Tag: volatility
Eurostat: House Prices Rose by 6.2% in Spain in 2017
11 July 2018 – Eje Prime
The acceleration of the housing market has placed Spain amongst the leading countries in Europe in terms of price rises. In fact, in just one year, the country has risen from 21st position, with an average increase of 4.6% in 2016, to 12th , with an average increase of 6.2% last year.
In 2016, Spain already exceeded the average rise for the European Union as a whole, which amounted to 4.6% at the time, but in 2017, it distanced itself further from the average, moving closer to the group of countries with the highest rises in prices: whilst in Spain, the increase amounted to 6.2% in 2017, the average rise for the European Union as a whole was 4.4%.
Spain outperformed Austria, where prices rose by 8.5% in 2016 (in 2017, they only increased by 5.3%); Norway, which went from an increase of 7.9% in 2016 to 5.4% in 2017; and the United Kingdom, where house prices increased by 7% in 2016 and by 4.5% in 2017.
Iceland, the Czech Republic and Ireland were, in that order, the three markets where house prices rose by the most in 2017, with rises of 19.5%, 11.7% and 10.9%, respectively. Iceland was the only country to feature in the top 3 in both years; in 2016, it was joined by Hungary and Sweden.
Several countries from Eastern Europe, such as Lithuania, Latvia, Bulgaria, Slovenia and Hungary (with high volatilities in terms of the evolution of house prices) were amongst the most inflationary in terms of house prices in 2017, together with countries in Western Europe, such as Portugal, where prices rose by 9.2%; the Netherlands (7.5%) and Sweden (6.4%).
At the opposite end of the spectrum, the only European country where house prices decreased in 2017 was Italy, with a reduction of -0.8%. It was accompanied by moderate price increases in Finland (1.6%), Cyprus (2.2%), France (3.6%) and Croatia and Poland (both 3.8%).
The figures from Eurostat, the European Union's statistics office, include purchase prices of new and second-hand homes. According to the EU entity, these prices "have fluctuated significantly since 2006". "The annual growth rate in the European Union as a whole was close to 8% in 2006 and 2007, followed by decreases of 4% as a result of the financial crisis", it continued.
Prices started to increase in 2014, with an average cumulative rise across the whole of the European Union of 11% between 2010 and 2017, and of 6% in the Eurozone during the same period, according to Eurostat. In the case of Spain, despite the increases in recent years, the country has registered a cumulative decrease of 17% since the start of the century.
Original story: Eje Prime (by Christian de Angelis)
Translation: Carmel Drake
Author Carmel DrakePosted on July 16, 2018 Categories Real Estate News, ResidentialTags average, Bulgaria, cumulative increases, Czech Republic, Europe, European Union, Eurostar, financial crisis, growth, house prices, Hungary, Iceland, Ireland, Latvia, Lithuania, ranking, rises, Slovenia, spain, volatility
Spain's RE Companies see their Share Prices Rise by 30% on Average in 2017
12 December 2017 – Expansión
Spain's real estate companies are on a roll: the recovery in activity has given these companies more visibility on the stock market. On average their share prices have risen by 30% in 2017. Renta Corporación, Hispania and InSur are the best performers and all three are very much in favour with the experts.
The property sector is in fashion on the stock market. On average, the share prices of real estate companies rose by 30% in 2017, well above the 10% rise that the Overall Index has registered since the beginning of the year.
Within this group, three companies shine the brightest: Inmobiliaria del Sur, Hispania and Renta Corporación all saw their share prices rise by between 39% and 53%, and the experts think that the upward trend will continue.
Moreover, Urbas and Axiare also saw their share prices rise by more than 30% in 2017, but for diametrically opposite reasons. The first was suspended from trading in September after the National Court announced that it was investigating the firm's President for "suspected fraud" following a complaint filed by the Anticorruption Prosecutor.
Meanwhile, Axiare is the target of a takeover by its counterpart Colonial, which launched its bid in the middle of November and saw it approved by the CNMV just a few days ago. The operation, which is expected to result in the creation of a real estate group with assets worth €10 billion, offered a 13% premium over the company's share price at the time, which led to a sharp rise. Currently, the company's shares are trading just below the offer price (€18.29 compared to €18.36 per Colonial's latest offer).
The economic environment, improvement in activity and greater investor appetite for housing are all working in favour of these companies, said Nicolás López, from M&G Valores.
However, the expert points out that the low market capitalisation of some of them and their very low liquidity increase their volatility, which makes them options suitable only for high-risk profiles.
Renta Corporación's share price has risen by more than 50%
In the case of Renta Corporación, which is limited in size: amounting to just €92 million. The company is the best performing real estate company of 2017, with a share price increase of 53% (…). The company has taken advantage of its knowledge of the real estate market to launch, together with the Dutch pension fund APG, a Socimi. Since its creation, eight months ago, the new listed company has invested €93 million in the purchase of more than 1,000 homes, all located in Madrid and the surrounding area (…).
