Testa’s Former CEO Buys a Plot of Land in Madrid to Build 25 Homes

23 January 2019 – Eje Prime

Testa’s former CEO is continuing to shape his new real estate project. Nidom, the property developer led by Daniel Loureda, has purchased a plot of land at number 312 Calle Embajadores in Madrid, according to Expansión. The objective is to construct a 6-story building containing 25 homes, whereby resuming the plans set out by the previous owner.

Until now, the plot was in the hands of the company Caoba Directorship, and it has been sold for above the asking price, which was set at €7.5 million. The operation has been brokered by Knight Frank.

The plot has a surface area of 1,051 m2 and is located in the Legazpi neighbourhood of the capital, in a very sought-after area, where prices are on the rise due to the shortage of land and the location. In fact, it is one of the last buildable plots inside the M-30.

Nidom is thereby continuing to increase its portfolio, after launching several developments, including at number 76 Príncipe de Vergara, 7 Duque de Pastrana and 98 Calle Ferraz.

The property developer is led by Daniel Loureda, former CEO of Vallehermoso and Testa Inmuebles.

Original story: Eje Prime 

Translation: Carmel Drake

Aedas Completes €2.3M Capital Increase

17 July 2017 – Eje Prime

Aedas Homes is continuing to raise funds to finance its growth. The company, the heir of Vallehermoso, has carried out a €2.3 million capital increase, which it plans to use to continue to boost its growth and strengthen its position as a key player in the real estate development business in Spain.

According to the Commercial Registry, the company Aedas Homes has carried out a capital increase amounting to €2.3 million. This is the second injection that the company has received in recent months after it increased its capital by €31.5 million in April. In this way, the company’s subscribed capital now amounts to €33.7 million.

Aedas Homes, created by the fund Castlelake and advised by Merlin Properties, was created with the objective of constructing 12,000 homes on land that it has been acquiring since 2013, spanning around 1.35 million m2. In March, Aedas Homes, which competes directly with Neinor Homes, Aelca and Vía Célere, began marketing its first fourteen developments and the group plans to add another fifteen developments to its portfolio in the near future.

The company began life in 2013, where the country’s housing market bottomed out and almost all of its activity was suspended. The fund Castlelake is one of the players who decided to back this business in Spain and in order to carry out its plans, it started to create a portfolio of land in locations that, according to its criteria, would be the first to recover.

At the end of 2015, when the real estate recovery started to become a reality and after investing more than €1,000 million in Spain, the fund had accumulated a portfolio of land covering more than 1.3 million m2, equivalent to 12,000 homes, of which 75% corresponded to primary residences.

It was at this point that the leaders of the project started to think about the possible evolution of all of their assets. To figure it out, they invited the Socimi Merlin Properties to enter the fold, to advise the group on the best formula for operating its land portfolio.

At the company’s helm is David Martínez (pictured above), who has vast experience in the real estate sector. After holding positions of responsibility at groups such as Ferrovial and Bovis Lend Lease in the 1990s, Martínez led projects such as Valdebebas and served as a senior manager at Distrito Castellana Norte.

New hires

In parallel to its growth, Aedas Homes is continuing to beef up its management team. The company recently hired Enrique Gracia, former director of Merlin, as the new Head of Finance. Gracia joined Aedas Homes in May; he has more than fifteen years of experience in the real estate sector (…).

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Spain’s RE Sector Gets Ready For A Wave Of Mergers & Sales

5 June 2017 – El Confidencial

(…). The race has begun to become the largest real estate company in Spain and Merlin is leading the ranking with a clear advantage over the second-placed contender, Colonial. Its purchase of Testa, for €1,800 million, and the subsequent merger of the Socimi led by Ismael Clemente with Metrovacesa, accelerated a consolidation process that wasn’t expected to happen until this year (but which was instead closed in 2016).

That unchecked move by Merlin forced Colonial to play its own hand, which, in turn, revolutionised the entire second tier of Socimis, which saw the Catalan group aiming directly at them with its purchase of 15% of Axiare, an operation that Colonial justified as a financial investment, but which the whole market, including the affected company itself, interpreted as the first step in a larger operation.

To defend itself, the Socimi led by Luis López de Herrera-Oria decided to call in the classic army of investment bankers and lawyers, with whom it has started to analyse all available options, including the possibility of buying up more assets to grow in size and somewhat complicate a hostile operation by Colonial. It is even entertaining entering into another type of corporate deal with a new, trustworthy, high-profile investor.

And it is here that the market has now started to place its bets, aware that the process of concentration amongst the players has started. “An agreement with Hispania, for example, would be a game changer. As would the acquisition of a significant logistics portfolio, because that would be a type of asset that would discourage Colonial from proceeding. Axiare could also consider acquiring one of the Socimis on the MAB created by funds that have already completed their investment cycle in Spain and that are interested in started to sell”, said sources at a corporate operations firm that asked to remain anonymous. (…).

