Tag: Savills

Lar Buys 3 Stores In A Pamplonese Retail Park For €8.45M

27 July 2015 – Mis Locales

Savills, one of the leading international real estate consultancy firms has advised Värde Partners on the sale of three stores in the Parque Galaria retail park in Pamplona.

The most important operators in the province are located in this retail complex, which includes brands such as Media Markt, Leroy Merlin, Conforama and Kiaba, as well as the E.Leclerc hypermarket and the La Morea shopping centre, which is regarded as one of the 20 best shopping centres in Spain with tenants such as Primark, Zara, H&M, C&A, Cortefiel and a 12-screen cinema.

Salvador González, Head of Retail Investment at Savills, said that “this transaction forms part of Värde Partners’ strategy to divest its non-strategic assets, and also gives Grupo Lar the opportunity to increase its portfolio of retail premises, whereby raising its profil in the retail park sector”.

Original story: Mis Locales

Translation: Carmel Drake

Acciona Hires Morgan Stanley To Sell Its RE Arm

20 July 2015 – El Confidencial

Acciona has decided to translate its words into action and accelerate the sale of some of its assets to clean up its ailing accounts. And, to that end, the energy, construction and service company has entrusted the sale of its real estate division to Morgan Stanley, the US bank that closed some of the largest property-related transactions during the real estate boom.

The holding company, owned by the Entrecanales family…has appointed Morgan Stanley, which is led by Luis Isasi in Spain, to list or sell its property-related assets, which were valued at €1,042.6 million at the end of 2014, according to Grupo Acciona’s own accounts. Based on appraisals performed by Savills Consultores and the Instituto de Valoraciones, the portfolio would have a price of €712 million, with land being the largest single item.

Nevertheless, other sources close to the group say that the book value of all of the real estate assets – which include several hotels, university halls, office buildings and 900 homes for rent in Madrid – may reach €1,500 million. “They may sell off the portfolio in parts because some of the businesses have nothing to do with each other”, said Morgan Stanley.

Morgan Stanley is going to sound out the market to decide which is the best option – i.e. whether to launch an IPO through a Socimi or to find a buyer that would take on the whole business. The operation will be similar to the one recently closed by Sacyr for its subsidiary Testa, which was acquired by Merlin Properties, for just over €1,800 million. (…).

With this decision, Acciona begins the divestment of its non-strategic businesses, which it announced at the beginning of the year after recording the worst results in its history. The group owned by the Entrecanales family, which recorded losses of €1,972 million in 2013, managed turn things around in 2014 and make a profit of €185 million, thanks to cost saving initiatives, the suspension of investments and the sale to a third party of its international energy business – this improved trend has continued in 2015 to date. (…).

Of the sales that the company announced at the beginning of 2014 – Bestinver, Trasmediterránea, real estate and energy – only the last one has taken place and then only partially. This has prevented the group from reducing its debt, which remains very high and is even growing (€5,300 million net at 31 March 2015).

Original story: El Confidencial (by Agustín Marco)

Translation: Carmel Drake

La Caixa: House Prices Increased By 2.65% YoY In Q1 2015

6 July 2015 – Cinco Días

The recovery in the housing market is strengthening with rising sales prices, an increase in the volume of mortgages and a decrease in the number of mortgage foreclosures. In parallel, major transactions are being signed in the market for offices once again.

The official statistics show that house prices increased by 2.65% YoY during the first quarter of 2015 and by 1.88% with respect to the end of 2014 – property prices fell by 31% on average during the crisis -. Furthermore, growth is being seen across all regions, with the País Vasco and the Balearic Islands leading the charge.

Between January and March 2015, 16.2% more house sales were registered than during the period from October to December 2014, and 9% more were recorded than during the same period in 2014. The sale of used homes rose by 23.8% during the first quarter.

Transactions involving foreigners – who are driving the sector – increased by 8.9% with respect to the same quarter in 2014. Certificates for mortgage foreclosures decreased by 4.3% with respect to the first quarter in 2013 and have now fallen by 14% since their peak in 2010. A report from La Caixa says that supply, demand and prices are all adjusting accordingly. The inclusion of Spaniards (as buyers) will happen in due course, supported by the “improved labour market and easing of access to credit” thanks to the ECB’s program and the clean up of the banking sector. There is still a high level of stock to sell and lease, and the market for the construction of new developments is only just beginning to recover. The study warns that we should continue to monitor the market for signs of a possible bubble.

