Spanish Properties Breathe Again A Good Time To Invest

Noted billionaires John Paulson and George Soros, are well-known for their ability to make bold calls. Despite showing different styles in their ventures in the past, the two have shown a common interest in the Spanish real estate market this year. The two recently invested $127 million each, in Hispania .

With Soros being one of the most celebrated hedge-fund managers in history, and Paulson being right in his predictions of the 2007-2008 US mortgage market bust, is it time for other investors to follow their lead, probably on a smaller scale? The proposition certainly looks inviting to investors, considering that current Spanish property prices are at their lowest.
An inrush of foreign investors

The prices of prime properties in the Spanish real estate market, are less than the peak values they reached, about five years back, by nearly 30 percent. The difference in property prices of those along the Costas is almost 70 percent, although, properties have been experiencing a renewal in the recent past.

Savills claims that the inflow into the retail property sphere in Spain, last year, increased almost three-fold. The inflow in 2012, was €320 million, when compared to last year's inflow of €850 million. The majority of the inflow can be accredited to foreign investment.
Predictions for 2014

Gema de la Puente, the research head at Savills, says that bullish multinationals have a built-up demand, and that they are trying to make their way into the improving mid-term economy in Spain. Many of these multinationals have been biding their time, waiting for suitable opportunities to spring up.

Recently, Vodafone bought Ono, one of Spain's biggest cable TV and broadband unit, for €7.2 billion. The economy has been looking promising too, as the credit rating was upgraded by Moody's last month. Among other stories of Spain's recovery, the yield from 10 year government bonds have hit their lowest values, since early 2006.

Whether or not the recent improvements will reflect on the property market, is the big question on everyone's lips. Fitch reports that mainland Spain will see slow progress for the most part, as it is yet to recover from the crisis, and its repercussions. The agency predicts that property prices in Spain, will continue dipping further this year, and will hit their lowest in 2015. While the Costa de Sol expects a gloomy phase, the classier markets to the north of Mallorca, near Deja, are looking promising.

According to reports from Knight Frank, property sales in the area went up 40 percent during 2013. The sales were largely propelled by investors from Northern Europe, who were looking for properties at bargain prices. The upmarket districts in Barcelona and Madrid, currently look promising for city dwellers.

The government has been working towards attracting in buyers too, hosting multiple property roadshows and highlighting bargain prices of Spanish properties. Aside from following in Soros' footsteps, the Spanish real-estate market now seems inviting to investors of all levels.

Source: property-abroad.com

Southern Europe: From Death’s Door to Real-Estate Haven

Property investors are venturing to Spain, Italy and even Greece in search of bargains, reasoning that the lure of higher returns trumps the risk that Southern Europe will remain mired in sluggish growth.

Investors are venturing to Spain, Italy and even Greece in search of bargains on commercial property, reasoning that the lure of higher returns trumps the risk that Southern Europe will remain mired in sluggish growth.
For much of the extended slowdown that plagued the European Union, many investors focused on offices and high-end residences in cities such as London and Paris, where real-estate markets came through the euro crisis in relatively good shape.

While rents and occupancy levels in Southern Europe remain anemic, the region is benefiting from the widespread belief that the worst of the financial crisis has passed.
“People are just waking up to the fact that Spain didn’t fall into the Mediterranean,” says Eric Adler, chief executive of Prudential Real Estate Investors, which invested about $1.5 billion in European real estate in 2013 and is hoping to do more this year.
Last year, investors purchased €177.8 billion ($245.3 billion) of commercial property in Europe, up 17% from the prior year and the highest since 2007, according to Real Capital Analytics.
In Southern Europe—comprising Spain, Portugal, Italy and Greece—transactions picked up speed in the fourth quarter, with deals doubling from a year earlier to €3 billion, according to broker JLL, formerly Jones Lang LaSalle.

