Cerberus Nears Sale of Haya Real Estate to Centricus

10 September 2019

The US-fund Cerberus is near to completing its planned sale of its servicer, Haya Real Estate. Centricus, a London-based fund backed by Softbank, is considered the leading contender to acquire the asset. Both firms declined to comment.

Market sources believe that the firms may finalise the transaction in the coming days. The amount of the sale partly depends on Haya’s renegotiation of its contract with Sareb. Cerberus had initially planned a stock market listing for its servicer, but doubts regarding that renegotiation led the US fund to shelve those plans.

The US fund then opted to sell the service, and in the early summer, Cerberus received three competing offers for Haya, estimated to be around ​​700 million euros, from doBank, Centerbridge and Centricus.

Original Story: La Información  – Pepe Bravo

Adaptation/Translation: Richard D. K. Turner

TPG Reaches Deal on Preferential Access to €175 Million of Sareb’s Assets

20 August 2019

TPG, which recently acquired Témpore Properties, has signed an agreement with Sareb maintaining its partnership with the state company.  Témpore will thus maintain a right of refusal for over 175 million euros in assets owned by the Sareb.

Original Story: La Información – Lucía Gómez

Adaptation/Translation: Richard D. K. Turner

Sareb Opens Bidding to Other Servicers After Low Bids from Haya, Solvia, Altamira and Servihabitat

30 July 2019

Sareb has notified the four servicers that manage its €34 billion in real estate loans and assets that it will open up bidding on its management contracts to other potential bidders, after having received a round of offers that it considered insufficient. Haya Real Estate (Cerberus), Servihabitat (Lone Star), Solvia (Intrum) and Altamira (doValue) have been servicing the bad bank’s assets until now. Sareb mandated DC Advisory to manage the process as the bank looks to reduce the size of the commissions it has been paying to the four firms.

DC Advisory and Sareb have reportedly been in contact with smaller, specialised firms such as Hipoges, Finsolutia and Copernicus. The decision is a message to the four current servicers, letting them know that they may lose out on future contracts unless they improve their bids. Sareb is considering dividing some sections of its portfolio by geographical location, reducing the number of managers in each and streamlining its operations.

The process – known as the Project Esparta – sent shudders through the servicing sector and was a factor in the postponement of Haya Real Estate’s IPO last year.  Haya currently has the largest mandate, servicing 37% of the bad bank’s assets (2014). Altamira, in turn, manages 29%, while Servihabitat has 19% and Solvia 15%.

Original Story: El Confidencial – Jorge Zuloaga

Adaptation/Translation: Richard D. Turner

Real Estate Investment Cycle Undergoes Change in Profile

20 July 2019 – Richard D. K. Turner

The real estate investment cycle in Spain is beginning to change as the funds that first acquired land and homes for rent from Sareb and the banking sector start to finally unload those initial acquisitions.

The new investors are generally conservative investment funds looking for large portfolios of long-term rental properties in Spain. These more conservative funds, such as the Dutch fund APG and AXA IM, seek returns of between 3.5% and 5%. The capital entering the market is often being deployed by insurers and pension funds, which look for stable, long-term income flows from their investments.

Another changing aspect of the market is the increased interest in turn-key projects. Such a structure allows investment funds to accelerate their business plans and improve results. Aedas Homes and Metrovacesa are considered two of the major players in the market.

Original Story: El País – Inmaculada de la Vega

 

Sareb Sells 75% of Témpore to TPG

5 July 2019

Sareb reached an agreement to sell 75% of Témpore, a socimi that focuses on rental apartments, to the US fund TPG, for 246.75 million euros. The bank bad held onto a 24.12% stake in the socimi to take advantage of any potential future upside. At the same time, however, Sareb emphasised its commitment to a long-term policy of divestment.

Sareb created Témpore at the end of 2017 and the socimi debuted on Spain’s MAB in early 2018. The firm currently controls 2,249 apartments and garages, making it the third largest player in the sector after Blackstone and Azora. Of this portfolio, 834 flats are in Madrid and another 269 in Barcelona and the rest distributed by other fourteen provinces.

Original Story: Europa Press

Adaptation/Translation: Richard D. K. Turner

 

Sareb to Use FABs to Aid in Divestment Strategy

5 July 2019 – Richard D. K. Turner

Sareb and Värde Partners have joined together to create Árqura Homes, with the goal of building 17,000 new homes. The joint-venture is the first of a series of invetsments that will employ a financial instrument called a FAB. This financial instrument was designed six years ago to facilitate the sale of non-performing bank assets. The structure confers specific tax benefits, primarily reduced taxes on the sale of such assets.

