Miguem Peña (Grupo Lar) and Laurent Fléchet (Primonial)
With this joint venture, Grupo Lar continues its strategic commitment to the segment of rented accommodation, as announced in October 2019, in order to meet a clear market need: there is an annual increase of between 60-80,000 in the demand of rental homes up to 2024, within a framework where only 49% of the population will have, in 10 years’ time, the savings needed to qualify for a mortgage and with a rental offer which is 95% held by private owners and largely in old buildings. This is why for Grupo Lar there is currently an imbalance between supply and demand in the residential rental market in large cities and a lack of supply of quality products specifically intended for rent: adapted to the current demand, sustainable, energy-efficient and professionally managed.
Their goal: manage a portfolio of 5,000 homes
Grupo Lar and Primonial are committed to a state-of-the-art ‘Build To Rent’ development strategy through the investment of 400 million euros of capital over the next five years, including an initial portfolio of 500 units located in Madrid, Málaga and Valladolid.
The homes, which shall be built by means of developments on acquired land and also through turn-key agreements with developers, will be aimed to meet the demand for the average market in the main cities and metropolitan areas of Spain. The portfolio will focus mostly in Madrid and Barcelona, but the newly set up joint-venture will also look for opportunities in other markets such as Valencia, Málaga, Seville, Zaragoza, Las Palmas, Alicante, Palma de Mallorca or Bilbao, among others.
The platform starts with a strong commitment to promote modern buildings, exclusively designed and built for rent, efficient and sustainable, in order to offer a comprehensive management and professional service to its customers.
Miguel Ángel Peña, Residential General Manager Spain at Grupo Lar highlights that this strategic commitment comes in response to «a unique market opportunity to adequately and professionally serve the social demand for affordable housing for rent. The alliance of a long-term investor, with the extensive real estate knowledge of Primonial, together with the experience and ability for property development and management provided by Grupo Lar, ensures that the platform will be a national benchmark».
For its part, Laurent Fléchet, Managing Director in charge of the Primonial Group's property business, said: «In a context marked by uncertainty, this key partnership proves the ambitions of the Primonial group and its ability to project itself into the future by actively pursuing its development strategy on a European scale. Residential real estate in Europe is one of our preferred areas of development, driven by strong rental demand and supported by favorable demographic trends, generating yield and added value over the long term».
This transaction between Grupo Lar and Primonial, has had the assistance of Deutsche Bank and Savills as M&A advisors, JLL and Deloitte as real estate consultants, and of Uría Menéndez and Clifford Chance as legal advisors.
Both companies, with extensive experience in the real estate sector, have signed this operation with a long-term vocation: to become the «leading rental management company in Spain», as they already are in other real estate segments in Europe.
Press Released By Grupo Lar