Among this year’s transactions in the region was the €61 million purchase by a UBS real-estate fund of a shopping center in San Sebastian, Spain with 62 stores and 11 restaurants.
International investors are even looking at Greece, the longest-suffering country in the euro zone, where the economy has shrunk more than a quarter since 2008.
Houston-based Hines is considering investing in the Greek hotel and retail sectors because tourists are “pouring in” while many property owners and their lenders remain financially distressed, says Michael J.G. Topham, chief executive of Europe for Hines, which controls assets valued at approximately $25.2 billion.

“They need us,” Mr. Topham says.
The surge in real-estate deal volume in Europe is part of a broader trend resulting from the low interest-rate environment in much of the world. Pension funds and other institutions are increasing allocations to real estate in the hunt for higher returns, something Spain and Italy both offer.
For example, the largest public U.S. pension funds last year increased their allocations to global real estate to 7.4%, according to Wilshire Consulting. Before that, the high-mark for this group was 6.4% in 2008, says the National Association of State Retirement Administrators, which tracks public pension-fund investments.

Opportunistic investors also are scooping up portfolios of distressed property loans that European banks are trying to get off their balance sheets. Commerzbank AG has seen high demand for Project Octopus, its portfolio of Spanish property loans with a face value of €4.4 billion that will be one of the biggest such deals in Europe this year.

Some of the big investors in Europe continue to be U.S. private-equity funds that showed up early, including Blackstone Group LP, Lone Star Funds, Apollo Global Management LLC, Cerberus Capital Management and Kennedy Wilson Holdings. Pacific Investment Management Co., the giant Newport Beach, Calif., asset manager, also has been looking at deals.
Blackstone Group last week closed a €5 billion Europe-only property fund, the largest ever of its kind, which it raised in just six months. Recent Blackstone deals include a purchase of a portfolio of Italian offices and retail centers from AXA Immoselect, an open-ended German investment fund, for about €180 million, according to a person familiar with the deal.

New players also are showing up on the Continent from countries such as South Korea, Malaysia and China. Chinese property developer Dalian Wanda Group, for example, purchased an iconic Madrid skyscraper for €280 million from Spanish lender Santander, according to data from Real Capital Analytics. At the end of last year, sovereign-wealth fund China Investment Corp. acquired Chiswick Park, one of London’s largest office developments, from Blackstone for 780 million British pounds.
Other sovereign-wealth funds are turning to European real estate, too. Such funds invested €13.6 billion in European real estate last year, a 31% increase in activity from 2012, Real Capital data show. Globally, allocation to real estate from sovereign-wealth funds increased only 9%.
Until recently, investors in European real estate had little appetite for risk. Most of the deals involved trophy, fully-leased office buildings, shopping centers and other properties in cities like London and Paris.

But demand for those so-called core properties drove up prices to the point that some are now at record values, reducing yields for buyers. For example, an investor buying a core property in London today would wind up with less than a 5% annual yield from the building’s income.
By contrast, in markets such as Spain, yields are over 6%. That has set off a rush for property in that country, putting upward pressure on prices, according to real-estate executives in Spain. “It wasn’t like the sun slowly going up,” said Rupert Lea, head of retail for real-estate broker Cushman & Wakefield Inc. in Spain, describing the increasing interest. “It was like a ricochet.”
Some owners are taking advantage of the interest by putting property on the block. The Spanish region of Catalonia, for example, plans to meet with international investors in New York this week to drum up interest in a portfolio of 13 buildings in Barcelona.
The roadshow was in London last week. Even the investor presentation in Barcelona was conducted in English.

“Many investors we are meeting have mandates to invest in Spain,” said Isabel Tornabell, a director in Catalonia’s real-estate office. “That’s something new…they are looking for what to buy, not if.”
But as demand increases for property in riskier markets, some experts are warning that investors are moving too quickly given the tepid pace of the economic recovery.
“When the pendulum swings back, it almost always overshoots,” said Ric Lewis, chief executive at Tristan Capital Partners, a private-equity firm that recently raised €950 million for an opportunistic fund aimed at buying distressed European assets. Demand for the vehicle was €5 million oversubscribed, he said.

