Tag: sacyr

ACS & Sacyr To Build Homes For Quabit In Madrid & Barcelona

31 May 2017 – El Mundo

Quabit Inmobiliaria has engaged Dragados (ACS) and Sacyr to build two new housing estates that it is developing in Madrid and Barcelona, respectively. The two projects will involve a total investment of €28.2 million, which will be financed by CaixaBank, according to a statement made by the company.

The large construction firms are starting to undertake residential projects for third parties once again. In this case, the new homes form part of the growth plan that Quabit is working on, with the aim of completing 4,000 homes in 2021.

Specifically, Dragados, the construction subsidiary of ACS, will be responsible for building a luxury housing development that Quabit is promoting in the Madrilenian town of Boadilla del Monte.

The project involves building 12 homes, with a useful surface area of 450 m2 each. All of the homes will have six bedrooms, a plot of land measuring 1,000 m2 and an individual heated pool. The development will require an investment of €11.1 million, of which €5.7 million corresponds to the cost of construction, and 75% of the properties are already sold. The houses are expected to be completed by September 2018.

Two blocks of flats in Barcelona

Meanwhile, in the Catalan capital, specifically, in Sant Feliu de Llobregat, Quabit has engaged Sacyr to build two 7-storey housing blocks, in a single complex, with swimming pools and green spaces.

Specifically, the development, which will require an investment of €17 million, will contain 63 apartments of between two and four bedrooms, of which 75% have already been pre-sold. They are expected to be completed in October 2018. (…).

Original story: El Mundo

Translation: Carmel Drake

Clemente: “Merlin May Participate In A Future Wave Of Socimi Mergers”

26 April 2017 – Cinco Días

He is one of the stars of the new real estate sector. In 2014, Ismael Clemente (…) created the Socimi Merlin Properties out of nothing. In less than three years, it had debuted on the Ibex 35 to become the largest player in the sector by market capitalisation. The company’s CEO convinced international funds to back the recovery in Spain and later on, he adopted an aggressive acquisitions policy.

First, Merlin acquired Testa from Sacyr, and then it absorbed the tertiary assets (shopping centres and offices) of Metrovacesa, which made way for Santander and BBVA to enter that company as major shareholders. Merlin Properties now has properties amounting to almost €10,000 million in its portfolio. Here, Cinco Días interviews the CEO.

Q: Merlin has grown very quickly. What are your plans now?

A: During 2017, we are focusing on managing our assets and on consolidating the company after several years of rapid growth. Over the next few years, we will invest in creating value from our properties, above all, rather than in buying more assets on the market. Right now, it is hard to justify any asset purchases to our shareholders because of the prices.

Q: In other words, you are going to withdraw from the market because of the high prices?

A: It seems like we have been very active in the market, given our recent acquisition of Torre Agbar in Barcelona, but really, since the middle of 2016, we have had a quiet period. Nevertheless, we knew that we wanted to increase our exposure in Barcelona and Lisbon and that is what we have done.

Q: What do you think about the future of the Socimis?

I think that we have a rather interesting period to look forward to because the Socimis have undergone a settling down period, and are now focusing on different specialisation strategies. There will be less purchasing activity and we will see more M&A activity between entities. (…).

Q: Might Merlin participate in any mergers?

A: Maybe, but it will take a while for the merger period to really get going. If we find something that we think may have value for our shareholders, then we may participate in the future wave of mergers between the Socimis.

Q: Why would Merlin be interested in that?

A: We would be interested if we could strengthen one of our areas of activity, if it was good for us from a cash flow point of view or if such an operation would contribute an asset that complemented the quality of our portfolio particularly well.

Q: Will we see mergers amongst the large players?

A: There are two very large players, us and Colonial, which is not actually a Socimi, even though it may as well be. Any of the large players could be interested in any of the small entities on the stock market, and even, eventually, on the MAB.

Q: Can we expect to see mergers in 2017?

A: It is still too early. I think that we will see some activity from 2018 onwards. What we are not going to see is mergers between real estate companies and residential developers. I don’t think that there will be any interaction between those two sectors. The starting point features five large players, including Colonial as a Socimi equivalent, and 30 entities on the MAB, where the largest players are GMP and Iba Capital. (…).

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Is Murcia’s ‘Ghost Airport’ Finally Set For Take-off?

