Andalusia buys back 70 office properties from WP Carey for €328M

Andalusia buys back 70 office properties from WP Carey for €328M

The president of the Junta de Andalucía, Juanma Moreno, has announced an agreement worth 328 million euros to buy back from the company WP Carey, 70 properties that belonged to the Junta de Andalucía and were sold in 2014. This will mean a saving of more than 100 million euros for the public coffers, plus the rents that would have to be paid from 2034 onwards. The consultancy firm CBRE has advised on this operation.

Moreno also pointed out that this year alone 35.6 million have been paid for the rental of these buildings, so he insisted that by no longer having to pay this amount, this money will be used to meet other priorities, as this will mean increasing the self-financed budget items and thus having more resources available in the areas where they are most needed. "These 35.6 million are equivalent to the gross annual salary of more than a thousand teachers or the cost of building ten schools," said the president.

In 2014, when she was Minister of Finance and, therefore, responsible for the Junta's assets, the at the time acting Minister of Finance, María Jesús Montero, sold a total of 70 buildings in which more than 8,600 public employees work to the company Inversiones Holmes for 300 million euros. An agreement that, according to Moreno, "had a counterpart that was absolutely detrimental to the interests of the regional administration".

Similarly, he explained that the rental contract had a "floor clause" which established that, regardless of the CPI, the price of the rent would rise by at least 1.5%, and stressed that in the decade that the contract has been in force, the CPI has been negative or below 1.5% most years, and when it has been higher, the rent has been revalued with the highest figure, i.e. the CPI.

In this way, Moreno stated that this agreement puts an end to this situation, as he added that until 2034, the year in which the initial contract would expire, the Junta would have paid some 708 million euros in rent, almost two and a half times what it received, and from then on, every year, for life, a rent that would exceed 40 million euros each year.

"By the end of 2023, some 279 million will have been paid, and between now and 2034, an estimated cost of 430 million would still have to be paid, plus maintenance and repair costs. In addition, after the 20 years of the contract, a new site would have to be found for the 8,600 employees at these sites, or new rents would have to be renegotiated with the property", he concluded.

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