Mr. Lewis said competition has got hotter in the past three months, and he often gets outbid for individual assets by as much as 30%. “I think we’ve making a pretty good bid on the fundamentals. And we’re wrong by 30%? These aren’t complicated assets,” he says.


Source: stream.wsj.com/

Spanish Property Deals Grab Investor Interest

At least a dozen large international investors are lining up to look at a large Spanish property-loan portfolio sale that will take the temperature of one of Europe's most distressed real-estate markets.

Commerzbank AG CBK.XE -2.28% recently began shopping around the portfolio—code named Project Octopus—that includes loans with a face value of €4.4 billion ($6 billion) that are backed by shopping centers, hotels and offices. 

The loans were originally extended by Eurohypo AG, a unit of Commerzbank that is being wound down after suffering large losses in recent years. 

The deal is expected to be one of the biggest of its kind in Europe this year and will be a key test of investor faith in Spain's budding economic recovery. Any buyer of the loans likely would pay a discount to their face value. Still, they would be making a multiyear bet on the euro zone's fourth-largest economy, which late last year emerged from more than two years of recession. 

Investors looking at the deal include Blackstone Group BX +0.67% L.P., Cerberus Capital Management L.P., Värde Partners, Apollo Global Management APO -0.81% LLC, Lone Star Funds, Kennedy Wilson, KW +1.64% Pacific Investment Management Co., Starwood Capital Group LLC, CarVal Investors, Colony Capital LLC and Centerbridge Partners L.P., according to people familiar with the deal. Some of these funds have teamed up with large lenders such as Deutsche Bank AG DBK.XE +0.56% and Wells Fargo WFC -0.02% & Co.

Commerzbank, which is among a number of European banks that have been unloading loan portfolios to align with new banking regulations, hired investment bank Lazard Ltd. LAZ +2.96% to run the sale. Commerzbank declined to comment. 

European banks still are digging out from an avalanche of bad real-estate debt that crushed them when the financial crisis hit. In 2014, more than €40 billion in European real-estate loans could be put on the market, a 32% increase from 2013, according to a report last week from real-estate broker Cushman & Wakefield.

Big sellers include so-called bad banks that were set up in Spain and Ireland to manage soured real-estate assets. Those banks are increasing their disposal activity, while sales in Italy also are expected to pick up, said Andrew Sim, head of European investment at Knight Frank in London.

Spain's real-estate market has seen a revival of late. The government, through its bad-bank structure Sareb, is expected to put several large property portfolios up for sale in the first quarter, and local banks also are looking to reduce their exposure to real estate.

However, there are reasons to be cautious, say some analysts. A shock to the economy would be a "particularly big problem" for the property market, where asset values have fallen far less than in other troubled countries like Ireland, said Matthew Richardson, European real-estate research director at Fidelity Worldwide Investment in London.

"If you're an institutional investor running third-party money, it's a heck of a risk to take," Mr. Richardson said.

Last week, Commerzbank sold €710 million of nonperforming Spanish property loans to hedge funds. In December, it sold €280 million of shipping loans to a buyer affiliated with Oaktree Capital Management L.P.

The latest Commerzbank Spanish portfolio sale is expected to be completed this summer. Interested investors will participate in the first round of bidding within the next four to six weeks, a person close to the deal said.

The deal could be structured similarly to Commerzbank's £4 billion ($6.6 billion) U.K. real-estate portfolio deal last year, said people familiar with the ongoing process. About half the Spanish portfolio consists of performing loans, while the other half is split between nonperforming and subperforming loans, these people said.

The U.K. sale was broken into two parts, with Wells Fargo taking control of £2.7 billion in performing loans, while Lone Star took on £1.3 billion of nonperforming loans.

There also is a chance one investor could buy the whole portfolio, said Adolfo Ramírez-Escudero, managing director in Spain at CBRE Group Inc., which is representing one of the bidders. He noted only a handful of bidders have the resources to consider this option.

Large asset managers such as Lone Star and Kennedy Wilson have opened local offices in the Spanish capital, and funds including Apollo Global Management and TPG Capital LLP have purchased real-estate servicing units from local banks, giving them a platform to manage the assets they buy.

