Tag: results

VBare’s Revenues & EBIT Rise by 28% & 46%, Respectively, in the 9 Month to September

2 November 2018 – Eje Prime

VBare Iberian Properties saw its net result for the first nine months of the year decrease YoY. The Socimi recorded a profit of €1.84 million to September, down by 15.6% compared to the same period in 2017, according to a statement filed by the company with the Alternative Investment Market (MAB).

Similarly, the company recorded gross revenues from rental income of €1 million between January and September, exceeding the turnover obtained during the same period last year by 28%. Meanwhile, its EBIT was 46% higher at €611,000.

Currently, VBare’s portfolio has an appraisal value of €35.1 million. So far this year, the company has acquired 37 homes and two commercial premises in the towns of Móstoles, Málaga and Madrid for €3.7 million. The Socimi also undertook a capital increase in June amounting to €3.2 million.

At the beginning of October, the company also completed its largest investment to date in a single asset. That involved the purchase, for €10.5 million, of a residential property located in Madrid. The building purchase, which has a surface area of 3,285 m2, was financed by the company through a mortgage loan amounting to €5.25 million and own funds.

VBare is a real estate investment vehicle specialising in the acquisition and management of residential assets for their rental. The company was constituted in March 2015 with the aim of generating high returns for its shareholders through the implementation of a value-added strategy and benefitting from the existing opportunities in the Spanish residential market.

Original story: Eje Prime 

Translation: Carmel Drake

Meridia III Doubled its Revenues and Cut its Losses by 76% in H1

24 October 2018 – Eje Prime

Meridia III is reducing its losses. The Socimi owned by Meridia Capital recorded losses of €522,124 to June, which represented a reduction of 76% with respect to the first half of 2017, according to reports from the company to the Alternative Investment Market (MAB).

The company recorded revenues of €8 million during the first six months of the year, doubling its turnover in comparison with the same period last year. The firm’s EBITDA amounted to €3.3 million, reversing the negative figure of €964,673 recorded between January and June 2017.

In recent months, Meridia III has continued with its growth plans and has completed two high-profile divestments. The first was the sale to Barings of five office buildings that it owned in Avalon, as revealed by Eje Prime. That deal was followed by another at the start of October when it sold the property that houses Nestlé’s headquarters in Barcelona to Igis for €87 million.

Listed on the MAB since the end of 2017, Meridia Capital’s Socimi has also made some significant investments in the Spanish office market such as the purchase in March of a building in the financial district of Madrid for €26.5 million. The building, measuring 7,500 m2, is located at number 4 Calle Juan Hurtado de Mendoza, close to Paseo de la Castellana. Moreover, in Barcelona, the Catalan manager has leased its new building in the 22@ district to the international consultancy firm Everis.

At the beginning of October, Meridia Capital completed a capital increase of €13 million in Meridia III. The increase in funds will give the Socimi “greater guarantees to face and develop future projects and investments”, according to explanations provided by the manager in a document published on its website.

Original story: Eje Prime

Translation: Carmel Drake

El Corte Inglés Values its Real Estate Assets at €17.1bn

25 September 2018 – Expansión

The properties owned by El Corte Inglés are worth €17.147 billion, according to the most recent valuation entrusted by the company to Tinsa for the end of its financial year, February 2018. That is the valuation that the company shared with investors interested in the placement of €600 million of its bonds.

This real estate portfolio, which according to previous reports was worth almost €17.0 billion, comprises 94 shopping centres, of which two are located in Portugal. These shopping centres account for 87% of the total value of the company’s assets. El Corte Inglés warns investors that this valuation may have to be adjusted in the future, given the illiquid nature of its real estate assets.

Tinsa’s study segments the distribution company’s shopping centres by value. Two of them are worth more than €500 million each, and another two are worth between €400 million and €500 million. The bulk of the centres, 45 to be precise, have a valuation of between €100 million and €200 million. Six of the centres are worth between €300 million and €400 million.

32% of the value of the real estate assets of El Corte Inglés are located in Madrid, whilst 10% are located in Barcelona. Málaga and Valencia are home to 6% each; Sevilla another 4%; and the other Spanish regions, the remaining 42%.

The bulk of the valuation of El Corte Inglés’s real estate portfolio, €14.964 million, corresponds to its stores and shopping centres

The company highlights that it owns the largest portfolio of real estate assets of any of the companies in its sector in Europe. The total surface area of its real estate assets spans 3,994 million m2.

