Tag: Spanish Association of Shopping Centres

ECE Finalises Purchase of 3 Shopping Centres from Sonae & CBRE GI for €450M

8 June 2018 – Eje Prime

The portfolio of shopping centres jointly owned by Sonae Sierra and CBRE Global Investors could be on the verge of having a new owner. The German company ECE is reportedly finalising the purchase of three shopping centres from the two groups for between €450 million and €500 million, according to sources close to the operation speaking to Eje Prime. Sonae Sierra and CBRE GI jointly own these three assets (50% each).

With the purchase of this portfolio, ECE would begin to acquire its first assets in Spain, given that since it carried out the acquisition of Auxideico Gestión in 2010, a company specialising in the management of retail complexes and which previously belonged to ING Real Estate Development, it has not closed any transaction of this kind.

The centres that may be added to the portfolio of the German firm ECE are: Gran Casa en Zaragoza, the largest of the three; Valle Real (Cantabria); and Max Center (Barakaldo, Bizkaia). The two current owners already announced when the sales process was launched that they expected to pocket around €500 million from the sale.

If the operation with ECE goes ahead, it will represent the real estate giant’s first purchase in Spain since its arrival. Eight years ago, the group headquartered in Hamburg and the leader of the European market in urban shopping centres, acquired the Spanish firm Auxideico Gestión, which was, at the time, responsible for the management of fourteen shopping centres.

Until last year and following its acquisition by ECE, the group controlled more than 25 retail complexes in Spain, including Albufera Plaza, Montecarmelo and Moraleja Green in Madrid, Alcalá Magna in Alcalá de Henares and Parc Central in Tarragona. In 2017, Auxideico finally stopped operating in Spain due to “its small business volume”, according to sources in the sector. Across Europe, ECE has more than 195 shopping centres under management.

ECE, a giant with a healthy investor appetite

Founded in 1965 by Werner Otto, ECE now has more than half a century of experience in the sector under its belt. The family-owned company develops, plans, builds, leases and manages shopping centres and invests in real estate projects.

With a retail surface area of 7.2 million m2 and around 21,000 retail operators, the shopping centres managed by ECE generate annual sales of more than €23 billion and have a market value of €30 billion. Moreover, ECE has a stock of shopping centres under construction and being planned, with an investment volume of €3.2 billion.

ECE, in addition to specialising in the management of shopping centres, also operates in the real estate sector with other types of assets. The company owns a portfolio of logistics assets spanning 913,000 m2 and office buildings measuring 1 million m2.

Shopping centres, a good business in Spain

The fact that a group such as ECE is showing interest again in this business in Spain is due to the good outlook that the studies predict for the sector. Spanish people both visited and spent more in shopping centres in 2017, and the turnover in this types of assets increased by 1.5% last year with respect to the previous year, whilst visitor footfall grew by 1.1% YoY.

The sectors that performed the best last year with respect to 2016 in terms of sales were the household, leisure and restaurant segments, with increases of 5%, 3,7% and 2,7%, respectively, according to a report from Cushman&Wakefield (…).

Shopping centres will continue to be the most sought-after assets by investors, primarily international funds. The Spanish retail market closed 2017 with 555 active shopping centres and a stock spanning 15.8 million m2, according to the Spanish Association of Shopping Centres (AECC).

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Aberdeen & Catella Acquire El Manar Shopping Centre For €40M

12 July 2017 – Cinco Días

The firm Harbert Management Corporation has sold the El Manar shopping centre in Valencia for €40 million, according to sources familiar with the operation. The buyers are the companies Catella and Aberdeen, which have created a joint venture to undertake the transaction.

El Manar has a gross leasable area of 24,000 m2 and is located in the city of Massalfassar, in the metropolitan area of Valencia. According to the directory compiled by the Spanish Association of Shopping Centres, the property is managed by CBRE, was inaugurated in 2007 and comprises around twenty stores, with the Carrefour hypermarket proving to be the main draw. El Manar is also home to stores operated by Media Markt, C&A, Kiwoko, Sprinter and the toy shop Poly and it has 1,344 parking spaces. Each year, the centre receives 2.4 million visitors.

El Manar was promoted by the Pradera Group, and Harbert purchased it in 2014, in an operation whose consideration was not disclosed at the time. Three years later, the fund from Alabama has sold the asset in a deal that has been advised by CBRE and Eversheds Sutherland. Meanwhile, the buyers have been advised by the law firm Dentons.

Catella is a Swedish investment manager, which also acts as an advisor in real estate transactions. In Spain, the firm is led by Javier Hortelano.

Meanwhile, the British fund Aberdeen has €360,000 million under management around the world. In Spain, the firm is led by Ana Guzmán Quintana.

