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Blackstone Buying Spanish Social Housing

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http://www.bloomberg...-in-madrid.html

Blackstone Group LP (BX), the largest manager of private-equity real estate funds, agreed to buy a group of Madrid apartments for 125.5 million euros ($166 million) in its first property purchase in Spain.

Blackstone, based in New York, is acquiring 18 apartment blocks with a total of 1,860 units from the city of Madrid. Of those units, 1,208 are rented to tenants and 652 are leased with an option to buy, according to an e-mailed statement from Cristina Garrido, a Blackstone spokeswoman.

Europe's biggest real estate managers are making their first investments in southern Europe since the financial crisis as low prices and diminishing risk make commercial properties more attractive. Blackstone also is bidding for 3,000 rental units being sold by the regional government of Madrid.

"We believe strongly in a recovery of the Spanish economy," Garrido said in the statement. Blackstone said it's required to honor the existing terms of all tenant and building agreements. The firm has invested in similarly regulated housing in Germany, San Francisco and New York, she said.

The apartments in the Spanish capital were the property of the Municipal Social Housing Co. and are located in the districts of Carabanchel, Vallecas and Villaverde and the city center, Blackstone said.

Wouldn't surprise me at all if all the social housing eventually ended up in private equity hands.

Edited by aSecureTenant

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1860 units in Madrid for 107 million pounds = 57k pounds per property. That is 9 times cheaper than the average property in London, yet London is where the foreign investors are flocking to buy.

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I realise it's probably heresy on here to say this,but it might be more efficiently looked after.

Personally,I can't the logic especially when you see things like this from Mish Shedlock 24/7/13,99% Believe the Economic Situation in Spain is Bad; How Much Worse Can This Get?.

They may be working on the basis that when 99% of people are fearful,it's time to buy,but I fear they're not weighing the possibility that they're paying Euro's for peseta assets.

Edited by Sancho Panza

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I realise it's probably heresy on here to say this,but it might be more efficiently looked after.

Personally,I can't the logic especially when you see things like this from Mish SHedlock 24/7/13,99% Believe the Economic Situation in Spain is Bad; How Much Worse Can This Get?.

They may be working on the basis that when 99% of people are fearful,it's time to buy,but I fear they're not weighing the possibility that they're paying Euro's for peseta assets.

They are required to maintain existing tenancy arrangements. Not sure how secure those contracts are.

It would be interesting whether a block of social flats can provide a decent return for capitalists plus security for tenants.

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They are required to maintain existing tenancy arrangements. Not sure how secure those contracts are.

It would be interesting whether a block of social flats can provide a decent return for capitalists plus security for tenants.

Personally,if I were a social tenant,I'd rather chance my arm with a private firm than the local council in terms of management.Currently,I rent through a private 'accidental' landlord and the service is poor to say the least.

When I look at the student sector,the big companies seem to be delivering a service and a product that customers want at a price they like,which is why the number of traditional student properties empty for the last academic year was so high.

Edit to add:I'd presume the contract would roll over.

Edited by Sancho Panza

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Guest eight

I realise it's probably heresy on here to say this,but it might be more efficiently looked after.

Personally,I can't the logic especially when you see things like this from Mish Shedlock 24/7/13,99% Believe the Economic Situation in Spain is Bad; How Much Worse Can This Get?.

They may be working on the basis that when 99% of people are fearful,it's time to buy,but I fear they're not weighing the possibility that they're paying Euro's for peseta assets.

As per the other thread, I reckon they're planning to fill these with UK pensioners.

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Personally,if I were a social tenant,I'd rather chance my arm with a private firm than the local council in terms of management.Currently,I rent through a private 'accidental' landlord and the service is poor to say the least.

When I look at the student sector,the big companies seem to be delivering a service and a product that customers want at a price they like,which is why the number of traditional student properties empty for the last academic year was so high.

Edit to add:I'd presume the contract would roll over.

I don't see why a private company shouldn't and it would be in a firms interests to have stable tenants, rather than creating churn to drive fee's and in the social sector that isn't going to work as the clients can't afford the fee's.

Wouldn't surprise me at all if it was viable for professional investors. At the moment it would be cheaper for me to rent from the bank than the council. Also Northern council flat seems to be worth roughly the same or slightly more what a flat in Madrid seems to be worth. (local agents have a flat similar to mine on the market at £65K).

At current interest rates of course.

Edited by aSecureTenant

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More bottom feeding private equity firms move in on Spanish housing. Spain’s banks are now, finally, blowing out bad real estate deals.

http://online.wsj.co...1078758426.html

Over the next 15 years, Sareb aims to sell real-estate debt and properties acquired this year from nationalized lenders at deep discounts, for €50.8 billion. The properties, numbering 106,856, include partially built beachfront resorts, empty and occupied apartments, plots of scrubland, and at least one church. Sareb aims for an average rate of return of 13% to 14% a year on its operations.

Tuesday's deal comes as the property sector in Spain is showing tentative signs of life. Even though official estimates still show decreases in house prices, real-estate company Fotocasa said last week that its own property index showed a 0.7% uptick in the price of used homes between July and June, the first since January 2010.

Last month, the Blackstone Group LP BX +0.17% agreed to buy 1,890 rent-controlled apartments in Madrid from the city's government, for a total of €128 million. And France's Axa Real Estate recently purchased 13 office buildings off the Catalonian government, for €172 million.

Edited by aSecureTenant

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  • 239 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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