This independent valuation entrusted to Tinsa does not include the real estate operations carried out by El Corte Inglés since February of this year. In August, the company sold two shopping centres located in Madrid (Princesa) and Bilbao (Gran Vía) to Corpfin Capital Real Estate for around €100 million.

Quarterly results

The results of El Corte Inglés remained practically stable YoY during the first quarter of its financial year, which finished at the end of May. According to the unaudited provisional accounts, the company lost €50 million during that quarter, compared with losses of €51 million during the same period in 2017.

The company’s sales grew slightly, with net revenues of €3.417 billion, just above the €3.413 billion recorded during its first quarter last year.

According to the unaudited provisional data at the end of July 2018, corresponding to the first five months of the financial year, sales fell by 0.1% YoY and EBITDA decreased by 0.6%.

This result is explained by a decrease in revenues in the retail and technological departments, which were partially offset by an increase in sales in its travel agency and insurance departments.

El Corte Inglés explains to investors interested in its bonds that sales of clothing were hit during that period due the unusual climate this year (…).

Original story: Expansión (by A. Roa & D. Badia)

Translation: Carmel Drake

Cerberus Completes Purchase of 35,000 Homes from Santander for €1.5bn

19 September 2018 – Eje Prime

Cerberus is strengthening its presence in the Spanish real estate sector with the purchase of a large portfolio of assets from Banco Santander. The US fund has reached an agreement with the financial entity to acquire a package of 35,700 residential properties for €1.535 billion.

The batch transferred by the Spanish bank has a gross value of €2.791 billion. The investment firm has been awarded the package in the end after significantly reducing the figure of €3 billion that it was expected to pay for the portfolio when the negotiations began.

The president of Banco Santander, Ana Botín, said in a statement that the exact percentage of the stakes that each party will hold in the new company that will be constituted following the formalisation of the transaction has not been determined yet. Nevertheless, Cerberus will control between 51% and 80% of the share capital, according to the senior executive.

Botín, who has indicated that the sale will have an “immaterial” impact on the results of the bank, expects the agreement to crystallise completely during the last quarter of this year or the beginning of 2019.

Original story: Eje Prime

Translation: Carmel Drake

Solvia Acknowledges That it Will Have to Generate Value from Solvia “Sooner or Later”

27 July 2018 – La Vanguardia

The CEO of Banco Sabadell, Jaime Guardiola, has acknowledged that “sooner or later”, he will have to generate value from Solvia, highlighting the “great job” that the entity has done and how “proud” he feels of the servicer.

That was according to the bank’s most senior executive at the presentation of Sabadell’s half-year results, where he reported that the entity has recorded a net profit of €120.6 million, down by 67.2% compared to the same period a year earlier, due to the provisions recognised as a result of the reduction in problem assets and the migration costs of the platform of TSB, its British subsidiary.

“Solvia not only serves assets on the bank’s books but also those of other clients such as Sareb. Beyond its financial value, it has a great industrial value, with some great professionals with a very different profile from those in the banking sector”, he specified.

In Guardiola’s opinion, Solvia is one of the bank’s entities that has done “a great job”, and so if at any time this value were to be realised and recognised, then selling the asset could become an option, although currently, it contributes in a positive way to Sabadell’s accounts.

Recently, the entity chaired by Josep Oliu disposed of four portfolios comprising problem assets with a gross value of €12.2 billion, which were awarded to the funds Axactor, Cerberus and Deutsche Bank, together with Carval.

The day on which it announced the sale of the largest batch of assets, worth €9.1 billion, Sabadell reassured the market that Solvia would continue to form a critical part of the bank and would continue to provide integral management services of the real estate assets subject to the operation on an exclusive basis.

Original story: La Vanguardia 

Translation: Carmel Drake

Quabit Conducts a €63M Capital Increase

18 May 2018 – Expansión

Quabit has completed, with an over-subscription, the €63 million capital increase through which it plans to raise funds to execute its Business Plan for 2022. The new shares are expected to start trading on 31 May.

The property developer received subscription orders for €62 million, more than 98% of the total, during the preferential subscription period. Moreover, during the period for the assignation of additional shares, requests were made for €53 million, which will be limited to just over €1 million on a pro-rata basis.

The property developer, which will increase its share capital by issuing 7 new shares for every 22 existing shares, has set the final subscription price at €1.80. The company’s shares closed trading yesterday at €2.095, 0.96% higher. “The excellent result confirms the confidence that the markets have in Quabit and is a resounding endorsement of our growth strategy”, said Félix Abánades, Chairman of Quabit (pictured above).