Original story: Cinco Días (by A. Simón)

Translation: Carmel Drake

Axa Puts UGC Manoteras Shopping Centre Up For Sale

14 January 2016 – Expansión

The real estate arm of the insurance company Axa has decided to put one of its most long-held assets from its Spanish portfolio on the market. The asset in question is the UGC Manoteras shopping centre, located in the north east of Madrid.

The establishment has a constructed surface area measuring 27,000 m2, of which 13,226 m2 is dedicated to retail space, according to the Spanish Association of Shopping Centres. The entire space is dedicated to leisure, with several cinema screens, operated by the company UGC Ciné Cité, and a number of restaurants.

Axa acquired this property in 2007 for €53 million, a price that may now be exceeded, given the high degree of interest that investors have in shopping centres at the moment.

The real estate subsidiary of Axa has been one of the institutional funds that has returned to the Spanish market after several years away investing in other markets. In this way, in 2014, it purchased the Urbil shopping centre in Guipúzcoa from the fund manager CBRE Global Investors for €60 million.

Last year, it also acquired the former Cine Avenida, located at number 37 on Madrid’s Gran Vía, which has now been converted into H&M’s flagship store in Madrid. For that transaction, the insurance company’s real estate subsidiary broke a market record by paying €79.7 million for the building, which has a surface area of around 4,000 m2. In other words, it paid €20,000 per m2 for the property.

At the end of April, Axa Real Estate also acquired 381 bank branches on behalf of a group of investors from the Socimi Uro Property. It paid €308 million for those properties, which are leased to Banco Santander. In addition, in August, it purchased two office buildings in Madrid (where it has its own headquarters in Spain) and Barcelona. The investment, made on behalf of one of its clients, was closed for more than €110 million.

Original story: Expansión

Translation: Carmel Drake

Kennedy Wilson Buys ‘Moraleja Green’ From ING

2 November 2015 – Expansión

Another shopping centre is changing hands barely a year after it was last sold. Later this week, the Moraleja Green shopping centre in Madrid, will have a new owner, twelve months after being acquired by the Dutch bank ING.

The financial institution, which purchased the property through one of its real estate funds, has decided to transfer ownership of the building to the US fund Kennedy Wilson. According to sources in the sector, ING will receive between €70 million and €75 million for the Madrilenian centre, which it acquired for €68 million in November 2014. This increase reflects the on-going appreciation in real estate assets in Spain, particularly for offices and shopping centres.

Cushman & Wakefield and Dentons have advised the buyer in the operation, whilst Deloitte and DLA Piper have advised on the sell-side. The agreement between both parties is absolute and will be announced officially this week.

The shopping centre is located in the northeast of Madrid, next to the exclusive La Moraleja urbanisation. It occupies a surface area of 76,763 m2 and 29,600 m2 is used for retail space. The centre’s main tenants include the supermarket chain Sánchez Romero, Inditex – with its brands Zara, Massimo Dutti and Oysho – and H&M.

The Moraleja Green centre was inaugurated in April 1995. Its developers were the real estate companies Metrovacesa and BBV Inmobiliario. It was expanded in 2001 and receives 3.38 million visitors (per year), according to the Spanish Association of Shopping Centres.

The new owner is the US fund Kennedy Wilson. The North American firm has been one of the most active players in Spain the most in recent months. Its latest operations include the purchase of 16 retail spaces, nine supermarkets and seven shops, leased to Carrefour and Día. It paid the fund AEW Europe and a French institutional investor €85.5 million for that portfolio.

The wider market

As a result of this deal, Moraleja Green will join the list of shopping centres that have changed hands during 2015, which also includes Plenilunio, acquired by Klépierre for €375 million, and Zielo Shopping, bought by UBS for €70 million.

Another shopping centre that has changed hands twice in just over a year is Parque Ceuta. A few months ago, the Brazilian group Hemisferio bought the Ceuta-based centre from the fund HIG for €26 million. The US fund had acquired it in January 2014 for €18 million.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake

Doughty Finalises The Sale Of Two Shopping Centres

23 April 2015 – Expansión

Activity continues apace in the shopping centre sector. The private equity firm Doughty Hanson is finalising the sale of two shopping centres in Spain, namely Plaza Eboli in Pinto (Madrid) and El Rosal in Ponferrada (León), which it acquired in 2011 for €120 million.

The two properties were acquired by Doughty in March 2011 and four years later, they are getting ready to change hands. The company paid the Portuguese real estate company Sonae Sierra €120 million for both assets. Now it is selling them for €115 million, according to sources close to the transaction.

For the centre in León, Doughty has received an offer from the Socimi Lar España for €85 million. In the case of Plaza Éboli, the fund is finalising its sale to the US investor HIG for around €30 million.

