Spain’s Four Largest Socimis Already Control €30 Billion of Real Estate

8 August 2018

The largest of these real estate companies multiplied their assets fourfold since their first major acquisitions in 2015. Axiare left the continuous market and Hispania will soon follow as the sector undergoes a period of concentration.

The success of the socimi regulatory regime since its launch in 2013 is reflected in the gigantic portfolio of assets that these real estate companies have amassed in the last few years. The four largest listed companies have already accumulated portfolios of properties worth nearly 30 billion euros in three or four years of operation, according to the companies’ financial reports for the first quarter of 2018.

The development of a regulatory regime for these listed real estate investment companies was helmed by the then Minister of Finance Cristóbal Montoro, as these companies were exempted from paying corporate taxes in exchange for obligations such as having to distribute at least 80% of their dividends (which is taxed) and a listing on the stock exchange, guaranteeing transparency, among other requirements. The regulatory regime followed the example of REITs (Real Estate Investment Trust), which have a long history in the US and Europe.

These companies are focused on the property business, and they lease their properties, which are principally offices, shopping centres and commercial premises, hotels, rental homes and logistics warehouses.

The launch of the regulatory regime coincided with the recovery in international confidence in Spain (after the sovereign debt crisis and doubts about its financial system) as some foreign firms (mainly investment funds and later institutional capital such as insurers) that returned to the market, betting on a recovery in the reactivation of the Spanish real estate market. Moreover, socimis have been one of the principal channels for investing these international flows of capital in this type of asset.

At Least €15 Billion More on the MAB

Spain’s Alternative Stock Market. The MAB found a way to grow through the socimis. 59 of these real estate companies have already listed on the market, often as purely tax vehicles, with no major movements in their limited free float and which also do not carry out large purchases. Among them, three big ones stand out: GMP (owned by the Montoro Alemán family and Singapore’s sovereign wealth fund, GIC), Uro Property (with Santander’s banking offices) and General de Galerias Comerciales (owned by the executive Tomás Olivo). At the end of last year, there were 44 of these companies in the MAB, with a value of 12.221 billion euros (+60% y-o-y), according to data from Armabex, a registered advisor.

Testa Residencial. Among the 15 socimis that joined the MAB in the last months, Testa, which is owned by Santander, BBVA, Acciona and Merlin, stands out. Testa debuted at the end of July with €2.275 billion in rental housing. Along with other companies that launched on the market this year, there are now 59 firms with at least €15 billion in property. Initially, Testa had planned to debut on the continuous market, but market doubts in June led the company to opt for its plan B. The company still plans on a move to the continuous market in the future.

Records for investments in this type of property were broken in 2015, 2016 and 2017. In the past year, 13.99 billion euros were allocated to acquisitions, according to the real estate consultancy JLL, with international funds and socimis as the main players.

The growth of these companies over the last three years has been spectacular. In the first semester of this year, when the socimis published updated property valuations, the big four had €27.336 million in their portfolios (up 3% compared to the end of 2017). The four include Merlin Properties, Colonial, Hispania and Lar España. Taking the first quarter of 2015 as a baseline, when the largest of these companies were already active and began to make their large purchases, these same companies had a total of €6.691 billion. That is a fourfold increase in three years.

If one takes into account that Colonial had not yet become socimi that year (the developer changed status in 2017), the jump is even greater since, at the time, Axiare (absorbed a few months ago by the Catalan company) is one of the top four, with only €465 million in its portfolio. At that point, Merlin, Hispania, Axiare and Lar España had total assets of €4.2 billion, 6.5 times less than at the present date.

The success of these companies has led them to be targets of large corporate operations in the sector in recent months, in a period of concentration that experts believe will continue for the time being.

The largest then, as now, is Merlin (listed on the Ibex-35), which has Ismael Clemente as its CEO. The socimi already owns properties worth €11.755 billion, mainly offices and shopping centres and commercial premises, although with increasing investments in the thriving logistics warehouse sector. The company was launched after convincing investors, mainly Americans, to acquire the so-called Árbol (Tree) portfolio and its 800 BBVA banking branches.

The socimi debuted on the stock exchange in 2014 and grew rapidly with the acquisition of Testa from Sacyr in 2015 (€1.8 billion cost) and the integration of Metrovacesa’s tertiary assets (buildings valued at €1.67 billion) in 2016. At this point, Santander became its largest shareholder, with 22.6% of the capital. The rest is highly diluted, with large international funds as the most common investors. Its flagship buildings include the Torre Agbar, where Facebook will open an office (through the CCC outsourcing company) to monitor and control harmful content on the social network.