Strategic diversification favours InSur
Inmobiliaria del Sur completes the podium of the most profitable real estate companies this year. Its share price has risen by 40%. The secret to its success is the new business plan that the company has launched and which has been welcomed warmly by the market.
The family business, which has more than 70 years of experience, splits its activity between the construction of homes and the rental of office buildings, which allows it to have two revenue streams. With a business plan that involves building more than 2,000 homes between now and 2020, InSur has closed alliances with partners such as Anida, the real estate arm of BBVA, to become a key player in residential development (…).
Hispania's specialisation boosts its share price
Meanwhile, Hispania's share price has risen by more than 39% since the beginning of the year. This year, the company (…) has initiated a new phase, specialising in hotel assets (in June, it became the largest hotel owner in Spain with 38 establishments) and divesting the rest of its properties (…).
A few weeks ago, the company published its results for the third quarter, which went down well. The Socimi recorded a profit of €179 million during the first nine months of the year, up by 31% compared to the same period in 2016 (…).
Original story: Expansión (by D. Esperanza and R. Ruiz)
Author Carmel DrakePosted on December 14, 2017 Categories Market, Real Estate NewsTags Anida, APG, Axiare, BBVA, boom, Colonial, divestment, high-risk profiles, Hispania, homes, hotels, Inmobiliaria del Sur, investors, low liquidity, M&G Valores, market capitalisation, offices, portfolio, recovery, renta corporación, rental, results, share price, shareholders, Socimi, Urbas, volatility
Cerberus Negotiates 10% Stake In Liberbank Following Capital Increase
19 October 2017 – Expansión
Cerberus is finalising its entry into Liberbank. The US fund is negotiating to buy a stake that would represent between 7% and 10% of the bank's share capital following its capital increase amounting to €500 million. Sources familiar with the negotiations explained to Expansión that, in this way, Cerberus would earn a seat on the entity's Board of Directors.
If the negotiations are successful, Cerberus would increase its commitment to the Spanish economy, having remained active with the purchase of several portfolios linked to the real estate sector. In fact, the fund is also holding exclusive negotiations with BBVA to buy its real estate platform Anida and some of that bank's real estate exposure.
Financial sources indicate that the management team at Cerberus has decided to go all out for the Spanish financial sector after the fund failed to get past the first round of the bidding for the company created by Santander to shelve 51% of Popular's real estate risk, which was awarded to Blackstone in the end.
Liberbank is planning to close the capital increase in the middle of November when it will also reduce the number of directors from the current figure (15) to 11. It is likely that Oceanwood, the largest private shareholder, with a 12.1% stake, will also have one representative on the Board once the capital increase has been completed. Liberbank currently has 15 directors, although two of the positions are vacant following the resignations of Luis Garicano in 2016 and Pitarch Rodríguez this year.
Core shareholders
Liberbank's core shareholders, comprising Oceanwood, Corporación Masaveu and the Mexican business Ernesto Tinajero, and the foundation heirs of the founder savings banks (CajAstur, Caja Cantabria and Caja Extremadura) have committed to participating in the capital increase, with a percentage of almost 40%, according to sources familiar with the operation.
The idea of the former savings banks is to carry out a white operation: they will sell some of their shares with rights in order to be able to participate in the capital increase without having to invest new capital. This move will result in a dilution of their stake, and, in turn, will give rise to the entry of at least one new major shareholder (…).
Liberbank has already taken its first steps towards conducting the capital increase. This week, it decreased the nominal value of its shares, from €0.90 to €0.02 to comply with the regulations. Meanwhile, the entity announced that, following the end of the voluntary conversion period for three series of convertible obligations, it has received requests to convert 293,879 obligations. Therefore, the entity informed the CNMV in a statement that it will issue 2.39 million shares, equivalent to 0.28% of its share capital.
Original story: Expansión (by S. Arancibia, R. Sampedro and N. Sarriés)
Author Carmel DrakePosted on October 19, 2017 Categories Real Estate NewsTags Anida, BBVA, Board of Directors, capital increase, Cerberus, CNMV, Corporación Masaveu, Director, Liberbank, nominal share price, Oceanwood, real estate exposure, share price, shareholder, stake, volatility
Merlin's Share Price Stays Below €10 Amidst Divestment Rumours
22 April 2016 – El Boletín
The downwards trend in the share price of Merlin Properties is accelerating amidst rumours of divestments. The Socimi's share price decreased by 2% on the stock exchange after it was revealed that it is considering the sale of some of its premises, currently leased to BBVA, its main tenant.
The slight decrease in the share price in recent months has accelerated following the news that Merlin is considering the sale of a "residual part" of the premises that BBVA leases from it as branches. Currently, there are 888 buildings in this situation, which meant that when it debuted on the stock exchange – exactly four months ago today – it was known as the landlord of the bank chaired by Francisco González.
