Juan Gómez-Acebo

Real estate joint ventures in Spain generating significant opportunities for law firms – BDO Abogados

Joint ventures between international real estate investors and local partners in Spain are a growing trend which is providing significant opportunities for law firms, according to BDO Abogados’ head of real estate, Juan Gómez-Acebo.

As market conditions improve and prices increase, finding profitable real estate portfolios is becoming harder for investors, says Gómez-Acebo. Instead, they are turning to strategic joint ventures with local funds and developers. “The KKR-Altamar-Elix venture is a case in point, where large international and Spanish funds partner with a local developer, combining financial muscle with valuable, on-the-ground expertise,” he adds.
Regulatory changes introduced in 2012, which enhanced the fiscal and tax regime overseeing real estate investment trusts (REITs), are also facilitating this trend. “The first REITs created in Spain were subject to a regime that did not provide significant fiscal advantages, but the regulatory changes implemented in 2012 introduced much more attractive conditions,” says Gómez-Acebo.
One of the regulatory requirements for REITs is to be publicly listed, and this is another area which is generating opportunities for law firms as they assist clients with their stock market listings. In terms of the  assets targeted by REITs, the most popular deals involve investment in the offices, retail, logistics and hotel sectors. However, investors are also increasingly eyeing residential assets in the rental market. “Traditionally, residential real estate was exclusively built with the intention to sell, but investors are using REITs as vehicles to develop properties for rent,” says Gómez-Acebo.  
In contrast, prime office buildings in major Spanish cities with attractive returns are increasingly difficult to find  due to price increases in recent months.