“The catalysts that are defining the consolidation process are size and specialisation. There are going to be a lot of corporate operations, everyone is talking to everyone, but the basis on which moves are going to be made are: what type of Socimi does each vehicle want to be and their need to gain in size”, said Antonio Sánchez-Recio, Partner and Head of the Real Estate Sector at PwC. (…).

What’s more, in the midst of this consolidation process, the market is going to start to enjoy more freedom to sell assets. From now onwards, the three years that the Socimi framework stipulates that the vehicles must hold onto the assets for to safeguard their tax benefits, start to come to an end, and so, a torrent of asset rotations is expected to begin, which will also help each vehicle to specialise further in what it wants to be.

For example, at its recent Investor Day, Lar España Real Estate revealed that it plans to start to sell assets and, specifically, it is looking to put its logistics properties up for sale, as it wants to continue specialising in shopping centres.

Although the Socimis have been the ones to fire the starting gun on the concentration process, the M&A wave is going to affect the entire real estate sector, in other words, significant movements are also expected between property developers and servicers. (…).

Lone Star would have preferred to wait (…), but in the end decided to bring forward Neinor’s debut on the stock market to March 2017. Castlelake may well take a similar step with Aedas, the real estate company that it created from the ashes of Vallehermoso, as it shares with its competitor the fact that it has been able to buy up land during the hard years of the crisis.

“All of the real estate companies that have funds as their controlling shareholders, which invested during the period 2011 to 2013, as well as those that are owned by the banks, are the first in line to be sold, merged or listed on the stock market”, said Francisco López, Partner at Lift Global Value Fund.

Heriberto Teruel, National Director of Corporate Operations at CBRE, shares this view. He talks of the concentration process happening in three areas: “Firstly, we have the corporate operations between the Socimis; secondly, and in parallel, we are seeing the debuts on the stock market and the mergers of the property developers; and thirdly, the servicers, where we will see both concentrations (Lindorff already purchased Aktua from Centerbridge) and repurchases of these vehicles by the banks to create their own real estate companies, in line with the move that Popular is trying to undertake”. (…).

The banks are also behind Metrovacesa Suelo y Promoción, Testa and URO, three companies that still expected to generate more news in terms of corporate operations. (…). In the same way, the funds that backed Spain when all of the other investors were fleeing the country, such as Blackstone and Autonomy, are also going to try to take advantage of the context to generate returns from their Socimis (…).

The show has only just begun.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Aedas Completes €31.5M Capital Increase To Finance Growth

21 April 2017 – Eje Prime

Aedas Homes is facing a new phase of growth. The company, the successor of Vallehermoso, has just completed a capital increase amounting to €31.5 million, and it plans to use the funds to finance the construction of around 50 developments between now and 2018. The group, created by the fund Castlelake and advised by Merlin Properties, was created with the aim of building 12,000 homes on land that the firm has been acquiring since 2013, around 1.35 million m2.

According to the Mercantile Registry, the company Aedas Homes Group has completed a capital injection amounting to €31.4 million. This is the first capital injection received by the company, which until now had a share capital of €3,000. The firm specialises in residential developments in the medium-high end segment of the market.

The group constructs its own developments only and does not render any services to third parties. “We differentiate ourselves from our competitors because we build developments in areas with solvent and sustainable demand”, explains David Martínez (pictured above), CEO of the group. Currently, Aedas Homes has its focus placed on Madrid, Barcelona, Alicante, Valencia, Mallorca, Sevilla and Málaga, where it already has developments underway.

“80% of the land in our portfolio is buildable, whilst the rest is pending urbanisation”, adds Martínez. Moreover, we are constantly buying land, although now the volume that we have is sufficient to be able to carry out our plans in the short term”.

Last month, Aedas Homes, which competes directly with Neinor Homes, Aelca and Vía Célere, started to advertise its first fourteen developments; and the group plans to add another fifteen developments to its portfolio soon. “We would like to end this year having marketed around thirty developments, which is equivalent to 1,500 homes”, added sources at the group. (…).

The company is led by David Martínez, who has extensive experience in the real estate sector. After holding positions of responsibility at groups such as Ferrovial and Bovis Lend Lease in the 1990s, Martínez went on to lead projects such as Valdebebas and to serve as the CEO of Distrito Castellana Norte.

Original story: Eje Prime (by C. Pareja)

Translation: Carmel Drake

Neinor, Dospuntos & Aedas Invest €5,000M In Homes

26 January 2017 – Cinco Días

The fund Castlelake is backing the same market as the funds Lone Star and Värde Partners by resuming construction of new homes. Between the three of them, the US entities have now invested almost €5,000 million in the sector. The latest player to join the party has created the company Aedas Homes, with a land portfolio worth €1,000 million and the capacity to construct 12,000 homes. (…).

