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

CBRE: Investment in High Street Premises Will Exceed €1.1bn in 2018

5 July 2018 – Eje Prime

Commercial premises, especially those located on the most prime streets of Spain, are proving highly sought-after. According to CBRE, the high street investment market is going to achieve record figures in 2018, up to a total of €1.1 billion. The culprits? The German fund Deka and Inditex, in addition to the strength of secondary cities in the country.

During the course of the last two years, investment in high street assets remained stable at around €800 million per year, after peaking at €1.01 billion in 2015. In 2018, according to calculations from the real estate consultancy CBRE, the investment volume will exceed the €1 billion threshold again, primarily due to the impact of the sale to Deka of a batch of 16 Zara stores for €400 million and the boost from activity beyond Madrid and Barcelona.

Deka has whereby become a catalyst for the retail investment market in Spain, together with Generali and Union Investment, which also starred in major investment operations during the first few months of 2018.

Deka’s €400 million operation was the largest in the last year and a half, followed by the purchase by Hines of number 17 Paseo de Gracia for €113 million and the acquisition by Generali of number 9 Preciados for €107 million.

Institutional investors are the main drivers of the investment market in this segment, according to the Retail keys in Spain report in CBRE. “In recent years, several overseas institutional investors have entered the Spanish market and many have been active in 2017 and 2018”, according to the document, which points out that Socimis such as Tander, Ores and Silicius have also been interested in the sector.

Madrid and Barcelona are continuing to be the main magnets for high street investment in Spain and, together, they account for 79% of the total expenditure. “Nevertheless, other cities in Spain are booming and demand is rising for investment products in cities such as Bilbao, Valencia, Sevilla and Málaga”, says the document.

The displacement of demand to other cities is a consequence of product shortages and low returns. On the one hand, according to CBRE, operators have accentuated their preferences for prime streets, which has strengthened the shortage of products. “Premises with recently signed contracts are sparking a lot of interest, given that if they reflect market rents, they become a very stable long-term investment”, says the document.

On the other hand, the pressure on returns remains strong and in 2017, they were compressed further still, reaching levels of 3.25% in Madrid and 3.50% in Barcelona for the most prime products. The “historically low” values are repeated in other European cities, with 3.25% in Berlin, 3% in Milan, 2.75% in Paris and 2.25% in Munich.

As a result of those two elements, investor interest is extending to other cities in Spain, although the operations closed tend to be of greater importance, “given that the premises and the rents are lower and the returns are higher”.

With investment of €170 million outside of Barcelona and Madrid in 2017, several purchases stand out such as M&G’s acquisition of the H&M store on Reyes Católicos in Granada as well as of the El Corte Inglés building in Plaza la Magdalena in Sevilla.

Valencia and Bilbao are the markets that, typically, generate the most interest from investors due to the size of the two cities, the importance of their high streets and the role of tourism. The tradition of investment in the segment by local family offices means that returns there are compressed to 4%.

Retail and shopping centres

High street premises accounted for 25% of the total investment in retail in 2017, well behind shopping centres, which accounted for 51% of the total, but ahead of retail parks (15%) and portfolios of supermarkets and hypermarkets (9%) (…).

In Spain in 2017, investment in the Spanish retail market amounted to €3.3 billion. CBRE forecasts that the figure will amount to €2.9 billion in 2018, boosted by high street investment (…).

Original story: Eje Prime (by P. Riaño)

Translation: Carmel Drake

CBRE: Investor Interest in High Street Stores Skyrockets

5 July 2018 – Cinco Días

Stores on the most commercial streets of Spain have become an object of desire for investors in the real estate market. Large funds and insurance companies alike are investing in these types of assets and experts predict that a new record is going to be set in the segment this year.

Investors are expected to spend around €1.1 billion on these types of commercial premises in 2018, according to forecasts from the consultancy CBRE. That figure would exceed the amount invested in high street stores in 2017 by €300 million, equivalent to a growth rate of 36.9%. Of interest are shops on commercial thoroughfares such as c/Preciados and c/Serrano in Madrid and Paseo de Gracia and Portal de l’Àngel in Barcelona. In fact, those two cities accounted for 79% of total investment last year. “Nevertheless, other cities in Spain are on the rise and there is growing demand for investment products in cities such as Bilbao, Valencia, Sevilla and Málaga”, according to the report “The Keys to Retail in Spain”, published by CBRE yesterday.

Investors regard these types of well-located assets as a good option for placing their money, a solid alternative in the context of low-interest rates and because these high street stores perform better (than other commercial assets) in the face of competition from online retailers. Currently, according to CBRE; the returns on these properties amount to 3.5% in Barcelona and to 3.25% in Madrid; in other cities (with more risk), the returns are greater.

The stars of these acquisitions are mainly the large funds. Hines, M&G, AEW, Thor, Union Investment, CBRE GI and Deka. “In 2017, in addition, an insurance company entered the high street sector for the first time: Generali acquired the Pull & Bear store on Calle Preciados in Madrid”, according to the report. Other active players include the Socimis, such as Tander, Ores, and Silicius, which have started to express interest.

In terms of large operations so far this year, in January, the German fund Deka acquired 16 Inditex stores for €400 million. Another significant operation was the acquisition of Mercado de San Miguel by the Dutch fund Redevco, for €70 million.

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Socimi Tander Acquires Gran Vía 6 (Bilbao) for €7.5M

26 June 2018 – Eje Prime

Tander is expanding its geographical reach. The Socimi, present in Barcelona and Santander until now, is growing in the north of Spain with the purchase of its first asset in Bilbao. The company has acquired number 6 Gran Vía in the Basque city for €7.5 million, in its first operation since it made its debut on the MAB in January.

According to a statement filed by the company with the Alternative Investment Market (MAB), the operation includes “two properties that comprise a single commercial premise”, with a constructed surface area of 257.33 m2.

“These premises have been leased recently, and are on the verge of being handed over to the new lessee, something that will happen within the next few days”, says the company, owner of a fund in which the Canadian manager Première Alliance holds a stake.

To carry out the operation, Tander has required external financing. In June, the company granted various guarantees to ING to “free up” €8.32 million of the financing committed with the financial entity, which amounts to €54.27 million in total. Similarly, the company drew down €4.27 million more.

The Socimi is using that amount to finance the purchase of the asset in Bilbao as well as to strengthen “its financial capacity to comply with its real estate asset acquisition strategy”. Tander’s investment plan for 2018 amounts to €25 million, which will serve for the acquisition of between three and four assets outside of Madrid and Barcelona, according to Eje Prime.

The company debuted on the MAB in January with a valuation of €50 million. Tander owns five assets in prime areas of Barcelona and a sixth in Santander, which constituted a portfolio that was worth €80.3 million at the beginning of the year.

From Vía Laietana to Paseo de Gracia

Tander’s footprint in Barcelona is located in the centre of the city. The Socimi’s largest asset is an office at number 6-20 Calle Casp, which has a surface area of 3,457 m2. That building houses the offices of Cadena SER, owned by Grupo Prisa, just above Teatro Tívoli.

At number 15 Paseo de Gracia, the manager owns a retail premise measuring 527 m2, which is currently leased to FC Barcelona, which has opened a flagship store. In the same street, at number 27, the Socimi has leased a store measuring 792 m2 to the brand Cos, part of the H&M group.

Tander completes its portfolio in Barcelona’s city centre with part of number 47 Vía Laietana, an office building in which the Socimi has leased 1,100 m2 to Banco Sabadell. The financial entity also leases a branch measuring 155 m2 at number 171 Travessera de Gràcia, which is also owned by Tander Inversiones.

Original story: Eje Prime

Translation: Carmel Drake

Tander To Invest €25M in Spain’s High Street Sector in 2018

13 February 2018 – Eje Prime

Tander Inversión is looking to get its teeth into the retail high street sector. The Socimi plans to invest up to €25 million in 2018 during which time it hopes to expand to more cities in Spain, with Madrid as the priority. That is according to comments made by the firm’s Director General, Sergi Mirapeix, speaking to Eje Prime. Tander’s objective is to buy between three and four assets during the course of this year.

Owned by a fund in which the Canadian manager Première Alliance holds a stake, the real estate company’s current investments are concentrated in Barcelona, where it owns five assets in prime areas of the Catalan capital. The sixth asset in the portfolio, with which it made its debut on the Alternative Investment Market (MAB) at the beginning of 2018, is located in Santander. When the MAB’s bell rang, the value of Tander’s portfolio amounted to €80.3 million.

Now, the objective of Mirapeix is “to expand our investments in the main cities in Spain”. Some of the locations that the Socimi is analysing include Bilbao, Valencia, Sevilla and San Sebastián, although it is also interested in Málaga and A Coruña.

Meanwhile, in Cataluña, beyond Barcelona, Girona is another city that is in Tander’s line of sight “because it has a high income per capita, above the Spanish average, and it is also an attractive commercial market”, says Clara Casales, administrator of the Socimi’s properties. “Our shareholder is very conservative and seeks very specific assets”, says Mirapeix.

Tander is analysing different operations but has not identified anything yet. In this regard, Mirapeix says that retail high street assets “are a complicated type because, when they are already on the market, they are very burned out, which makes it difficult to obtain the margin that you want”.

The executive also highlights the high degree of competition that exists for these types of properties, especially between family offices, which “have a higher investment margin”, he said.

On the other hand, in addition to expanding to more Spanish cities, Tander’s roadmap could involve expanding and crossing the border within the next few years. “We are going to explore entering Portugal, focusing on Lisbon and Porto”, said Mirapeix, “although, for that, we still need to establish ourselves in Spain”.

Prime stores on Vía Laietana and Paseo de Gracia  

Tander’s current portfolio in Barcelona is located in the most luxurious commercial area of the Catalan capital. The Socimi’s largest asset is an office space at number 6-20 Calle Casp, which spans 3,457 m2. That is home to the offices of Cadena SER, owned by the Prisa Group, just above Teatro Tívoli.

Very close by, at number 15 Paseo de Gracia, the manager owns a retail store spanning 527 m2, which is currently leased to FC Barcelona, which has opened its flagship store there. On the same street, at number 27, the Socimi owns a store measuring 792 m2, which it has leased to the Cos brand, from the H&M group.

Ten minutes towards the sea by foot, Tander completes its portfolio in the central area of Barcelona with part of number 47 Vía Laietana, an office building where the Socimi has leased 1,100 m2 of space to Banco Sabadell. In addition, the financial institution has a branch measuring 155 m2 at number 171 Travessera de Gracia, which is also owned by Tander Inversiones.

Original story: Eje Prime (by J. Izquierdo)

Translation: Carmel Drake

Socimi Tander Inversiones Debuts on the MAB

12 January 2018 – Expansión

The listed real estate investment company (Socimi) Tander Inversiones has debuted on the Alternative Investment Market (MAB) with no change to its initial price, which was fixed at €9.50 per share.

Tander Inversiones, which is trading under the code “YTAN”, was listed through the fixing contracting system, which sets prices twice a day, in such a way that the next variation will be published at 16:00.

The starting price of €9.50 per share, which had been established by the Socimi’s Board of Directors, represents a company valuation of €49.8 million.

Renta 4 Corporate served as the registered advisor, whilst Renta 4 Banco was the liquidity provider.

Tander Inversiones Socimi is a company dedicated to investment in properties, primarily retail premises allocated for rent.

The Socimi owns a portfolio of assets comprising five retail premises in Barcelona and another one in Santander.

Original story: Expansión 

Translation: Carmel Drake