CBRE Global Investment Partners (CBRE GIP) and Madison International Realty have created a JV to buy an €870M Spanish residential portfolio. The two funds have agreed to buy 65 apartment block buildings as part of the closing and recapitalisation of a fund managed by Azora, which will continue managing the assets and keep a minority stake. The portfolio includes 6,458 apartments in primarily mid-market areas located mostly in the the city of Madrid and its region.
According to Alexander van Riel, the head of continental Europe at CBRE GIP, “the residential rental market in Spain is very fragmented making this portfolio and its critical size unique to act as a major consolidator in the sector. This investment is in line with our key strategy – to focus on urbanization and demographic trends in supply constrained markets – and increases the CBRE GIP residential sector exposure in Europe». The JV partners intend to analyse new acquisition opportunities in the Spanish residential market.
For Madison International Realty “this investment represents a rare opportunity to acquire a large scale, high-quality residential portfolio located largely in the Spanish capital», as stated by Derek O. Jacobson, their co-chief investment officer. Madison was founded in 2002 by Ronald M. Dickerman and has with a track record of residential investment and management in the US from which to draw. The group has offices in New York City, London, and Frankfurt and more than 40 professionals dedicated to the sourcing, underwriting, acquisition, asset management, and investor relations for the firm.
Azora is one of the largest independent property managers in Spain with a strong focus on the multi-family housing market. Founded in 2003, Azora currently has a team of more than 200 professionals, managing assets worth more than €4.4 billion. The group has «kept this 6,458-unit portfolio under rental for 15 years, providing living solutions to thousands of families» according to Javier Rodriguez-Heredia, a partner of Azora and head of residential division. “Instead of liquidating and selling these units, with this strategic partnership, we have not only found a way to keep the units available for the families, but we will also increase the supply by continuing to invest in new rental product.”