Whilst this movement would form part of the asset rotation policy set out in the listed entity's strategic plan, investors are reacting negatively to this change in Merlin's criteria with respect to one of its main tenants. Thus, share sales increased during the trading session and the Ibex 35 fell prey to the uncertainty surrounding the wait for Mario Draghi to share his account of the European Central Bank (ECB)'s next moves.
Analysts at Capital Bolsa also indicated that the technical analysis of its graph points more towards a decline to €9.50 per share, than a comeback to the €10.00 threshold. Until the Ibex's Socimi manages to exceed its recent maximums of €10.079 per share, the trend to increase its losses will continue, which now amount to 15% in terms of its market capitalisation since the beginning of this year.
Original story: El Boletín
Author Carmel DrakePosted on April 22, 2016 Categories Real Estate NewsTags BBVA, Capital Bolsa, divestment, European Central Bank, ibex 35, landlord, market capitalisation, Merlin, merlin properties, share price, tenant, volatilityLeave a comment on Merlin's Share Price Stays Below €10 Amidst Divestment Rumours
Acciona Postpones Sale Of RE Subsidiary
14 April 2016 – El Economista
The delay in forming a Government in Spain, along with the uncertainty surrounding the United Kingdom's departure from the European Union and the instability in world markets, are delaying the possible IPO or sale to a private investor of a stake in Acciona's real estate subsidiary.
In an interview with EFE-Dow Jones, the Corporate Development Director of Acciona, Juan Muro-Lara, said that the political gridlock "is part of a cocktail of uncertainty in Europe, driven by volatility in the markets and possible discounts on prices", which means that now "is a difficult time to close operations at a good price".
For this reason, he said that it is better to wait "for all those uncertainties to be resolved" in order to have the right market conditions for the sale of Acciona Real Estate and he added that "seeing as we do not need to complete the sale at any price, we would rather wait for the conditions to be right".
Original story: El Economista
Author Carmel DrakePosted on April 14, 2016 Categories Real Estate NewsTags Acciona, Acciona Real Estate, conditions, European Union, exit, IPO, operations, political gridlock, political uncertainty, price, sale, shareholding, stake, stock markets, UK, volatilityLeave a comment on Acciona Postpones Sale Of RE Subsidiary
Sabadell Places €750M 5-Yr Debt Issue At 0.475%
1 June 2015 – Expansión
€750 million debt issue / The bank has placed an issue of 5-year mortgage bonds with a record low yield of 0.475%.
For many financial institutions, the excess liquidity in the market is offsetting the recent increase in volatility that has resulted from the lack of agreement between Brussels and Greece. As a result, debt issues are proving successful.
Friday's operation by Sabadell is a good example. Just 24 hours after the bank held its AGM, it went to the market in search of financing through the issue of 5-year mortgage bonds, arranged by Barclays, Deutsche Bank, HSBC and Lloyds. It paid a yield of 0.475%, which represents the lowest ever interest rate on a bond issue. Moreover, spreads, or differentials, are returning to pre-crisis levels, given that this yield sits just 12 basis points above the mid-swap rate (the reference rate for fixed rate issues).
"The primary international investors have all taken part in this operation and the participation rate in Germany has been particularly noteworthy. The main investors participating in the issue have been financial institutions, central banks, investment fund managers, insurance companies and pension funds", said the entity in a statement on Friday.
Sabadell has been particularly active in the market for this type of issue. Since November last year, it has completed four such transactions, raising €3,100 million in total. "The solvency of Banco Sabadell and its reputation on the international financial markets have undoubtedly been the factors that have contributed to the success of this placement", it added. The bank wants to take advantage of the decreasing financing costs caused by the recent stimulus measures put in place by the European Central Bank (ECB). "The release of this issue will take place on 10 June and its launch forms part of Banco Sabadell's non-equity security program, filed with the CNMV", explain sources at the bank.
In September last year, the financial institution launched a covered bond (the term used for bonds in Europe) purchase program. In total, it has acquired €82,805 million. Moreover, it put in place a securitisation purchase program at the end of last year, and as a result it will close the first transaction involving Spanish mortgages since 2007, with UCI, which is owned by Santander and BNP Paribas. And in March this year, it started to purchase government debt, which has significantly reduced its financing costs.
Improved credit
As a result, credit is being revived once more, which is the main objective of the ECB. In this regard, Josep Oliu, Chairman of Sabadell (pictured above), said at the entity's AGM last Thursday, that the strong level of competition in the financial markets to secure credit in the context of excess liquidity, represents a threat to the recovery of the banks' financial results.
Original story: Expansión (by D. Badía)
Author Carmel DrakePosted on June 1, 2015 Categories Real Estate NewsTags AGM, banco sabadell, Barclays, bnp paribas, CNMV, covered bond, debt issue, Deutsche Bank, ECB, financing, financing costs, HSBC, institutional investors, insurance companies, interest rate, Josep Oliu, Lloyds, mortgage bond, pension funds, reference rate, sabadell, santander, UCI, volatility, yieldLeave a comment on Sabadell Places €750M 5-Yr Debt Issue At 0.475%