Merlin is closely followed by Colonial (Ibex 35), which has assets valued at €11.19 billion, compared to €2.185 billion in 2015. The historic real estate company began operations in Barcelona in 1946 and decided to become a socimi last year for the tax benefits. It has made major strides through its investments, including its recent takeover of Axiare, for which it paid €1.7 billion, giving Madrid a greater weight in its portfolio. The portfolio, mainly offices (91%), includes properties controlled by its French subsidiary SFL, with buildings in Paris (33% of the total value). The core of Colonial’s shareholders includes the Mexican investor Carlos Fernández González (18.3% of the capital), the Qatar Investment Authority (10.6%), the Colombian group Santo Domingo (7.3%) and the perfume family Puig (5.1%).

The other major socimi that has been the protagonist of a recent corporate deal is Hispania, listed since 2014, which was recently taken over by the giant American fund Blackstone. In fact, Blackstone has controlled 90.5% of the socimi since the end of July and is expected to abandon the socimi tax regime in the coming weeks. The company has €2.185 billion in real estate, 66% of which corresponds to hotels. The US fund plans to use Hispania’s assets to create a large hotel platform after having also acquired the HI Partners from Sabadell for €630 million.

After the acquisitions of Hispania and Axiare, the only large company that will remain on the continuous market is Lar España, which is managed externally by Grupo Lar, with the Pimco fund as its main shareholder (19.6%). It was the first socimi to make the jump to the stock market and has assets of €1.58 billion, of which 82% are shopping centres, following its strategy of focusing on the retail sector. With that in mind, the company announced the sale of its logistics park to Blackstone for €120 million at the end of July.

Original Story: Cinco Días / El País – Alfonso Simón Ruiz

Translation: Richard Turner

M&G Real Estate Buys 16 Santander Branches For €56.2M

25 May 2017 – El Economista

The fund manager M&G Real Estate has signed another deal in Spain, this time to become Banco Santander’s new landlord. Specifically, the firm has just signed an agreement with the Socimi Uro Property to acquire 16 of the financial institution’s branches for which it has paid €56.2 million.

The operation, which was closed at a premium with respect to the most recent valuation of the transferred portfolio, also includes the granting of a call option over another branch, which may be executed in the short term.

According to the Socimi, which owns approximately one-third of Banco Santander’s branches, the portfolio that M&G has purchased generates annual rental income of €3.04 million and comprises seven branches from the so-called Blue portfolio and nine from the Green portfolio.

The classification of the branches into these portfolios reflects the maturity dates of the corresponding rental contracts. Thus, in the first case (Blue portfolio), the lease contracts are due to terminate in 2045, 2046 and 2047, and may be extended for another seven years. In the case of the assets included in the Green portfolio, the lease contracts are due to mature between 2036 and 2038.

These terms of 30 and 20 years, respectively, match the British manager’s investment strategy, given that it seeks safe, long-term operations. In this way, the firm’s first operation in Spain was closed in 2015, when it acquired Telefónica’s former headquarters in Madrid, located in the heart of the city on Calle Ríos Rosas. It paid €175 million for that property, which is now the headquarters of WPP.

Following the sale, Uro will continue to own a portfolio of bank branches whose approximate value amounts to €1,893 million. When the Socimi debuted on the stock market, in March 2015, it managed 1,136 Santander branches, nevertheless, in April 2015, it sold a portfolio of 381 branches to Axa Real Estate for €308 million, leaving 755 branches, which cover a surface area of more than 340,000 m2.

Original story: El Economista (by Alba Brualla and Javier Mesones)

Translation: Carmel Drake

Who’s Who Behind The MAB’s Largest Socimis?

6 February 2017 – Expansión

The majority of Spain’s Socimis are now listed on the Alternative Investment Market (MAB). They have a combined market capitalisation of €3,500 million and so account for 68.5% of the value of that market, which is aimed at small and medium-sized companies.

In total, 29 real estate companies form part of the MAB, which comprises 67 companies in total. Seventeen of those real estate companies debuted on the MAB last year (…).

