Colonial ends 2016 with 97% of its buildings occupied
2016 has been an excellent year for the Colonial Group and its shareholders. In a rental market with increasingly demanding clients, the Colonial Group has completed 93 rental transactions for 116,045m2 and yearly revenues of €39 million.
The Colonial Group has been able to attract first-class clients that demand unique locations. This has enabled us to achieve the market’s high-end prices, capturing a significant growth in revenues.
Some of the most significant transactions of the year were:
- In Barcelona, pre-rental of more than 9,000m2 with Schibsted Ibérica in the ParcGlòries project.
- In Madrid, pre-rental of more than 4,200m2 in the Serrano, 73 building, which is currently under refurbishment.
- In Paris, the agreement of 9,400m² in the Washington Plaza property with various tenants and the completion of the #Cloud building’s commercialisation, with 3,000m2 with the international cosmetics company, Coty.
97% occupation
The excellent results in the rental contracts have allowed Colonial to reach and maintain stable levels of occupation. At 2016 year-end, the office portfolio reached a 97% financial occupation (+319 basis points higher than the previous year) and well above the market average.
Repositioning of assets and projects
In 2016 the Group invested €86 million in development projects and asset repositioning. In particular, the reorganisation of communal spaces in the Cézanne Saint Honoré office complex, and the refurbishment of various floors in the Percier building. In Spain, several refurbishments have been carried out in communal spaces and floors in Berlín, 38-48/Numància, 46 and Via Augusta, 21-23 in Barcelona and the Castellana 52, José Abascal 45 and Miguel Ángel 11 assets in Madrid.
The significant commercial success of these assets with rental prices agreed within the high-end of the market is a direct result of the Colonial Group’s Prime Factory industrial strategy.
Within the company’s acquisition programme, Colonial has acquired three prime assets in Madrid and a project in Barcelona within the Alpha I project framework. Accelerating the completion of the strategic plan’s growth objectives, Colonial has commenced 2017 with the implementation of the Alpha II project, which includes acquiring four assets with an investment of €400 million.
All the 2016 acquisitions and the Alpha II project in 2017 offer a considerable route to creating real estate value based on (1) the real estate transformation of the properties into first-class products and, (2) the location in market segments with solid fundamentals.
Likewise, all acquisitions have been made under very attractive terms, demonstrating the Colonial Group’s capacity to identify and capture opportunities to create real estate value.
“The results reflect the successful implementation of the growth strategy based on an industrial approach to creating prime office real estate value in the Barcelona, Madrid and Paris markets," explains Juan José Brugera, President of Colonial.
