Tag: Zambal

Banca March Creates A Socimi To Maximise Returns From ABC Serrano

7 November 2017 – La Información

Serrano 61 Desarrollo Socimi – that is the name of the listed real estate investment company (Socimi) that Banca March has constituted to try to optimise the profitability of one of the most high-profile investments that the entity has undertaken this year, the acquisition of the ABC Serrano shopping centre, according to data in the Mercantile Register.

Banca March purchased the building on Calle Serrano, 61, in June for an undisclosed sum. It is one of the jewels in the crown of Madrid’s golden mile, which until then formed had part of a portfolio owned by CBRE Global Investors – the investment arm of the largest real estate consultancy firm in the world (CBRE Ellis). Banca March is the fifth owner the asset has had since 2013. In that year, Reyal Urbis, which has now filed for liquidation, transferred ownership of ABC Serrano and another commercial space to the investment company IBA Capital Partners, which shortly after included it in the asset portfolio of its Socimi Zambal. CBRE Global Investors acquired the building at the beginning of 2016.

Banca March has chosen the Socimi format, just like IBA Capital Partners, which is still responsible for managing the centre, did back in the day; its aim is to try and extract the maximum return possible from this real estate investment, in which it shares the risk and reward with a group of the bank’s clients who have participated in the operation as a result of a co-investment model through which the deal was formalised.

Co-investment is one of the unconventional investment formats that Banca March offers its clients. According to information provided by the entity on its website, it uses the format in “projects analysed by the March Group in which it decides to invest, and it offers its clients the opportunity to participate in the investments” (…).

MAB debut in 2018

This implies that Serrano 61 Desarrollo Socimi will not be an exclusive Banca March project, but rather will have financial backing from a group of the entity’s clients, which will also be shareholders of the company.

According to sources familiar with the operation, the company will start to operate as a Socimi from 1 January 2018 onwards and will make its debut on the Alternative Investment Market at some point next year. Its sole asset will be the ABC Serrano shopping centre.

Financial sources consulted by lainformacion.com deny that the activation of this Socimi is the first step of a more decided commitment by Banca March to the real estate sector. “Grupo March has a very recognisable investment approach. It identifies assets of interest, analyses their profitability threshold and if it takes the decision to acquire them, it looks for the most appropriate vehicle to make them profitable. It does not invest in sectors, it invests in assets”, explained one market source.

The Socimi format will allow Banca March and the clients that accompany it with this investment to benefit from a Corporation Tax rate of 0%. Moreover, it will guarantee the distribution of 80% of the returns obtained from the management of the ABC Serrano to the shareholders, and it will provide a favourable fiscal framework that characterises this vehicle for the dividends obtained.

Original story: La Información (by Bruno Pérez)

Translation: Carmel Drake

Snapshot Of The MAB’s Real Estate Companies

4 September 2017 – Expansión

An attractive tax structure and investors’ appetite for real estate assets have led to a veritable flood of Socimi debuts on the stock market in recent years. With the exception of Merlin and Colonial – which form part of the Ibex – and Axiare, Hispania and Lar España – which are listed on the main stock market – the other Socimis trade on the Alternative Investment Market (MAB). In 2013, that market opened a new segment for this type of investment vehicle, which now comprises 40 companies.

To be incorporated, Socimis must have a minimum share capital of €5 million and invest in urban properties allocated for rent. These companies, which must be listed on regulated markets, are exempt from paying Corporation Tax in exchange for fulfilling certain obligations such as the distribution of dividends in a systematic way.

The first Socimi to debut on the MAB was Entrecampos Cuatro. That company, constituted in 2004 as a merger of several companies from the Segura Rodríguez family group, was responsible for firing the Socimi-starting gun on the MAB in November 2013.

The 40 Socimis now listed on the MAB have a combined market capitalisation of more than €7,000 million and comprise a very heterogeneous group both in terms of size, as well as by specialisation and category. The companies range from family groups to institutions (with one fund or professional investor holding a stake) to publicly owned entities (with numerous shareholders).

Of the Socimis currently listed on the MAB, the largest by a long way is General de Galerías Comerciales (GGC). That Socimi, which currently has a market capitalisation of €2,547 million, debuted on the stock market in July and, despite its size, is controlled almost in its entirety by a single shareholder, the Murcian businessman Tomás Olivo. GGC is exceeded in terms of market capitalisation only by Merlin and Colonial.