The largest Socimis

With a market capitalisation of €819 million, GMP is the largest Socimi on the MAB, larger even than one of the four Socimis that trades on the main stock market, Lar España. GMP, which was founded in 1979 by the Montoro Alemán family, debuted on the MAB last July, after adopting the Socimi structure two years ago. The real estate company, which owns around twenty office buildings in the most high profile financial districts of Madrid, has the sovereign fund of Singapore GIC as one of its shareholders; GIC owns a 32.9% stake in GMP, which it controls through another MAB-listed company, Eurocervantes.

Moreover, GMP is not only the largest Socimi (on the MAB) by market capitalisation, it also holds the largest portfolio of assets, worth €1,800 million as at 30 June 2016.

Another important owner of office buildings is Zambal. This Socimi is the only one of the five largest Socimis on the MAB that is not managed by its owner. The firm Investment Business Beverage Fund, based in Luxembourg and owned by the French magnate Pierre Castel, has appointed Iba Capital to manage its real estate investments in Spain. Iba is led by Castel’s fellow countryman Thierry Julienne.

This Socimi is the landlord of a number of large companies, both home-grown and from overseas. It owns the Madrid headquarters of Vodafone, Enagás, Gas Natural, BMW, Unidad Editorial and Día, amongst other buildings. Its portfolio is worth more than €730 million and its market capitalisation amounts to €559 million.

Meanwhile, Uro Property was created by the creditors of the company Samo, which purchased around 1,130 bank branches leased to Banco Santander in 2007. Nowadays, after selling several batches, it owns 755 branches worth €1,585 million (as at 30 June 2016).

Its main shareholder is the firm Ziloti Holding, although Santander and CaixaBank also hold direct stakes in the company amounting to 22.79% and 14.5%, respectively.

Blackstone, the largest investment fund in the world, has also listed a Socimi on the MAB to manage some of its real estate assets in Spain. Specifically, it has placed the thousands of homes that it owns and rents out into Fidere, worth €317.5 million.

The fifth largest Socimi on the MAB by market capitalisation is Isc Fresh Water. This vehicle was created with more than 200 bank branches from Banco Sabadell purchased in April 2010 by the Mexican fund Fibra Uno, controlled by the investor Moisés El-Mann.

Nowadays, the Socimi owns 213 branches, worth around €374 million, and its main shareholders are the El-Mann family, with a 65% stake and Jacobo Bazbaz Sacal, with 14.85%.

Diversity on the MAB

Each one of the Socimis on the MAB has its own characteristics, ranging from Promorent, with its market capitalisation of €4 million to GMP (which is worth more than €800 million). Their performance on the stock market is also very different: five of them have recorded increases since the beginning of 2017; three have registered decreases; and the remaining 21 have not seen any changes in their share price since the start of the year. (…).

Outlook for 2017

The proliferation of Socimis on the stock market will continue this year, according to the experts, who believe that the economic context favours these companies. (…).

Nevertheless, analysts warn that their small size and lack of liquidity imply risks for investors, since it is possible that they will not be able to sell their shares when they want to, due to the very small volume of business. (…).

Original story: Expansión (by Rocío Ruiz and Diana Esperanza)

Translation: Carmel Drake

Santander Launches The Sale Of Its Landlord URO Property

11 November 2016 – El Confidencial

Banco Santander and the other shareholders of URO Property, the Socimi that owns 755 of the Cantabrian-based entity’s branches, have formally launched the sale of the company, with a view to finding a white knight to acquire most of the Socimi’s shares.

According to three sources close to the operation, Citi was given the mandate to open an organised process on 19 September, with a view to closing the operation before the end of the first half of 2017.

The US entity had already been engaged in May to analyse the possible alternatives for a change in the shareholder structure and now that interest from sovereign and pension funds, insurance companies, fixed income investors and several real estate companies, has been confirmed, the formal process has been launched.

Citi, Santander and URO all declined to comment on the announcement.

The Socimi is attractive because it represents a low risk investment, with guaranteed returns and the certainty of dividend distributions. Those characteristics make it an object of desire for large sovereign funds and very conservative vehicles, the main candidates that Santander and its partner shareholders are targetting for this divestment process.

In addition, URO’s shareholders are open to exploring formulas such as the one that Santander has just successfully carried out with Metrovacesa, including merging the Socimi with another large landlord of commercial premises, according to the sources.

In addition to the activity undertaken by the bank chaired by Ana Botín, several other entities have also sold off large batches of branches in recent years, including BBVA, which sold 800 branches to Tree Inversiones Inmobiliarios, now part of Merlin, and Sabadell, which sold a portfolio of 228 branches and 133 parking spaces to Moor Park, which, in turn, subsequently sold the portfolio to the Mexican businessman Moisés El-Mann.

