Opportunity & Distressed

Transcription

1 Southern Europe Investment Briefing Opportunity & Distressed CBRE London, 9 th September 2014 Patricio Palomar Murillo Head of Research & Investment Strategy Spain [email protected]

2 1 THE MACROECONOMIC CONTEXT Visuel p. 2

3 Macroeconomic Data Spain GDP 4% 2% 1.3% 2.0% 2.2% 2.4% 2.4% 2.6% 0% 0.4% -2% -1.3% -1.6% -4% % annual change p. 3

4 Macroeconomic Data Spain Labor Market 30% Unemplo yment rate 25% 20% 15% 10% 5% p. 4

5 Bloomberg Businessweek Spain Growth beats Bank of Spain Estimate Even as Prices Fall p. 5

6 REUTERS Spain Unemployment Rate Drops as Job Creation Gathers Pace p. 6

7 Financial Times Europe s property IPOs at eightyear high - Tuesday 15 th July 2014 p. 7

8 2 INVESTMENT MARKET Visuel p. 8

9 CRE Investment Volumes in Southern Europe p. 9

10 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q CRE Investment Volumes in CEE vs. Southern European Economies In nominal figures Million CEE PIIGs p. 10

11 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q CRE Investment Volumes in Southern Europe Spain Million Italy Spain Portugal 4Q average p. 11

12 Change in Direct CRE investment Twelve months to Q compared to previous twelve Change in Value (%) 160,0 140,0 120,0 100,0 80,0 60,0 40,0 20,0 0,0 Iberia Italy UK Benelux Europe France Germany Nordics CEE p. 12

13 Commercial Real Estate Finance Market Conditions in Europe Key Lending Terms*: Top Quality Real Estate and Tenant, Q Market Max Loan** Max LTV Margin*** Germany 200 m 75% 150 bps Ireland 80m 70% 300 bps Netherlands 120m 70% 200 bps Russia 150m 70% 450 bps**** 600 bps***** Spain 50m 60% 4600 bps UK 150m 70% 170 bps Market Trend / * New 5-year loan based on the maximum underwriting ability of a single lender. ** Max ticket size for a single lender. *** Margin over EURIBOR/LIBOR swap. **** Lending in RUB. ***** Lending in US Dollar /. p. 13

14 1H of 2012, 2013 & 2014 Total Investment volume; Spain Doubling year on year Millions 3,226 MM ,455 MM MM H H H 2014 p. 14

15 1H 2013 vs 1H 2014 Total Investment volume; Spain The share per sectors (% of total) Millions Offices Retail Industrial Others ,226 MM ,455 MM MM H H H 2014 p. 15

16 The new tax efficient vehicles established in Spain Current and futures SOCIMIs and FABs SOCIMI Capitalization , p. 16

17 Spain H1 2014: Cross-Regional CRE Investment 2,201 out of 3,226 million came from over seas in H Europe 927 million North America 583 million Middle East 138 million Asia-Pacific 359 million North LatAm 130 million South LatAm 63 million p. 17

18 Spain H1 2014: Cross-European CRE Investment Only 28% came from other European countries UK Netherlands 233 million 130 Germany million 55 million France 509 million p. 18

19 Spain: Historical CRE Turnover Investor demand is now reflected in investment volumes million Offices Retail Industrial & Logistics Other Forecast H H p. 19

20 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Madrid: Prime yields evolution 11 Industrial Offices High Street Shopping Centres p. 20

21 2014 Investment activity in the Madrid Office Market M-50 Castellana, 200 (Q1 2014) Price: 150 million /sqm: 5,500 Purchaser: PSP & Drago Capital A-6 M-40 A-1 R-2 Avenida de América, 115 (Q1 2014) Price: 117 million /sqm: 2,312 Purchaser: London & Regional A-2 M-50 M-40 M MADRID R-3 A-5 A-4 A-3 A-42 M-50 R-5 R-4 Edificio IBM (Q2 2014) Price: 130 million /sqm: 1,800 Purchaser: Finaccess Edificio España (Q1 2014) Price: 265 million /sqm: 4,308 Purchaser: Dalian Wanda Group Castellana 77 (Q3 2014) Price: NA MM /sqm: NA Purchaser: NA p. 21

22 H Investment activity in the Barcelona Office Market Paseo de Gracia, 111 (Q3 2014) Price: 90 million /sqm: 6,308 Purchaser: Emin Capital Avenida Diagonal, 211 (Q3 2014) Price: 150 million /sqm: 3,543 Purchaser: Emin Capital Diagonal, 00 (Q2 2014) Price: 107 million /sqm: 3,543 Purchaser: NA p. 22

