Bayside Capital, the credit affiliate of H.I.G. Capital, has agreed to buy the first pool of real-estate assets sold by Sareb, known as Project Bull. Sareb will retain a 49% stake while Bayside will have 51%. The deal values the portfolio at €100m and allows Sareb to participate in future gains. The Project Bull portfolio is comprised of residential developments, more specifically 939 homes located in: Andalusia (275), Canary Islands (129), Cantabria (5), Catalonia (38), Balearic Islands (19), Madrid (86), Murcia (44) and the Community of Valencia (343). The portfolio also includes 750 ancillary premises (parking spaces and storage rooms) and one retail unit.
MADRID–(BUSINESS WIRE)–H.I.G. Capital announced today that an investment fund managed by its credit affiliate Bayside Capital entered into a definitive agreement for the acquisition of the first pool of real-estate assets sold by Sareb, known as Project Bull. H.I.G. Capital is a leading global investment firm with assets under management of over $13 billion and through its Bayside Capital division, is one of the leading players in the European distressed assets market.
The sale, which was advised on by KPMG, Ashurst, Baker & McKenzie and Monthisa, values the portfolio at €100m and allows Sareb to participate in future gains.
Sareb’s president, Belén Romana, has assessed the keen interest that this transaction has sparked amongst institutional investors worldwide. “The quality of the bids submitted shows the confidence that investors have in Sareb and in the recovery of Spain’s real-estate market,” she stated. For its Director of Real-estate Assets, Juan Barba, Project Bull’s success “allows us to be optimistic with regards to the portfolios we plan to put on to the wholesale market over the second half of the year, which will also involve creating investment vehicles”.
In selecting the bid submitted by H.I.G. Capital, Sareb took into account the proposed business plan to manage the properties, which would provide it with a greater potential for return on investment.
Chris Zlatarev, from Bayside Capital, commented: “We are pleased to have been able to partner with Sareb on this portfolio. This transaction demonstrates H.I.G.’s commitment to investing in Spain and growing our Real Estate and NPL business”. H.I.G. Capital has a significant presence in Spain, led by Jaime Bergel, who heads its Madrid office.
This is the first Sareb real-estate asset portfolio to be put on the wholesale market. Sareb was set up at the end of last year to divest the portfolio of loans and real-estate assets transferred by banks, which had received government funding.
The Project Bull portfolio is comprised of residential developments, more specifically 939 homes located in: Andalusia (275), Canary Islands (129), Cantabria (5), Catalonia (38), Balearic Islands (19), Madrid (86), Murcia (44) and the Community of Valencia (343). The portfolio also includes 750 ancillary premises (parking spaces and storage rooms) and one retail unit.
The transaction has been structured via the creation of a Bank Asset Fund (FAB), a first in Spain. Sareb will retain a 49% share in the FAB, whilst H.I.G Capital will own 51%.
The properties in the hands of the FAB will be managed by an independent servicer selected by H.I.G., Monthisa, a Spanish company with more than thirty years of real estate management experience.
The Management Company for Assets Arising from the Banking Sector Reorganisation (Sareb) is a private institution which was created in November 2012 in order to help clean up the Spanish financial sector, and more specifically the institutions that received government funding. Sareb is committed to selling the acquired assets within a maximum 15-year time horizon. The FROB (Fund for Orderly Bank Restructuring) owns 45% of Sareb and the remaining 55% is in the hands of banks and national and international insurance companies and one electricity company.
About H.I.G. Capital
H.I.G. is a leading global private equity investment firm with more than $13 billion of equity capital under management. Based in Miami, and with offices in Atlanta, Boston, Chicago, Dallas, New York, and San Francisco in the U.S., as well as international affiliate offices in London, Hamburg, Madrid, Paris, and Rio de Janeiro, H.I.G. specializes in providing capital to small and medium-sized companies with attractive growth potential. H.I.G. invests in management-led buyouts and recapitalizations of profitable and well managed manufacturing or service businesses. Since its founding in 1993, H.I.G. invested in and managed more than 200 companies worldwide. The firm’s current portfolio includes more than 80 companies with combined sales in excess of $30 billion. For more information, please refer to the H.I.G. website at www.higcapital.com.