Haya Real Estate Looks to Expand into Italy & Greece to Grow its Business

27 May 2019 – Expansión

Haya Real Estate, the servicer controlled by the US investment fund Cerberus, is looking to grow its business. Following its merger with Divarian (formerly Anida), it is now the second largest servicer in Spain, after Altamira, with 1,200 employees and €47 billion in assets under management.

In order to diversify its portfolio, the servicer led by Carlos Abad (pictured above) is evaluating its expansion into Italy and Greece, two emerging markets in which multiple NPL investment and management opportunities are expected to arise in the short term. That would help alleviate concerns over Haya’s future, which currently depends heavily on the outcome of the servicer’s negotiations with Sareb, whose contract is due to expire in December.

The future of Haya Real Estate has been up in the air since its stock market debut was postponed last year. Cerberus has held its stake in the servicer for six years now and is keen to exit soon given that its typical investment rotation period amounts to five years. Following the postponed IPO, the US giant is now holding preliminary conversations with several other investment funds interested in acquiring its stake, but the price will depend on the servicer’s future with Sareb.

Original story: Expansión (by Rebeca Arroyo)

Translation/Summary: Carmel Drake

Moonlake Capital Launches a Vehicle to Invest €600M in NPLs

27 May 2019 – Eje Prime

Moonlake Capital is going to launch a vehicle to invest €600 million in large portfolios of non-performing loans in Madrid, Barcelona, the Costa del Sol, the Balearic Islands, Valencia and Sevilla.

The new vehicle will operate as a servicer for the fund and so will manage and divest the portfolio of properties that the banks were left with after their owners were unable to keep up the repayments on their mortgages.

As such, the investment group created in 2016 and headquartered in Madrid will enter the market to compete with the likes of Servihabitat, Altamira, Solvia and Haya Real Estate, amongst others.

In parallel, Moonlake is also planning to create a joint venture with an as yet unidentified investor to develop a 2.5 million m2 project in Málaga’s technology park, involving the construction of 5,000 homes, 110,000 m2 of industrial warehouses and 30,000 m2 of commercial premises.

Original story: Eje Prime (by Marta Casado Pla)

Translation/Summary: Carmel Drake

Solvia Joins Forces with Orion Capital & Will Manage an Asset Portfolio Acquired from Goldman

8 April 2019 – Idealista

Solvia has joined forces with Orion Capital, which has entrusted the servicer with managing the portfolio that it purchased from Goldman Sachs at the end of last year.

The portfolio has a nominal value of €400 million and contains loans originated by CaixaBank. As such, Solvia will lead the sales process for all of the real estate assets included in the portfolio and for the properties that are recovered as solutions are found to the non-payment of loans.

Original story: Idealista 

Translation/Summary: Carmel Drake

Santander Transfers Land Worth €4bn to a Newly Created Land Manager

18 March 2019 – Cinco Días

Santander is making history once again. The entity has created a company to which it is going to transfer all of the land proceeding from its exposure to property, which has a gross book value of around €4 billion (and a net value of around €2 billion).

The purpose of this new vehicle, known as Landmark Iberia, will be to advance with the urban planning procedures required to generate value from these plots and to continue selling the land, with the ultimate goal of selling the whole company if an attractive offer is received.

Landmark is not like any of the bank’s previous projects given that it is not a servicer. Its job is to generate value from the plots that it receives from Santander – it is the first entity of its kind in Spain.

The operation forms part of the group’s overall strategy to reduce its exposure to real estate, in accordance with the instructions of the Bank of Spain. Last year, Santander decreased the value of its exposure by 55.9% in gross terms to €15.1 billion, according to the entity’s annual accounts, thanks to its operations with Blackstone (project Quasar) and Cerberus.

Landmark will likely become the largest landowner in the country, alongside other major companies in the sector such as the property developer Metrovacesa and the fund Cerberus.

Original story: Cinco Días 

Translation/Summary: Carmel Drake

Cerberus Puts Haya Real Estate up for Sale for c. €1.2bn

15 March 2019 – Eje Prime

Cerberus had been planning to list Haya Real Estate on the stock market but it suspended that operation in light of the political instability in the country, amongst other reasons. Instead, the US fund has decided to put the servicer up for sale.

The asking price is €1.2 billion and the advisor Rothschild has already made contact with possible interested parties. They include DoBank, which acquired Altamira in January for €412 million; the Swedish company Intrum, which purchased 80% of Solvia in December; and the fund manager Centricus.

Haya’s contract with Sareb is due to expire at the end of this year and the bad bank is understood to be considering not renewing the agreement as part of a wider strategic rethink.

