Urbas’s Share Price Rallies Following the Publication of its 5-Year Strategic Plan

8 January 2019 – Idealista

Few events are as long-awaited by investors and analysts as the presentation of the strategic plan of a listed company. Above all, when that company has had a difficult year on the stock market, such as the case of Urbas. The real estate company, a classic amongst the ‘small cap’ or companies with a small market capitalisation in the Spanish market, is leading the first stock market rally of 2019 in the sector after losing almost 75% of its value in 2018.

During the first week of the year, Urbas’s share price has recorded a large rise of 30%. In reality, the reaction began during the final week of last year, when the group revealed the broad strokes of its strategy for the period 2019-2024. Its plan pivots around a reduction in the level of debt, generating value from its assets and the payment of a dividend from 2022.

The market has picked up on the company’s message, which with a land portfolio of almost 18 million m2, also wants to provide a new boost to its property developer business. But its number one objective is to reorganise its debt balance, which amounted to €194 million at the end of the third quarter, up by 3.7% compared to the same period a year earlier. The figure contrasts with the just over €16 million that the company is currently worth on the stock market.

The objective is to reduce the debt figure to €86 million. To achieve that, Urbas faces the challenge of moving forward with the dual negotiations that it is holding on the one hand with its creditor banks and on the other hand with Sareb to refinance its indebtedness to the necessary levels to allow it to handle new investments.

Therefore, the group’s plans are aggressive, as shown by the fact that Urbas wants to finish the first year of its new business plan with revenues of more than €20 million and a net profit of more than €14 million. By the end of the period, in 2024, the forecasts skyrocket. But, today, the reality of the group is very different. Until 30 September, Urbas lost €5 million due to the effect of the financial interest adjustment made and its revenues slightly exceeded €2 million.

In any case, the sharp rise in Urbas’s share price so far this year should be considered with the utmost caution. It is a very small security with very limited liquidity, which means that its movements may be brusque and fast, both up and down. In recent years, it has recorded large fluctuations. With the sole exception of 2017, the share price has always moved by at least 33% in each of the last nine years (…).

Original story: Idealista 

Translation: Carmel Drake

Atom Makes its MAB Debut with a Stable Share Price

27 November 2018 – Eje Prime

Atom completed its first day on the MAB without any variation in its share price. The Socimi specialising in the hotel sector and owned by Bankinter made its debut on the Alternative Investment Market (MAB) with no variation in its debut price of €10.70 per share.

That is the amount that the company set for its stock market debut and which values the company at €264.76 million. The Socimi started the day with a slight rise of 0.9%, to reach €10.80 per share, but ended trading flat.

Atom operates on the stock market with the code YAT and its shares are traded through the fixing system, whereby prices are fixed twice a day, a 12 noon and 4pm.

Atom owns 23 hotels with a total accounting value of €439.7 million, including the AC Marriott in Palma, Sevilla and Álava, as well as the Meliá hotels in Sevilla and the Canary Islands. The group is the 20th company to join the MAB in 2018 and the 67th Socimi to debut on the Spanish stock market to date: 62 Socimis operate on the MAB and five operate on the main stock market.

Original story: Eje Prime

Translation: Carmel Drake

Bankinter’s Hotel Socimi Atom will Make its MAB Debut with a Valuation of €265.7M

21 November 2018 – Eje Prime

Atom is lining up to make its debut on the stock market. Bankinter’s hotel Socimi will ring the bell soon on the Alternative Investment Market (MAB) with a portfolio comprising 21 assets located all over Spain. The company will make its debut with a valuation of €265.7 million and a share price of €10.60 after the stock market regulator issued a favourable report for its inclusion on the alternative market, scheduled for before the end of the year.

Atom’s main partner is the Melià Group, which operates six of its establishments. In addition, the Socimi has agreements with AC Hotel by Marriott, Eurostars, Ibersol and B&B, amongst other chains.

