Eduard Mendiluce is the trusted man of the Blackstone investment fund in Spain and accumulates decades of experience in the real estate sector, largely forged in banking and with management responsibilities in the best and worst times of the sector.
What has changed in the Spanish real estate sector with the crisis linked to the pandemic?
The importance of digitization has been highlighted, and I think it is something positive for companies in the real estate sector and for users. Companies grow in efficiency and agility thanks to technologies such as big data, and users gain in simplicity and avoid procedures that can be carried out through the computer or smartphone.
We will soon see, for example, how the signature before a notary, the final process of buying a home, is carried out through these new technologies. And in the office business, teleworking in its various forms has also come to stay, which will undoubtedly also have an impact on how offices should adapt their spaces.
Pandemic: “Teleworking has come to stay and will have an impact on offices”
How can the funds from the European recovery plan help the Spanish real estate sector?
They are essential to work on the elimination of the carbon footprint and deepen the digital immersion of the sector. In Spain there are 18 million second-hand homes and 80% have a high energy inefficiency. There is great room for improvement there. We are committed to allocating these funds to the communities of owners that channel the subsidies, total or partial, so that they can face rehabilitation works that improve energy efficiency.
How has Covid impacted your business?
From the first moment we have worked to support both tenants and mortgage debtors, agreeing moratoriums and payment plans in the face of the loss of income of some families. Internally, we have made a great effort to contain operating expenses, but we have not carried out any Erte. And as for the business, despite the fact that in the first moments of the pandemic the sale of homes suffered, the evolution has been more favorable than originally expected.
How do you think the real estate investment or divestment opportunities are presented in 2021 in the Spanish real estate sector?
The Spanish economy is going to grow around 6% this year and the unprecedented fact in our history is going to take place that this growth is going to be concentrated especially in the second half of the year. This fact, together with low interest rates, is boosting the real estate sector, which will return to a level of transactions and prices prior to the pandemic.
In addition to the residential segment, the logistics and data centers sector will be among those that will see the greatest growth. However, in order for us to see large investment operations in the residential sector, we need to have a stable legal framework that guarantees the future of operations and does not sow uncertainty. Regulation must be balanced to maintain the inertia between supply and demand.
Growth: “It must come from the increase in supply and long-term legal security”
What is Blackstone’s roadmap for Spain?
I can speak for the companies that I manage, but not for my shareholders. Blackstone continues to believe in the fundamentals of the country, investing in different types of assets, such as logistics, hotels or offices, to the extent that legal certainty is guaranteed.
How many assets under management have Anticipa and Aliseda incorporated in 2020 and for what value?
At the moment, Anticipa manages approximately 17,500 residential assets and Aliseda around 13,500, for a combined value close to 10 billion euros, as a result of the acquisition of various portfolios in recent years.
Will there be news in the business model as manager of Blackstone’s assets in Spain?
To date, both Anticipa and Aliseda have worked practically exclusively for our shareholder, Blackstone. However, as a servicer we have always had the ability to adapt to market needs, so now we can apply our technology and processes to put them at the service of third parties, both in loan management and real estate management. Our experience in these years in the management of highly complex portfolios and with very good results make us partners with great know-how. In fact, Anticipa and Aliseda already manage assets for Bankia, Carval and Santander.
Diversification: “We can apply our technology and processes to put them at the service of third parties”
Are new diversification initiatives such as ‘tugaraje.com’ envisaged?
One of our objectives is to constantly analyze market opportunities that we activate when the opportunity occurs, either in the case of a specific portal for parking spaces, which is working very well, or as at the time it was to be able to rent in a click, in a completely digital process.
How do you assess the regulations regarding home squatting? The 2020 one in Catalonia and the state one in January 2021.
It is worrying because Spain is the only country in Europe where illegal squatting is protected. The regulations approved in Catalonia at the beginning of 2020, in which squatters were obliged to offer social rent under certain circumstances, put a mortgage or rent debtor and a squatter at the same level. This regulation resulted in a clear increase in occupation in Catalonia.
The Constitutional Court ruling has repealed two Catalan decrees that supported squatting, but this type of regulation can seriously damage investment and the behavior of owners, private investors and institutional investors. The lack of affordable housing must be addressed seriously and urgently, and in the meantime we must analyze case by case and try to reach agreements to cover the most vulnerable families,
And the Catalan law that limits rental prices?
Rent regulation does not help, but acts as a brake on supply and can cause a parallel market outside of regulatory control, to the detriment of tenants. We have clear examples of this in cities where this price regulation has occurred, such as Paris and Berlin. From our point of view, the most appropriate thing is to reach very clear public-private collaboration agreements that allow the expansion of affordable rental parks. The key is to increase the supply.
How do you assess the housing law prepared by the Spanish Government?
We must wait until there is a final text to be able to assess what the Government is proposing. As a general reflection, the increase in supply, especially of affordable housing, and legal certainty are the engines that will allow the sector to achieve sustainable growth and generate interest from long-term institutional investors.