Sareb is currently planning a number of such vehicles for selling different types of assets, including hotels, shopping centres, offices and homes.

Original Story: El Confidencial – Ruth Ugalde

 

Spanish Supreme Court Rules Against Barcelona’s Tax on Empty Properties

2 July 2019 – Richard D. K. Turner

The Third Chamber of the Supreme Court dealt Ada Colau a setback, ruling against a penalty on empty dwellings in the hands of financial institutions. The Supreme Court upheld the Superior Court of Justice of Catalonia’s ruling stating that the Barcelona City Council does not have the power to impose such a tax.

The municipal ordinance had set a rate of 633 euros for each case opened upon discovering an empty flat and 286 euros for each additional requirement in cases where the owner failed to comply with the municipal order.

Original Story: El Confidencial – Elena Sanz

 

Haya Real Estate Tops Off its Annus Horribilis with Losses of €0.5M

18 June 2019 – El Confidencial

Haya Real Estate suffered an “annus horribilis” in 2018 after it failed to debut on the stock market and was unsuccessful in its efforts to renegotiate its contract with Sareb (discussions are still on-going). Those events were further compounded by the servicer’s recently published results for the year, which saw it record losses of €445,000, compared with a profit of €32.57 million in 2017, despite a 6.7% increase in revenues to €273.7 million.

The losses were caused by several factors, both accounting and operational nature, and would have been even greater had the group not consolidated the results of Haya Titulización, which contributed profits of €1.27 million.

In fact, the real estate servicer platform Haya Real Estate itself recorded losses of €1.7 million in 2018 compared with profits of €20 million last year. They were caused in part by the new contract that the servicer signed with Bankia in 2018, to include BMN’s assets, which involves disbursements and amortisations during the first few years and which have penalised the company in accounting terms. In addition, Haya purchased the company Mihabitans from Liberbank in June 2018.

Specifically, the amortisations of the management contracts of Bankia and Liberbank increased by more than €20 million YoY in 2018, which, combined with the poor performance of other operating costs (they soared by 46% to €92.2 million) meant that the servicer had little chance of repeating its success of 2017.

Original story: El Confidencial (by Ruth Ugalde)

Translation/Summary: Carmel Drake

Sareb Offers the Contracts of Altamira, Servihabitat & Solvia to its Rivals

17 June 2019 – El Confidencial

Sareb is on a mission to change its course. According to market sources, the bad bank chaired by Jaime Echegoyen (pictured below) has decided to put its contracts with Altamira (owned by doBank), Servihabitat (Lone Star) and Solvia (Intrum) out to tender two years before their scheduled renewal.

Even though the contracts are not due to expire until the end of 2021, Sareb is putting them out to tender alongside that of Haya Real Estate, which is due to expire at the end of 2019. This represents a boost for Cerberus’s servicer, given that its competitors will now also have to focus on retaining their own contracts rather than just bidding for Haya’s.

In the event that Sareb awards the contracts of Altamira, Servihabitat and Solvia to other entities, it will have to compensate the servicers since their contracts clearly establish early termination clauses.

Altogether, Sareb is looking at putting out to tender the management of €34 billion in loans and properties that it still has left in its portfolio. The four will have to submit their bids in the next few months, specifying which assets they want to manage and what commissions they will charge.

The largest mandate is that of Haya, which manages assets proceeding from Bankia, which accounted for 37% of the bad bank’s original assets. It is followed by Altamira, which manages the assets proceeding from Catalunya Banc, BMN and Caja 3 (29% of the total); Servihabitat, which manages the assets from NCG Banco, Liberbank and Banco de Valencia (19%); and Solvia,  which manages assets from Bankia (foreclosed), Banco Gallego and Ceiss (15%). Clearly, there is a lot at stake for these servicers.

Original story: El Confidencial (by J. Zuloaga & R. Ugalde)

Translation/Summary: Carmel Drake

Swiss Life Buys a Hotel in Valencia from Grupo Senator for €24.5M

13 June 2019 – Expansión

The Swiss fund Swiss Life has purchased the Hotel Senator Parque Central in Valencia from Grupo Senator for €24.5 million in a sale and leaseback operation.

The 4-star hotel, which has 192 rooms, spans 12,851 m2 and is located in a central area of the Mediterranean city where a large urban park is planned once the nearby railway tracks have been moved underground.

Grupo Senator acquired the property from Sareb in 2017, which itself took ownership after the Valencian property developer that constructed it filed for bankruptcy in 2010.

Original story: Expansión (by Rebeca Arroyo)

Translation/Summary: Carmel Drake