The meeting organized by the Global Real Estate Institute (GRI) in Madrid between yesterday and today to discuss the reality and perspectives of the real estate sector in Spain left a clear conclusion expressed by many of the promoters and fund managers and assistants banks. The emergence of live operations for a year and a half is not supported by some key indicators -prices for sale or rental, occupation-solids level.
In other words, eye to premature overheating of asset prices, based only on the flood of liquidity at a good price the market and the changing perception of Spain macroeconomic lives. “International capital has moved much faster than the industry itself to crazy scale, the Spanish investor has trouble removing backpacks seven years of crisis,” said Miguel Pereda, CEO of Grupo Lar.
The Blackstone Fund also spoke on prices. One of its leaders even proposed interveners not even compete so intensely and by many investors at this time of recovery, premium assets. Is too expensive and can fail to be profitable, they warned. Other speakers noted even the return of speculative segments such as logistics operations assets.
From the point of view of banks, representatives of Sabadell and CaixaBank agreed that the leverage of the operations has not yet reached 80 percent of the boom years, is between 50 and 60 percent depending on the features operation. From Sabadell it was even said that more than loan to value ratio, which is regarded above all is the ability to repay the principal of a loan.
International organizations like the German PBB or ING agreed to compare the current time with the beginning of the century, with much liquidity available and the value of land beginning to rise. Although, again, they said it was not comparable as the level of performance of office rental market, which is half that fifteen years ago.
In this sense, some asset management vehicles as Meridia a difference of up to one hundred percent in the price of renting offices in the Paseo de la Castellana in Madrid said.
(El Economista 21/05/2015)