Twelve of the company’s hotels are vacation properties, and the remaining nine are urban assets; most are four-star establishments. The properties are worth €483.5 million altogether, according to an independent valuation of the portfolio carried out by EY.

In addition to Bankinter, which owns 5.3% of the shares, other shareholders of the management company include Alcor, which controls 5% of the shares; Mistral Iberia Real Estate, with 5.15%; and Línea Directa Aseguradora, with 2%.

Original story: Eje Prime

Translation: Carmel Drake

Santander Sells Another 10.6% of Testa to Blackstone for €201M

21 November 2018 – Expansión

Santander has sold another 10.62% of the share capital in the Socimi Testa Residencial to Blackstone for €201 million, whereby reducing its stake in the rental home Socimi to 18%. Meanwhile, the US fund now controls 80.63% of the entity’s shares.

The bank chaired by Ana Botín has added this sale to another one involving 7.76% of share capital that it already agreed with the US fund. The new sale from Santander came about after Blackstone launched an offer to purchase any Testa shares owned by minority shareholders, a total of 702,508 shares, representing 0.53% of its share capital, according to reports filed by the fund with the Alternative Investment Market (MAB).

Blackstone offered the owners of those shares €14.32 per share, the same price it paid Santander, BBVA, Merlin and Acciona for the stakes that those companies and banks sold it, which together amount to the aforementioned 80.63% stake. The offer price is 3% higher than the listing price (€13.90) at which Testa debuted on the MAB at the end of July and represents a market valuation for the company of €1.895 billion.

The amount is also higher than the €14.10 price at which the firm was trading when Blackstone launched its offer in the middle of last month, but below the price at which the Socimi’s shares are currently trading. The offer by the fund to Testa’s minority shareholders, estimated to amount to €10.06 million in total, began yesterday and will last for a month until 20 December.

Blackstone has convened two consecutive extraordinary shareholders meetings for Testa to be held on 18 and 21 December with the aim of closing the operation to purchase this Socimi and restructure its Board of Directors.

With this operation, the fund from the USA is strengthening its position as the largest owner of rental homes in Spain, with a portfolio of around 24,000 properties, and is ratifying its position as one of the largest owners of all types of real estate assets, given that it now holds assets worth more than €20 billion in its portfolio.

Original story: Expansión

Translation: Carmel Drake

Vitruvio Submits €32M Bid to Acquire Única Real Estate

8 November 2018 – Eje Prime

Vitruvio is planning to grow from inside the Alternative Investment Market (MAB). The Socimi chaired by Joaquín López-Chicheri has submitted an offer amounting to €31.96 million for Única Real Estate, the manager that is also listed on the same exchange, according to a statement filed by the company with the MAB.

The bid covers 100% of Única’s share capital, for which the Socimi has established a payment of approximately €27.14 per share, on the basis of the number of shares in circulation to date and the valuation that Vitruvio has determined for the company.

The team led by López-Chicheri has agreed that the payment may be made both in cash as well as by exchanging shares in Vitruvio. Each shareholder that participates will have to accept a share exchange as the payment form for at least 25% of the shares that they sell and a maximum of 75% in cash, explained the company.

Moreover, the Socimi is offering Única the possibility of postponing the appointment of a representative to its Board. After learning about the interest of the listed company in purchasing it, the operation must be approved at the General Shareholders’ Meeting by 51% of Vitruvio’s shareholders, once the favourable reports have been received from an independent expert designated by the Mercantile Registry and following the legal, technical and financial review.

Vitruvio: profits up by 22% to June to €580,000  

The Socimi, specialising in the management of office buildings, homes and commercial premises, recorded a profit of €578,459 during the first half of 2018, up by 21.8% compared to the same period in 2017.

Supported by its 288 investors, of which only one owns more than 5% of the company, Vitruvio owns around thirty real estate assets located all over Spain. Nevertheless, the Socimi has a clear focus on Madrid, given that the Spanish capital accounts for 79% of its portfolio. The other assets are located in Bizkaia (10%), Barcelona (4%) and a number of other cities ranging from Palencia to Salamanca, and including Ourense, Badajoz and Zamora.

