Regeneration in Madrid: the City’s Office Supply is Set to Increase by 25%

25 February 2019 – Eje Prime

The major urban development projects underway in Madrid are going to multiply the availability of office space in the capital. Madrid Nuevo Norte, the real estate plan from Aena and the work being planned in Las Tablas, Valdebebas and Pegaso will add 3.3 million m2 of office space to the existing supply in the capital. In this way, an increase of 25% is expected, according to a report compiled by Deloitte and reported by Expansión.

Currently, Madrid has an office surface area spanning 13 million m2, of which 9.5% is unoccupied. The average rent in the financial district amounts to €33/m2/month. Together with Barcelona, the city accounts for 85% of all office inventory in Spain, and is the largest business centre in the country by surface area, with more than twice as much space on offer than the Catalan capital.

In the short and medium term, 400,000 m2 of new space will be handed over in Madrid and almost 375,000 m2 in Barcelona, according to Deloitte. For the owners, it is not only important to create new supply, but also to attract new tenants, as well as to increase rents and the valuation of buildings through the transformation of spaces.

Of the major urban development projects underway in Madrid, Valdebebas is probably the most ambitious. It constitutes a business district, called Valdebebas Fintech District, spanning more than 1 million m2, which is also going to include hotel services. Besides that program, there is also a business centre being planned in Madrid Nuevo Norte, with three skyscrapers measuring 250m, 230m and 190m tall, respectively.

The renovation of the space also forms part of the regeneration project. Over the next four years, more than 300,000 m2 of office space in Madrid will be restored. In parallel, the owners of offices in Barcelona are planning to replace buildings with a surface area of more than 58,000 m2.

Original story: Eje Prime

Translation: Carmel Drake

Baraka Invests €60M in the Construction of 2 Skyscrapers in Torrevieja

21 January 2019 – Idealista

Trinitario Casanova is on a roll with Baraka. Baraka Properties, the group’s arm specialising property development, has invested €60 million in the construction of two skyscrapers in Torrevieja, which will house more than 130 homes and 250 tourist apartments, according to explanations provided by the company to Idealista News.

The project is going to materialise into two 26-storey towers. Whilst the first will be dedicated to housing in its entirety, the second will be dedicated to hotel use. “Right now, the approval of the project is in the evaluation phase, although our plans are to finalise this first phase during the first quarter of the year”, explain sources at the group, “and once the project has been approved, we will request the licence”.

The land on which the two towers are going to be built is located on Avenida Doctor Gregorio Marañon, on the seafront next to the Doña Sinforosa park. “It is 200 metre from the marina, and all of the homes from the first floor up will have views of the sea. The homes from the fifth floor up will have 360º views”, say sources at Baraka Properties.

According to the company, these will be the first towers in the city, and the tallest to date. The other enclave with towers of this calibre is Benidorm. “The trend for tourists in the area is to look for more unique properties, with higher quality finishes, where they can be offered services like in an American condominium, and this plot fulfils all of those characteristics, both due to its location, and its scale/volume”, they conclude.

In total, 32,000 m2 of space is going to be built in the two towers, and by way of reference, the price per m2 of the penthouse will amount to around €7,000/m2, making it one of the most expensive developments in the area (…).

Original story: Idealista (by Custodio Pareja & P. Martínez-Almeida)

Translation: Carmel Drake

Metrovacesa Invests €175M in Torre del Río Residential Project in Málaga

13 September 2018 – Eje Prime

Metrovacesa is backing the Malagan residential market. The property developer is going to invest €175 million in the Torre del Río residential project in the city of Málaga. The proposal involves the construction, on a surface area spanning 58,368 m2, of three residential properties, distributed over 21 storeys and with the capacity for more than 250 homes.

Each tower will house around 75 large homes, two swimming pools, a gym, a gastrobar, a coworking area and a movie theatre. The first units are expected to be handed over at the beginning of 2021.

The construction of the project is going to generate 1,500 direct and indirect jobs and is going to be led by Estudio Lamela, the company that won the architectural tender to construct Torre del Río. In the vicinity around the three skyscrapers, 39,131 m2 of space will be dedicated to free public areas and 12,648 m2 will be allocated for school, sports and social uses, as well as a building for tertiary and hotel use.

According to the developers of the project, “the urban development of this area is going to allow the recovery for Malaga of old industrial enclaves along the Antonino Banderas seafront on Calle Pacífico.

The Torre del Río residential development follows another investment undertaken by Metrovacesa in the south. In June, the listed property developer signed an agreement with the Town Hall of Sevilla to unblock the largest real estate development in the Andalucían capital at the moment.

