Are you listed in the Spanish stock exchange?
Metrovacesa was re-listed to the stock exchange in 2018. We have a long history, starting more than 100 years ago, and we had been listed before between the years 1941 to 2013. For us, returning to the stock market was a natural step given our history and size, as the leading residential developer in Spain.
With money being cheap to borrow these days, what sources do you favour to finance the company?
We see a growing appetite from institutional investors to buy residential buildings for rent in Spain, a segment traditionally dominated by individual investors,” Juan Carlos Calvo
We have a very good access to bank financing, which is the most competitive source of external financing at this moment in terms of cost and flexibility. In any case, we have a conservative financial policy and we intend to preserve a sound balance sheet. Therefore, we want to maintain our debt ratios well under control even if the interest cost is low.
How much interest are you seeing from institutional investors in private equity in Spain?
Private equity funds have played a fundamental role in 2013 and 2014, providing liquidity and facilitating an inflection point in the Spanish sector. They continue to be active, particularly with the acquisition of bulk portfolios from banks. But now that the sector is becoming more stabilised, we think that traditional real estate funds, pension funds and insurance companies may start to have a more preeminent role going forward.
What is the demographic group you are primarily targeting?
We are targeting middle and upper-middle class, with a price range of €200k to €400k per unit in most cases. This is the segment that concentrates the bulk of the housing transactions in Spain.
About 150,000 UK pensioners living in Spain do not have the guarantee that their state pensions will increase for more than three years in the event of a no-deal Brexit, which could end forcing them to leave the country. What will be the impact of this?
It is still unclear how Brexit will impact the British residents in Spain, and the uncertainty may have some impact on UK buyers' demand until the outlook is more certain. Fortunately, this represent only a small proportion of the foreign buyers in the locations where Metrovacesa is present, while demand from other European countries remains very solid. Therefore, we expect a marginal effect only.