23 II Public disposal of the Catalonia Government ( 13 assets for a value of 201 mios) Casp, Gran Vía, 639 Pamplona, Avinguda Meridiana, Pere IV, Vía Laietana, Ausias Marc, Paseo Taulat Diputació, 353 Girona, La Rambla, 6-8 P. de Sant Joan 39-41/ Diputació, 355 P. De Sant Joan,45 p. 23

24 H Shopping Center investment activity in Spain CC El Boulevard (Q2 2014) Price: 155 million Purchaser: ING Nationale Nederlanden C.C. Modóo (Q1 2014) Price: NA million Purchaser: Alpha Capital C.C. Gran Vía de Vigo (Q2 2014) Price: 115 million Purchaser: Oaktree C.C. Txingudi (Q1 2014) Price: 24 million Purchaser: Grupo Lar Socimi C.C. Mercado de Fuencarral (Q2 2014) Price: 22 million Purchaser: Thalus C.C. Las Huertas (Q1 2014) Price: 15.5 million Purchaser: Grupo Lar Socimi C.C. Vialia Málaga (Q2 2014) Price: 63 million Purchaser: Brazilian Investment Club Varios activos (Q4 2013) Price: 160 million Purchaser: Baupost, GreenOak, Lar C.C. Parque Ceuta (Q1 2014) Price: 18 Price: 18 million Purchaser: HGI C.C. Las Rosas (Madrid) C.C. Madrid Sur (Madrid) C.C. Getafe 3 (Madrid) C.C. Rosaleda (Málaga) p. 24 C.C. El Mirador (Burgos) C.C. Atalayas (Murcia) Parque PVistahermosa Vistahermosa C.C. Montigalá (Badalona) (Alicante)

25 H Shopping Center investment activity in Spain (a) C.C. Planetocio ( Q3 2014) Price: 14 million Purchaser: AXIA RE C. C. Marineda City (Q3 2014) Price: 250 million Purchaser: Merlin Properties C.C. L Anec Blacu (Q3 2014) Price: 80 million Purchaser: Lar España C.C. As Cancelas ( Q3 2014) Price: NA million Purchaser: Carmila C.C. Alcalá Magna (Q3 2014) Price: 67 million Purchaser: Incus Capital P.C. MediaMarkt Villaverde( Q3 2014) Price: 9.2 million Purchaser: Lar España SOCIMI C.C. Los Alfares (Q3 2014) Price: NA million Purchaser: Carmila C.C. Imaginalia (Q3 2014) Price: 11.5 million Purchaser: Benson Elliot C.C. Holea ( Q3 2014) Price: NA million Purchaser: Carmila C.C. Albacenter (Q3 2014) Price: 28.4 million Purchaser: Lar España Socimi p. 25

26 3 THE DISTRESSED ASSETS Visuel p. 26

27 The Servicing Platforms of the banks Mandatory for those who want to invest in big resi portfolios Bank Platforms Investors and there are only very few ones in hands of the banks! p. 27

28 The bank repossessions in Spain In Million as of June 2014 * ** Net value. It includes assets from loans to companies that promote mortgages for buying houses of equity instruments. ** Bfa-Bankia data p. 28

29 SAREB: A bunch of investment projects either NPLs, land banks, CRE, Resi, etc a new world of opportuties for non risk averse investors! p. 29

30 Conclusions Visuel p. 30

31 Why invest now? Spanish cycle is very volatile Main structural reforms are being implemented Banks are starting lending again but gingerly Rentals levels adjusted heavily and have started growing Good quality stock is not in oversupply p. 31

32 Where is the opportunity? Bigger ticket assets (Castellana 77 for instance) Good asset/location with capex requirement (Castellana 89 for instance) Public sector sale and lease (Junta de Andalucia for instance) NPL s (Amazona Project for instance) Good companies over leveraged that go for sale and lease Supply segmentation is key to separate the good from the bad Offices (Good locations not so good asset or vacancy) Retail (regions with license granting moratorium) Logistic portfolio lease (>7,5 % net yield) Resi (Costa del Sol, resort type with track record) Student housing and health sector p. 32

33 For more information regarding this presentation please contact: PATRICIO PALOMAR MURILLO Head of Research & Investment Strategy T F [email protected]