The English Court continues in the search to make money selling properties. The group of department stores has mobilized the large consultants in the real estate sector with the aim of finding buyers for part of its property portfolio, as confirmed by the company itself, chaired by Marta Álvarez.
The group has contacted in recent weeks with the leading consultants in the sector to distribute among them a portfolio of assets. In principle, each of these firms will be in charge of the marketing process of different properties, for which they will have to find offers.
In this process, El Corte Inglés puts up for sale what they call non-strategic assets. Among those that are now being marketed, according to market sources, is, for example, a currently empty building in the 22@ district of Barcelona, the main pole of attraction for office investment in Spain, so it is likely to wake up interest among potential buyers.
Similarly, the intention is to get rid of various commercial premises, such as one located in the Ourense street from Madrid, the most commercial area at the back of Azca and where El Corte Ingles has its large department store, Nuevos Ministerios.
This marketing portfolio also includes certain plots of land, such as a piece of land located on Calle Alfonso Gómez, in the Julián Camarillo area of the capital.
This traditionally industrial area has been renamed Madbit, attracting in recent times numerous technology companies or technology providers. There are Indra and Telefónica offices there; L’Oréal develops its future headquarters; Industries such as Bosch, Rovi and ALK-Abelló are established, and Torre Rioja, for example, is building one of the main office projects.
Numerous data centers are also being installed on this area. Interxion erects one of them on Calle Alfonso Gómez itself, on a plot of land acquired from Recreativos Franco for €27 million and which adjoins the headquarters of Viajes El Corte Inglés.
An exact figure of the amount that the group could pocket is not known, but some sources raise it to 800 million euros. From El Corte Inglés it is pointed out that this process responds to “the strategy of the group of optimize your real estate portfolio”, and is separated from the debt reduction objectives set.
The group rules out that in this sale process buyers will be sought for more iconic properties such as Titania Towerin Azca, or its headquarters Hermosilla and Thomas Breton. He also does not consider trespassing any of his malls.
Liquidity
This sale operation is added to the process that the distribution company has in hand with BNP Paribas Real Estate, to which it commissioned, last June, the sale of around half a million square meters of logistics area, as announced then Five days.
A process in which the company has been quite successful, according to various sources in the real estate sector, with the sale of a warehouse and land in La Bisbal del Penedès (Tarragona), acquired by the logistics developer Panattoni, and which aroused enormous interest in a very active market for new lots.
Through this new process of selling non-strategic assets, the intention of the group chaired by Álvarez is to take advantage of the market moment, with a large volume of liquidity and in which there is a high appetite of national and foreign funds and family offices to buy real estate assets as an alternative with higher returns in a low interest rate environment.
The real estate assets of El Corte Inglés is valued at around 16.1 billion euros, according to the latest appraisal carried out by JLL, Savills and Tinsa. A “competitive advantage”, as recognized by the group itself in its last semi-annual presentation of results, which allows it great financial flexibility and a good cushion against crises.
Divestments in full refinancing
Talks. El Corte Inglés has several fronts open with which it seeks to strengthen its balance sheet, obtain greater liquidity and reduce its debt. The distribution group is in negotiations with its pool of entities to sign a refinancing of its financial debt, which at the end of the first half of 2021 was close to 3,800 million euros, although in January it amortized a bond issue for more than 600 million.
Rating. The group wants to drastically reduce its financial bill, in view of the good recovery that its business is showing, and the accolade that Mutua’s entry into its shareholding has meant. This, together with the sale of half of the insurance business, has given El Corte Inglés 1,105 million euros to further reduce its liabilities. Something that the rating agencies have already rewarded, improving its credit outlook to stable, and that places the company one step closer to the desired investment grade.
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