AURA News Real Estate

Temprano Capital Partners to Double its Portfolio of Student Residences in Three Years

25 April 2019 – Eje Prime

Temprano Capital Partners, a Spanish investment firm, plans to double its portfolio of student residences, through its subsidiary Temprano Student Living (TSL). The planned investments would increase its portfolio to more than 7,000 beds within three years.

TSL currently has 3,500 beds spread between ten ongoing projects, including those under development and others in operation. TSL’s student residences are located in Lisbon, Porto, Coimbra, Barcelona, Granada, Seville and Valencia. TSL plans to open two new developments in Barcelona and Porto by the end of 2019, in partnerships with CPA 18 Global and Carey European Student Housing Fund.

The Barcelona residence is located next to the Finistrelles shopping center. The 10,500-m2 asset will consist of 372 studios. The project in Portugal will have 580 studios spread over a 20,000-m2 area.

Original Story: Eje Prime

Translation/Summary: Richard D. Turner

Amro Acquires Building for Future Student Residence in Seville

7 February 2019

The British company, which specialises in student residences, has plans for 5,000 new beds in Spain and Portugal, 3,000 of which are already under negotiation.

Amro Real Estate is going through its paces. The British company specialising in the development and management of student residences has just acquired a building in Seville where it will create accommodations for 332 university students, another step in the company’s expansion plans for Spain.

The company estimates that the refurbishment of the 9,300-square-meter building will begin this summer. The residence is expected to open in January 2021, with common areas, group study areas, a dining room, gym and parking.

Amro, which consulted with CBRE, was attracted to the complex’s location. Situated between the campuses of the universities of Seville, Pablo Olavide and Loyola Andalucía, it could serve any of the 38,600 students enrolled in the three schools.

Original Story: EjePrime

Translation: Richard Turner

From Greystar to GSA, a Who’s Who of Investors in Spain’s Market for Student Residences

27 August 2018

With returns of 5.5%, the student housing market has become the new El Dorado of the real estate market. A long list of foreign funds are beginning to invest in this sector in Spain, and the supply of accommodations is expected to rise by almost 10% up to 2019.

Anglo-Saxon funds and operators dominate the wave of foreign capital that is taking on the market for student residences, one that offers returns of 5.5% in Spain. Just in 2017, investments grew from 50 million to 600 million euros.

The supply of assets in this alternative market has increased by 3.5% since 2015, boasting 93,563 beds in the market at the close of last year. Forecasts expect the sector to grow by another 1.5% this year and up to 7.7% at the end of 2019, according to data from the consultancy JLL. Which are the funds that dominate the sector? And who set to join this latest rush for gold?

The high point of the new wave of international investment in Spain’s resis (student residences) was reached at the end of 2017. Until December, Resa was considered the king of the residential market for university students in the country. It was owned by for years by the firm Lazora (Azora) until the arrival of the joint venture formed by AXA Real Assets and CBRE Global Investment Partners funds, which made an offer for roughly 500 million euros. Subsequently, the company’s 37 assets, distributed among 33 buildings and four undeveloped plots of land, were taken over by the specialised operator Greystar, partner of AXA Real Assets and CBRE GI.

Greystar’s place at the top of the list remains firm, but a long list of other players are vying to take the top spot. The British operators GSA and Collegiate, and the Luxembourg fund manager Corestate all have ambitious plans for growth in Spain.

GSA will invest 300 million euros in new acquisitions in the Spanish market, as reported by EjePrime. The international student-accommodation giant expects to be managing 10,000 beds in Spain within five years’ time. For now, the company has two projects underway in Barcelona, in a total investment of thirty million euros, and is already working on plans to enter the market in Madrid, as well as exploring other cities such as Salamanca along with regional capitals in the south and north of the country.

For its part, Collegiate allied itself with the Spanish group Early Capital at the beginning of the year to enter Barcelona. The operator will manage the student residences at the Finestrelles complex, in Esplugues de Llobregat, acquired by Early last autumn, its third asset after the ones it already owns in Madrid and Valencia. Now, the company is looking for opportunities in Bilbao, Malaga and Granada.

Corestate also flew in from Luxembourg. Like the more than 473,000 university students who arrive every year in the country, searching for accommodation, the fund is looking to enrol in the sector. After beginning work on its first two projects, in Madrid (inauguration in September) and Seville, it is now finalising the purchase of a plot of land on which it is to develop another 400 beds. The manager’s goal is to become one of the top three players in the sector by 2020, with more than a thousand beds spread across the country. The company is already analysing the acquisition of another half a dozen plots of land to attain the goal it set for itself.

The Student Hotel is another of the major European players that have begun to take a close look at Spain. The Dutch operator has announced plans to invest 240 million euros in Spain and has already acquired two assets in Barcelona and will debut its first project in Madrid in 2019.

The Spanish ‘resi’ listed on the MAB

Although much of the capital that is being allocated to the student residence market in Spain comes from abroad, the local players are also looking for their piece of the pie. The Lofttown and Syllabus, a specialised vehicle created by Urbania International, are two clear examples of emerging, local interest in the sector.

Lofttown started its journey in the picturesque neighbourhood of Gràcia in Barcelona. Presided over by Santiago de Cruilles, the company already has two more projects in the Catalan capital in which it invested 24 million euros, EjePrime reported. The company is also analysing a possible debut in other cities around the country, such as Madrid, Girona and Valencia.

