trade fair. Demand exists and is on the rise, but the supply is scattered and lacks professionalism. In Germany, several companies specialise in the sector, with more than 100,000 homes for rent. In Spain, Blackstone has just 10,000 homes.

“Currently, tenants have to deal with amateurs and individuals; anyone that succeeds in becoming a professional manager of rental housing, with good services, will secured demand in a growing and unsatisfied market”, says Javier García-Carranza, Managing Director of Morgan Stanley in London.

The President of CBRE España, Adolfo Ramírez-Escudero, thinks that now is the right time to develop this segment. “Housing is cheap” for buy-to-let homes. García-Carranza says that the economic incentive to promote this niche in the market is to offer services that increase revenues thanks to their added value. “If we rely only on the appreciation of property prices, we will have a cyclical model, with less recurrent business”, he says.

The percentage of rented homes has risen from 11.4% during the real estate boom to 18% or even 20% according to analysts in the sector, although the Bank of Spain reports a more conservative figure of 15%. Therefore, 3.42 million of the 18 million primary residences in Spain are rental properties. If we also include holiday rentals, that figure increases to 5 million.

Prices, which are now more competitive than ever, have contributed to this situation. The average rental price amounted to €7.02/m2/month in September, i.e. 30% lower than in May 2007, according to the IESE-Fotocasa index. In September, rental prices increased by 1% YoY.

For example, rental prices in Cataluña increased by 2.5% during the first half of the year, for the first time since 2008. In Barcelona, the increase amounted to 6.9%, according to the Generalitat, which notes that the market is beginning to become saturated.

Changing attitudes

The changing mentality is here to stay In 2011, 70% of Spaniards believed that “renting meant throwing money down the drain”, but now 65% regard it as a robust life choice, according to a survey conducted by Fotocasa. “This is partly explained by the crisis and because the younger generations have a much more favourable attitude (towards renting)”, explained Beatriz Toribio, Head of Research for the website.

Another website, Idealista, predicts that the rental market will continue to gain strength over the next few years, to account for around 25% of the total market. “Despite the classic reluctance to rent in Spain, the rental market is now undergoing a period of significant development”, said Fernando Encinar, Head of Research at the company.

Original story: Expansión (by J.M. Lamet and A. Zanón)

Translation: Carmel Drake

Versace Returns To Madrid’s Golden Mile

8 June 2015 – Expansión

Opening on Serrano / The luxury brand returns to the capital’s most exclusive shopping district, after closing its first store there a decade ago.

One of the leaders in the luxury fashion industry is returning to Madrid. The Italian firm Versace has just signed the lease for a store on Madrid’s exclusive Calle Serrano. The opening of the shop means the return of the firm, which closed its first stores in Madrid and Barcelona in 2005.

The company led by Donatella Versace has already taken the first steps in its return to the Spanish market with the opening of a store in Puerto Banús (Marbella) and on Paseo de Gracia, 85 in Barcelona.

Now, it has just signed the lease for a shop located on Calle Serrano, 16, where its neighbours will include other luxury brands such as Longchamp, Michael Kors, Louis Vuitton and Loewe. (…)

The store is currently being refurbished following the departure of its previous tenant, the Catalan firm Custo. Prior to that, it was occupied by another Spanish fashion group, Hoss Intropia. Following the refurbishment, which has been commissioned by the family office that owns the building, Versace will have a store with more than 500 m2 of space in the most exclusive shopping district of Madrid. As such, experts forecast that the firm will pay a rent of around €1 million per year.

The arrival of Versace is not the only big move happening on the city’s Golden Mile over the next few months. The firm Macson, which specialises in menswear, will take over from Massimo Dutti at Serrano, 17. Macson, which is headquartered in Madrid, will become the tenant of the store measuring 550 m2, after Inditex’s high-end brand moved to number 46. The change at that address (Serrano, 46) will be from one brand of Amancio Ortega’s group to another, since Zara used to lease the property, until it opened its flagship store at number 23, Calle Serrano. The opening of that property, a year ago, marked the launch of Zara’s first flagship store in Spain, following the opening of several flagship stores around the world, including in New York, Milan and Shanghai. Another Spanish firm, Mango, is also preparing to open its own flagship store on one of Spain’s most expensive retail streets.

Availability

“The completion of the refurbishment work has given way to frenetic change, with 24 new store openings in 2014 alone, and with very limited levels of availability, which has caused rents to increase, to reach €220/m2/month”, explain sources at Ascana.