Castlelake has been purchasing land in Spain since 2013, when the property crisis was more acute and few international investors were interested in the real estate sector in Spain. In the end, the fund has created an independent company to construct its homes, into which it has placed 1,350 million m2 of land. 90% of those plots are ready to be built on (with permits) and the firm’s strategy is to continue buying.

For this operation, the fund has been advised by Merlin Properties, which is listed on the Ibex 35. The heads of the fund were looking for a recent real estate success story that did not present any conflict of interest – the Socimi is not involved in the residential sector –and so they asked its directors for help. Moreover, of the 45 people that work for the new company Aedas, seven come from the Socimi, specifically, from the former Testa (acquired by Merlin in 2015), given that they had experience in residential development at the now extinct Vallehermoso.

Castlelake is a firm from Minneapolis that manages €8,600 million in assets around the world. (…).

The new real estate company’s plans

Aedas – the name has Latin roots, stemming from the word to build – will construct homes in seven provinces: Madrid, Barcelona, Alicante, Valencia, the Balearic Islands, Málaga and Sevilla. “We are committed to the areas where there is clear residential demand”, said David Martínez Montero (pictured above), Director General at Aedas. Martínez Montero previously led the Operación Chamartín project between 2013 and 2016, the Valdebebas Compensation Board and the Cuatro Torres project in Madrid.

The new company is going to launch 14 developments to construct 1,000 homes, with the aim of finishing them by the end of the year and handing them over between 2018 and 2019. These homes will be located in Madrid (capital, Boadilla and Las Rozas); Barcelona (Hospitalet, Sabadell and Vilanova i la Geltrú); Sevilla (in the capital and in Dos Hermanas); Valencia (capital and Denia); and Estepona (Málaga).

Aedas is not proposing a pre-determined rate of investment or committing to building a specific number of homes per year. “It will depend on how the market absorbs our first 1,000 homes. We are not going to make the same mistakes as in the past”, said Martínez Montero. The company’s strategy involves tackling the primary residential market with urban products for middle class buyers, a segment where demand exists. (…). The directors of the company believe that there is a need for new builds given that hardly any new homes have been built in the last decade.

The arrival of the funds

It is the same theory that the other funds that have burst onto the residential scene are applying. The first was Neinor Homes, owned by the Texan firm Lone Star, with the plan to invest €2,000 million in land and building homes. That company was created from the business purchased from Kutxabank (…).

The next to emerge was Dospuntos, created by Värde Partners, from the ashes of the San José Group’s real estate division, which plans to invest €2,000 million between now and 2021. (…).

Original story: Cinco Días (by Alfonso Simón Ruiz)

Translation: Carmel Drake

Operación Chamartín’s # 2 Jumps Ship To Castlelake

21 September 2016 – El Confidencial

Just three years ago, BBVA and San José hired David Martínez as the CEO of Duch, the property developer of Operación Chamartín, which was subsequently renamed Distrito Castellana Norte. It was a high profile move, given that Martínez was CEO of Valdebebas at the time, the only large real estate development in the capital that had managed to resist the crisis.

With those credentials, Martínez became the number two in command at Operación Chamartín, behind only the Chairman, Antonio Béjar. He was also the key figure that allowed the project to be relaunched, a year later, with the consent of the three administrations involved: the Ministry of Development, the Community of Madrid and the Town Hall of Madrid.

But that consensus broke down with the arrival of Ahora Madrid in Palacio de Cibeles. They reversed the plan and submitted their own proposal, Madrid Puerta Norte, which cut the scope of the original plans in half.

In the middle of this blockade, whose most recent chapter has just been written by the High Court of Justice in Madrid, with the admission of the appeal submitted by DCN against the Town Hall, Martínez has abandoned ship to join one of the major international funds in the Spanish real estate sector: Castlelake.

As El Confidencial revealed, the US firm has reached an agreement with Merlin to launch its own property developer from what was leftover of the former firm Vallehermoso, and the 1 million sqm of land that the fund has been acquiring over the last two years.

New property developer

Martínez said goodbye to DCN on 1 September to join this new company, which is expected to start work in October under the brand, Aedas Home. The firm has offices on Paseo de la Castellana and an 11-man team that used to form part of Vallehermoso, Sacyr’s former property developer subsidiary, which was liquidated two years ago.

Martínez’s recruitment is a statement of intent regarding the plans that Castlelake has for Spain, given that he is one of the most recognised professionals in his sector in Spain – he was at the helm for eight years at Valdebebas and then has spent another three years at Operación Chamartín. In fact, many consider him to be the real brains behind these two developments, on whose future the final configuration of the north of Madrid depends.

