Neinor Homes and Orion Capital Managers, through its Orion European Real Estate Fund V, and Neinor's main shareholder with a 27% stake, have agreed to establish a €150 million joint venture to invest in the build-to-sell (BtS) sector in Spain.
Orion will hold a 90% stake in the joint venture, while Neinor will own the remaining 10% and will act as the managing partner in charge of delivery, overseeing project design, licensing, marketing and construction. As part of the deal, Neinor and Orion have already agreed to acquire two plots of land for €20 million to build more than 150 new homes.
Orion and Neinor will continue to explore further investment and development opportunities in the Spanish residential market in the coming months. Alantra has acted as exclusive financial advisor to Neinor.
The co-investment strategy plays a key role in the business plan announced in March 2023, in which Neinor places greater emphasis on optimising its balance sheet while pursuing capital efficient acquisitions. For the period between 2023 and 2027, Neinor plans to invest approximately €1 billion in new land acquisitions, half of which will come from new equity partners.
Borja García-Egotxeaga, CEO of Neinor Homes, said: "When we announced Neinor's co-investment business we told investors that we were opening a new channel to invest alongside Neinor as a way to diversify our sources of capital and improve shareholder returns. Today we are very proud that Orion, Neinor's largest shareholder, has also decided to become a co-investor through its V Fund, which demonstrates the strength and confidence of the platform we have built, as well as our commitment to deliver exceptional returns to both co-investors and shareholders.
Jordi Argemi, Neinor's Deputy CEO and CFO, said: "Listed companies are designed for growth, as they have faster, more agile and diversified access to debt and equity markets. However, in the current market conditions, where debt has become significantly more expensive and real estate is trading at a significant discount to NAV, this has become a difficult exercise that hinders growth opportunities. So, as part of our strategic update, we decided to find a new way of structuring land investment so that we can pursue growth opportunities in a way that is efficient for shareholders.