Quabit owns a portfolio of land spanning more than 1 million m2 for the construction of around 9,000 homes.

Original story: Expansión (by R. A.)

Translation: Carmel Drake

Aena: Countdown to the Real Estate Megaplan

1 March 2018 – Expansión

Business / Aena is going to market 2.7 million m2 of land in Barajas over 40 years and 1.8 million m2 of land in El Prat over 20 years.

The starting gun has been fired for Aena’s real estate megaplan. The President of the firm, Jaime García-Legaz, confirmed the details of the project yesterday to analysts. It forms one of the pillars of the new strategy that the group is preparing for the period 2018-2021, which will be published within the next few weeks. Aena is going to launch a tender to hire an investment bank to design the process and determine the capex required and the formula to maximise the value. The airport manager, which spent €1.4 million in 2017 on the development of its plans for the project, will kick off in Madrid and Barcelona, where it owns the majority of its plots.

In Barajas (Madrid), it is going to market 2.7 million m2 of land over 40 years for a mixture of uses. According to its estimates, the maximum development potential is 3.6 million m2. Meanwhile, in El Prat (Barcelona), the term will last for 20 years and will span 1.8 million m2 of land, also for various uses, and including the construction of loading and logistics areas. According to the first estimates in the market, the capex associated with this project is going to amount to several hundreds of millions of euros per year.

“Real estate development is one of the main strands of the strategic plan together with the internationalisation of Aena and the dividend policy”, confirmed García-Legaz yesterday. On Tuesday, to coincide with the results announcement, the group announced the distribution of a dividend amounting to €6.50 gross per share, 80% of its profits in 2017, up by 69.7% compared to the previous year. “The Board considered what was appropriate, taking into account the increase in cash generation and the leverage level; and it is applicable to 2017”, he said. And for the future? “The policy will be reviewed with the new roadmap, but the Board’s philosophy involves returning to shareholders all of the free cash flow that is not required for operations overseas or capex over the next few years”, he said. The State is the primary shareholder of Aena with a 51% stake.

The K Factor

Meanwhile, the results for 2017 include a difference amounting to €57.8 million between the maximum annual revenue per passenger set by Dora – the airport framework applicable until 2021 – and actual revenues. That adjustment, known as the K factor, is going to have to be incorporated into the review of the tariffs for 2019. As a result, “the airport charges could be flat” when the forecast was a decrease of 2.2%. This year, Aena forecasts that air traffic is going to continue to rise, with growth of 5.5%.

Original story: Expansión (by Y. Blanco)

Translation: Carmel Drake

Neinor Starts Buying “Non-Finalist” Land

23 February 2018 – Expansión

With its first birthday as a listed company just around the corner, Neinor is making a strategic shift. It is negotiating the acquisition of “non-finalist” land (plots that require urban planning management to become developable) to maintain its pace of development once it has reached its cruising speed in 2020. Specifically, the property developer, which has plots of land on its radar worth €500 million, is holding negotiations with banks, private investors and institutional funds regarding the possible completion of three land purchase operations involving “non-finalist” plots for around €200 million. They will allow for the construction of around 1,000 homes spread over various cities, including Madrid and Barcelona.

Under the framework of the negotiations, Neinor plans to make an initial payment of almost 10% of the total price to take control of the “non-finalist” land and to pay the remaining balance once the plots have been granted their corresponding urban planning permits, within a period of between three and five years. “My concern now focuses on acquiring a land bank to put into production from 2022 onwards”, explains the CEO of the company, Juan Velayos (pictured above).

The real estate firm, which announced results yesterday, closed last year with losses of €4.6 million but expects to become profitable in 2018. If we take into account the incentive plan for directors amounting to €19 million – of which €10.6 million corresponded to the CEO – paid in its entirety by the fund Lone Star, and the costs associated with the stock market debut,  then the property developer lost €25.9 million last year.

In 2017, Neinor generated revenues of €225 million, of which €77 million proceeded from its property developer business. It also recorded cumulative pre-sales of €746 million. The company, which delivered 313 homes in 2017, expects to hand over 1,000 units in 2018. It then plans to double that figure in 2019, to 2,000 units; and reach its cruising speed from 2020 onwards with 4,000 units. That would represent the high end of the range announced initially, although it will do so with an evolution in “more conservative phases to protect margins, improve the quality of revenues and deliveries”, he said.

