Spain Overview January 2020
Spain Real Estate Market Overview January 2020
The Spanish real estate sector made an exceptionally strong start to the new decade with the completion of a large number of chunky transactions during the month of January. The retail sector was the star of the show, but it was closely followed by the office and hotel sectors, which both registered several significant operations.
The misfortunes of the British retail giant Intu forced its exit from two of its major investments in Spain. Its partner in both assets, CPPIB, divested too, resulting in the sale of the Puerto Venecia shopping centre in Zaragoza to Generali Estate and Union Investment for €475 million, and the sale of the Intu Asturias shopping centre near Oviedo to ECE (part of the German Otto Group) for €290 million.
Also in the retail sector, Riu finally completed the sale of the 15,000 m2 shopping arcade in Edificio España (downtown Madrid) to the Socimi Inbest for €160 million; Barings acquired 10 Carrefour stores from Kennedy Wilson for €73.4 million, with the French supermarket chain continuing to occupy the properties; the New Winds Group purchased the Puerta de Chiclana shopping centre from Redevco for an undisclosed sum; and AEW bought a 560 m2 premium retail premise leased to the LVMH Group on Passeig de Gracia in Barcelona.
In Madrid, GPF acquired the Axis Building, located in the Plaza de Colón, from CBRE GI for €100 million – that property (a glass cube) is still under construction and will become CaixaBank’s flagship office upon completion. In parallel, CBRE GI purchased the office building on Calle General Lacy, 23 from La Salle Investment Management for €47 million; the Socimi Árima bought a 14,000 m2 office building in the Campo de las Naciones area of the capital for €37.75 million; and Commodus acquired Spotahome’s HQ on Calle Vizcaya from the Socimi Persépolis, in an operation that represents the German investment fund’s first foray into Spain.
In Barcelona, in the 22@ district, Commerz Real purchased two office buildings under construction from Conren Tramway for €132 million and Principal Real Estate Europe bought the Torre Llacuna office building from Goldman Sachs for an undisclosed sum. Meanwhile, in the nearby WTC Alameda Park, Standard Life Aberdeen acquired Pepsico’s HQ in Southern Europe from UBS for €60 million.
In Málaga, Nitsba Spain purchased the former Correos HQ from the Junta de Andalucía for €23.5 million; Telefónica sold off its former HQ to an unknown buyer for €12 million; and Banca March purchased a 4-storey property on Alameda Principal for €5 million, which it plans to convert into an office for its own use.
In Madrid, Zaka Investments and Evok Hotels purchased the property on Gran Vía 20 for €65 million, which they are going to convert into a 5-star 59-room hotel; the Socimi Atom Hoteles acquired the 4-star NH Las Tablas for €21.3 million; and Commerz Real bought a 10,000 m2 office building near to Madrid airport (on the Ciudad Pegaso business park), which it is going to convert into a 2-star 280-room Zleep Hotel.
In Barcelona, Principal Real Estate Europe was active again, with the purchase of the brand new 3-star, 152-room Ona Hotel Terra from a local property developer for €40.5 million; and Catalonia Hotels & Resorts acquired Hotel La Maquinista for €11.5 million.
Further afield, in Sotogrande (Cádiz), Millenium Hotels bought some beachfront land and two golf courses for €33.2 million, where it plans to construct a 5-star resort with almost 400 rooms; and in Ibiza, the Reuben brothers acquired Hotel Pacha through a joint venture with the Pacha Group.
In other news, the fund Tilden Park paid between €100 million and €150 million to acquire 2,500 flats from Coral Homes, a company owned by Lone Star (80%) and CaixaBank (20%). The British student accommodation specialist Global Student Accommodation (GSA) purchased a hall of residence in Madrid from Corestate for more than €50 million. And the company Healthcare Activos Yield acquired a hospital and five polyclinics in Cartagena (Murcia) from Magnum Capital for €30 million. Finally, in Madrid, the Cortina-Koplowitz brothers snapped up the mixed-use property on Calle Orellana, 1 for €22 million.
Finally, several real estate consultancies published their take on the sector’s results for 2019. Highlights included: BNP Paribas’s report that total real estate investment grew by 5% to €12.7 billion in 2019, following a bumper fourth quarter (€3.9 billion). The most sought-after assets were offices (€4.6 billion) and residential properties (€2 billion), with the latter being boosted by the rental market and the wave of build-to-rent projects. Christie & Co revealed that hotel investment amounted to €2.4 billion, down by 51% YoY, mainly due to the lack of holiday hotel portfolios available for sale (compared with 2018). The urban hotel market, led by Madrid, accounted for 59% of that investment, up from 36% in 2018.
Source: Aura Real Estate Experts