Original story: Eje Prime 

Translation/Summary: Carmel Drake

Neinor Withdraws from the Purchase Process of ‘Solvia Desarrollos Inmobiliarios’

28 February 2019 – El Español

Neinor Homes is not going to be one of the candidates that submits an offer to acquire Solvia Desarrollos Inmobiliarios (SDI), the subsidiary of Banco Sabadell. The real estate company has been studying the operation for a while but has concluded, following its initial analysis, that the numbers do not fit with its investment philosophy.

That is according to explanations provided by Neinor’s CEO, Juan Velayos, who acknowledged that he has the sales prospectus on his desk but that at the moment, “it is not a priority” for him. We are talking about a company that has a portfolio of 300 buildable plots and which the bank led by Jaime Guardiola put up for sale in January.

Velayos himself acknowledges that he “loves the portfolio”, but he’s not so convinced by the numbers being seen in the market”. (…). “I’m afraid that it is not going to be for us from the perspective of a disciplined investor”, he said. The first valuations of SDI’s land are in the region of €1.3 billion, given that the portfolio also includes 130 real estate developments in different areas with 5,000 homes under construction.

Indeed, the price of land is one of Neinor’s obsessions. Over the last year, it has purchased 2,400 plots in which it has invested €95 million. Neinor’s CEO believes that his firm has adopted a prudent policy in this regard (…).

As a result, it looks like Neinor will not be one of the candidates to bid for Sabadell’s subsidiary in the end. The bank is awaiting possible expressions of interest for its land company. The intention is to receive binding offers before the end of this quarter and to settle the sale during the month of April.

Interested parties

In terms of the parties that are interested in SDI, they include some of the main international funds such as Cerberus, Värde, Oaktree and Blackstone (…).

The sale of SDI comes after Banco Sabadell sold Solvia, its real estate servicer for €300 million, for which it obtained capital gains of €185 million (…).

Original story: El Español (by Arturo Criado)

Translation: Carmel Drake

CPPIB Awards Altamira the Mandate to Manage BBVA’s Former €1.5bn Portfolio

1 March 2019 – Voz Pópuli

The Canadian pension fund (CPPIB) has delegated the management of the Ánfora portfolio, purchased from BBVA, to the servicer Altamira, according to financial sources consulted by this newspaper. Altamira has declined to comment on the reports.

It is a striking decision given that the fund decided to sell its stake in the servicer to DoBank in January, along with Apollo.

Between them, the two funds used to own 85% of Altamira. Santander owns the remaining 15%, although that stake could also end up being sold to DoBank. This operation shows that the Canadian fund continues to trust in Altamira, despite its exit from the company.

Agreement with BBVA

BBVA signed an agreement to sell the aforementioned loan portfolio, which mainly comprises mortgage loans (primarily doubtful and non-performing loans) with a live balance of approximately €1.49 billion to CPPIB in December. That operation formed part of the bank’s strategy to reduce its exposure to real estate risk to a minimum.

In the last two years, BBVA has closed a series of operations that form part of that real estate strategy, including the transfer of its real estate business in Spain to Cerberus, which was announced in November 2017 and closed last October.

The acquisition of 100% of the share capital of the servicer has been valued at €412 million in business value terms, according to Oliver Wyman, strategic advisor to the operation.

Altamira offers NPL services, including the sale, development and administration of real estate assets, advisory services and portfolio administration activities. In 2017, it had a market share of 15% in Spain, with assets amounting to more than €140 billion and a workforce of 2,200 employees.

Original story: Voz Pópuli (by David Cabrera)

Translation: Carmel Drake

Unicaja Considers the Sale of a Large RE Portfolio in 2019

12 February 2019 – Expansión

Unicaja accelerated the clean up of its balance sheet during the course of 2018. The Málaga-based entity decreased its volume of non-performing assets by 22%, in such a way that it is now close to the reduction objective it established in its latest strategic plan for 2020. That is according to the figures provided by the bank itself during the presentation of its results for last year.

The entity chaired by Manuel Azuaga (pictured above) ended 2018 with a volume of non-performing assets (NPAs) amounting to €3.6 billion, of which €1.7 billion were foreclosed assets and €1.9 billion were non-performing loans.

In five years, the bank has reduced its toxic legacy by 51% or more than €3.8 billion. Unicaja’s commitment to investors was to bring its exposure to problem assets down below the €3.5 billion mark before the end of 2020. The rate of sales of small NPA portfolios has allowed it to get ahead in the calendar that it established in its strategic plan. But the entity will continue its clean up.

The heads of Unicaja have reported their intention to continue with small portfolio sales during 2019. Moreover, they do not rule out carrying out the sale of a large portfolio in order to segregate a majority of the non-performing exposure, in a similar way to what most of the Spanish banks have been doing over the last two years.