Plaza Éboli was opened in March 2005 and has a constructible surface area of 62,000 square metres, over four floors, of which 31,306 square metres are used for retail space. The main tenants include E. Leclerc, which has a supermarket, and a chain of cinemas, which occupies more than 2,000 square metres. Moreover, the centre has 1,004 parking spaces.

In the case of El Rosal, the property was opened in October 2007. It has a surface area of more than 151,000 square metres of which 50,851 square metres are used for retail space, according to the Spanish Association of Shopping Centres. It also has 2,450 parking spaces.

With its acquisition of El Rosal, the Socimi Lar España is continuing to increase the number of assets in its portfolio (especially retail premises and logistics warehouses), which were valued at €406 million at 31 December 2014. These include the shopping centres L’Anec Balu in Castelldefels (Barcelona) and Albacenter, in Albacete.

Socimi

Already this year, the Socimi controlled by Miguel Pereda has acquired the As Termas shopping centre in La Coruña for €67 million.

The real estate company debuted on the stock exchange in March 2014 with €400 million of capital to invest; funds it had received from large institutional investors, such as Pimco.

Meanwhile, the interest expressed by the US fund HIG Capital in the Madrid shopping centre reflects the investor frenzy between large international funds. In the case of HIG, it closed its first real estate acquisition purchase in 2013 when it acquired almost one thousand homes from Sareb, as part of the so-called portfolio Bull.

Original story: Expansión (by R. Ruiz)

Translation: Carmel Drake

Balkany To Open Plaza Río 2 Retail Park In Madrid In 2017

20 January 2015 – Cinco Días

Madrid will have a new shopping centre in 2017. The first one to be built in the heart of the capital for more than a decade. The Plaza Río 2 project will be built alongside the Madrid Río park, and will be developed by the company Sociedad General Inmobiliaria de España (LSGIE). The company is led by Robert de Balkany, a Romanian-French multi-millionaire, related by marriage to the European monarchy and a close friend of the former King Juan Carlos. One of the directors of LSGIE, Jaime de Marichalar, is the ex-husband of Elena de Borbón.

The shopping centre, which will be located on Calle Antonio López, less than four kilometres from the Puerta del Sol, will cover an area of 40,000 square metres, with 180 shops over three floors and more than 1,500 parking spaces.

LSGIE has mandated the company SCCE – a subsidiary of the French group SCC, also controlled by the Balkany family – to begin commercial work and look for businesses who want to open stores in Río Plaza 2. For the moment, it has managed to close a deal with its first illustrious tenant: Alcampo announced a few days ago that it will open a store in the new centre occupying an area of 5,000 square metres.

The most recent shopping centre to be opened in the central area of Madrid was the one located in the former Príncipe Pío train station (also next to the Manzanares river) in October 2004. Since then, only smaller centres have opened, such as the one recently opened on Paseo de la Castellana, 200 (which houses 6,000 square metres of retail space).

Over the last 10 years, during which time Spain has gone through the toughest economic crisis since the Civil War, only a handful of retail parks have been developed in the Community of Madrid, although some of those have also borne the stamp of Robert de Balknay. Such is the case of the Plaza Norte 2 complex – in Alcobendas – the largest shopping centre in Spain, covering 50,000 square metres, and most recently, Gran Plaza 2 – in Majadahonda – whose red tape was cut in 2012 by Robert de Balkany himself and the then President of the Community of Madrid, Esperanza Aguirre.

Six shopping centres have been opened in the city of Madrid since 2004 (in Montecarmelo, Canillejas-Plenilunio, Manoteras, Carabanchel-Isla Azul and the Ensanche de Vallecas-La Gavia) according to data from the Spanish Association of Shopping Centres (Aedecc), but none of those are as central as the planned Plaza Río 2.

Project Canalejas

Another project that is also expected to open its doors in 2017 are the Galarías Canalejas, a luxury shopping centre, covering 7,000 square metres, being developed by Inmobiliaria Espacio and the OHL Group, just 250 metres from the Puerta del Sol.

Plaza Río 2 will be located directly opposite the Matadero Madrid, a group of buildings that have been renovated by the Town Hall in recent years to offer cultural activities (exhibitions, theatres, festivals…) and which has become a magnet for artists and creatives alike. In the area surrounding the capital’s new park, Madrid Río, a project known as Operation Calderón will also be taking shape, involving the demolition of Atlético de Madrid’s current football stadium and the construction of several residential towers.

The original project for the development of the site that will house Plaza Río 2 was approved by the Town Hall in June 2013 and involved the creation of a special urban development plan, which included the construction of a 27-story hotel on top of the shopping centre. However, sources from the company LSGIE say that the project that they have developed never included plans for the construction of that hotel.