Furthermore, activity is returning to the segments for offices, warehouses and commercial premises. During the first quarter, there was a five-fold increase in transaction volumes with respect to the same period in 2014, say Savills, and four purchases alone amounted to €1,340 million in total.

According to PricewaterhouseCoopers, Madrid is one of the European cities with the best investment prospects; that is reflected in the “surge in capital inflows, which began in 2013 and is not showing any signs of receding”. And the money is coming from all sources, including global funds and tycoons such as Warren Buffet. Spain is a good place to invest.

Original story: Cinco Días (by Carlos Gómez Abajo)

Translation: Carmel Drake

CBRE GI To Buy Airesur – Sevilla’s Largest Shopping Centre

25 March 2015 – El Confidencial

Today (Wednesday), CBRE Global Investors will formalise its purchase of Airesur from the Lar Group for €75 million. In addition, it expects to invest a further €10 million in repositioning and expanding the shopping centre located (on the outskirts of the city of) Sevilla.

New first class transaction in the real estate sector. CBRE Global Investors, the international real estate asset manager, has reached an agreement with the Lar Group to purchase the Airesur shopping centre, the largest in Sevilla. Airesur has a surface area of 37,283 square metres and is located next to the only store that IKEA has, for the moment, in the Andalusian capital.

The definitive transfer of this asset is expected to take place today, after a busy process led by JLL, which also involved several international funds, according to sources familiar with the process. Despite the high level of interest, the complex financial structure hiding behind Airesur, coupled with the need to undertake additional investments to expand and reposition the centre, tipped the scale in favour of CBRE GI, which not only has the financial muscle (require for a transaction of this size), but also has more than 20 years of experience in the management of real estate assets.

After a lengthy due diligence process (internal audit), a price of around €75 million has been agreed, which is close to the latest official valuation completed by Savills (€77.5 million), as at the end of 2014. Nevertheless, it is long way off of the €102.5 million that Lar paid when it acquired the shopping centre in the summer of 2006, in conjunction with Morgan Stanley’s private bank (which today forms part of Caixabank).

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Savills: Spain’s Commercial Property Market Outlook Is Improving

11 March 2015 – Property Wire

There are already signs that Spain’s residential property market is recovering and now a new report shows that its commercial markets are also growing.

International real estate advisor Savills is predicting CBD office yields in Madrid will move from 5% to 4% and 4.5% for super prime properties, as a lack of good quality stock puts pressure on pricing.

This follows strong investment volumes in Spain’s office market during 2014 in which €2.8 billion was transacted, triple the €990 million total in 2013.

The firm states that in terms of location, 60% of investment was made in Madrid, 30% in Barcelona and the remaining 10% in other locations throughout the country.

Savills reports that the growing amount of demand and the lack of supply continues to push achievable yields down in the CBD and the main business areas. Prime yields at the end of the year moved by 100 basis points, secondary areas by 75 basis points and out of town locations saw a change of 50 basis points.

‘Investors preference for Spain’s more mature market of Madrid is undeniable, accounting for a total of €1.65 billion. But the lack of good quality stock is putting pressure on yields,’ said Luis Espadas, director of investment at Savills Spain.

‘The yield in the CBD stands at 5%, and for super prime properties could achieve between 4% and 4.5%,’ he added.

The firm finds that SOCIMIs, the Spanish equivalent of REIT’s, were very active in the office market, with 27% of their total capital being invested in commercial property and 76% of that total in offices.

‘Whilst the SOCIMI and domestic investors were very active in 2014 this year we predict we will see large Latin American investors capitalizing on opportunities in the Spanish office market,’ said Pablo Pavia, director of investment at Savills Spain.

The Savills report also states that take up in the office market at the end of 2014 was 382,000 square meters, some 2.5% less than the previous year. However, 2013 take up was heavily distorted by the Vodafone letting of 50,000 square meters, and discounting that letting take-up grew 12% on the previous year.

Additionally, it points out that there are a number of large space requirements currently in the market, several of which are seeking space exceeding 5,000 square meters.

‘Thanks to signs of a recovery in Spain some occupiers are more willing to sign pre-lease agreements on speculative space in the CBD which in term is prompting major market players to carry out speculative developments. The increase in take up activity will cause rents in the best properties to continue to rise through 2015,’ said Ana Zavala, director of office agency at Savills.

According to Savills rents in the CBD are currently in excess of €25.50 per square meter and could reach €28 per square meter in 2015 given continued strong take up. The firm also predicts landlord will continue to undertake refurbishment projects in 2015, with three quarters of new space in the pipeline for the upcoming year related to refurbishment projects.