On Tuesday, a portfolio of seven shopping centers in Spain was sold to U.K.-based GreenOak Real Estate Advisors L.P. and Spanish investor Grupo Lar Real Estate Investments SA for €160 million by Dutch property fund Vastned Retail VASTN.AE -0.25% NV.

The rising number of investors looking at distressed Spanish assets also may drive prices higher, increasing risk. A person familiar with Project Octopus noted the deal was "extraordinarily" well bid.

"You look at the bigger picture and it sounds pretty good. But on second look, you're thinking the good news might be priced in," the person said.

Source: online.wsj.com

Foreign investors even more confident about Spanish property investment

FOREIGN INVESTORS have done a dramatic U-turn on Spanish property investment, with two thirds now believing Spain has attractive buying opportunities.

A total 67% of participants in an Urban Land Institute and PwC survey said they were feeling more confident about investing in the country.

Marc Pritchard, Sales and Marketing Manager for leading Spanish home builder Taylor Wimpey Espana comments, “It is very encouraging to see the experts such as the Urban Land Institute and PwC highlighting the turnaround which Spain has undergone and the vast potential which remains. We have been saying for some months now that the situation, especially within the second homes market, is steadily improving.

“Last year we at Taylor Wimpey Espana recorded our best year since 2006 in terms of sales volume and you only have to look at the vast sums being invested into real estate by both private individuals such as Bill Gates and large investment funds, to see that ‘good opportunities’ still do exist in Spain.“

Source: theolivepress.es

Foreign investors return to Spain

A year after fleeing Spain as its economy tottered on the brink of a full-blown sovereign bailout, foreign investors are coming back.
The prospect of relatively high returns in a eurozone economy emerging from recession with a strong corporate presence in Latin America is apparently proving irresistible.
Among the latest converts, Microsoft co-founder Bill Gates snapped up in September a 5.7-percent stake in Spanish construction and services group FCC for 108 million euros ($147 million).
News of the US billionaire's decision sent FCC stock surging more than 10 percent in a single day and made headlines in the Spanish media.
"Foreign investment is returning to Spain," said state secretary for business Jaime Garcia Legaz as he presented a report last month on sovereign funds by the Spanish business school ESADE.
"They are expecting a Spanish economic recovery," he added.
"It is clear that the perception of Spain has changed. It is improving week by week."
Spain would enjoy a surplus in its current account -- the broadest measure of trade including financial flows -- equal to two percent of its economic output at the end of this year, he forecast.
That would be a far cry from the 10-percent current account deficit Spain posted in the depth of the financial crisis, which erupted in 2008 after the collapse of a decade-long property bubble.
Between January and August this year, foreigners ploughed nearly 19 billion euros in net direct investments into Spain, twice as much as they had in the same period a year earlier.
The money is welcome in a country gingerly emerging from a two-year recession as it narrows its public deficit, boosts competitiveness and struggles with a jobless rate of 25.98 percent.
"The Spanish market is regaining its attraction," said France's ambassador to Spain, Jerome Bonnafont, describing the change as "a turning point".
"There is a clear increase in spontaneous questions from French companies about Spain," said Richard Gomes, local director of Ubifrance, an organisation that helps French firms to operate internationally.
Sovereign funds are banking on Spain, too, showing particular interest in companies that have a strong presence in Latin America, according to the ESADE study.
Among the most emblematic investments, Singaporean sovereign fund Temasek has ploughed money into Repsol, and Abu Dhabi's IPIC is now the full owner of Spanish petroleum and gas group Cepsa.
Maria Victoria Zingani, financial director at another Spanish oil giant, Repsol, said Temasek had also approached her company in 2012 as it toured Southeast Asia to lure foreign investors. Today the fund, which has visited Repsol installations in Brazil and Bolivia, holds a 6.23-percent stake in the group.
Sovereign funds are looking for highly diversified companies with long-term growth prospects and a presence in Latin America, she said.
"It is a phenomenon that is growing and will continue to grow," said ESADE professor Javier Santiso.
The ESADE study identified 82 sovereign funds in the world with total assets of more than $5.5 trillion.
After initially targeting infrastructure and energy industries, they are increasingly looking at the new technology sector while also casting a cautious eye at property, Santiso said.
According to the ESADE study, Asian funds especially from Singapore and China are emerging as the big investors in Spanish companies, a change from just two years ago when Arab funds, in particular Qatar Holdings, were the leaders.
Qatar Holdings took stakes of more than six percent in Banco Santander and energy group Iberdrola, spending more than $2 billion on each investment as it banked on their strong presence in Brazil. It is now the main shareholder in Iberdrola with 8.18 percent of the company.
"Sovereign funds anticipated the return of foreign investors, betting on Spain since 2011," said Antonio Hernandez, analyst at financial advisory group KPMG, predicting they would continue to do so in 2013.