There are currently three stores in the same building (Calle Serrano, 7) that are awaiting tenants. In total, the three premises have a surface area of 10,000 m2, which will undoubtedly be snapped up soon given the furore currently surrounding Madrid’s Golden Mile.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Caixabank Begins To Market Office Space In Torre Pelli

20 February 2015 – El Economista

Servihabitat, the credit and property management company owned by Caixabank, has started to market 35,000 square metres of office space in the building known as Torre Pelli (178m high), on the island of Cartuja in Sevilla. The tower is in its final stages of construction by the (development) company Puerto Triana, in which Caixabank is a majority shareholder.

Sources close to Servihabitat have confirmed that this week the company has started to market office spaces on floors 1 to 24; initially, a hotel was planned for floors 24 and above, although that is now pending confirmation.

The sources indicated that 1,500 square metres of office space is available per floor, with a minimum space of 200 square metres. In total, 35,000 square metres of office space has come onto the market.

In terms of the rental prices for these spaces, the sources indicated that “prices vary depending on the volume of square metres (contracted), the floor, the direction/orientation” and they note that prices “are being agreed on a personalised basis”.

Nevertheless, “El Correo de Andalucía” reported on Thursday that it will cost €3000/m2/month plus shared costs to rent a 200 square metre space, and so Caixabank may generate revenues of almost half a million euros per month if it manages to rent out the whole building.

The sources stressed that this marketing campaign “is attracting interest and has been very well received by its potential clients”.

Original story: El Economista

Translation: Carmel Drake

Housing: Rental Prices Are On The Rise In 7 Autonomous Regions

29 January 2015 – Expansión

Trend/ The rental market is showing signs of improvement, after seven consecutive years of decline. Rental prices are increasing again in seven autonomous regions and are now stable in three.

The trend in rental prices is starting to change. After seven years of uninterrupted decreases, there were signs of stabilisation in the market in 2014. Overall, prices decreased by 1.9%, but that represented the smallest decreased since the golden years of the bubble, in 2007. Moreover, rental prices in 10 autonomous regions are no longer falling (they are increasing in seven and stable in three).

Those are the main conclusions of a report, prepared by Fotocasa.es in collaboration with the IESE Business School, about Rental Housing In 2014. “In the space of a few months, we have gone from seeing decreasing rental prices across almost the whole country, to seeing year-on-year increases in seven autonomous communities; furthermore, the scope for further downward movement is now limited in certain other areas”, says the study.

The Balearic Islands led the return to rental increases, with an annual rise of 6.7%. It was followed by Cataluña (6.5%), Pais Vasco (6.1%), the Canary Islands (1.8%), Madrid (0.6%), Extremadura (0.5%) and Valencia (0.2%).

Moreover, for the first time in seven years, none of the autonomous regions recorded rental price decreases of more than -5%. In fact, the sharpest decline was in Castilla-La Mancha (-3.4%), followed by Asturias (-3.2%), Navarra (-2.9%), Murcia (-2.3%) and La Rioja (-2.1%).

“The year-on-year variation in 2014 (-1.9%) is more than three points lower than the decline recorded at the end of 2013 (-5.2%) and it brings us back to pre-crisis levels”, said Fotocasa.

Rental prices in Spain reached their historical peak in May 2007, at €10.12 per sqm per month. Since then, they have declined by 33.1% overall, with Aragon (-42.5%) and Cantabria (-37%) being hit particularly hard.

The report identifies 86 municipalities that recorded rental price increases last year. The most notable increase was in San Sebastián, the city with the most expensive housing in Spain (12.7%), followed by Sant Pere de Ribes (11.7%) and Calvia (11.5%).

In Spain’s two largest real estate markets, the changing trend is catching on more quickly. In 2014, the rental price per sqm increased in 10 of the 21 districts in Madrid and in 9 of the 10 districts in Barcelona.

Madrid and Barcelona

The most notable increase in the capital was in the Retiro district (5.5%), followed by the Centro (5.3%), Chamberí and Salamanca (4.1% in both). And the most marked decreases were in Vicálvaro (-7%), Puente de Vallecas (-5.7%) and Villaverde (-5%).

Meanwhile, in Barcelona, the largest increase in rental prices was recorded in the district of Les Corts (12.9%), followed by Eixample (9.8%), Ciutat Vella (9.4%), San Martí (8.8%) and Sarria-Sant Gervasi (8.5%). The only district to experience a decrease was Sant Andreu (-1.2%).

The most expensive area to rent a home in Barcelona is Ciutat Vella, with a average price per sqm per month of €13.60, followed by Sarria-Sant Gervasi (€13.04). Meanwhile, the most expensive district in Madrid is Salamanca, with an average price of €13.04 per sqm per month, followed by Chamberí (€12.96).

Original story: Expansión (by Juanma Lamet)

Translation: Carmel Drake