URO is currently very limited in terms of its business operations, due to the clauses included in the bond issue, amounting to €1,300 million, which it undertook in the spring of 2015, a month after it sold 381 of Santander’s branches to Axa.

Those two operations were a complete success from a financial point of view because they granted the Socimi the stability that it had been seeking for so long, but they also reduced its room for maneouvre, as the entity was forced to use the rental income from 666 of Santander’s branches to guarantee the issue, and also pledge another 80 branches (…).

Santander and CaixaBank will continue to hold stakes in URO

According to URO, the net book value of its current portfolio of branches amounts to €1,585 million, based on its most recent official accounts corresponding to the month of June, whilst its market capitalisation on the Alternative Investment Market (MAB) amounts to €197.5 million.

The decision to activate a formal sales process represents the company’s response to the desire expressed by several of its shareholders to exit from its share capital, now that the “lock-up period” has come to an end.

URO’s creditor entities, led by Santander and CaixaBank (which hold stakes of 22.78% and 14.5%, respectively), decided to execute their debts and take over control of the company in 2014. Both plan to continue as shareholders in the Socimi following the sale, although they are hoping to take advantage of this move to adopt smaller positions.

Other shareholders include BNP Paribas, one of the entities that wants to sell, which controls 9.18%; whilst the former shareholders of URO, Sun Capital (renamed Atisha Holding) and Pearl Group (now Phoenix Life) hold 18.92% and 14.90%, respectively. Other entities, such as Barclays and several hedge funds, which hold stakes of less than 5%, also want to exit. (…).

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Citi Seeks New Shareholders For Uro Property

20 May 2016 – Expansión

Uro Property, the Socimi that owns a quarter of Santander’s branch network in Spain, may see a change in its shareholders in the coming months. The company that holds 84% of its share capital, Ziloti Holdings, has given Citi a mandate to study possible shareholder changes.

This mandate comes in the face of interest from some of the current shareholders to exit the company, given that they were forced to acquire shares in the first place when their debt was converted into capital in 2014.

The main shareholders of Uro Property – both through Ziloti and otherwise – are Santander, with 22.7%; Atisha Holding, the former Sun Group, with 18.9%; Phoenix Life Assurance, with 14.6%; CaixaBank, with 14.5%; BNP Paribas, with 9.2%; and other private investors and international entities.

Citi will mainly look for investors amongst the large pension funds, insurance companies and investment funds.

The departure of the shareholders was vetoed until March under an institutional agreement reached following the recapitalisation of Uro.

The renewal of the shareholder base is one of the outstanding milestones for the company, which owns 755 Santander branches in Spain. It refinanced its debt last year and cancelled a swap, whereby reducing the financing costs of its €1,300 million debt from 6% to 3.35%. Last year, the Socimi sold 381 branches to Axa for €308 million, recording a capital gain of €27 million.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake

Uro Property’s Profits Amounted To €67M In 2015

19 April 2016 – Expansión

Uro Property, the Socimi that owns a quarter of Santander’s branch network on Spain, recorded profits of €67 million in 2015, down by 82% compared with 2014, after it sold some of the branches to Axa.

This operation, which saw Uro go from owning 1,136 branches of the bank chaired by Ana Botín, to 755 branches, generated net profits of €27 million for the Socimi. The transfer price for the 381 branches was €308 million. In addition, the company has another 40 branches up for sale after they were returned by Santander; BNP Real Estate has been appointed to coordinate the sale.

The second major milestone for Uro Property in 2015 was the refinancing of its debt and the cancelation of a swap (insurance against interest rates), which generated losses of €65 million in 2014. As a result, the Socimi reduced the financing costs on its €1,300 million debt balance from 6% to 3.35%.

Despite these achievements, Uro Property’s profit in 2015 was 82% lower than in 2014 as it incurred higher extraordinary revenues in the prior year. In this way, the valuation of its property portfolio generated profits of €183 million two years ago. In addition, the Socimi also recorded extraordinary revenues of €198 million due to the conversion of a mezzanine tranche (young or high risk debt) with a discount on its original value.

Uro Property saw an improvement in the valuation of its properties in 2015, up by 5%, from €1,804 million to €1,916 million, excluding the impact of the branches sold to Axa.