Source: au.news.yahoo.com

Cheap Spanish Propewrty prices drive sales recovery.

Recovering sales in Spain's regions are linked to lower house prices, according to a comparative analysis of data by Fotocasa. Indeed, falling values are encouraging buyers to enter the market once again, Kyero reported. Six regions in Spain avoided drops in sales during the last quarter, including the Canary Islands, Catalonia, Murcia, Valencia, Andalusia and La Rioja. The first five regions saw rises in sales of 16.2 per cent, 12.1 per cent, 9.5 per cent, three per cent and 0.1 per cent respectively, while La Rioja remained stable.

Fotocasa noted that these are largely the areas where Spanish property prices fell the most over the last year, the news portal revealed. Murcia, Catalonia and Valencia saw values decline by around 11 per cent, while La Rioja had a 16 per cent drop. Beatriz Toribio, head of research for Fotocasa, said: "This data demonstrates that, in the current context of economic crisis and tightening of credit by banks, the only way right now to get rid of the large housing stock that exists in Spain is to lower the price."

Nevertheless, this rule might not apply to popular holiday destinations, where second-home buyers and investors are snapping up modern, high specification builds. Competition in these areas is only likely to get more fierce too, as more and more people flock to Spain. Mortgage specialist Conti recently revealed that among UK buyers Spain is now the second most preferred destination, behind France. However, the gap between the two nations is closing. Indeed, 36 per cent of all enquiries received so far this year have been for Spain. This equates to a year-on-year rise of three per cent, while French property interest declined by two per cent, although it counted for 43 per cent of all enquiries.

What's more, Spain accounted for more enquiries than France during May, June and July of this year. According to Conti, this indicates that confidence is increasing and investors are in a strong position when buying in the country. Due to the number of homes available, it is possible to negotiate an even lower price than advertised with motivated vendors. 

Also see Cheap Property in Spain for sale

Moor Park Capital sells entire Banco Sabadell bank branch Portfolio to Mexican Investor Group backed by Moises El-Mann

Moor Park Capital LLP ("Moor Park Capital"), the London based specialists in European corporate finance led net lease real estate transactions for institutional and retail investors today announced that a group of Mexican investors led by Moisés El-Mann (the "Investors"), through the Mexican investment vehicle Branch Management, S.A.P.I. de C.V. ("Branch Management"), have acquired 100% of the share capital of the Spanish company ISC Fresh Water Investment, S.L.U. ("ISC Fresh Water"), owner of 253 bank branches in Spain, for a consideration of approx. EUR 290 million.

These bank branches, located throughout Spain with particular presence in Madrid and Barcelona, are let to Banco de Sabadell S.A. ("Banco Sabadell"), and represent one of the largest investments in the Spanish real estate market ever conducted by Mexican investors.

The bank branches have the benefit of a long term lease agreement with Banco Sabadell for an initial term of 25 years, put in place at the time the initial acquisition was closed by Moor Park Capital in April 2010, when 378 bank branches were acquired from Banco Sabadell. Since that time 125 bank branches have been successfully sold by Moor Park Capital to individual investors and the sale of the shares in ISC Freshwater completes the disposal process.
Moor Park Capital have been retained by Branch Management as exclusive asset managers for the acquired bank branch portfolio. Clifford Chance (real estate and corporate/M&A), Garrigues (tax) and CBRE Spain advised Moor Park Capital on the sale and Banco Santander acted as financial advisors to the Investors and Uría Menéndez advised the Investors in relation to taxation and legal issues.