Original story: Property Wire

Edited by: Carmel Drake

Best Start To The Year For Real Estate Market Since 2010

6 February 2015 – El Economista

Investment activity in the non-residential real estate sector in Spain has started the year with the same strength with which it closed 2014. In just one month, investment has risen to almost €1,100 million, approximately equal to the total amount recorded during the first quarter last year, according to data published by Savills, the international real estate consultancy.

This has been the best start to the year for the real estate market since 2010 in terms of transaction volumes. Nevertheless, in terms of the number of transactions, the level has not been particularly noteworthy compared with other periods – as of yesterday, only nine deals had been closed.

“In January and February, we tend to see transactions left over from before the holidays being closed, however, the pipeline of investment transactions in retail and offices currently exceeds €2,000 million. We expect investment volumes to be similar to or even exceed those recorded in 2014”, said Luis Espadas, Director of Capital Markets for Savills España.

Two transactions have accounted for almost 80% of the total investment in 2015. Firstly, the sale of Gran Vía 32, which was acquired by Pontegadea for around €400 million, according to market sources and secondly, the Puerto Venecia shopping centre, which was sold for €451 million – the deal was announced at the end of the year, but was actually closed in January.

“Both transactions not only support the rising trend in mega-deals (those exceeding €100 million), which accounted for 2.5% of all transactions in 2011 and for 9% last year, they also far outweigh the size of the largest operations recorded in 2014. Moreover, Savills highlights that in each case, the transactions involved a single building, rather than portfolios (of buildings) like in 2014 (when the Junta de Andalucía sold 70 buildings for €300 million and Carrefour sold a portfolio for €350 million).

Success in the office market

Amongst other transactions, interest for the office segment in Madrid stands out once again. It broke records in 2014 for the highest number of transactions ever recorded, with 71 transactions; and which has started 2015 on the right foot. Five buildings were sold in two weeks, almost all located within the M-30.

“The shortage of high quality properties for sale in the business district and other urban areas diverted the search for opportunities towards well-established business centres outside of the M-30, although 75% of investment last year was located inside the periphery” explained Espadas.

Nevertheless, there is an increasing drive towards refurbishment “to add value to office blocks, particularly those that are well located, which are being used either as offices or for conversion into hotels and shops”, added Espadas.

Meanwhile, yesterday, the consultancy firm Irea published its report about investment in the real estate sector in 2014, a year in which direct transactions in real estate assets tripled. Such investments accounted for €9,660 million worth of transactions, out of a total investment volume in the sector of €23,028 million, compared with €5,344 million in 2013.

Original story: El Economista (by A. Brualla)

Translation: Carmel Drake

Investment In Tertiary Real Estate Tripled In 2014 To €7,000m

21 January 2015 – La Vanguardia

Investment in non-residential real estate in Spain amounted to more than €7,000 million in 2014, almost triple the €2,500 million recorded in 2013, according to the consultancy Savills, which expects investors’ interest in Spain to continue in 2015, at the expense of other European markets.

Nevertheless, the possible political instability following the country’s general elections in 2015 may overshadow the optimistic scenario being painted in Spain at the moment, which is being driven by: better economic forecasts than for the other members of the Eurozone; the relaxation of credit constraints; and growth in yields on the best prime real estate assets.

The segments that played the most important role in the investment market in 2014 were offices, which accounted for 39%, and commerce and retail, with 33%.

The limited supply of “prime” products in these segments has spurred greater interest in secondary areas and other properties, as well as in other segments, such as logistics and hotels, which closed the year with the most notable increases.

Transactions involving portfolios of assets quadrupled their presence in the market, resulting in the geographic dispersion of investment.

Thanks to these types of transactions, which are expected to continue in 2015, 45% of the assets targeted for investment in 2014 were located outside of Madrid and Barcelona.

Socimis accounted for one third of total investments in tertiary assets, whereby becoming the main driving force in the market, a role that is forecast to continue in 2015.

As for the origin of investors, local players recovered market share, accounting for 44% of the total, although 72% of the volume invested by Spain was channelled through Socimis, whose shareholders are essentially international players.

The most active international players were the North American funds, with 40.2% of the market, followed by the Europeans with 37.3%. Investors from Latin America were also present; they focused on the office segment in particular, whilst investors from the Asia/Pacific region accounted for 10.6%.

Although most transactions continue to be financed using own funds, the credit market is showing signs of recovery.

Original story: La Vanguardia

Translation: Carmel Drake