The Socimi will distribute €54 million of the €65 million profit as a dividend, equivalent to 80% of its profits, as required by the legislation that governs these companies. Of this amount, €18 million was already paid to shareholders in December and another €36 million will be distributed in July.

Investigation

Meanwhile, Uro Property is being investigated by the Tax Authorities, which have started disciplinary proceedings. According to the company’s accounts, this investigation is due to “a transcription error”, for which the Treasury has proposed a fine of €7.29 million. Uro has appealed that decision and has not recognised any provisions in its accounts for the time being.

Uro is the company that used to be Samos, which acquired 1,152 Santander branches in 2007 under a sale & lease back arrangement. Its high level of debt meant that the creditor bank acquired some of its share capital in 2014.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake

Socimis Account For Almost One Third Of The MAB

14 March 2016 – El Economista

Almost one third of the 49 companies currently trading on the Alternative Investment Market (MAB) are Socimis. The real estate investment vehicles have a combined market capitalisation of €1,600 million and have led the debuts on this market, which have accompanied the recovery of the sector.

The first Socimi to make the move onto this growing business market was Entrecampos, which debuted in November 2013, a year in which Promorent also joined the exchange. In the middle of 2012, the Ministry of Development decided to improve the regulations governing Socimis – created in 2009 – whereby relaxing the requirements for their constitution, in relation to capital and the number of shareholders.

Despite that, in 2014, only two Socimis debuted on the MAB, namely Mercal and Obsido; the latter specialises in hotel assets.

The presence of Socimis was almost symbolic until in 2015, when there was also a change of direction in the real estate sector and this type of company – very common in other countries similar to our own – burst onto the MAB, which had been questioned after having witnessed some high profile failures (Gowex, Grupo Nostrum and Bodaclick, amongst others).

Last year, seven Socimis debuted on the MAB. They included Trajano Iberia, which is managed and promoted by a division of Deutsche Bank; Uro Property, whose portfolio mainly comprises bank branches leased to Santander; Corpfin Capital Prime Retail II; Autonomy; Fidere; Zambal; and Zaragoza Properties, which owns a stake in the Puerto Venecia Shopping Resort shopping centre in Zaragoza.

So far this year, four Socimis have debuted on the MAB, namely, Heref Habaneras, owner of the Habaneras shopping centre (in Torrevieja); Corpfin Capital Prime Retail III; Inversiones Doalca and Jaba I Inversiones Inmobiliarias. Indeed, the last two made their debuts on Friday.

Zambal is the Socimi with the largest market capitalisation on the MAB, almost €570 million, followed by Uro Property (€218 million) and Fidere (€192 million). Promorent and Obsido have the smallest market capitalisations in the Socimi segment on the MAB, with €4.3 million and €6.6 million, respectively.

The tax advantages of these vehicles for investors (they are exempt from Corporation Tax, although they must distribute almost 80% of the profit that is not reinvested in the form of dividends) are part of their appeal.

Nevertheless, even though the MAB is still growing and increasingly more companies are joining it, the heavy weight Socimis are listed on the main stock market (Hispania, Axiare, Lar España Real Estate) and Merlin Properties is even listed on the Ibex 35.

Original story: El Economista

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

Uro Engages BNP To Sell 40 Santander Branches

16 November 2015 – Expansión

Mandate / The Socimi owns 775 branches that it acquired from the bank chaired by Ana Botín under a ‘sale and leaseback’ agreement.

Uro Property, the Socimi that owns one third of Santander’s branch network, is looking for new tenants. The company has engaged BNP Paribas Real Estate to sell or re-let 40 branches released by the entity chaired by Ana Botín.

The bank’s exit from these branches is a reflection of its strategy to gradually reduce its installed capacity – a strategy that the whole sector is undertaking – and forms part of the contract between the entity and Uro Property. Under this agreement, Santander may exit between 4 and 5 branches per year. That figure has been increased for 2015 following the refinancing carried out by the Socimi during the summer.

Uro is the successor company of Samos, which purchased 1,152 offices from Santander in 2007 under a sale & lease back arrangement for €2,040 million. The entity’s high debt level caused the creditor bank to capitalise come of its bonds in 2014, with Santander, Atisha (the former Sun Group), CaixaBank, Phoenix Life (formerly Pearl) and BNP taking over control.

Stock market

At the time, the entity made a commitment to list on the stock exchange, which it did last March, debuting on the Alternative Investment Market (‘Mercado Alternativo Bursátil’ or MAB). It began life by listing at €100/per share and after distributing a dividend of €59/per share, closed trading on Friday at €57/share. Excluding the payment to its shareholders, the company’s share price has increased by 13% since its debut.