GGC is followed by the Montoro family’s real estate firm GMP, in which the fund Singapore GIC owns a 30% stake. That company currently holds 27 properties in its portfolio, including several iconic buildings, such as the historical Torre BBVA (renamed Castellana 81 due to its location) and a few metres away, Castellana 77 (also known as Torre Ederra). Other large listed Socimis include Zambal, the Socimi managed by IBA Capital, with investments in offices and commercial assets; and Bay, the Socimi owned by Hispania and Barceló. The latter, which focuses on the tourist sector, held 21 assets with a gross value of €790 million at the end of last year and since then has purchased another three assets: Hotel Selomar in Benidorm for almost €16 million; Hotel Fergus Tobago in Palmanova for €20 million; and the Armadores de Puerto Rico company for €6 million.

Shopping centres are also present on the MAB. In this way, for example, Intu owns two listed shopping centres: the Socimi Asturias Retail & Leisure, owner of the Intu Asturias shopping centre (previously Parque Principado), which has a total approximate surface area of 75,000 m2; and Zaragoza Properties, owner of Puerto Venecia Shopping Resort, in Zaragoza, with a surface area of more than 200,000 m2.

Another example is the Socimi Heref Habaneras, which owns the Habaneras shopping centre in Torrevieja (Alicante).

Residential market

One of the investment segments that has gained weight amongst the specialist Socimis in recent times is the residential market. Specifically, the private equity fund Blackstone has two listed Socimis. The largest, Fidere, debuted on the stock market in June 2015 with an asset value of €304.3 million and a portfolio of 2,688 social housing properties for let purchased during the crisis.

Moreover, the fund listed another Socimi on the stock market in March, Albirana Properties, which owns more than 5,000 assets spread all over Spain, most of which are rental homes (….).

A few weeks ago, the MAB introduced a modification to its rules to tighten up the access requirements for new Socimis. This change, which came into force in August, requires Socimis to have minority shareholders in their shareholdings when they debut on the stock market. Until then, companies had a year to fulfil the requirement. This led to an intensification in terms of the number of Socimi debuts. In July alone, seven companies joined the MAB: GGC, Bay Hotels & Leisure, Grupo Ortiz, Kingbook Inversiones, AM Locales Property, Colon and Numulae (…).

Original story: Expansión (by Rebeca Arroyo)

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

Gas Natural Sells 4 Office Buildings In Madrid For €206M

28 December 2016 – Expansión

Gas Natural Fenosa has made cash from some of its real estate portfolio. The energy company has sold four corporate buildings in Madrid for more than €206 million, according to a statement filed with the CNMV.

Gas Natural, which will continue to occupy all of these buildings as the tenant on a rental basis, has generated net profits of around €35 million through the operation.

Specifically, the gas company has sold its headquarters in Madrid, located on Avenida de San Luis 77, to the Socimi Zambal Spain for €120 million, as Expansión reported on 24 November. It is a building with a surface area of almost 31,900 m2 and 979 parking spaces.

Similarly, Gas Natural has also closed an agreement with an institutional investor to sell three buildings located in Spain’s capital city, specifically those on Avenida de América, 38; Calle Antonio López, 193; and Calle Acanto 11-13.

The price to be paid by the buyer, whose identity has not been revealed, will amount to €86.5 million in total. The three buildings have a combined surface area of 25,100 m2 and 716 parking spaces.

Just like in the case of its Madrilenian headquarters, Gas Natural will continue to occupy these other buildings as the tenant on a rental basis.

Original story: Expansión (by J.D.)

Translation: Carmel Drake

Gas Natural Sells Its HQ In Madrid To IBA Capital For €120M

24 November 2016 – Expansión

Gas Natural has had a change of heart in its strategy to sell its real estate jewels in Madrid. The firm chaired by Isidro Fainé, which engaged the real estate consultants CBRE and Cushman & Wakefield in the summer to sell its main real estate assets in the capital, has decided to divide up its batch of four properties and sell the most sought after asset, located on Avenida de San Luis, in a separate transaction.

