KKR, Round Hill Capital & Pulsar Properties Create a JV to Purchase 4 Logistics Warehouses

29 January 2019 – Eje Prime

A trio of funds are taking a piece of the Spanish real estate pie. The investment fund KKR, the investment group and real estate manager Round Hill Capital and the logistics company Pulsar Properties have created a joint venture to purchase four platforms in the Spanish market. The objective over the medium term is to acquire logistics spaces in Spain spanning up to 400,000 m2.

The joint venture, called Pulsar Iberia Logistics, has already signed the acquisition of three logistics development projects in Madrid and another one in Barcelona. KKR has formalised the investment through its fund Real Estate Partners Europe.

The four logistics assets are going to be developed by Pulsar Properties, a Spanish company specialising in the promotion of industrial, logistics and inter-modal surfaces. The four properties are the first investments undertaken by the new joint venture in Spain, “a country that is showing very positive signs for logistics investment, with high demand and, at the same time, a scarce supply of logistics assets, as well as an economy with a solid track record”, said the company in a statement.

One of the developments is located in Ontígola, in the third logistics ring of Madrid, and has a gross surface area of 21,145 m2. In Barcelona, the asset is located in Parets del Vallès and has a surface area of 19,907 m2. Finally, the company has also acquired two logistics warehouses measuring 33,091 m2 and 20,280 m2, respectively, in Torija, also in the third logistics ring of Madrid.

Original story: Eje Prime

Translation: Carmel Drake

Round Hill: A New Player in Spain’s Student Hall Market

19 July 2018 – Eje Prime

A new player wants to benefit from the boom in student residences in Spain. The British fund Round Hill has set its sights on the domestic market and is joining the long list of investment firms that are looking for opportunities in these types of assets in the country, according to explanations from sources close to the company speaking to Eje Prime.

The fund currently has a pipeline of more than 7,000 beds in the student hall market in several countries across Europe. Spain and Portugal feature on the list, as do the United Kingdom, Ireland, The Netherlands and Portugal.

Round Hill, founded in 2002 by Michael Bickford, a former director of Morgan Stanley, is sounding out the market to find both land and student residence assets through which to compete in a sector that is clearly booming around the world and, above all, in Spain, the country the receives the most Erasmus students.

The company even has strategic alliances with other investment funds for specific projects. In this way, in the Netherlands, Round Hill and KKR have created a joint venture to purchase a three-acre plot in Utrecht, in partnership with Stadium Capital Partners, on which they are going to build a 23-storey building with 577 beds. In addition, the tower will contain 173 apartments for young professionals.

The joint venture between Round Hill and KKR may also make its debut in Spain, according to sources at the company. “We hope to expand our footprint in student housing and residential accommodation in certain key markets in Europe”, they say.

In addition, Round Hill has been interested in the Spanish hall of residence market for several years now. One example is that the fund was one of the parties interested in buying the Resa asset portfolio, which ended up in the hands of AXA Real Assets and CBRE Global Investment Partners for around €500 million.

Luxury developers of Palo Alto

Round Hill Capital already has a star project in Spain. Palo Alto, located in Ojén, a town adjacent to Marbella, comprises 600 homes spread over a plot measuring fifty hectares, including twenty hectares of green space. A luxury urbanisation in which the real estate fund invested €250 million in 2016.

Moreover, following its arrival in the Spanish market, the company led by Bickford explained that it had another €1.5 billion to invest in real estate. One of the closest directors to the founder of Round Hill is a Spaniard, who played a key role in the development of Palo Alto. Matías Villarroal, formerly of JP Morgan and Morgan Stanley in New York, is the Director General and Head of Residential Developments at Round Hill in the Spanish market (…).

Original story: Eje Prime (by J. Izquierdo & P. Riaño)

Translation: Carmel Drake

British Developers Lead Revival Of Costa Del Sol’s Property Sector

4 January 2017 – El País

The United Kingdom’s decision to leave the European Union in June has not discouraged London-based property developers from investing in Spain. Among the companies looking to establish a presence along the Mediterranean are Round Hill Capital, which has chosen the Costa del Sol as its launch pad into Spain.