24 April 2017 – El País

The government of Murcia has made definitive steps toward reviving the region’s international airport in Corvera and is once again putting the management contract for this ‘ghost’ travel hub out to tender, despite the failure of other similar ventures in Spain to pay off and in spite of the fact that it is still embroiled in a long-running legal battle with the first company to win the concession back in 2007.

The new phase of this cripplingly expensive aviation saga began on March 25 with the bidders’ conditions released in the Official Journal of the European Union. Interested companies have until May 2 to register. After that date, those who can provide proof of financial buoyancy and experience will have two months to provide detailed technical and economic plans.

Corvera airport received an initial investment of €270 million and building work on it is all but finished. But the facility was never opened to the public and, in December 2015, the regional government was forced to cancel the contract with Madrid-based Sacyr on the grounds that the company granted the concession had exceeded its allotted time period.

The subsequent legal battle between Sacyr and Murcia’s authorities has become increasingly complex and is now headed for the High Court.

Corvera is the first regional airport to be put out to tender since the frenzy to open small airports across Spain began sapping resources and leading – in the case of Castellón and Ciudad Real, to years of disuse – or, in the case in Huesca, Lérida, Salamanca, León, La Rioja, Burgos and Albacete, to crippling losses absorbed by the airport networks. When it opens, it will replace the region’s San Javier airport.

According to estimates from Murcia’s Department of Development and Infrastructure, Corvera will be able to welcome 800,000 foreign tourists in the first four years, pushing total passenger traffic up to 3.5 million a year, a figure which could, in time, rise to 5 million. It will also create 20,000 jobs and raise regional GDP by 3.5 percentage points.

These passenger figures would mean revenue of €495.8 million (€600 million including sales tax) in the first 25 years. A complementary activities zone totalling 600,000 square meters is also on the cards, with profits from it remaining in private hands.

The successful bidder will be able to establish fees and negotiate with airline operators – a freedom which should improve competitiveness in the Alicante, Murcia and Almería regions and allow for more efficient management, according to the authorities.

Meanwhile, the regional government has introduced two conditions to recoup some of the taxpayer money that has been sunk into the project: the successful bidder will pump €0.73 per passenger into state coffers for the first 10 years, €2.09 per passenger in the five years following that, €2.27 in the subsequent five years and €2.56 for the last five years. A total of 10% of income earned by cargo airline companies on cargo weighing more than 50,000 tonnes will also be paid to the region.

There will also be incentives to increase passenger traffic; if there are more than 2.5 million passengers a year, the successful bidder will get a discount of 5%; another 5% discount will be applied if numbers exceed 400,000 in the winter months, or from November to February.

Original story: El País (by Ramón Muñoz)

Edited by: Carmel Drake

Merlin Buys Torre Agbar In Barcelona For €142M

13 January 2017 – Cinco Días

The company General Aguas de Barcelona has sold Torre Agbar to Merlin Properties for €142 million. As such, the project announced by Emin Capital in 2013 to convert the property into a luxury hotel has been abandoned, given the difficulties involved. In theory, the plan was for a hotel to be opened there and managed by Hyatt, but the hotel moratorium imposed by the mayoress Ada Colau made that project impossible, according to sources at the fund.

In the end, Merlin pipped the Andorran investor group Emin at the post and purchased the iconic skyscraper, which will be used for office space. As such, the Socimi will not need to request any change in its designated use. Meanwhile, yesterday, Emin asked the Town Hall of Barcelona to cancel the request it had filed to change the designated use of the building to allow it to open a hotel.

Located at number 211 on Avenida Diagonal, the building designed by Jean Nouvel has become a symbol of the city and marks the entrance to Barcelona’s technological district, 22@. The pace of activity in the office market in the district has caused the number of operations to double in the last two years, establishing it as the city’s business hub.

At 142 m, Torre Agbar is the third tallest building in the city and has a gross leasable area of 37,614m2, spread over 34 floors and an auditorium with capacity for more than 350 people. In addition, it has 300 parking spaces on four underground floors and until July 2015, it housed the headquarters of Aguas de Barcelona.

Merlin – listed on the Ibex 35 – is the largest Socimi in Spain. It has a portfolio of assets worth €9,600 million, following its acquisition of Testa from Sacyr and the integration of Metrovacesa’s portfolio of commercial properties. Its main shareholders include Santander and BBVA, as well as international funds.

The company, led by Ismael Clemente, sold 19 hotels to Foncière des Regions for €535 million at the end of December, given that that type of property does not form part of its strategy. It has announced that it will allocate the resources raised to reducing its debt and to possible acquisitions. It also revealed that it wants to grow its presence in Barcelona, which accounts for just 13% of the value of its portfolio. On this occasion, it has been advised by Savills. (…).