This transaction represents the first investment of a major acquisition plan for real estate investments to be undertaken by the Investors in Europe.
The Investors plan to continue their real estate investments in Spain and Europe to convert Branch Management into a SOCIMI, the Spanish legal entity equivalent to a REIT (Real Estate Investment Trust) in the near future.

Source: businesswire.com

The whole world wants to invest in Spain

The chairman of Spain's Santander bank has told a New York press conference that the Spanish economy is going through a "fantastic" period in time as trust in the country "had grown unimaginably".

Emilio Botín, recently voted Spain’s most influential businessman, had nothing but praise for the current state of the Spanish economy in a press conference held in New York on Thursday.
"Everyone is interested in investing in Spain," Botín rejoiced.
"We're getting money for the stock exchange, for debt, for investment.
"You wouldn't believe how things have changed in the last six months."
Botín gave the example of a Chinese client he had convinced to invest in Spanish public debt who later thanked him and told him he was doubling his initial investment.
"It's a fantastic period in time for Spain's economy," Botín argued while praising the Spanish government's labour and financial reforms.
Although he acknowledged there was still "a lot to be done" with regard to the country’s high unemployment rate, the Santander boss said Spain’s banking sector "is better than ever".
The 79-year-old banker announced that Spanish banks were eager to lend money but added that demand is essential, as foreign entities want "good clients and not insolvent ones like the ones lending a few years back".
Botín was in New York to launch the rebranding of the US's Sovereign Bank to Santander.


Source: thelocal.es

Suitors Considering Investment In Spanish Property

Investors are considering splashing the cash on Spanish real estate as the country’s economy and real estate market seem to be finally cleaning up, following a long period of recession. The nation recorded an increase in GDP for the first time in five years during the third quarter this year, and investors from across the world are beginning to display interest in their property market. Although complete recovery may take a few years to materialize, interest from foreign investors is sure to boost the market.

Spain’s real estate woes are no secret as several thousand properties remain unsold. Banks in the country have suffered due to the economic trouble and a host of unwanted real estate assets have piled up on their mortgage books. Market insiders are of the belief that the country has moved past its worst moments and the only way now is up. While some investors are still cautious about what the future might bring, others are making the most of the present situations and flocking to the Iberian peninsula with the intention of racking up some fine properties for extraordinarily affordable prices.

What does the future hold for Spanish property?

On paper, investment in Spanish properties could not have offered a better value, but investors are still considering the wider continental picture which appears uncertain with a bleak future. There are positive signs pointing towards Europe and its consolidation following the recession, and the continent is poised to experience a fairly better medium to long term future. However, the short term signs are mixed.

Several different austerity measures have been implemented by the government of Spain as a large number of businesses and people have been pushed to the limit. Conflicts and unrest have become a common feature among the various authorities in the country while the locals and their businesses have also suffered a lot.

Since a good economy is essential for a good property market, Spain’s 26 per cent unemployment rate only made matters worse for the nation. However, the economy’s recent upturn in GDP has provided hope for the future as it is seemingly taking short and effective strides towards recovery.

Promising long term future

Although Spain has experienced a quarterly increase in GDP, a mere 0.1 per cent does not appear too exciting. Several real estate experts in the country are predicting that there may be a further decline in the near future as the market is still not stable. But, the medium and long term future is expected to be positive thanks to an influx of foreign investors who are currently flocking into the country’s property market.

Spain is offering free residency visas spanning five years to investors who purchase big properties in the country. With a EU passport up for grabs, investors from the Americas and Asia are stepping up their interest as they look to capitalize on long term benefits. The fact that the visas can be converted into permanent ones makes the prospect all the more fascinating for potential suitors who are set to invest capital into the market and in essence, the economy.