The group, set up by Michael Bickford, has opened offices in Madrid, where it is also looking to buy property, along with Barcelona and the western part of Malaga’s coastline. It has paid €30 million for a 50-hectare plot of land in Ojén, close to Marbella, from Sareb, the entity set up by the government in 2012 to absorb the toxic assets of the country’s banks. It intends to build 600 luxury apartments there. Palo Alto will be the first major property development in the area since 2008, when the country’s real estate sector crashed.

With a total investment of €250 million, Palo Alto is planned in 10 phases, with work on 75 properties due to begin early in the new year. Ojén’s local council has approved construction and other permits in less than two months.

Matías Villaroel, Round Hill Capital’s Spanish manager, says that the company had second thoughts about the project immediately after the Brexit vote, but decided to go ahead because the properties are not being targeted at British buyers.

Round Hill Capital has already sold half of the first phase of the development, mainly to Germans, Belgians, and Scandinavians. Prices for the apartments range from €440,000 to €950,000.

A few kilometers along the coast in Torremolinos, another British property developer, Intu, is going to build what it says will be the largest shopping and leisure complex in Andalucía, covering some 200,000 square meters. The company is still awaiting final approval, but says it intends to begin work early in the new year, with completion due in 36 months.

Intu, which built the Puerto Venecia shopping center in Zaragoza, says it intends to invest some €600 million in the project, with a further €500 million coming from other partners. The company adds that it expects to generate some 2,500 jobs to build the project, which will then provide work for around 4,000 people.

The most recent report commissioned by the British Chamber of Commerce into the opportunities for UK businesses in Spain concludes that neither the uncertainty over the Brexit referendum nor the absence of a Spanish government put investors off during the first six months of 2016. It notes that 64% of UK companies in Spain intend to maintain their investments here, with 8% saying they intend to increase their presence, while 28% said they intended to reduce their investment. The United Kingdom is Spain’s fifth-biggest source of foreign direct investment, making up 11% of the total.

British ambassador to Spain Simon Manley says he is “optimistic” and believes that the EU and the UK will reach agreement over Brexit that will protect trade ties.

Also in Marbella, Pacific Investment is building five upscale villas at a cost of €25 million. Each of the properties, which will sit on between 2,000 and 3,000 square meters of land, will cost around €7 million.

Estepona, in the west of Malaga province, has been keen to attract developments, granting building permits within three months. Over the course of 2016, it has approved planning permission for four property developments for some 198 apartments, along with around 20 free-standing houses. Among the main players is London-based Kronos Home, which is building 70 luxury apartments in the Arroyo Vaquero area, some eight kilometers west of Estepona. It has plans to build in other areas of the Malaga coastline.

Original story: El País (by Esperanza Codina)

Translation: Carmel Drake

Round Hill Capital Invests €250M In Luxury Homes In Málaga

1 December 2016 – Expansión

Round Hill Capital, one of the leading international real estate investment firms, has launched operations in Spain with an investment of €250 million in the luxury Palo Alto real estate development. The project that will be constructed on a plot of land measuring 50 hectares in Ojén (Málaga) and represents the entity’s first investment in Spain.

The project will be divided into six phases and reflects Ojén’s General Urban Development Plan (PGOU). The licence has already been granted for the first phase and construction will begin as soon as the tender has been awarded.  Six construction companies are currently competing to secure the bid.

Specifically, the first phase, which will be executed between January 2017 and the autumn of 2018, will involve the construction of sixty apartments and fifteen penthouses, which will be sold for between €440,000 and €1 million each.

At an event in Ojén yesterday, the architect and developer of the project, Matías Villarroel, explained that the land on which the housing development will be constructed was acquired from Sareb for €30 million. It represents one of the most important sales by the entity in the area. “The natural location is privileged and unique”, said the property developer.