Original story: Cinco Días (by Alfonso Simón Ruiz and Laura Salces)

Translation: Carmel Drake

Merlin Finalises The Sale Of Its Hotels For €500M+

28 December 2016 – Preferente.com

Merlin, a company listed on the Ibex 35, is finalising the sale of its hotels to the French Socimi Foncière des Régions, for a figure that exceeds €500 million. Advised by CBRE, it will be the largest operation carried out by a Socimi in 2016, excluding the integration of Merlin and Metrovacesa.

The portfolio of properties contains 29 hotels operated by different chains, including the Eurostars Grand Marina in Barcelona and the NH Sanvy in Madrid (pictured above). The hotels that share buildings with offices will be left out of the transaction, such as the Eurostars Torre Castellana, which is located in the Torre PwC, and the Novotel de Barcelona, which is next to Capgemini’s headquarters. The hotels have come from corporate operations with Testa and Metrovacesa.

In 2015, Merlin acquired Testa, the real estate subsidiary of Sacyr, for more than €1,790 million. As part of that transaction, it bought 12 hotels, valued at more than €380 million at the time. As a result of the integration of the tertiary assets of Metrovacesa, a deal that was closed this year, another 12 hotels, worth €258 million, were transfered to Merlin. In total, the Socimi has 4,495 rooms, in establishments operated by Barceló, Meliá, AC Hotels, Tryp, Holiday Inn, NH Hoteles and Exe. The Carris Marineda hotel in A Coruña and the Socimi’s 30% stake in Barceló Costa Ballena in Cádiz have been left out of the transaction. Moreover, Merlin already sold off one hotel in Perpignan (France).

The hotels account for around 7% of Merlin’s asset portfolio, worth €9,300 million in total and will generate expected revenues of €450 million following the integration of Metrovacesa approved in September. The properties are home to hotels such as the NH Collection Colón, the Paseo del Arte, Exe Puerta Castilla, Eurostars Gran Madrid, and Barceló Castellana Norte, all in Madrid. In Barcelona, the portfolio includes AC Forum and Tryp Aeropuerto, amongst others. In other locations, Merlin owns the Holiday Inn and Tryp Oceanic, both in Valencia, Playa Capricho (Almería), Costa Park and Tryp Alameda (Málaga), Tryp Jerez, and Barceló Corralejo (Las Palmas).

Original story: Preferente.com

Translation: Carmel Drake

Merlin Begins Its New Journey As Spain’s Largest RE Company

2 November 2016 – Cinco Días

On Monday, Merlin Properties consummated the latest stage in the process to create Spain’s new real estate giant. Trading of the Socimi’s new shares began on the Ibex 35 after it completed the absorption of Metrovacesa’s real estate assets, giving rise to a company with a market capitalisation of around €4,810 million, according to Bloomberg.

The 146.7 million new shares in the Socimi – or listed real estate investment company –, following the exchange of Metrovacesa shares, began trading on the stock exchanges in Madrid, Barcelona, Valencia and Bilbaoon Monday.

To complete the exchange, Merlin had to hand over those 146.7 million shares with a nominal value of one euro to Metrovacesa’s shareholders. Those shares were launched with an issue premium of €10.40, in other words, with a total value of €1,526 million.

This operation was first announced back in June, when the Socimi chaired by Ismael Clemente (pictured above) reported that it was going to absorb the real estate business of Metrovacesa – owner of offices, shopping centres and other real estate assets that are rented out – which was controlled at the time by Santander (70%), BBVA (21%) and Popular (9%).

During trading on Monday, Merlin’s share price fell by 0.58% to €10.24.

By virtue of this agreement, another jointly owned company emerged, in the form of Testa Residencial, which will be converted into a Socimi and listed on the stock market in the future, and which owns the companies’ rental homes. In this case, the aforementioned financial entities will control around 65% of the new companies and the former shareholders of the Socimi will be minority shareholders, although one of Merlin’s directors, Miguel Oñate, will serve as the CEO.

As a result of this operation, the bank chaired by Ana Patricia Botín, now holds a 21.95% stake in Merlin and a 46.21% stake in Testa Residencial.

The exponential growth of Merlin

Similarly, the former real estate company, created in 1918 to develop the neighbourhood of Cuatro Caminos following the arrival of the Metropolitan Railway in Madrid, will continue to operate another company called Metrovacesa Promoción y Suelo, which will be responsible for the future construction of homes.