That project is going to be located in Palmas Altas and will comprise more than 2,800 homes, of which 2,200 will be constructed by Metrovacesa. In terms of investment, access and the urbanisation of the land, the Spanish property developer is going to invest €60 million, funds that will come from a corporate loan that it signed with seven entities at the end of 2017.

Original story: Eje Prime

Translation: Carmel Drake

Madrid Nuevo Norte: Carmena Unveils the Latest Plans

28 July 2018 – El País

More green spaces, sustainable transport and a new financial district (city), which is going to change the face of the Castellana over the next 20 years. The thoroughfare that crosses the north of Madrid is going to grow up around Chamartín station, which will become a large hub due to its proximity to the airport. The mayor of the city, Manuela Carmena, having reached an agreement with the Minister for Development, José Luis Ábalos, the Community of Madrid and the property developer Distrito Castellana Norte (DCN) presented the Madrid Nuevo Norte project, also known as Operación Chamartín, on Friday. It is going to be one of the largest urban planning developments in Europe, and its aim is to launch the Spanish capital into the 21st century.

In numbers, Madrid Nuevo Norte is going to involve the renovation of an area spanning 2,600 km2, where the property developer Distrito Castellana Norte (DCN), the Town Hall, the Ministry of Development and the Community of Madrid are going to build a financial centre with large green spaces, modern buildings for latest generation offices and a new train station, which will be at the heart of the new financial district.

The future Chamartín station will become a domestic and international hub. Its strategic position, given its proximity to the Madrid-Barajas airport, will allow for journeys in record time. Adif is considering creating a direct connection between the station and the airport. The public company controlled by the Ministry of Development also announced that it is going to work on a direct connection between Chamartín and Atocha train stations.

The new business centre will be home to three skyscrapers, one of which will stand 250 m high, the tallest in Spain. The project is being inspired by the north of Europe from an urban planning perspective (experts highlight the similarities with the new financial district in Amsterdam). Specifically, due to the coexistence of work areas and residential spaces. In fact, leisure areas and housing will be created in Madrid’s new city. The idea is to build a centre that will be “open 24 hours a day, 7 days a week”, according to explanations provided by the Councillor for Sustainable Urban Development, José Manuel Calvo (Podemos).

The project will divide the space into four zones: Chamartín station, the business centre and the neighbourhoods of Malmea-San Roque-Tres Olivos and Las Tablas Oeste. In total, the Town Hall, which has led the project and  the negotiations with the private operators, has ensured that up to 20% of all the homes built in the area will be social housing properties (compared with 10% proposed by Ana Botella’s previous plan) (…).

In terms of the timings, the Town Hall expects to raise the project to the plenary this year. Nevertheless, the Community of Madrid still needs to approve several reports, including the environmental study, which is mandatory. The Community of Madrid is expected to approve the plan next year. If so, the first bricks will be laid in three or four years time. According to estimates from the property developers, this project will generate 200,000 jobs and involve an investment of €6 billion.

Original story: El País (by Luca Costantini)

Translation: Carmel Drake

Amancio Ortega Earned €72M From His Property Portfolio In 2016

24 July 2017 – Expansión

A portfolio worth €6,719 million containing assets spread over markets as diverse as Spain, Canada, the United Kingdom and Korea. That summarises the real estate activity of Amancio Ortega, founder and majority shareholder of the textile giant Inditex.

The fourth richest man in the world (exceeded in the ranking only by Bill Gates, Warren Buffet and Jeff Bezos), with a fortune worth $80,400 million according to Forbes, has allocated most of the revenues obtained from the annual dividend he has received from Inditex for the last two decades, to creating one of the largest personal real estate portfolios in the world. Through his firm Pontegadea Inmobiliaria, Ortega has acquired buildings, primarily offices and retail premises, located in a multitude of markets.

Acquisitions

In 2016, Ortega starred in the largest purchase of an office building in Spain, by paying €490 million for Torre Foster, one of the skyscrapers that forms part of the Cuatro Torres de la Castellana complex in Madrid. Months before, Pontegadea Inmobiliaria made its debut in South Korea when it acquired the M Plaza commercial complex. For both properties, Ortega’s company spent €662 million in total, according to the most recent results presented by the company.

Also in 2016, Inditex’s largest shareholder spent around €129 million on a building in San Francisco (USA).

These investments allowed Pontegadea Inmobiliaria to increase its total asset volume by €661 million in 12 months. At the end of 2016, the company owned net assets worth €6,475 million, up by €373 million compared to the previous year.

Despite this increase in assets, Pontegadea’s revenues and profits decreased last year. Revenues amounted to €120 million, compared to €129 million in 2015. Nevertheless, the gross operating profit rose slightly in 2016 to €102 million, compared with €101 million a year earlier. Last year, Pontegadea’s profit amounted to €72 million, down by 30%. The company attributes this decrease (the second consecutive fall, given that it earned €182 million in 2014) to “currency fluctuations”, which “generated negative exchange rate differences of €19 million, concentrated primarily in the variation of the value of the pound sterling”.