In this sense, the energy company has reached an agreement with IBA Capital, through its Socimi Zambal, to sell its headquarters in the capital located on Avenida de San Luis 77. The transaction will be completed within the next few days for around €120 million, once the bureaucratic procedures have been completed.

The firm has opted for the sale & leaseback formula, involving the sale of the property and its subsequent lease for a period of ten years.

The real estate fund manager, which purchased Vodafone España’s headquarters in Madrid just over a year ago, has knocked out the Spanish real estate and investment manager, Drago Capital, from the process, which until now was the favourite candidate for taking over Gas Natural’s buildings in Madrid. Drago Capital, which has been in exclusive negotiations with the energy firm for several weeks regarding the purchase, was unable to complete the operation as it failed to obtain financing from the banks.

In terms of the rest of the buildings up for sale – one property on Avenida de América 38; the Acanto 11 complex; and the Antonio López complex, on Antonio López 193– , the company has decided to reopen the process and invite those investors who expressed interest in the initial process to participate. Besides Drago Capital, the finalists also included Henderson Park and Has Capital.

In total, the combined surface area of the four complexes amounts to 57,000 m2. In addition, this asset portfolio includes 1,695 parking spaces. Specifically, Gas Natural’s headquarters on Avenida de San Luis 77 has a surface area of almost 32,000 m2, which is dedicated to office space. With this operation, Gas Natural is taking advantage of the real estate sector’s current strong performance to generate value from its properties and earn some cash, without having to move its staff by remaining as the tenant.

The office market in Madrid and Barcelona has heated up a lot in recent months due to the shortage of high quality products in good locations. During the first three quarters of this year, investment in the office market amounted to €2,200 million, according to data from Aguirre Newman.

Gas Natural’s approach is in line with that of some of its rivals, which have also opted to divest their real estate investments. For example, Torre Cepsa, located in the Cuatro Torres complex in Madrid, was sold to Amancio Ortega’s investment vehicle, Pontegadea, two months ago for €490 million. Meanwhile, Endesa’s headquarters in the capital is owned by the Socimi Merlin and Iberdrola’s head office in Bilbao is partly owned by Kutxabank.

Original story: Expansión (by R. Arroyo & M. Á. Patiño)

Translation: Carmel Drake

Henderson, IBA, Has & Drago Bid For Gas Natural’s RE Assets

19 October 2016 – Expansión

The bidding for Gas Natural’s real estate gems in Madrid is entering its final phase. The British fund manager Henderson Global Investors, IBA Capital, through its Socimi Zambal, the US investment fund Has Capital and the Spanish management company Drago Capital have all submitted binding offers for the four corporate office complexes that the energy firm has put up for sale in the Spanish capital.

The assets include: the group’s operating headquarters in Madrid, located on Avenida de San Luis 77 (pictured above); a property on Avenida de América 38; the Acanto complex, at number 11 on the same street; and the Antonio López complex on Calle Antonio López 193.

The investors have submitted offers valuing the assets, which have a combined surface area of 57,000 sqm in office space and 1,695 parking spaces, at around €300 million, according to sources in the sector.

The gas firm, which engaged the real estate consultancy firms CBRE and Cushman & Wakefield to sell its main real estate assets in Madrid this summer, plans to chose the candidate during the second half of November and close the deal before the end of the year.

The firm, chaired by Isidro Fainé, is negotiating with these four investors regarding the option of selling the four office complexes in a single operation or awarding the assets in batches. In this sense, both IBA Capital and Has Capital have already submitted offers for all of the assets as well as for different batches, an option that the other candidates may also consider.

The operation, whereby Gas Natural will sell the properties but continue as the tenant, will allow the firm to raise funds without needing to move its employees or look for new offices.

The operation represents the largest sale & leaseback deal in the segment in recent years. (…). The volume of sale & leaseback operations reached its peak between 2007 and 2010, but has slowed down since then. Nevertheless, the formula has been used recently by companies such as Telefónica and Eroski. (…).

The future of sale & leaseback operations

However, new accounting legislation, which no longer allows property sales that are subsequently rented out to be accounted for as off balance sheet financing structures, may put a stop to this option of real estate asset optimisation.