The shopping centre’s developers value the location of this site due to its easy access from the M-30 ring road (which runs under the Madrid Río river park), as well as from the roads to Toledo (A-42) and Andalucía (A-4). The proximity of several popular neighbourhoods, such as Usera, Arganzuela, Carabanchel and Puente de Vallecas, has also played a role. According to SCCE’s calculations, 175,000 people live within five minutes of Río Plaza 2 and 500,000 people live within a radius of 10 minutes.

According to the designs for the project, the shopping centre will be directly accessible from the Madrid Río park. Just at that point, there is already a bridge that provides access to the facilities of the Matadero Madrid, the cultural centre Casa del Lector and the Palacio de Cristal-Invernadero de Arganzuela.

The Man Who Brought Us The Mall

The CEO of LSGIE and the SCC group, Robert de Balkany, was the person responsible for importing the concept of the shopping centre or mall from the United States to Europe. It was in 1962 when, after a trip around North America, this Romanian-born Frenchman decided to launch his business venture, which has led him to control the largest shopping centre conglomerate in Europe, with more than 120 properties. He developed his first centre – Parly 2 – in the metropolitan area of the French capital. It opened its doors in 1969. “When I returned from my trip to Detroit, I realised that shopping would never been the same again. The world had changed and consumers wanted service, comfort and activities”, explains Balkany in a corporate publication prepared for the 50th anniversary of the SCC group. “Design had been democratised. I had discovered some land in Chesnay, to the west of Paris, very close to Versailles, and I hired an American architect to join the adventure, to build the first shopping centre in Europe”. Then came Velizy2, Rosny2, Evry2, Ulis2, St Genis2…

Next came international expansion, into Spain, where the SCC group today manages 20 shopping centres, including La Vaguada (the first one opened in the country in 1983) and Plaza Norte 2 (the largest in Spain, with an investment of €300 million and where 2,500 people work). Then came Belgium, Italy, Monaco, Abu Dhabi…

Today, the empire built by Balkany manages 135 shopping centres around the world, with a turnover of €50 million and more than 500 employees.

Original story: Cinco Días (by M. M. Mendieta)

Translation: Carmel Drake

Klépierre, Invesco And TH Offer €350m For Plenilunio

19 January 2015 – Expansión

The home straight/ Orion receives three binding offers for the Plenilunio Retail Park. Unibail Rodamco withdraws from the process.

The sales process for one of the largest shopping centres in Madrid is in its final stages with three finalists. The French company Klépierre and the funds Tiaa Henderson (TH) and Invesco have all submitted binding offers for the property.

Invesco is the latest candidate to join the bid for the centre; the French-Dutch group Unibail Rodamco has withdrawn from the process. The shopping centre operator had expressed interest in acquiring Plenilunio to create a Golden Triangle in Madrid, as the owner of three landmark properties: La Vaguada, ParqueSur and through this transaction, Plenilunio. However, the high price offered by its competitors has put pay to Unibail Rodamco’s aspirations, explain industry sources. The British real estate company Grosvenor has also expressed interest in the centre, according to real estate sources.

Thus, TH – which bid alongside a sovereign fund -, Invesco and Klépierre would all be willing to pay €350 million for this property, which occupies a surface area of 220,000 square metres. Plenilunio has 70,000 square metres of retail space (GLA), distributed over three floors, plus 2,500 parking spaces, according to the Spanish Association of Shopping Centres. The property, which has an occupancy rate of almost 98%, generates annual rental income of €20 million.

Upon receipt of the binding offers, the current owner, the US fund Orion, must choose whether to negotiate with a single finalist or to conduct a final competition with two of the finalists. It is expected to take this decision quickly as it aims to close the sale during the first quarter of 2015, as revealed by Expansión on 17 December.

Plenilunio, which opened in May 2006, was developed by the Spanish real estate firm Riofisa (acquired soon after by Colonial). Before its opening, Banco Santander bought the property for €275 million, and then sold it onto Orion for €235 million in 2009.

The US fund controls the property through its company Orion Columba which adopted a Socimi structure in September 2013. The sale of Plenilunio is the second large divestment that Orion has undertaken in Spain in recent months – it closed the sale of the Puerto Venecia shopping centre in Zaragoza at the end of 2014. The property, the largest in Spain, was acquired by the British real estate company, Intu Properties for €451 million. In October 2013, Orion paid €144.5 million for the 50% of the centre that it did not already own.

Plenilunio is one of 80 shopping centres expected to change hands over the next few months in Spain, according to Deloitte Real Estate. In 2014, more than €2,100 million was invested in shopping centres across the country, driven by the sale of Marineda in La Coruña for €260 million and Islazul in Madrid for €232 million.

Original story: Expansión (Rocío Ruiz)

Translation: Carmel Drake