Merlin, created in 2014, attracted confidence from international investors from the get go. Upon constitution, it acquired the Árbol portfolio, containing more than 1,000 BBVA branches, which had previously been owned by several funds and family offices.

The strategy of the Socimi’s managers was to grow rapidly, benefitting from investor confidence and the recovery in the sector. In 2015, it seized the opportunity to buy Sacyr’s real estate subsidiary Testa for €1,800 million. As such, it added several iconic buildings in Barcelona and Madrid to its portfolio, including one of the four towers to the north of the Castellana. Following that decision, it received the blessing from its investors to carry out a €1,034 million capital increase and it immediately followed that with the clean up of its liabilities, with a syndicated loan from ten entities amounting to €1,700 million and the issue of bonds amounting to €850 million (in April).

With the integration of Metrovacesa complete, the new Merlin now controls assets worth €9,600 million, and whereby becomes one of the largest 10 Socimis in Europe and the second largest owner of shopping centres in Spain.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Bankia & Apollo Go To Court Re Sale Of Finanmadrid

3 October 2016 – Expansión

Both entities are waiting for the discrepancies that arose from the sale of Finanmadrid to be resolved. The sale was completed in 2013 for €1.6 million

Fracciona Financiera Holding, the subsidiary of Apollo, filed the first lawsuit, in which it claimed €8.5 million from Bankia due to discrepancies in the sale and purchase contract based on the determination of the sales price for Finanmadrid.

The contract included clauses that have an impact on the basis of the evolution of various parameters. These conditions have been common in multiple sales operations closed in the financial sector since the outbreak of the crisis. The asset protection schemes (EPA), which cover the buyers of former savings banks, are the most visible example of these types of operations.

Bankia has responded to the lawsuit filed by Apollo, with its own claim for €6.4 million.

Finanmadrid, which used to specialise in offering consumer credit through retailers and car dealerships, has now been integrated into Avant Tarjetas, a subsidiary of Evo Banco, controlled by Apollo. Previously, it was integrated into Fracciona Financiera Holding. In the company’s accounts from last year, the audit report explains that “in the opinion of the company’s legal advisors, an unfavourable outcome from the lawsuit (with Bankia) is remote, nevertheless, the shareholder (Apollo) would financially support any contingency that may arise in the event that no provision has been recognised”.

Before the integration, Finanmadrid reduced its share capital by €2.24 million to absorb losses and so it was left at €2.79 million.

Apollo’s claim against Bankia forms part of a broad range of claims against the entity chaired by José Ignacio Goirigolzarri. In total, the bank faces claims amounting to €390 million, not including the claims relating to its debut on the stock market and the sale of its preference shares.

Claims

The largest claim, amounting to €165 million, is one presented by ING Belgium, BBVA, Santander and Catalunya Banc against Bankia, ACS and Sacyr. (…).

The construction group Rayet also claims €78.2 million from Bankia for what it considers are accounting irregularities and for differences in the valuation of plots of land linked to the debut of Astroc on the stock market in 2006, an operation piloted by the former Caja Madrid.

The bank has 305 legal proceedings open relating to derivatives with claims amounting to €38.8 million.

Original story: Expansión (by E. del Pozo)

Translation: Carmel Drake

Operación Chamartín’s # 2 Jumps Ship To Castlelake

21 September 2016 – El Confidencial

Just three years ago, BBVA and San José hired David Martínez as the CEO of Duch, the property developer of Operación Chamartín, which was subsequently renamed Distrito Castellana Norte. It was a high profile move, given that Martínez was CEO of Valdebebas at the time, the only large real estate development in the capital that had managed to resist the crisis.

With those credentials, Martínez became the number two in command at Operación Chamartín, behind only the Chairman, Antonio Béjar. He was also the key figure that allowed the project to be relaunched, a year later, with the consent of the three administrations involved: the Ministry of Development, the Community of Madrid and the Town Hall of Madrid.

But that consensus broke down with the arrival of Ahora Madrid in Palacio de Cibeles. They reversed the plan and submitted their own proposal, Madrid Puerta Norte, which cut the scope of the original plans in half.

In the middle of this blockade, whose most recent chapter has just been written by the High Court of Justice in Madrid, with the admission of the appeal submitted by DCN against the Town Hall, Martínez has abandoned ship to join one of the major international funds in the Spanish real estate sector: Castlelake.