Specifically, IFRS 16 requires companies to recognise rental commitments as debt, except those that have a term of less than a year or relate to low value assets. This standard, which will replace the standard currently in force, IAS 17, eliminates the dual accounting model for lessees, which differentiates between financing lease contracts, which are recorded on balance sheet, and operating lease contracts, which do not require future lease commitments to be recognised (on balance sheet).

Although the new law does not enter into force until 2019, companies are obliged to analyse their lease contracts in advance and make new estimates, which must be updated on a regular basis.

Original story: Expansión (by R. Arroyo and M. A. Patiño)

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

The Socimi Zambal Debuts On MAB With 4.84% Rise

2 December 2015 – El Economista

The Socimi Zambal, owner of the ABC Serrano shopping centre, amongst other properties, has debuted on the Alternative Investment Market (‘Mercado Alternative Bursátil’ or MAB) with a 4.84% increase, after it recorded an initial price of €1.30/share, compared with the price it set to go public (€1.24).

Zambal, the eleventh real estate firm of its kind to debut on this market, is the owner of nine office and commercial buildings in Madrid and Barcelona.

Besides the ABC Serrano shopping complex, located in the centre of the capital, the firm is the landlord of Día, Unidad Editorial, BMW Ibérica, Enagás and Vodafone España, since it leases buildings in Madrid in which these companies have their respective corporate headquarters.

In the commercial sphere, Zambal is the owner of a property in Plaza de Cataluña in Barcelona, which El Corte Inglés occupies under a lease contract.

Zambal listed on the MAB under the ticker ‘YZBL’ and its shares were traded through a fixing system. At the first auction, held at 12:00h, the company sold 1,500 shares.

Original story: El Economista

Translation: Carmel Drake

Iba Capital’s Socimi, Zambal, Will List This Year

17 September 2015 – Expansión

The Socimi Zambal, created by the fund manager Iba Capital, is finalising its debut on the stock exchange before the end of the year. Its main assets include the headquarters of BMW, Enagás and Día in Madrid and the ABC Serrano shopping centre, also in the capital.

A new mega Socimi is preparing to debut on the stock market in 2015. The company in question is Zambal Spain, the listed real estate investment company created by the fund manager Iba Capital. With assets worth €500 million, the company will list on the MAB stock exchange before the end of the year. “We are not in any rush, but our aim is to go public before the end of the year”, explains Thierry Julienne, the President of IBA and of Zambal.

Since closing its first acquisition in 2013, the fund manager has created one of the most desirable portfolios in the market and plans to invest a further €1,000 million in new acquisitions. “We aim to invest a further €500 million in assets with a core profile in Madrid and Barcelona, through Zambal Spain, plus an additional €500 million with a value-added profile (those that require active management) in Spain’s main regional capital cities, through other vehicles”, explained Julienne in a statement.

The Socimi closed its first operation in Spain in the summer of 2013, when it purchased a building in Plaza Cataluña, Barcelona, from El Corte Inglés for €100 million. At the end of that year, it bought the ABC Serrano shopping centre and an office complex, located on Avenida de San Luis, 25, both in Madrid, from the real estate company Reyal Urbis, which had filed for bankruptcy in the February of that year. The office houses the headquarters of the communication group Unidad Editorial (which edits Expansión, El Mundo and Marca, amongst others).

Over the last two years, Zambal has added the headquarters of other famous brands to its portfolio. In December 2013, Iba purchased Torres Ágora from the real estate company Colonial; the property is leased in its entirety to the Ministry of Foreign Affairs. The Socimi spent €73 million on its purchase of that office complex.

In 2014, the fund manager acquired Enagás’ headquarters in Madrid for €35 million and then Día’s headquarters for €30 million.

At the beginning of this year, Iba purchased BMW’s head offices in Spain, located in the north west of the capital. It paid €41 million to the French real estate company Gecina for the property, which measures 11,680 m2.

In addition to its extensive portfolio of offices, the Socimi also owns a retail building on Calle Preciados, 9, which it acquired from El Corte Inglés in 2013 for €50 million. Once the renovation of the property has been completed, it will house a major international fashion company.

Both the Socimi and the fund manager are led by Thierry Julienne, the former director of the consultancy Exa in Spain. Its investors include major European and American investors.

Original story: Expansión (by Rocío Ruiz)

Translation: Carmel Drake