Merlin Clings to its Office Business to Protect itself from the Impact of Coronavirus

The largest Spanish Socimi forecasts a maximum decrease of 9% in its annual income from its shopping centres after it waived their rental payments, something it has not done with its offices and logistics assets.

The large Spanish real estate companies are beginning to take stock of the impact of the Covid-19 coronavirus epidemic on their businesses. Such is the case of Merlin Properties. The Socimi with the largest number of rental assets in the Spanish market has revealed, in a call with analysts, that the closure of non-essential commercial establishments decreed by the State of Emergency will result in a decrease in its annual income from that type of property.

Specifically, Merlin, whose shopping centres generate 23% of its gross income, points out that only 23% of the stores in its commercial establishments are currently open. The company has given those tenants a 100% payment holiday on their rents for as long as the State of Emergency lasts.

Témpore to Increase its Share Capital by €19M to Pay Off Loans

The Socimi’s General Shareholders’ Meeting approved the launch of a capital increase amounting to €18.8 million to pay off two bank loans.

Témpore, the rental home Socimi created by Sareb, has approved the implementation of a capital increase amounting to €18.8 million at its General Shareholders’ Meeting.

The expansion will be carried out through a credit clearing operation to pay off two bank loans, according to a statement filed with the Alternative Stock Market (MAB).

Cerberus Lends €3 Million to its Socimi Optimum

The loan signed amounts to €2.94 million and has a maturity of ten years and an interest rate of 2.75%.

The Socimi Optimum has signed two unsecured loans amounting to €2,946,000 in total with its majority shareholder Promontoria Bravo – a vehicle controlled by the US fund Cerberus -, with a maturity of ten years and an interest rate of 2.75%, according to information submitted by the company to the National Securities Market Commission (CNMV).

The loans, one of which was signed in January and the other on 16 April, amount to €1 million and more than €1.94 million, respectively.

Coronavirus Leaves the Occupancy Rate of Home Capital’s Properties at Minimum Levels

The Socimi has acknowledged that there is a risk that the building work that it is carrying out in some of its buildings may be temporarily suspended due to the pandemic.

The Socimi Home Capital, which rents apartments to professionals on business trips, has indicated that the average occupancy of its building on Blasco de Garay, 32 in Madrid stands at 50.3%, whilst the asset that it owns on Gignàs, 26 in Barcelona has an occupancy rate of 7.9%, as reported by the firm to the Alternative Investment Market (MAB). The company does not believe that the occupancy level of its buildings will improve for as long as the current restrictions continue.

The Socimi, which made its debut on the alternative market in the midst of the coronavirus crisis, has acknowledged that there is a risk that the building work that it is carrying out in some of its buildings may be temporarily suspended, in the event of a possible closure of the work centres by the administration, with the consequent delay in their completion.

Domo Completes the Sale of a Residential Building in the Midst of Lockdown

The Socimi Domo Activos has announced the sale of a residential building located in the Vallecas neighbourhood of Madrid for €25.5 million.

The Socimi Domo Activos has announced the sale of a residential building located in the Vallecas neighbourhood of Madrid. The property, located on Calle Arte Figurativo, has a surface area of more than 15,182 square metres, distributed over 80 homes, six commercial premises, 106 parking spaces and common areas.

The asset sold is an investment project that Domo built on a plot with the aim of selling the properties to individuals. However, in February, Domo announced that it had received a binding offer for the whole property, as reported by Brainsre.news.

Corpfin Changes its Plans for Edificio España and Considers Leasing an Entire Floor as Offices

The Socimi Inbest Prime, owner of the commercial space on the lower floors of the emblematic Madrid building, is considering reducing the commercial area to ensure its rental income.

It was the great retail operation in the centre of Madrid. Inbest Prime II, the commercial asset Socimi created by the Spanish manager Corpfin Capital, reached an agreement with the hotel chain RIU at the beginning of last year to buy the commercial space in ​​one of the most emblematic projects that was being developed at the time in the capital: Edificio España.

The famous skyscraper located in Plaza de España had been in disuse for more than a decade until the Chinese group Dalian Wanda decided to buy it in 2017 from its then-owner, Banco Santander, with the aim of recovering its former use as a hotel. However, the problems associated with its refurbishment, including the refusal of Madrid City Council to allow the dismantling of its protected façade, led Wanda to withdraw from the project. The Mallorcan hotel group RIU took it on and months later, in January 2019, reached an agreement with Inbest Prime II, the Socimi created by Corpfin Capital, to sell the lower floors of the building so that they could be convert into one of the best shopping areas in the capital, at one end of Madrid’s greatest commercial thoroughfare, Gran Vía.

Merlin to Build a Logistics Warehouse for DSV in Zaragoza

17 January 2020 – La Vanguardia

Merlin Properties has agreed to build a warehouse in Zaragoza for the Danish transport and logistics company DSV. The Socimi led by Ismael Clemente will lease the 12,000 m2 property to DSV for ten years.

Original story: La Vanguardia 

Translation/Summary: Carmel Drake

Blackstone Creates ‘Testa Home’ to Manage 20,000 of its Rental Homes

10 January 2020 – El Economista

Blackstone has created a new company, Testa Home, to manage 20,000 of the rental flats owned by its Socimis and other subsidiaries.

The entity will be led by Fidere’s current president, Juan Pablo Vera, and will owned by Testa (58.12%) and Fidere (41.88%).

The aim is to make the management of the portfolio more efficient, optimise operating costs and returns, and render an improved service to tenants.

Of the 20,000 flats, 11,000 are owned by Testa, 6,500 by Fidere, 2,000 by Aliseda and 500 by Hispania.

Original story: El Economista (by Alba Brualla)

Translation/Summary: Carmel Drake

Merlin to Make its Portuguese Stock Market Debut on 15 January

9 January 2020 – Europa Press

Merlin Properties, the Socimi led by Ismael Clemente (pictured below), is going to make its debut on the Lisbon stock market on Wednesday 15 January.

Merlin will thus fulfil its objective, announced in 2019, of trading its shares in Portugal (as well as on the Ibex in Madrid), given that it is a strategic market for the entity.

Specifically, the Socimi already owns 9 offices, 2 shopping centres and 1 logistics warehouse in the neighbouring country, assets which together account for 8% of its total portfolio. They span a combined surface area of 113,000 m2 and generating €44 million in annual revenues.

Original story: Europa Press 

Translation/Summary: Carmel Drake

Vivenio, Millenium & Atom Invested €543M in New Purchases in 2019

9 January 2020 – Eje Prime

Vivenio and the hotel Socimis drove the MAB in 2019. The Socimi controlled by Renta Corporación, plus Millenium Hoteles and Atom Hoteles together invested €543 million in new acquisitions during 2019. That figure accounted for 71.2% of all the funds spent on asset purchases by the MAB’s Socimis during the year.

Specifically, Vivenio invested €234 million, including €75.5 million on some of the Operación Calderón plots; Millenium closed 3 operations amounting to €192.4 million, including the purchase of 2 buildings in central Madrid which it is going to convert into a 5-star hotel; and Atom Hoteles spent €116.6 million on 5 hotels in Madrid, A Coruña, Cádiz, Tenerife and Gran Canaria.

In total, all of the Socimis on the MAB spent €762.1 million on the purchase of assets during 2019, up by 34.1% compared to 2018.

Original story: Eje Prime (by Marc Vidal Ordeig)

Translation/Summary: Carmel Drake