Neinor owns 1.5 million m2 of developable land with capacity for the construction of 12,500 homes and a gross asset value (GAV) of €1.7 billion. The company, which invested €286 million in land in 2017 for the development of 3,100 units, plans to disburse another €200 million on purchases this year. Neinor’s share price closed trading down by 4% yesterday at €16.66.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Colonial Completes Successful Takeover of Axiare

2 February 2018 – Eje Prime

Colonial has completed its colonisation of Axiare. After two months of to-ing and fro-ing, the company led by Pere Viñolas has managed to acquire 58.07% of the share capital of its rival Socimi and to secure approval from 81.5% of the shareholders to which it addressed its public takeover bid (OPA), which it launched in November. The company now controls 86.86% of Axiare.

In a statement submitted at midday on Friday to the National Securities and Exchange Commission (CNMV), which had previously accepted the positive result of the takeover, Colonial reported that its offer for 45,912,569 shares has been accepted. That figure represents a success for the Socimi, which had a minimum limit of 16,769,180 shares.

The company had offered to pay Axiare’s shareholders €18.36 per share, whereby valuing the management company, until now a competitor of its, at €1.451 billion. The takeover bid was launched for 71.21% of the shares that Colonial did not yet control (it was already the largest shareholder with a 28.79% stake), and so, in the end, the company will have to disburse €1.030 billion following the results made public on Friday.

With the signing of this operation, Colonial has created a real estate giant worth €10 billion and comes even closer to Merlin Properties, its main competitor and the king of the Spanish real estate sector.

Original story: Eje Prime

Translation: Carmel Drake

Insur Carves Out its Property Development & Rental Businesses

29 January 2018 – El Confidencial

In order to adapt itself to the preferences of investors, Grupo Insur is carrying out the separation of its two main branches of activity: property development and real estate management – the latter arm will hold onto the rental properties. This carve-out could be described as historical given that the firm, which is listed on the main stock market and led by Ricardo Pumar, has used the combination of both businesses as its best antidote against the cyclical crises of the real estate sector. But now, although the two activities will continue to be owned by the parent company and consolidated for reporting purposes, they will generate independent income statements, belonging to the two subsidiaries.

According to sources close to the Sevillan company, the first step in this sense has been to increase the share capital of Insur Promoción Integral, the real estate parent company, to reach assets worth €80 million. The firm had a frantic 2017 in terms of house sales, with activity soaring by 41% in the last two quarters to reach €37.4 million between June and September (including the sale of properties jointly owned with third-party partners, whose amounts are not recorded by Insur).

In total, the group’s development activity generated sales of €60 million between January and September – up by 82% YoY – of which €28 million proceeded from revenues for the construction of housing developments, both in-house, as well as for initiatives with partners such as BBVA, Santander and the bad bank (Sareb). Insur planned to have 1,000 homes under construction distributed across 18 developments in Andalucía and Madrid by the end of last year.

By contrast, the real estate management activity is continuing to see a decline in its contribution, in line with previous years. Insur owns rental buildings spanning around 116,000 m2, almost all of which are located in Andalucía, although it is currently building a business park in Madrid. Its vacancy rate has fallen by 10 points in recent months, to 23% in September, and the rental income generated during the first three quarters of last year amounted to €7.5 million compared with €8 million during the same period in 2016.

The Junta de Andalucía, to which Insur has traditionally leased space, especially in Sevilla, vacated 12,000 m2 in May 2016 and whereby increased the total amount of space that it has stopped leasing during the final years of the crisis to 33,000 m2. Insur details in its accounts to September that the annualised rental income from tenants that have already signed contracts (not all of them have moved in yet as the offices are being refurbished) is €12.7 million. The picture of this business area is completed if we look at the request for additional information about the accounts for 2016 that Insur sent to the CNMV in October, which shows that each year it spends €6.8 million on these rental properties (…).

Coverage from Sabadell

For all these reasons, and according to the same sources, the managers of Insur rule out the creation of a Socimi to group together the real estate management activity, for the time being, given the need to improve its results and have better visibility over its evolution in the future. Moreover, there is no need for it to provide liquidity to its shareholders, given that 43% of Insur’s share capital is free-float. The company’s 15 directors control 37.5% of the share capital.

Insur’s share price has increased by more than 50% over the last 12 months, to reach €12.50. Its shares are soon going to be covered by analysts at Banco Sabadell, who will join the more specialist firms that have been following the stock until now: Arcano, Kepler and Fidentiis.

Original story: El Confidencial (by Carlos Pizá de Silva)

Translation: Carmel Drake