Uro sold 381 of the 1,152 branches it acquired initially to Axa Real Estate for around €300 million. They had a gross leasable surface area of 90,000 m2.

Following that operation, Uro now owns around 775 branches, for which it receives annual rental income of just over €100 million.

Now that 40 branches have been released by Santander, Uro Property faces the challenge of looking for new business solutions for the first time. Its priority is to sell the branches one by one, maximising the price. Although by quantity, these branches represent 5% of the total portfolio, they are worth just €20 million, which represents just 1% of the €1,800 million appraisal value of the Socimi’s properties.

These 40 branches have a combined surface area of 9,500 m2 and 50% of them (by surface area) are located in Madrid and Barcelona, whilst the remaining 50% are distributed across the rest of Spain. The properties will be sold empty and may be converted into shops, service outlets or used for other commercial purposes.

Shareholder structure

In addition to the management of these properties, the other major challenge that Uro Property will face in the coming months is the possible renewal of its shareholder structure. The Socimi’s investors have pledged to continue as shareholders for one year after the company’s debut on the stock exchange; that period will expire in March. Subsequently, one or more of the original investors may exit the company, such as Atisha and Phoenix Life, or other entities. In addition to Santander, CaixaBank and BNP Paribas, other shareholders include Burlington, Société Générale and Stichting Z+S.

Another key milestone for the company in recent months was the refinancing of its debt, which it achieved through an income securitisation amounting to €1,345 million, with a term of between 22 and 24 years. Uro Property agreed a fixed interest rate of 3.348% with investors, whereby reducing its financing cost from 6%, including interest rate derivatives.

The company is led by Simon Blaxland as the CEO and is chaired by Carlos Martínez Campos, the former number one at Barclays in Spain.

Original story: Expansión (by J. Zuloaga)

Translation: Carmel Drake

Socimi Fever Shakes Up The Stock Market

28 September 2015 – El Economista

After a flurry of activity during 2015, Spain now has 14 listed Socimis, of which 10 trade on the MAB. And this figure is expected to continue to grow over the coming months.

Last week, two Socimis went public on the Alternative Investment Market (‘Mercado Alternativo Bursátil’ or MAB). The first, Autonomy Spain, debuted with an increase of 1.52%, to €16.75.

Autonomy is the parent company of a group that currently comprises two sub-Socimis. The group’s real estate portfolio contains six office buildings – five located in the Community of Madrid and one in Cataluña.

A day later, it was the turn of the Socimi Corpfin Capital Prime Retail II, which became the tenth real estate investment company to go public on the MAB.

The company, which has already invested €75 million in retail premises in “prime” areas of Madrid, San Sebastián, Burgos and Vitoria, expects to invest a further €35 million before November 2016, whereby taking its total investment to €110 million.

This is the first Socimi that the private equity firm Corpfin Capital has listed publicly. The firm also has plans to list another Socimi, Corpfin Capital III, through which it holds joint investments in 8 real estate assets.

The week before, Zaragoza Properties, which owns a stake in the Puerto Venecia Shopping Resort shopping centre in Zaragoza, debuted on the MAB.

Also this year, the Socimi Obsido entered the market for small companies. Its growth plans involve the purchase of hotels in Spain’s principal tourist destinations.

In addition, Trajano Iberia debuted on the stock market (in July). It is managed and promoted by a division of Deutsche Bank, and focuses on “semi prime” offices in Madrid and Barcelona; “prime” offices in secondary cities, shopping centres, and logistics assets.

Also in July, Mercal went public with a portfolio of assets in strategic locations in Spain. Four months before that Uro Property Holding, which owns one third of Santander’s bank branches, began trading on the MAB with a valuation of €259.7 million.

The Socimis Entrecampos, Fidere and Promorent also trade on the MAB, but the largest Socimis, namely Merlin Properties, Hispania, Lar España Real Estate and Axiare, all trade on the main stock exchange. Between them, they had purchased assets amounting to more than €3,100 million as at the middle of August, strengthened by the funds raised through their respective capital increases.

Even Acciona is evaluating the possibility of creating a Socimi for its real estate assets, and this Monday, the General Shareholders’ Meeting of Testa is expected to approve the conversion of the company into a Socimi after it was acquired by Merlin.

Original story: El Economista

Translation: Carmel Drake