As El Confidencial revealed, the US firm has reached an agreement with Merlin to launch its own property developer from what was leftover of the former firm Vallehermoso, and the 1 million sqm of land that the fund has been acquiring over the last two years.

New property developer

Martínez said goodbye to DCN on 1 September to join this new company, which is expected to start work in October under the brand, Aedas Home. The firm has offices on Paseo de la Castellana and an 11-man team that used to form part of Vallehermoso, Sacyr’s former property developer subsidiary, which was liquidated two years ago.

Martínez’s recruitment is a statement of intent regarding the plans that Castlelake has for Spain, given that he is one of the most recognised professionals in his sector in Spain – he was at the helm for eight years at Valdebebas and then has spent another three years at Operación Chamartín. In fact, many consider him to be the real brains behind these two developments, on whose future the final configuration of the north of Madrid depends.

With Aedas Home, Castlelake has finished shaping the new map of the largest property developers in Spain, a market whose present and future is marked by the clear commitment that three large international funds, in particular, have made to the Spanish real estate sector: Lone Star, which acquired the developer Neinor from Kutxabank for €930 million two years ago; Värde, which together with Marathon and Attestor has launched Dos Puntos from the ashes of the former San José Desarrollos; and now, Castlelake.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Testa Approves Completion Of Merger With Merlin

7 September 2016 – Expansión

Merlin completed its merger with Testa yesterday, after the General Shareholders’ Meeting of Sacyr’s former subsidiary approved the deal. The Socimi chaired by Ismael Clemente is now getting ready to finalise the integration of its business with Metrovacesa.

Original story: Expansión

Translation: Carmel Drake

CNMC Approves Merger Between Merlin & Metrovacesa

30 August 2016 – Expansión

Authorisation from the CNMC / The merger will result in the creation of the largest real estate company in Spain, with assets worth almost €10,300 million. The group will compete with the large European Socimis.

On Friday, Spain’s National Commission for Markets and Competition (CNMC) approved the merger between the Socimi Merlin Properties (owner of Torre PwC in Madrid, pictured above, amongst other assets) and Metrovacesa, the real estate company controlled by Banco Santander, in an operation announced on 21 June. With the green light from the supervisory body, the door has been opened for the creation of a giant that will become the largest real estate company in Spain and one of the largest in Europe. The group will own assets worth €10,297 million in total.

The CNMC approved the deal on the basis that the barriers to entry into the tertiary real estate business (shopping centres, offices, logistics warehouses, retail premises and hotels) are not instrumental. And on the basis that this business, which comprises domestic and international companies, is quite fragmented in Spain, according to the body.

The analysis performed by the Commission focused on the relationship of control between Merlin, Testa – the real estate company that the Socimi purchased from Sacyr and in which it owns a 99.93% stake, and for which it plans to complete the integration of the remaining 0.07% within the next few months – and Testa Residencial, which is fully owned by Testa and therefore controlled indirectly by Merlin.

Three carve-outs

The operation will involve the carve-out of Metrovacesa into three lines of business, as revealed by Expansión on 22 June. One real estate line, one residential line and one line for assets under development and land.

The new Merlin will group together all of the real estate business and will acquire Metrovacesa’s tertiary assets, worth €1,672 million. To execute the operation, the Socimi will increase its share capital by 146.7 million shares, at a price of €11.40 per share.

The residential arm of Metrovacesa will carve out its assets from its rental housing business and move them into the newly created company Testa Residencial. The gross value of that company’s assets will amount to €980 million and it will also take over debt amounting to €250 million not transferred to Merlin as part of the tertiary business.

In terms of the third line of business, a newly created public company will take ownership of Metrovacesa’s remaining assets, in other words, the set of land and work in progress in the tertiary sector whose characteristics “do not fit with the profile defined by Merlin for its investments”. The total value of the assets of this third company will amount to €326.49 million.

The Boards of Directors of both companies will meet on 15 September to give their final approval of the operation.

In terms of the shareholder structure of the new Merlin and Testa Residencial companies, Banco Santander will be the largest individual shareholder of both, with stakes of 21.95% and 46.21%, respectively. Merlin will be left with a 68.76% stake in the tertiary business and Metrovacesa will have a 31.24% stake.

In the case of Testa Residencial, Metrovacesa’s shareholders will acquire 65.76% of the share capital.

Original story: Expansión (by María Sánchez)

Translation: Carmel Drake