BBVA Closes EUR 364 Million Sale Leaseback of Property Portfolio in Spain

PropertyEU - July 30, 2010

A consortium of Deutsche Bank's RREEF Europe, Area Property Partners and Europa Capital has announced that it has completed the EUR 364 mln acquisition of a second portfolio of Spanish property assets owned by Banco Bilbao Vizcaya Argentaria (BBVA). The investment volume reflects an initial yield of 6.5%.

The assets, comprising five office assets and 153 bank branches located throughout Spain, will be leased back to BBVA on a long-term basis. REEF Spezialfonds acquired three of the office properties.

In September last year the consortium led by RREEF completed the sale-and-leaseback of the majority of the bank's Spanish assets for EUR 1.15 bn. That sale, which reflected a yield of about 7%, covered three office buildings and 944 bank branches.

The second deal completes the disposal of BBVA's Spanish assets.

Carlos Portocarrero de las Heras, partner at Clifford Chance Madrid who represented BBVA, said the second tranche was 'slightly easier' to close then the first, given the improving market conditions and the ability to use the largest disposal as a model. BBVA still owns about 500 properties in Spain in order to retain the option of swapping assets for ones covered under the sale-and-leaseback agreements when necessary, he added.

Ismael Clemente, head of RREEF Spain, told PropertyEU that the terms and conditions underlying both deals are similar. The office properties are being leased by BBVA for 20-year terms and the bank branches for 30 years.

In a statement on the transaction, Clemente added: 'We are extremely satisfied of the successful closing of this second tranche. We would like to thank our partners AREA, Europa and March for their continued support and confidence in our management capacity up to now. We would also thank our colleagues of RREEF Spezialfonds in Germany for having made their first acquisition in Spain in the framework of this transaction. It is an excellent opportunity for our investors, since we acquire on their behalf very good quality assets in prime locations with a proven and solid tenant'.

A full report on the deal will be published in the September edition of PropertyEU Magazine. Sphere: Related Content