For its part, Syllabus is already currently one of the most active investors in the student residence market. Created last April by Urbania, the vehicle expects to invest up to 200 million euros in the development of new student residences in Spain. The company hired the former CEO of Hill International, Jeffrey Sújar, and has already made its first acquisitions, in Valencia and Malaga.

In addition, the university market in Spain is undergoing such a boom that a company that focuses on the market is also listed on the local stock exchange. Student Properties debuted on the Mercado Alternativo Bursátil (MAB) last December. Currently, the company owns a single asset, located in the district of Salamanca in Madrid.

Other possible arrivals

During this year and, above all, the one that is coming, new players are expected to enter the market for university residences. On such arrival is the American giant CA Ventures, which has Spain squarely in its sights within a 500-million-euro European investment plan.

Other institutional investors that are interested in the market include the Belgian group Life, the American investment fund Round Hill and the British operator Amro. The latter is looking for a partner in the national market to invest up to €300 million to create a portfolio of 5,000 beds in southern Europe.

Original Story: EjePrime – Jabier Izquierdo

Translation: Richard Turner

Corestate Finalises More Land Purchases in Spain

25 June 2018 – Eje Prime

Corestate wants its share of the student resident cake in Spain. The Luxembourg-based fund manager is finalising the purchase of new plots of land in the country, at the same time as it is starting to search for new opportunities in Portugal, according to explanations provided by the company’s most senior executive in Spain, Christopher Hütwohl. Corestate’s objective is to be ranked as one of the Top 3 operators in the sector by 2020.

The group is whereby seeking to fight off competition from companies such as Greystar, currently number one in the sector by number of beds following its acquisition together with Axa Real Assets and CBRE Global Investment Partners of Resa’s portfolio (formed by 37 assets) for €500 million. Another prominent operator is GSA, which acquired RIO’s portfolio for €180 million.

Corestate, which managed assets worth €22 billion at the end of the first quarter, is now launching new land acquisitions to build halls of residence for students, which will be added to the 206 beds that it is going to open in the Madrilenian district of Moncloa in September and the more than 300 that it will incorporate in Sevilla following the purchase of a plot of land in May.

According to Hütwohl, the company is currently finalising the acquisition of another plot on which it will build 400 beds and is “analysing four more plots” for 700 beds. Thus, Corestate’s plans include closing 2018 with more than 200 beds in Madrid and reaching 1,000 beds by 2020, which, according to Hütwohl “would place us as one off the Top three players in Spain”.

In parallel, the company has started to analyse its entry into Portugal with its business model. According to the head of Corestate, the fund is looking for opportunities in cities such as Lisbon, Porto and Aveiro.

The company is looking for plots on which to build with sizes that depend on the sizes of the halls of residence that they want to build, provided they are located in university cities. Nevertheless, Hütwohl warns that the “minimum size to achieve efficient management is 200 beds”.

“The student residence sector is becoming increasingly more competitive in Spain and we do not want to miss out on the opportunity and the advantage that our international knowledge affords us”, says the group’s executive in Spain (…).

Original story: Eje Prime (by P. Riaño)

Translation: Carmel Drake

C&W: Inv’t In RE Assets Amounted To €10,300M During YTD Sept

20 October 2017 – Expansión

The interest from investors in the Spanish real estate sector is far from slowing down; in fact, it has intensified in recent months. Specifically, during the 9 months to September, the total volume transacted on direct purchases, in other words, excluding corporate operations, amounted to €10,300 million, up by 74% compared to the same period last year, whereby exceeding the figure recorded during the whole of 2016, according to a report compiled by Cushman & Wakefield.

The report also forecasts that “the appropriate environment for investment that Spain offers” will allow the volume of investment in direct purchases to reach €12,000 million by the end of the year.

By area, one of the best performing segments so far this year has been the retail sector (retail premises, stores, shopping centres, retail parks and outlets). Between January and September, €3,100 million was invested in the segment, which represents 30% of the total investment in the real estate sector. The consultancy firm calculates that the investment volumes for the whole year could reach record levels, last seen in 2015, when purchases amounting to €4,150 million were made.

Offices were the second most sold asset by volume, with a 24% share of investment. Investment in offices during the first nine months of the year reached €2,500 million, of which almost €1,500 million corresponded to Madrid and €816 million to Barcelona.

Tourism is still one of the main attractions for investors. Hotel investment rose by 67% during the 9 months to September, to €2,000 million, thanks to the push from the Costa Brava, Costa del Sol, Palma de Mallorca, Canary Islands and Madrid.

Another niche segment with a strong outlook is the logistics sector. Cushman & Wakefield forecasts that investment in that area will amount to €1,000 million in 2017. The consultancy firm explains that the good figures in terms of leasing and the scarcity of high-quality assets are boosting the development of land up to 500,000 m2, in both Barcelona and Madrid.

New opportunities

In addition to the traditional segments, investors are paying attention to alternative assets, such as student residences, parking lots and petrol stations, which generate better returns.

In terms of the forecast evolution, the consultancy firm explains that the major activity recorded in recent years will result in a lower level of supply and will incentivise new acquisition formulae with indirect purchases through corporate operations and joint ventures. Moreover, the new cycle of property development will encourage investors to participate in the initial phases of developments, whereby redistributing the burden of property developer risk and facilitating investment.

Original story: Expansión (by Rebeca Arroyo)