Spain's property market increasingly targeted by foreign investors.

New reports reveal that when it comes to buying Spanish real estate, foreign investors are increasingly outnumbering their local counterparts.

Compared to the same period of 2012, the first six months of 2013 saw international purchases of property in Spain grow by 13.6%, the General Council of Notaries reveals.

Indeed, while Spanish spending in the international market has reached a ten-year low, the Bank of Spain reports that foreign investment in Spain reached over 2,834 million euros: the biggest amount recorded since 2004.

With an erratic market and mortgage lending at record lows, Spanish banks have made it difficult for their citizens to take the plunge and buy. Unsurprisingly, Spanish investment in property abroad has also dropped significantly with 89% less spending than in 2007.

Foreign investors escape the bulk of these problems, giving them an advantage when buying up property. 

Current levels of foreign investment in Spain are still 20 per cent less than the heady days of 2003. 

However, Spanish newspaper El Mundo reported a healthy level of non-resident British citizens in this category. With 1,244 transactions made by Brits in the first quarter of 2013 it paints a bright picture for the future of Spanish property investment. 

Source: aplaceinthesun.com

Optimism, and Caution, as Spain Attracts Investment

MADRID — Like other Spanish builders, Fomento de Construcciones y Contratas, or F.C.C., had struggled to convince investors that it could extract itself from Spain’s housing market quagmire.

In the last six months, the management of F.C.C. was on an almost continual investor road show in the world’s financial capitals. The campaign finally yielded fruit Oct. 21, when the company announced the sale of 6 percent of its equity to Bill Gates, the co-founder of Microsoft, for 113.5 million euros, or $154 million.

Two days after Mr. Gates’s purchase, as it happens, the Bank of Spain said the country had pulled out of recession and returned to growth of 0.1 percent in the third quarter after nine consecutive quarters of contraction.

Both announcements appeared to confirm what many Spanish executives and the government of Prime Minister Mariano Rajoy had been asserting for months: that Spain deserved its place back in the sunshine.

There are, of course, plenty of clouds still hanging over Madrid — so many that on Wednesday the Spanish economy minister, Luis de Guindos, warned against triumphalism, telling members of the Spanish Senate that, at a time of near-record joblessness of 26.6 percent, nobody should claim that “all is well.” Overall growth is expected to remain anemic for several years.

Still, the speed of the turnaround in investor sentiment has been striking.

“What is truly remarkable is that Spain is suddenly flavor of the month, when until recently investors smelled a rat here,” said Gonzalo Díaz-Rato, who advises international funds on buying Spanish assets.

Three weeks ago on a visit to New York, Emilio Botín, the chairman of Banco Santander, told reporters that Spain was in “a fantastic moment.” He added: “Money is arriving from everywhere.”

Although Mr. Botín’s optimism raised eyebrows back home, especially among ordinary Spaniards struggling with austerity budgets and joblessness, most indicators add credence to his assessment.

Foreign direct investment doubled in the first eight months of this year to €19.4 billion, according to Mr. de Guindos, the economy minister. That was thanks in part to Ford and other carmakers that have been expanding production here. For all of 2012, foreign direct investment had fallen to €21 billion, from €30 billion in 2010, when Spain briefly returned to growth.

Spanish banks, whose loan defaults forced Spain to negotiate a European bailout last year, have since then been able to sell assets and reduce by three-fourths the level of exposure to troubled real estate loans they had before the rescue. Last month the main Spanish stock market index climbed to its highest level since July 2011, although it has since slipped back a bit. And Friday, the credit rating agency Fitch upgraded Spain’s outlook to stable from negative.

How far can this Spanish recovery continue?

“Very” is the answer that Arcano, a Spanish wealth advisory and asset management firm, provided in a report published in October.

The analysis compared the situation of Spain with that of Germany a decade ago, when Berlin managed to turn around its current-account deficit — a broad measure of a country’s trade performance — and embark on an export surge that has more recently allowed Germany to weather the financial crisis better than most other European nations.