The British real estate market is one of Pontegadea’s favourite destinations. In London alone, Ortega’s property arm has invested at least €3,000 million. Some of its properties include Rio Tinto’s headquarters, acquired for €335 million in 2015 and Devonshire House, for which it paid €480 million in 2013. In March, Pontegadea covered a €114 million capital increase of its British subsidiary (Pontegadea UK).

In Spain, in addition to Torre Foster, also known as Torre Cepsa thanks to its tenant, Pontegadea also owns Torre Picasso, Gran Vía 32 and several buildings along La Castellana.

Pontegadea Inversiones

Ortega’s property arm forms part of the business conglomerate that the founder of Inditex has controlled for several years through Pontegadea Inversiones. That company, which groups together its majority stake in the textile group (59.29% in total), recorded revenues of €23,649 million in 2016, compared with €21,234 million a year earlier. Last year, the company’s profit amounted to €3,277 million, up by 8.3% compared to the previous year.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

50% Of Lagasca 99’s Luxury Homes Have Been Pre-Reserved

27 March 2017 – Expansión

A “unique” project, destined to become a “European and international architectural icon”. That is the ambitious challenge that the Socimi Lar España and the largest fund manager Pimco have set themselves in an unusual project for both partners, namely: the luxury residential building, Lagasca 99. Lar España and its largest shareholder purchased the company Juan Bravo 3 at the end of 2014. At the time, the company owned the plot of land at the address of its name, in the exclusive neighbourhood of Madrid.

The company had been created in December 2006 by the real estate company Eurosazor, controlled by the businessman Rafael Ortiz. Ortiz had wanted to construct the most exclusive development in the capital, inspired by the One Hyde skyscraper in London. Nevertheless, financial difficulties left Eurosazor and Juan Bravo 3 filing for bankruptcy and the project never got off the ground. Then, Lar and Pimco invested €120 million to acquire the plot of land (along with the loans linked to the company that owned that land) and, ten years later, and also with the support of the renowned architect Rafael de la Hoz, the development has now resumed with a novel concept.

The future property, which will have a constructed surface area of 26,203 m2, will contain 44 homes, compared with the 60 units that Eurosazor had planned, and the 55 that were initially proposed by the new owners. These homes, spread over nine floors plus penthouses, will be located at different heights, including duplexes with ceilings measuring more than five metres high and duplex penthouses measuring up to 700 m2, including terraces and private swimming pools.

The building, which will offer five different types of homes, will incorporate elements such as bevelled corners and shark fins on the windows, which will allow natural light to enter the homes whilst at the same time ensuring the privacy of residents. Each home will have a minimum surface area of 330 m2 and will be sold for around €12,00/m2, and up to €14,000/m2 for the most exclusive units, say sources in the sector. In addition, each property will include two or three parking spaces – Colliers International will be responsible for marketing the properties.

The buyers of these exclusive homes (pre-reservations already exist for 50%) will have access to a gym and indoor swimming pool, as well as a wellness centre and a rooftop garden with an outdoor pool and landscaped roof. The development is expected to be ready by the beginning of 2018.

Lagasca 99 will compete against homes in the Canalejas complex to become the most luxurious development in Madrid. Located next to Puerta del Sol, the project run by Villar Mir (which Mark Scheinberg has just acquired a stake in) will build around twenty luxury apartments. Their residents will have access to the services of the five-star hotel in the same building, which will be operated by the Four Seasons chain.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Carmena Commits To Studying Operación Chamartín

25 June 2015 – Expansión

The mayoress of Madrid, Manuela Carmena, has confirmed to the Chairman of the Distrito Castellana Norte (DCN), Antonio Béjar, that she is committed to studying the draft plans for the extension of the Paseo de la Castellana, according to sources close to the company.

Carmena met with the project’s leaders on Wednesday, for around an hour, in an atmosphere characterised by the “utmost cordiality”.

During the meeting, Béjar described the planned development to the mayoress of Ahora Madrid. He explained that the project aims to promote the DCN through its Partial Plan and that it will be one of the most important city projects in Europe.

At the end of the meeting, Béjar seemed optimistic and said that he hopes that the Partial Plan will be approved at an upcoming plenary session, once the Town Hall’s new government has analysed it in detail.

The project will extend the Paseo de la Castellana north by 3.7 km and involve the redesign of an area covering 311 hectares. It will also include the construction of 17,700 homes, 56 hectares of green space – half the size of the Retiro park – and several skyscrapers.

Original story: Expansión

Translation: Carmel Drake