With Aedas Home, Castlelake has finished shaping the new map of the largest property developers in Spain, a market whose present and future is marked by the clear commitment that three large international funds, in particular, have made to the Spanish real estate sector: Lone Star, which acquired the developer Neinor from Kutxabank for €930 million two years ago; Värde, which together with Marathon and Attestor has launched Dos Puntos from the ashes of the former San José Desarrollos; and now, Castlelake.

Original story: El Confidencial (by Ruth Ugalde)

Translation: Carmel Drake

Vallehermoso’s Days Numbered As Sacyr Transfers €448 Mn in Its Assets to Sareb

15/12/2014 – El Economista, Economia Digital

Sacyr has just closed conveyance of the second pool of mortgage-collateral assets of Vallehermoso División Promoción (VdP), allowing it to cut in the overall net debt owed to the bad bank of Spain by 448 million euros.

In a statement provided to the Stock Exchange Market Regulator (CNMV) the builder informed the package includes blocks of apartments, shops and add-on elements (finished product).

Following the transaction, VdP has tackled its debt with financial entites by 601 million euros year-to-date.

In turn, Sacyr has broken even with liquidation of its real estate arm, operating on the Spanish market over the last 60 years.

Precisely, the group chaired by Manuel Manrique planned to allocate thousands of dwelling units and millions of square meters of land to the creditors and Sareb in exchange for a progressive reduction of its 2.73 billion in the red. Today, thanks to the two operations with the bad bank, the company owes ‘only’ 130 million.

Five Years in Liquidation

The liquidation of Vallehermoso has practically been its destiny since 2009, although Sacyr kept assuring some third parties had shown huge interest about the firm.

A financial reorganization agreement permitted a three-year prolongation of the payments, until 2013, for finished housing developments and a five years’ term for the rest of the liabilities, mainly land.

However, together with expiration, Sacyr started to swap the properties for debt. The transactions amounted to 400 million euros.


The bad bank of Spain became the majority stakeholder in the property manager after receiving non-performing or doubtful loans (50% from Bankia, and the rest from Novagalicia and Catalunya Caixa) worth 580 million euros in total.

After difficult negotiations, the parties agreed on swapping the debt for assets in two phases. First included housing developments under construction and plots jointly valued at 409 million, while in the other Vallehermoso had to transfer another 39 million euro amount in finished products (the homes and shops).

Now, the bad bank will face selling the land for which the company paid tremendous amounts in 2006. For instance, Vallehermoso spent 185 million euros on a 1.38 million square meter piece of rural land in Navalcarnero, Madrid. Although the use was changed, the plot has never seen the 5.000 homes which supposedly were going to stand thereon.


Original stories: El Economista, Economía Digital (by Juan Carlos Martínez)

Sacyr Sells Vallehermoso’s Real Estate to Sareb For €409 Mn

2/12/2014 – Expansion

Construction firm Sacyr sold assets owned by its Vallehermoso División Promoción (VdP) unit to Sareb, Spain’s bad bank, for a total of €409 million. The transaction, including land and unfinished housing developments, will allow cancellation of the outstanding debt of Vallehermoso owed to Sareb.

Likewise, Sacyr notified to the Spanish Stock Exchange Regulator CNMV of having reduced the indebtness of Vallehermoso by €549 million year-to-date, last deal included.

The sale forms a part of an orderly liquidation of Vallehermoso set to conclude at the end of 2014, as Sacyr’s chairman Manuel Manrique (pictured) informed in June. The unit has been placed on the market in October 2013 in an attempt of leaving the development and home sales business. Then, the group entered in talks with creditors to liquidate assets in its possession and cut in debt.


Original article: Expansión

Translation: AURA REE

Sacyr puts its real estate company Vallehermoso on sale.

The board of Sacyr approved yesterday afternoon the sale of Vallehermoso, its real estate development subsidiary, after having received “signs of interest in its acquisition from third parties”.

The company presided over by Manuel Manrique has sent a statement to the National Share Market Commission indicating that that yesterday afternoon the managing board of Sacyr decided the sale of its real estate development subsidiary. “This takes place after Sacyr has received indications from third parties on the acquisition of Vallehermoso, although these have not been specified yet”, the company declares. Also, the company indicates that “we will inform about the sale as soon as it takes place”.

This information reaches us two weeks after Sacyr announced that it was negotiating with Vallehermoso´s banks to exchange assets for debt with the intention of liquidating “in an orderly way” this subsidiary, and cancelling the liability of 1200 million Euros it is suffering.

At the end of June 2013, Sacyr had a net debt of 8.357 million Euros, so that the amount corresponding to the subsidiary reaches 15% Vallehermoso had a stock of 600 homes and a portfolio of 7,25 million square meters of land. At the end of 2012, the market value of the stock of this subsidiary reached 1848 million Euros, according to the valuation carried out by BNP Paribas. (…)