According to Villarroel, Palo Alto “is going to put Ojén on the map with a development that will be talked about a lot in the future”. The urbanisation, which has panoramic views of the sea and mountains is just five minutes from the La Cañada shopping centre and thirty minutes from the Málaga-Costa del Sol airport.

Meanwhile, the mayor of the municipality, José Antoni Gómez, who also attended the event yesterday, said that a project like Palo Alto “represents a socio-economic boost for Ojén and for the coast as a whole”. Gómez said that this urbanisation will be “a balcony to the Costa del Sol and a door to the nature and mountains of Sierra de las Nieves”.

Original story: Expansión

Translation: Carmel Drake

JLL: 3 Large Funds Want To Buy Student Halls In Spain

29 March 2016 – El Economista

Investment funds have been buying real estate in Spain for years and during that time they have acquired the best hotels, skyscrapers and shopping centres in the market. Now that those assets are no longer offering such high returns, investors are starting to look at alternative assets, including student halls of residences.

The US fund Oaktree, through the company Knightsbridge Student Housing, Round Hill Capital and The Student Hotel (TSH) are just some of the players that are currently looking for investment opportunities in this sector, according to Nick Wride, Director of Alternative Investments at JLL.

“For the best assets in operation, yields should be between 6% and 6.5% for the best locations”, says Wride, who recalls that these properties have to generate a higher spread than residential products, because they require more management”. The user is more demanding, there is more rotation and, in many cases, in addition to accommodation, these sites also provide catering services”.

Currently, Knightsbridge Student Housing is the most active firm in Spain. “They saw the opportunity before anyone else and they have led the way for other investors, who are now showing a great deal of interest in these types of assets in the country” explains Wride.

The firm owned by Oaktree currently owns one hall of residence in Madrid with 370 rooms, namely the Galdós hall, located in the Ciudad Universitaria.

At the end of last year, it acquired the Sucesores de Rivadeneira print works, which used to house the former printing press of the Gaceta de Madrid, located on the Cuesta de San Vicente, in the centre of the capital. The project, which will have 350 rooms, has not been started yet but is expected to become operational for the 2018/2019 academic year.

The manager is also preparing to open halls of residences in La Plaza de Cristo Rey (El Faro) and Calle de San Bernardo (Claraval), with 550 rooms, next year and is working on a 500-room project in the historical centre of Alcalá de Henares, which is due to be completed between 2017 and 2018.

The group also has a presence in Barcelona, where it was awarded two concessions by the Administration. Nevertheless, both projects have been suspected due to the hotel moratorium imposed by the mayoress, Ada Colau. (…).

Operation in Barcelona

The Student Hotel, the platform that was acquired by the US fund manager Perella at the end of 2014, is the other firm specialising in the sector that is looking for more projects in Spain. Last year, it participated in an important transaction in Barcelona, where it acquired a portfolio of two halls of residences in the Melon District (Poble-Sec and Marina). Both had belonged to BBVA and contain 597 rooms and 152 parking spaces, as well as around 3,465m2 of adjoining restaurant space in different areas of each building.

According to sources at the time, that operation amounted to almost €45 million. (…).

On the other hand, Nick Wride says that Round Hill Capital is also interested in investing in the country. “They have not made any purchases here yet or developed any projects for students in Spain, but they are looking actively”.

That firm starred in one of the most significant transactions at the European level last year when it sold The Nido Collection to the US firm Greystar Real Estate Partners for €847 million. (…).

Expectation and competition

(…). Nevertheless, halls of residence in Spain often do not comply with the criteria that these investors are looking for. “Funds have to justify movement of capital into a country with large projects, those containing at least 200 rooms. The typical halls found here tend to be smaller and many have double rooms. Now, the trend is increasingly moving towards individual rooms”, says Wride. (…).

Original story: El Economista (by Alba Brualla)

Translation: Carmel Drake