Zurich is about to buy one of the future real estate jewels of offices in Madrid, also giving the starting gun to the new normality among large international investors. The insurer plans to close in the coming weeks the acquisition of the building of Velázquez 34, the former headquarters of the disappeared Popular Bank, for around 120 million euros, according to sources in the real estate sector. This transaction means that more conservative investors, such as the case of an international insurance group, are willing to invest in Spain in the post-Covid scenario.
The Velázquez 34 building, which intersects with Calle de Goya, was until a few years ago Popular’s headquarters, although the bank also had presidential and private banking offices in the so-called Beatriz Building, on Velázquez’s corner with Ortega and Gasset. The financial entity sold it in 2008 to Grupo Rosales for 60 million euros. In that case it was an operation of sale & leaseback, in which the entity remained as a tenant until it built its new headquarters at the exit of the A-2, a brand-new building that never occupied and now houses Santander Spain.
The acquisition by Zurich is currently in the final process of due dilligence. The transaction is the perfect definition of an operation called core, from an institutional investor who can afford to pay a high amount for an asset to guarantee a long-term profitability thanks to an excellently located and recently renovated property.
Since March, due to the forced confinement due to the Covid-19 pandemic, real estate investment practically stopped. The sector was waiting for who would be the first international investors to return and if the prominence of opportunistic funds would return as in the worst of the past crisis. But the investment of a profile entity core and conservative like Zurich could indicate that the break has been a parenthesis and that investor confidence in the country continues.
The building it acquires has been completely renovated by Grupo Rosales, who commissioned the façade design from the prestigious architect Rafael de La-Hoz, who has created a stone and glass envelope reminiscent of the one designed for Grupo luxury homes Lar in the Madrid project of Lagasca 99. The property has almost 7,000 square meters on seven floors, to which is added an upper terrace of 500 m2 and a 140 m attic2, in addition to a 49-space car park, as can be seen on the website of the consultancy CBRE, which markets office spaces for future tenant companies.
Zurich also achieves, through this purchase, a commercial premises with entrance on Goya street, one of the most demanded by the brands and most expensive in the capital.
The seller, Grupo Rosales, is a small Madrid real estate company created in 1978 with a presence in the business of residential development in stately neighborhoods of the capital and with a patrimonial business branch. Among its properties are the buildings of the Vincci Soma hotels in Madrid and the Vincci Bit in Barcelona.
The Swiss entity made another purchase in Spain last year, specifically the portfolio of office buildings in Madrid named Ilunion, since it has this company as the main tenant. He paid 163 million to Blackstone for those properties that had previously belonged to the Socimi Hispania.