CBRE advises on five investments deals during a busy summer
Investment activity has clearly remained upbeat at the start of the third quarter, driven mainly by international investors looking to close large-volume deals, both via portfolio and individual asset purchases. Investors are continuing to bet on Spain as a place to invest and are looking to increase their exposure to the country’s real estate market, mainly in large cities such as Madrid and Barcelona, although they are also gradually widening their scope to include cities such as Valencia, Bilbao, Seville and Malaga.
The real estate investment market is truly booming in 2015 and there was no let-up during the summer months, a period when investment activity usually sees a lull.
The real estate investment volume in Spain had already reached 8.43 billion euros by the end of the 1H 2015, more the double the figure registered for the same period in 2014 and the highest recorded for eight years. These results were largely boosted by what has so far been the largest deal of the year in terms of volume; the purchase of Testa by the socimi (Spanish REIT) Merlin Properties, who was advised by CBRE. Real estate investment volume is forecast to touch levels of around 12–14 billion euros by the end of the year, topping even pre-crisis levels.
These forecasts were consolidated by the high level of activity witnessed in the real estate sector during the summer, when instead of slowing down as is normally the case, the rate at which deals were closed remained the same. Office buildings remain the most sought-after product by investors, however, they are also showing an increasing interest in different types of buildings, especially retail portfolios.
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At the end of July, CBRE advised Banco Santander on the sale of 4 office buildings located in the Avalon Business Park to the US fund GreenOak, in the Julián Camarillo industrial estate in Madrid. The 4 buildings were located in Calle Santa Leonor and had an individual surface area of between 4,000 and 6,000 sqm and a total of 21,170 sqm and 353 parking spaces.
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Another office deal closed in Madrid in August was GMP’s purchase of the Titán 4 building in the Méndez Álvaro area, a transaction in which CBRE advised Invesco Real Estate on its sale. The property, currently Adif’s headquarters, has a total lettable surface are of over 10,000 sqm distributed over 14 floors and 218 parking spaces.
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The sale of the Thunder Portfolio was also closed in August, 2 office complexes located in Madrid and Barcelona belonging to the Abu Dhabi sovereign fund. CBRE acted as real estate advisor for the sale in which the 2 assets were acquired by AXA REAL ESTATE, the real estate arm of the insurance company. The Madrid building, located in Manoteras (Fuente de la Mora, 1), has a surface area of 42,945 sqm and was previously the AXA headquarters in Spain. The second asset was the Can Ametller business complex in Sant Cugat del Vallès (Barcelona) comprising 4 buildings, with a total surface area of 28.500 sqm and over 850 parking spaces.
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Retail portfolio transactions have generated a rising interest among investors over recent months, with a significant increase in the amount of these types of deals closed. At the end of July, the Velázquez Portfolio, comprising 16 assets spread across Spain, was sold. A deal on which CBRE exclusively advised the European fund AEW on the sale of the supermarket portfolio, consisting of local retail units as well as big box stores, occupied by Carrefour and Dia. The North-American fund Kennedy Wilson was the investor to acquire the portfolio.
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The latest “retail” portfolio transaction to be closed was the Blue Box Portfolio, on which CBRE advised a Spanish family office exclusively on the sale of 33 Caprabo supermarkets and which was finally purchased by the Spanish socimi Merlin Properties.
These five deals that total a volume of approximately 375 million euros confirm that there is still great investor appetite in Spain.