Spanish company Árima Real Estate has agreed to sell the María de Molina office in Madrid and buy Torrelaguna, it has revealed in its H1 2023 report.
This Class-A property boasts a gross lettable area of over 4,000 square meters in the heart of Madrid and is fully let. Its rental income has increased ninefold thanks to the work of Árima’s active asset management. After four years of value uplift, the timing is right for the company to lock in the returns on its initial investment, says the report.
Árima has begun to rotate its assets with the acquisition of Torrelaguna for €30 million and is in advanced negotiations to acquire an additional property in Madrid. Its portfolio is now valued at €402 million — up 25% on total investment.
Torrelaguna fully let
Torrelaguna, located on the street with the same name, is fully let and offers significant growth potential. This latest acquisition adds a further 11,000 square meters of gross lettable area and 303 parking spaces to Árima’s portfolio and promises a highly attractive return.
The company has also agreed on the main terms for the lease of its flagship property Botanic to a top-tier tenant.
The Spanish Real Estate Investment Trust (Socimi) publishes the H1 2023 results, booking a net tangible asset value per share of €11.91, 24% higher than at its IPO in October 2018 despite the challenging backdrop.
Meanwhile, it has reached a key sustainability milestone, with new LEED® and BREEAM® certifications. At the end of the period, 50% of Árima’s portfolio is certified, and its properties continue to raise the bar for sustainable office design.
Árima has posted a total rental income of €3.9 million for the first six months of the year — up 40% in like-for-like terms over the same period of 2022 — and a positive EBITDA.
The company has also agreed heads of terms for the lease of its flagship office building, Botanic. This pioneering property will be the new headquarters for a top-tier multinational company. The agreement is set to be formalised in Q4 this year.
Rental income increases on the back of higher letting volumes Árima continues to demonstrate its strategic acumen in acquiring and repositioning Class A properties, aided by a shortfall of quality space in the city of Madrid.
Habana, Ramirez de Arellano and the Guadalix logistics warehouse are now fully let.
Rental income
Overall, the Socimi has reported rental income of €3.9 million for H1 2023, up 40% in like-for-like terms compared with H1 2022. This has helped secure a positive EBITDA for this reporting period.
The Socimi is confident in its portfolio’s upside potential, projecting a 110% increase medium term in rental income.
Cadenza, for example, was the focus of a major repositioning project completed this year: 14,500 square meters of gross lettable area in a Class A office property, located in a consolidated submarket in Madrid. Similar transformations are now underway at Pradillo and Dune, which between them will offer a gross lettable area of 25,000 square meters.
Árima’s portfolio comprises a total of 10 properties — nine offices and one logistics warehouse. All of high-quality, Class A, assets representing a combined gross lettable area in excess of 113,000 square meters and 1,558 parking spaces in Madrid.
Árima’s balance sheet remains sound, with gearing below the sector average at 22.7% LTV. The Socimi has very advantageous financing terms, with limited maturities before 2026.
investment opportunities
With its long-term vision, Árima continues to monitor the market for new investment opportunities and is currently in advanced negotiations for another potential acquisition, entailing a total investment of €40 million (including CapEx).
Árima has now been awarded LEED® or BREEAM® certifications for 50% of its portfolio, as it makes progress to reach the 80% target (LEED®, BREEAM® and WELL®) for 2025.
The company’s overarching commitment to sustainability and environmental protection is reflected in every one of its properties, both in terms of energy performance and structural and internal upgrading.
Árima’s leadership in this area has been recognised by major international organisations, such as the European Public Real Estate Association (EPRA) and GRESB (Global Real Estate Sustainability Benchmark). The company finances its entire portfolio via green loans, and it is the only property firm in Spain to be certified by RICS (Royal Institution of Chartered Surveyors).
About Árima Real Estate Árima Real Estate is a Spanish company listed on the Madrid Stock Exchange as a SOCIMI (Sociedad Anónima Cotizada de Inversión Inmobiliaria) and led by a fully dedicated internal management team.