“Spain is now in a position to achieve that kind of German recovery,” said Ignacio de la Torre, a partner at Arcano.

Aiming to ride this wave of optimism, the government has revived a privatization program that was shelved two years ago because of Spain’s downturn. In coming months, it is expected to sell as much as 60 percent of Aena, the national airport management company. Analysts value Aena at about €15 billion, but that includes a debt of €12 billion.

But the fact that Spain has been in and out of recession since the start of the crisis — briefly returning to growth in 2010 before sinking into its banking crisis — has also left some economists skeptical about the staying power of the latest recovery.

Foreign investment in Spanish real estate at a 9-year high

Foreign investment in Spanish real estate rose to 2.83 billion euros (about $3.87 billion) in the first half of 2013, up 16 percent compared to the same period last year and a nine-year high, a study by consulting firm Knight Frank said.

Spain is such an attractive market that foreign investors may be willing to pump up to 14 billion euros into the Iberian nation's real estate market over the next year, Knight Frank said.
The severe economic downturn in Spain caused housing prices to plunge 47.7 percent since the peak of the boom, with the average cost now down to 1,253 euros per square meter, the Spanish Property Appraisers Association said in its latest report.
Although it is at its highest level since 2008, when the economic downturn started, foreign investment in Spain's real estate market is still well below the 3.5 billion euros registered in the first half of 2003.
The top foreign buyers of Spanish real estate are Belgians, whose purchases are up 78.1 percent; French citizens, whose purchases are up 70 percent; and Germans, whose purchases have risen 35.3 percent, General Notaries Council figures show.
Britons, however, are still the top non-resident purchasers of Spanish real estate, buying 1,244 properties during the period, up 24.6 percent from the comparable period. EFE

Source: latino.foxnews.com

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5 of the Best Household Investments to Make

For a lot of us a home is an investment, as much as it is a place to live. Even though house prices have at best remained stagnant in some countries, in the UK and other parts of Europe at least it seems that things are picking up again somewhat. So, for those with some extra cash lying about we take a look at some of the best household investments to make and how they can not only enhance your lifestyle but also your property’s worth.

Kitchen

Kitchens are the best place to put your money, unless there is another part of the home in dire need of

repair. When people come to look at homes, generally the first port of call is the kitchen – after all that’s where the magic happens. A well placed, logically planned kitchen made from quality materials that look great and will last, will really help sell a home. For a lot of people the kitchen is the main living area of the home and so the desirability factor here is huge. In short, it’s the first port of call if you’re looking to invest.

Attic/ Basement

With land prices as high as they are in so many countries, it only makes sense to add extra space to the land you already have. An attic or basement renovation can add a lot more room to the home and add instant square foot and equity to your property as an investment. It is added living space that you would pay a lot more for if you extended out of the house. All you have to do is make sure that it’s well insulated and that all property planning and codes are met. It’s the ideal place for a playroom, extra bedroom and bathroom or just a chill out area and it adds notable value and a decent return.

Bathroom

The bathroom is also a desirable current area of the home where renovation pays. Adding some new fixtures, modernising and making the room look a little more sophisticated can go a long way. Bathrooms can repay investment significantly and a little texture and a few improvements can go a long way in monetary terms.

Garage

If you own a home with a connected garage, then this is the place to build onto to provide that extra room. Garages are generally full of junk and stuff that’s not needed in the home and seldom used for much more. As the structure is already there, you just have to make it inhabitable and adding insulation, interior walls and decoration is only the start of making the most of this extra space and provide the most bang for your buck when looking to increase property worth and add desirability for when you wish to sell your home.

Curb Appeal

The curb appeal is the appeal your home has from the first impression from the side of the road. If a

home looks like a junk yard people will tend to give it no more than a look. However, if it looks great from outdoors then it’s far more desirable and so worth more. A decent landscaper, some paint and some other little tweaks can add a lot to your home’s exterior and also its price.

These are just some of the best home improvements to make when looking to increase a home’s price. So, take heed and invest to improve quality of life and also home value. 

Author: Cormac Reynolds

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