Original story: Eje Prime 

Translation: Carmel Drake

Socimi Vitruvio to Sale its Industrial Assets worth €12.8M

2 November 2018 – La Información

The Socimi Vitruvio, which focuses on the residential market, wants to take a new step on its journey and get rid of its industrial assets. In this way, the Socimi, which has Joaquín López-Chicheri as its CEO, will focus on the residential sector, above all, although without neglecting its commercial assets or offices. On the other hand, it will dispose of the least glamorous part of its real estate portfolio, its logistics warehouses.

This part of its business, worth €12.8 million, according to the company’s own accounts, generates a return of 9.3% – the highest of any of its divisions – and has an occupancy rate of 100%. Despite that, the company’s plans involve forgetting about these types of assets, which they consider to be “residual” and “non-strategic”.

“We have always thought that residential is the safest type of asset”, say sources at the company. On the other hand, they recognise that diversification is due, in large part, to the need to generate higher profits to access dividend payments to shareholders. “Residential has the capacity to generate a lower recurring return, unless you assume one more level of risk”, said the CEO of the firm.

Where are this Socimi’s industrial assets located? The firm led by López-Chicheri owns properties of an industrial nature in Mercamadrid and Yunquera de Henares, a town close to Guadalajara.

The first of them, located in the aforementioned distribution platform, has a market value of €2.82 million, which represents a price of €526/m2. The second, on an industrial estate in the town of Yunquera de Henares, Guadalajara has a market value of €5.2 million. That asset has a surface area of 13,587 m2 and a price of €381/m2.

The Socimi that now wants to divest the logistics component of its assets has a “patrimonialist” vision, according to its CEO. In this way, the firm has diversified its assets to reduce risks. “The portfolios that traditional patrimonialist firms have are normally distributed between residential, well-located commercial premises and offices. And that is what Vitruvio has”, said the executive.

This real estate investment company was constituted in June 2014, under the Socimi tax regime. Since then, it has undergone several capital increases – raising almost €30 million in total – to acquire assets and position itself ahead of its stock market debut.

The bell was rung in July 2016, two years after its creation, at a price of €12.63 per share and with 126 shareholders. Nowadays, Vitruvio’s shares are listed on the Alternative Investment Market (MAB) through the fixing system – with two daily auctions – at a price of €13.70 per share.

In January of that same year, the company carried out its largest capital increase to date raising €11.5 million. Thanks to that, the number of assets increased along with their value to exceed €100 million.

Original story: La Información (by Lucía Gómez)

Translation: Carmel Drake

MAB’s Director Encourages Socimis to Generate Trust to Attract Investment

30 October 2018 – Finanzas

The Director General of the Alternative Investment Market (MAB), Jesús González Nieto (pictured below), has today encouraged the Socimis to “generate trust” through the transparency of their corporate governance arrangements to attract new investors and “to depend on the market for growth”.

González Nieto closed a conference about Socimis at the headquarters of the CEOE by underlining that generating trust is a task for everyone so that the real estate investment formula, which has been on the Spanish stock market for five years, can become increasingly well known.

In his opinion, the French and British markets have many more small investors in the real estate sector thanks to the structures that they have, which are similar to Socimis, and so he expects growth in the Spanish market if the entities can manage to provide good information about that possibility of stock market investment.

At the moment, 61 Socimis are trading on the MAB, whilst another five trade on the main stock market.

The Director General of Renta 4 Banco, Jesús Sánchez-Quiñones, has inaugurated a process for the concentration of Socimis over the coming years and has said that “they are avoiding stock market crashes”, due to their strong expectations and lower liquidity.

Representatives from eleven Socimis participated in the conference, ten on behalf of Socimis that are trading on the MAB and one that will make its debut soon: Park Rose Iberoamericana, which will start trading on 15 December.