Unicaja’s decision to carry out a massive property sale will depend, like in other cases, on the discounts that the entity will have to apply to its portfolio. The NPAs of the Malagan bank have an average coverage level of 57%, which means that a discount of a similar percentage could be applied to the book value without resulting in accounting losses for the entity this year.

High asset quality

Unicaja is, together with Abanca, the only Spanish bank entity that still retains ownership of its servicer, the real estate subsidiary through which it sells its homes and commercial premises.

The recent decision by Sabadell to sell 80% of Solvia to Intrum followed other previous operations that have seen the Spanish banks undoing their positions in the property segment, including the sale of Servihabitat to Lone Star by CaixaBank, and of Aliseda to Blackstone by Santander.

Beyond Unicaja’s plans for its property, the entity has been recording a positive trend in terms of the quality of its assets for several years now. The net inflows of problem loans have registered eight consecutive quarters of decreases, and between September and December, they recorded the largest decrease in the bank’s historical series.

Since 2014, Unicaja’s default ratio has also decreased by almost half: from 12.6% recorded in December 2014, the Málaga-based entity has managed to clean up its balance sheet to bring the rate of toxic loans down to just 6.7%.

Original story: Expansión (by Nicolás M. Sarriés)

Translation: Carmel Drake

Sabadell Puts its Property Developer Subsidiary Up For Sale with Assets worth €1.2bn

5 February 2019 – La Vanguardia

Banco Sabadell announced on Tuesday that it is putting its subsidiary Solvia Desarollos Inmobiliarios up for sale. The property developer owns assets worth around €1.2 billion. The assets are mostly plots of residential land, located in prime areas of Madrid, Barcelona and other major cities, as well as 130 work-in-progress real estate developments.

Less than a week ago, the President of Banco Sabadell, Josep Oliu, announced at the presentation of last year’s results that “we are going to continue with our asset divestment policy”. On this occasion, Sabadell has chosen the investment bank Rothschild, according to the relevant fact sent to the CNMV, to circulate the sales prospectus amongst possible buyers. According to market sources, large funds such as Blackstone, Cerberus, Värde and Oaktree, amongst others, may be interested in buying the company.

The entity, led by Francisco Pérez, has around 40 employees, who will also exit Sabadell’s orbit. The sales process may last six months. Firstly, the candidates will have to submit offers and then a competitive process will be carried out.

This sale is running in parallel to the sale of 80% of the real estate manager Solvia. In theory, an agreement has been reached to sell that firm to Lindorff Holding Spain, which belongs to the Swedish fund Intrum, for €300 million. That price may increase by an additional €40 million if certain conditions established in the sales agreement are fulfilled.

Original story: La Vanguardia (by Conchi Lafraya)

Translation: Carmel Drake

Izilend to Spend €200M Financing Real Estate Projects in Spain

1 February 2019 – Expansión

Izilend has arrived in Spain with the launch of a vehicle, which has funding of up to €200 million to finance real estate projects in the country.

Since September, the alternative financing firm has already undertaken ten operations worth €20 million and it plans to finance operations amounting to €50 million during the course of this year.

Izilend, which has a presence in Portugal with a real estate crowdfunding platform, forms part of the holding company FS Capital Partners, which also includes a servicer, Fintech, Finsolutia and a financial advisory company (EAFI).

Izilend is thereby joining other alternative financing platforms specialising in the real estate sector that have made their debuts in Spain in recent months, such as Íbero Capital Management, from the US investment fund Oak Hill Advisors, and the firm promoted by Azora and Oquendo.

Focus

In the case of Izilend, the firm focuses on the financing of projects amounting to between €1 million and €10 million. To date, it has financed investors, property developers, cooperatives and Socimis for projects in Madrid, Málaga, Sevilla and the Balearic Islands. The financing fund intends to continue expanding the focus and to finance different types of assets ranging from housing, offices, retail and land in the main cities of Spain and Portugal.

Francisco Jonet, one of the people responsible for Izilend’s business in Spain, explains that the company offers a solution to property developers and real estate investors to develop projects that the traditional banks are not interested in either due to the type of product, the situation of the operation or the response times.

“To date, we have financed firms ranging from small property developers to Socimis, and products ranging from land to residential blocks, located in different provinces around the country”, said Jonet.

Gonzalo Gutiérrez de Mesa, the other person in charge of the fund, forecasts that the demand for alternative financing will double over the next five years and will thereby approach the market rates in more mature countries in Europe, where this type of financing accounts for between 30% and 40% of the total market. “We are creating a new niche in which we believe there is great potential”, adds Gutiérrez.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake