Tag: turnover

Sareb Expects Its Business To Normalise By Start Of 2016

20 October 2015 – Expansión

Sareb is close to restoring the cruising speed of its business. That is what its President, Jaime Echegoyen, confirmed yesterday before the Senate’s Finance Committee: “From what we are seeing and given the pressure we are exerting to ensure that the migration of assets (to the new managers: Haya, Altamira, Servihabitat and Solvia) is completed as quickly as possible, I think that we will be back to providing a normal level of service by the first quarter of next year”.

This (migration) process caused Sareb’s turnover to drop by 10% during the first half of 2015. Echegoyen confirmed that the arrival of the new managers is already being felt in the second half of the year, despite the fact that the handover will not conclude until the beginning of 2016: “During the second half of the year, we are already in a much better position to fulfil our objectives and undertake our commercial activity than we were during the first half, and that will all be reflected in the numbers”, he said.

The transfer of assets was one of the points of interest during Echegoyen’s appearance in the Senate, together with the new accounting circular pursuant to which Sareb will have to make extraordinary provisions at the end of the year.

“In the likely event that capital requirements arise, the company has €3,600 million of convertible subordinated debt, which is more than sufficient to meet the requirements of the accounting circular”, explained Echegoyen. In response to questions from members of parliament, the President of Sareb went even further and said that “these own resources are sufficient to enable the company to fulfil its mandate and its business plan over the remainder of the entity’s twelve year life”.

Social housing

Echegoyen also used his appearance to announce that Sareb will double the number of homes available for social purposes, from 2,000 to 4,000, through the agreements it has in place with several autonomous regions and town halls, such as Madrid and Barcelona.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake

Quabit Recorded €6M Loss In H1 2015

17 August 2015 – Expansión

The real estate company Quabit recorded a loss of €6 million during the first half of 2015, compared with a profit of €62.3 million during the same period in 2014. According to management, the company’s earnings performance during the first half of 2014 was positively affected by the operations linked to its debt restructuring program.

Quabit has indicated that the loss recorded during H1 2015 reflects the “state of transition” in which the company currently finds itself and is the result of “limitations that have existed in recent years surrounding the launch of new projects, due to the crisis in the sector, and the difficulties involved in obtaining funding”.

Since restructuring its debt, Quabit has started to resume its activity, with projects in Zaragoza, Boadilla del Monte (Madrid) and Guadalajara, which now “need to undergo a period of maturation” before they will be reflected in the income statement.

The extraordinary impact of the debt restructuring is also reflected in Quabit’s turnover, which amounted to €4.1 million between January and June 2015, down by 91.8% on the same period last year, when the real estate company recorded revenues of €50.4 million.

EBITDA and debt

The company’s gross operating profit (EBITDA) was negative during H1 2015 (€5.8 million) compared with €71.6 million the previous year. Net debt with credit entities amounted to €355.4 million at the end of the first half of 2015, the same figure as a year earlier.

As at 30 June 2015, Quabit held a stock of 305 homes, compared with 281 homes at the end of 2014, up by 8.5%.

Original story: Expansión

Translation: Carmel Drake

Renta Corporación Intends To Double Its Profits In Five Years

24 July 2015 – El Economista

Renta Corporación has launched a new five-year strategic plan (for the period 2016-2020), in which it details its plans to double its profit to €20 million by 2020, compared with the €9 million that it expects to generate this year, according to the real estate company.

Thus, the company, which exited from bankruptcy proceedings last year, embarks on a new growth phase, driven by the economic recovery and the real estate sector.

In this context, the real estate company, which specialises in the purchase of buildings for their renovation and subsequent sale, will focus on “taking advantage” of the opportunities that arise in the sector “mainly, in the management of assets for third parties” and in increasing the number and size of its transactions.

In this sense, Renta Corporación expects its turnover to almost double (+88%) over the next five years to reach €340 million by 2020.

The real estate company will combine this new policy with its compliance with a creditors agreement (through which it emerged from bankruptcy in June 2014), as well as a unilateral agreement it made with the Tax Authorities to repay its senior debt.

During the first half of the year, Renta Corporación recorded a net profit of €4.5 million, i.e. 47% less than in 2014, because of the effect of a reclassification that it had to record for part of the debt it holds with the Tax Authorities.

Appeal to the Supreme Court regarding its debt with the Tax Authorities

Specifically, as a result of a ruling issued by the Provincial Court of Barcelona, the real estate company had to classify €9.3 million of the amount it owes to the Tax Authorities as senior debt.

Nevertheless, the company has appealed against the ruling to the Supreme Court and estimates that “the effects of this reclassification may be reserved in the event that this judicial review considers it appropriate”.

Renta Corporación’s half year results were also affected by the extraordinary items that the company recorded in 2014. Profits remained stable during H1 2015 at €4.4 million; meanwhile, the company recorded a negative EBITDA of €500,000), compared with an EBITDA loss of €25.2 million a year earlier.

At the end of June, Renta Corporación held net financial debt amounting to €17.6 million, roughly in line with its debt balance at the beginning of the year.

The company’s new strategic plan also envisages a gradual reduction in its level of indebtedness, from a liability of €17.5 million forecast for the end of 2015, to €4.9 million in 2019, to a positive balance by 2020.

Original story: El Economista

Translation: Carmel Drake

Miquel Alimentació Will Sell Business But Retain RE Assets

6 July 2015 – Expansión

On Friday, Miquel Alimentació announced that it is in advanced negotiations to sell its business to the Chinese state-owned group, Bright Food. The Asian food sector giant will acquire all of the business lines of the Spanish distribution company, which owns 63 GM Cash stores and more than five hundred supermarkets, operated under the Suma and Spar brand franchises.

The Miquel family, which currently owns 100% of the share capital, will nevertheless retain ownership of all of the group’s real estate assets. In this sense, it will continue to be linked to the business as it will lease all of the wholesale distribution company’s  logistics platforms and cash & carry stores to Bright Food.

According to Miquel Alminenació, Bright Food “has expressed its interest” in retaining the strategic lines identified by the existing management team and in preserving the organisational structure and the jobs at the Girona group. The objective of the company chaired by Ramon Miquel is to generate turnover of €1,024 million this year.

With headquarters in Shanghai and publicly owned share capital, Bright Food is an industrial conglomerate comprising 22 food and distribution companies, with turnover of €18,000 million. The purchase of Miquel Alimentació will be its first in the distribution sector in Europe, and it will open the door to the Asian market for the sale of the more than 17,000 product reference lines and 2,000 own-branded products that the Miquel group currently distributes.

The operation has been brokered by GBS Finanzas. KPMG has advised the vendor and the law firm Baker & Mckenzie has advised the buyer. The purchase now depends on the relevant authorisations from the European competition court and also the administrative procedures in China.

Original story: Expansión (by S. Saborit)

Translation: Carmel Drake

‘La Zagaleta’ Tripled Its Profits In 2014 To €10M

15 June 2015 – Expansión

La Zagaleta is regarded as the most luxurious residential development in Europe / The complex in Marbella, which has 235 homes, tripled its profits in 2014 to €10 million.

In just 900 hectares of land nestled in a Mediterranean forest a few kilometres from Marbella, and guarded by the highest level of security, the residential development of La Zagaleta hides a real estate oasis to which only a few wealthy individuals can aspire.

The Chairman of the company, Oswald Grübel, estimates that the 235 mansions that comprise the residential development are worth €1,800 million at market prices, although that figure increases to €3,000 million if we include the golf courses and other facilities at the site, which is linked together by a 60km-long internal road.

Considered the most luxurious and exclusive urban development in Europe, La Zagaleta is located in the middle of the Golden Triangle – between Marbella, Benahavía and Estepona – the area where the real estate recovery has started in Spain, driven by the pull of international investors.

Grübel, a former CEO of the Swiss bank UBS, took over the reins in 2013, after the Chairman and founder, Enrique Pérez Flores, decided to stand down from his role, at the age of 90. Last year, the company reported record sales of €40 million and tripled its net profit to €10 million. One of the drivers (behind these results) was the sale of several plots of land to a US fund, whose identity has not been disclosed for confidentiality reasons.

An agreement has been made with that fund to manage its assets, i.e. to build villas (on the acquired plots) and then sell them. The contract provides for the construction of the first two (villas) through a joint venture, on which work will begin this year; and then to build several more (villas) over the next five years, although that figure may increase.

According to Jacobo Cestino, CEO of La Zagaleta, in 2006, a strategic decision was taken for the firm to develop the land, in order to generate higher margins and so it reserved all of the available land. “Homes may end up forming part of the stock for a year and a half. That is a risk we run, but the reality is that we have sold properties that have not even been completed”. Thus, this year, the company will invest €15 million in three new mansions, whose market price will be around €40 million.

Cestino also revealed that the company is considering corporate operations, “because our aim is to grow and export our brand. We are analysing operations to form partnerships overseas on a daily basis. We expect to finalise at least one purchase between now and the end of the year”.

In La Zagaleta, around 150,000 m2 of land is occupied, although the buildability ratio is reduced to 15%. Thus, there is still 200,000 m2 available, divided into 185 plots. In terms of rotation, Cestino indicates that “there is still quite a lot”. In recent years, there have been 8 or 9 re-sales per year on average.

Original story: Expansión (by Lidia Velasco)

Translation: Carmel Drake

Barceló Acquires 42.5% Stake In Occidental Hoteles

5 May 2015 – Expansión

42.5% shareholding / The tourism group acquires the stakes held by Amancio Ortega, owner of Inditex, and several minority shareholders, and continues to negotiate with BBVA to take control of the chain.

The sale of Occidental Hoteles has been unblocked with Barceló’s purchase of a share of its capital. The tourist group has acquired a 42.5% stake from Amancio Ortega, owner of the textile empire Inditex, and several minority shareholders. In parallel, it is also negotiating with BBVA, which controls the remaining 57.5%, to gain control of 100% of Occidental and strengthen its position in the Caribbean.

Although the exact amount of the transaction is unknown, it has been closed with a discount of between 40% and 50% with respect to the €700 million that BBVA and Ortega paid in 2007. That was the figure that the shareholders hoped to obtain through the divestment process launched in 2013, which was thwarted last December, with Barceló as the favourite, due to differences over price.

Then, Barceló was bidding together with the fund Caribbean Property Group (CPG). Now, the tourism group is going to single-handedly undertake the purchase of the shares held by Ortega (who holds 23.63% through his company Partler 2006), Gregorio de Diego (who controls 13.5% through Tamar International) and the Miarnau family (whose company Iosa Inmuebles holds 5.26%).

Competition

The transaction, which is pending approval by the Mexican competition authorities, will be structured as a financial investment, and so Barceló will not take over the management of Occidental’s hotels. The chain operates 13 properties in the Caribbean and owns the majority of those establishments.

Nevertheless, sources in the sector are convinced that BBVA will end up selling a non-strategic stake. In fact, that is the joint position that the entity chaired by Francisco González and Amancio Ortega held until the end of 2014. The only thing that has separated them has been the timing (of their respective exits).

The textile businessman wanted to accelerate his exit from Occidental before the company looses value, since there is no growth plan on the table. In contrast, BBVA was keen to wait for a better offer and set a limit below which it was not willing to divest. In the end, the partners have broken their shareholders’ agreement, which has opened the door to Occidental for Barceló.

In terms of convincing BBVA, the close ties that unite the companies work in the tourism group’s favour. Barceló, BBVA and FCC created an asset company Grubarges in 1998, with the aim of channelling its surplus investors and growing in the hotel sector. Grubarges was dissolved in 2004 due to strategic differences between the partners, but the relationship is still strong.

If Barceló acquires 100% of Occidental, it will strengthen its position in the Caribbean, one of the priorities on its roadmap to become the world leader in the holiday hotel sector. Through the integration, Barceló would obtain a presence in new countries – Colombia, Aruba and Haití – and would strengthen its position in the Dominican Republic, Mexico and Costa Rica. Furthermore, the transaction would involve an investment plan to reposition Occidental’s properties.

Barceló currently operates 94 hotels and 30,000 rooms in 16 countries. In 2014, the company generated profits of €46.4 million, up 85.6% and turnover of €2,056.6 million, up 6.2%.

Original story: Expansión (by Yovanna Blanco)

Translation: Carmel Drake

Barceló’s Profits Soar By 86% In 2014 To Reach €46.4M

23 April 2015 – Expansión

Barceló’s results are improving thanks to the economic recovery. The tourism group closed 2014 with turnover of €2,056.6 million, up 6.2% from a year earlier. Net income increased by 22.1% to €1,329.7million – €888.4 million in Spain – whilst its gross operating profit (EBITDA) amounted to €216.7 million. The group’s profit for the full year after tax shot up by 85.6% to €46.4 million and its net debt decreased by 15.3% to €717.3 million, to yield a ratio of net debt over EBITDA of 3.3x.

By division, Barceló Viajes, which will soon be renamed B The Travel Brand, recorded revenues of €1,200 million in 2014, up 14.2%. The increase came as a result of the decrease in the number of operators in the Spanish market – after the disappearance of Marsans and Orizonia – and the upturn in domestic demand.

At 31 December 2014, Barceló had 653 agencies, several tour operators and the charter airline Evelop.

Latin America

In the hotel segment, the company highlights the rise in the average daily (room) rate and revenue per room, which allowed it to offset the 0.6% decrease in its occupancy rate. In Latin America, Barceló’s properties recorded EBITDA increases of 30% and overall accounted for 74% of the group’s total profits. In addition to the increase in (room) rates, Barceló’s policy to refurbish its hotels has also had an effect. Since 2007, the group has spent more than €1,000 million in this area – €90 million in 2014.

At 1 March 2015, Barceló operated 95 hotels – it owned 55% of these and rented 27% – and 29,375 rooms in 16 countries. 59% of its properties are four-star hotels and 65% are sun and beach locations. Moreover, Barceló owns a 40% stake in Crestline, a company that manages another 74 properties in the USA.

After opening two hotels in 2014, the Group’s routemap includes resuming growth. As such, the chain has started the year by opening a new hotel in Puebla (Mexico) and will incorporate another six properties (into its portfolio) before 2016.

In parallel, at the beginning of 2015, the Group created a Socimi with Hispania. It will transfer 16 hotels and two shopping centres valued at €421 million to this entity to reduce its exposure to real estate, which is currently at its highest level ever. Similarly, in 2014, Barceló sold a number of its hotels in the USA and Dominican Republic.

This year, the goal of the company, which is controlled by the Barceló family and employs 23,681 people, is to generate EBITDA of €251 million and net profit of €99.8 million.

In 2014, Barceló agreed to distribute €10 million in dividends and has proposed an additional payment of €4.3 million in 2015, which is pending shareholder approval.

Original story: Expansión (by Y. Blanco)

Translation: Carmel Drake

Franklin Templeton Increases Its Stake In Lar España

20 March 2015 – Expansión

The fund Franklin Templeton has increased its stake in the Socimi Lar España to more than 15%, according to the CNMV’s records. Specifically, the investor, which with its 14.9% stake was already the largest shareholder of the Socimi chaired by José Luis del Valle, has increased his participation to 15.07%, after purchasing a package of 126,537 shares.

Other shareholders of Lar España include the fund manager Pimco, which owns 12.5% of the capital; the fund manager Bestinver, with 4.8% and Ameriprise Financial with 3.7%. These investors spent €400 million on the IPO.

In 2014, Lar España recorded turnover of €7.2 million from rental income. Its market capitalisation amounts to €399.3 million, after its share price fell by 0.26% yesterday to €9.974.

Original story: Expansión (by R.R.)

Translation: Carmel Drake

CBRE Enters The Real Estate Wealth Management Segment

18 March 2015 – Expansión

CBRE, the multi-national consultant and real estate services company, has launched a Wealth Management division in Spain, which will specialise in the management of large property estates. To this end, the US company has hired Etienne Brocas, who will advise domestic and international investors in the acquisition of properties in the country, where assets are particularly “attractive in terms of price and yields compared with those in other European countries”.

The entry of CBRE into the Wealth Management segment is one of the goals mentioned by the company in its Strategic Plan for 2014–2016. The objective of that plan is to double the company’s turnover “through organic and inorganic growth, and to expand into new and innovative business streams”.

Experience

Etienne Brocas has more than 25 years of experience in the real estate market and 16 in private banking. He was the CEO of Santander Private Banking’s real estate arm and CEO of the same sector for Western Europe at UBS Wealth Management.

Original story: Expansión (by J.B.)

Translation: Carmel Drake

Servihabitat: Sales Of €212M For Spain’s Largest Servicer

18 March 2015 – Expansión

Servihabitat increased its real estate sales by 38.8% in 2014, selling 21,163 assets in total. The real estate company, which is controlled by the fund TPG (51%) and part-owned by Caixabank (49%) also signed 14,873 lease agreements, and so, in total, it successfully marketed 36,036 units.

Thanks to these transactions, the platform led by Julián Cabanillas generated turnover of €212.64 million, which represents an increase of 24.9%. “We are very pleased with the results obtained in a particularly difficult year”, said Cabanillas, the CEO (of Servihabitat) yesterday.

When it was founded, Servihabitat was dedicated solely to the sale of property that had been repossessed by the La Caixa group. Nevertheless, it has now adopted a multi-client strategy and it was one of the real estate companies to be awarded the management of some of Sareb’s assets, which are now being migrated across. Specifically, it took over the management of 33,000 properties and loans from Novacaixagalicia, Liberbank and Banco de Valencia worth €9,200 million. In this way, Servihabitat’s portfolio has grown by 26% and now includes 194,156 units. According to market sources, this volume of properties is worth around €59,000 million, which makes Servihabitat the largest servicer in the sector with a market share (by value) of 22%, ahead of Haya Real Estate, Altamira, Solvia, Anida and Aliseda.

44,207 properties in the entity’s portfolio are currently rented out, which represents an increase of 47%.

Original story: Expansión (by S. Saborit)

Translation: Carmel Drake