The President of Park Rose, Luis Alberto Akel, explained that his firm has Chilean capital and is diversifying its real estate investments in Chile, the USA and Spain.

The CEO of Témpore, Nicolás Díaz Saldaña, warned that “there is a lot of international interest in the Spanish residential sector”, and, after reminding the audience that his Socimi arose as an “additional mechanism for the divestment of assets by Sareb”, he said that when that operation concludes, they will go “and look for new investors”.

Díaz Saldaña has indicated that he would like for Témpore to be listed on the main stock market and the Director General of GMP Property, José Luis García de la Calle, also noted that his firm has considered that option, but that the growing “demands” of the MAB are already broad enough, without having to implement audit and remuneration committees.

Meanwhile, the CEO of Castellana Properties, Alfonso Brunet said, “We are getting ready to comply with the requirements of the main stock market”.

The CEO of Vitruvio, Joaquín López-Chicheri, highlighted that “the Socimis allow us to diversify risk” and to be present in the four segments (residential, commercial, offices and logistics), whilst other participants in the conference indicated that they prefer to focus on a niche market.

In this way, José Nistal, from the Socimi Almagro, explained its specialisation in the purchase and rental of flats for the elderly, where the tenants have an average age of 84.3 years.

The latest Socimi to join the MAB, Azaria, in September, focuses exclusively on the long-term, stable, rental of offices and its only asset, for the time being, is the headquarters of El Páis, which is leased until 2033, explained its manager, Teodoro Díez.

Sergi Mirapeix, from Tander, explained that his firm only invests in commercial premises in the most central areas of cities (currently, it is present in four: Barcelona, Santander, Bilbao and San Sebastián) and Jorge González, the representative of the Socimi Asturias, has indicated that its sole objective is to focus on large retail parks.

Josep Turró, from Barcino, said that his firm is going to seek to diversify as much as possible, by “adaptating to demand”, and Fabrizio Agrimi, from Vbare Iberian, said that his Socimi is committed to “added value, without property developer risk”.

Original story: Finanzas 

Translation: Carmel Drake

British Fund Pelham Acquires 10% of Árima

25 October 2018 – Eje Prime

Árima has opened the door to British capital. The UK fund Pelham Capital has declared a stake of 9.98% in the new Socimi from Luis López de Herrera-Oria (pictured below), according to a statement filed by the company with Spain’s National Securities and Market Commission (CNMV).

The new real estate vehicle of the former founder and CEO of Axiare (which was taken over by Colonial) has convinced the London-based firm to enter its share capital by acquiring 999,028 shares, worth €9.5 million, on the basis of the real estate firm’s current share price.

After completing its debut on the main stock market, with a dip of 10%, Árima’s share price recorded a slight upturn on the second day of trading, with an increase of 5.56%.

It is expected that, over the coming days, other funds and institutional investors will be revealed that have participated in the €100 million capital increase that Árima launched to complete its stock market debut. Initially, the Socimi had intended to raise up to €300 million, but it lowered its expectations in light of the unstable situation in the markets.

Original story: Eje Prime

Translation: Carmel Drake

Azaria Rental Debuts on the MAB with a €125M Investment Plan

25 September 2018 – Eje Prime

Azaria Rental made its debut on the stock market today with the clear intention of expanding its asset portfolio. The Socimi, specialising in the rental market and managed by Drago Capital, started trading at a price of €5.40 per share, which means that its valuation amounts to €45 million, according to a statement filed by the company with the Alternative Investment Market (MAB).

On its first day on the MAB, the Socimi confirmed its plan to search for new investment opportunities to increase returns for its shareholders. Specifically, according to Mayte Medina, CEO of Drago Capital, the firm’s future acquisitions are expected “to amount to €125 million in total”.

