Allianz Real Estate said on Monday that it has signed its first value-add deal in Madrid by joining forces with US developer Tishman Speyer to take control of the Monteburgos office development project in Madrid's Las Tablas district.
Allianz has entered into a 50/50 joint venture with Tishman Speyer’s TSEV VIII value-add fund to acquire 76% of the shares of the 56,650 m2 office project from Spanish landowner Metrovacesa for a total of nearly €88 mln.
The Spanish firm is retaining a 24% interest in the project and a key management role as local expert.
As part of the agreement, the land will be divided into three plots to be developed in phases. The district of Las Tablas is an established office submarket located immediately north of Madrid. It has been historically popular for large corporations to establish their Spanish headquarters in the region, and since 2010 has attracted companies such as BBVA, Telefonica, Phillips, Porsche and Técnicas Reunidas.
The acquisition follows the opening 18 months ago of Allianz Real Estate's Madrid office headed by Miguel Torres. To date Allianz has concluded four financing deals in the retail and office space totalling €400 mln of commitments.
First investment in Spain in a decade
Olivier Teran, CIO Allianz Real Estate said: 'We’re excited by the opportunity of investing alongside Tishman Speyer. We believe in the prospects of the Spanish office market especially for building with best-in-class specifications naturally designed to address tenants with the most stringent space requirements.'
Bernard Penaud, head of Europe for Tishman Speyer commented: 'This, our first investment in Spain for over a decade, represents an important further step in the growth of our business here in Europe. We’ve also identified Madrid as having an acute shortage of grade A office space, and the core of our business platform is to develop and own the highest quality assets in the world’s great cities.'
Colliers advised Metrovacesa on the sale. Crédit Agricole is financing Phase I of the project.
Metrovacesa bought the plot of land in November 2007 in a deal valued at just over €260 mln.