Spain’s Largest Real Estate Companies are Financed by Foreign Investors

0
445

Seven of the ten large listed real estate companies are in largely in foreign hands. This is the new reality of the Spanish real estate market that marks a new period of growth ten years after the last boom began.

Previously owners and builders were national entrepreneurs, now it is the international funds that cover the majority of companies in the sector. This is the case of the new leaders in home promotion: Aedas and Neinor Homes. These companies have led this year in the stock market in both October and March. In both cases, the promoters of the IPO were two large international funds: Lone Star in the case of Neinor and Castlelake in the case of Aedas. But in addition, other large funds managers have not hesitated to take different shares in Spanish real estate.

In the case of Aedas, which debuted on the Stock Exchange on October 20 with a valuation of 1,518 million, two international firms have become reference shareholders: T. Rowe Price, with a participation of around 3.8%, and Fidelity Management and Research (FMR), with 3.6%.

In both cases, it was not their first investment in Spanish real estate. For example, T. Rowe was one of the funds that bought the stock of the Socimi, Axiare, in July 2015, purchasing  9.7%. For its part, FMR is the third largest shareholder of another Socimi, Hispania, and the developer, Neinor Homes. In the case of the latter, there is another international investor, Wellington Management, which owns around 8.5% of the capital, valued at around 120 million euros.

Two of the classic real estate companies of the Stock Exchange keep Spanish businessmen as the main owners: Quabit, whose maximum shareholder is its president Félix Abánades, with 21% of the capital (participation that has been reducing during the years of crisis) ; and Renta Corporación, controlled by 29.97% by Dinomen, a company controlled by its president Luis Hernández. In this real estate company appears Baldomero Falcones, with more than 5% of the capital, placing him as the fourth largest shareholder.

Quabit also includes a Spanish company as second highest shareholder: Sareb. The public company owns 7.663% of the Alcarreña real estate after exchanging debt inherited from the bank nationalized by shares. In contrast, in Renta, in the second position of ownership appears Morgan Stanley again, with 8.1%.

Among the five main Socimis and the four big promoters, foreign investors accumulate more than 4.343 million in the Stock Exchange.

In contrast to the ten different international funds that invest in listed real estate companies, the number of foreign investors that control this type of company is much smaller but with a very prominent weight.

This is the case of Santander and BBVA banks, top shareholders of the largest real estate company in the Spanish stock market: Socimi Merlin Properties. These entities became the outstanding owners of this company by integrating it with Metrovacesa, the real estate company that they inherited during the crisis as their owner, Román Sanahuja, was unable to meet his debts. Currently, Santander has a 22.268% stake valued at some 1,162 million, more than half of all Spanish investment in the ten largest real estate companies listed (about 1,800.48 million). The participation of BBVA is valued at around 336 million.

Along with the two major Spanish banks, two real estate groups stand out as prominent investors in the listed companies in the sector. This is the case of Colonial that surprised in October 2016 when it won a majority stake in Socimi, Axiare. One year later, and after initial hesitation, Colonial has established itself as the largest shareholder of its counterpart, with a stake valued at approximately 200 million euros. For its part, Colonial is controlled by three foreign investors, after Villar Mir. reduced  his participation.

Likewise, the real estate group Lar, controlled by the Pereda family, is the third largest shareholder of the Socimi Lar España, with a participation of more than 5.6%. As promoters of this Socimi, Lar group managed to get the largest fund manager in the world to bet on what was the first large listed real estate investment company to go out on the market. Currently, Pimco has a stake valued at about 149 million.

Source: Expansion.com.