Currently, Azaria Rental owns just one asset: a 100% stake in Bifur Investments, the owner of the industrial and office complex located at number 40 Calle Miguel Yuste in Madrid, which houses the headquarters of the El País newspaperThe property spans a surface area of 46,480 m2 and comprises five buildings, leased to the Prisa group until 2033 for €4.9 million per year, according to Expansión.

Azaria Rental is the 19th Socimi to debut on the MAB so far this year. The objective of the company is to create a real estate investment vehicle to generate returns of between 4% and 5%, “from rental contracts with a net triple income profile over the long-term”.

Meanwhile, Drago Capital is a real estate asset management company that operates in the Spanish market as well as in the United States of America. Founded in 2001 by a group of professionals from the sector, it has offices in Madrid, Lisbon and Miami.

Original story: Eje Prime

Translation: Carmel Drake

Quabit Acquires Land from Sankar in Exchange for 4.55% of its Own Shares

3 August 2018 – El Español

Félix Abánades, President and largest shareholder of the listed real estate company Quabit, is continuing to immerse himself in a quagmire of capital increases that he has been promoting in order to raise funds to use to purchase land, on which to build almost 8,000 homes between now and 2022. His ambitious objective is to invoice almost €2 billion, generate a cash flow of almost €500 million and distribute €90 million in dividends.

Land in exchange for shares

Basically, these increases have been of a non-monetary nature, with the purchase of land in exchange for shares in Quabit. A much cheaper route than the two lines of credit amounting to €100 million that the firm signed with the fund Avenue between December 2016 and December 2017.

Those loans carry a clear risk, given that the principal, on which interest of between 12% and 16% is charged, must be repaid within a maximum term of 4 years following the drawdown date.

Repayment commitment

In light of the probability that the principal will not be returned on time, Avenue forced Quabit to issue warrants, an abusive right over the shares in favour of the fund that, in the worst case, would see it take ownership of 8.56% of the property developer.

For the time being, with Quabit trading at €1.77, at the close of business on Thursday, that option would be ruled out, given that the subscription prices agreed with Avenue for the execution of those rights over the shares range between €3.07 and €3.75.

Six capital increases in one fell swoop

It is for that reason that, in light of this negative outlook, Abánades carried out six capital increases in one fell swoop last November, for a combined total of €41.8 million, with the issue of shares at a price of €2, with a nominal value of €0.50 and a premium of €1.50.

All of those increases were of a non-monetary nature, in which Abánades captured estates from the Basque property developer Ondabide in Mijas (Málaga) and plots in Guadalajara contributed by Rayet, Abánades’s own company. The other four capital increases were placed by the President of Quabit with the Malaga-based property developer, Sankar Real Estate.

Agreement with Sankar

Quabit’s agreement with Sankar, for the subscription of those four increases, was aimed at obtaining plots in the Malagan municipalities of Mijas, Marbella and Estepona and in the Menorcan town of Mercadal, some in the form of proindivisos for 30% of the surface area.

The total operation will allow Sankar to acquire 4.55% of Quabit’s share capital, once the four increases have been fully subscribed. A package of 6.78 million shares, valued initially at an issue price of €13.56 million.

For the time being, Sankar has subscribed to two of these increases. With the public deed of the capital increase of the latter, relating to estates on the island of Menorca, the Malaga-based property developer has been obliged to report to Spain’s National Securities and Exchange Commission (CNMV) its stake as a reference shareholder of Quabit, given that it now owns 3% of the shares. Specifically, its stake amounts to 3.31%.

Losses of 12%

A package of 4.93 million shares that have accumulated losses of 12% compared with the €2 price for which they were issued, taking as a reference Quabit’s COB trading price on Thursday, €1.77.

The consequence of these non-monetary increases is affecting the personal stake of Félix Abánades, the President of Quabit, who has seen his position in the company decrease from 24% just a few months ago to the current level of 21.4%. He is trying to maintain the rate with the acquisition of financial instruments that, in the future, may yield another 1% of share capital.

Original story: El Español (by Juan Carlos Martínez)

Translation: Carmel Drake