INTERVIEW: Carlton’s Beltran sees recovery ahead for Spanish real estate

The Spanish property market’s recovery is on its way, according to Javier Beltran, managing director of the Iberian office of New York-headquartered private equity real estate investment bank Carlton Group.

Beltran, a Spanish investment banker with a past at banks UBS, Morgan Stanley, Barclays and Unicredit, said the year 2013 represents the turning point for the Spanish real estate investment sector, which has started to recover ground in terms of both volumes and prices' stabilisation.

‘Economic growth will resume next year in Spain and international investors are pouring in to buy in the last part of the cycle,’ Beltran told PropertyEU in an interview. ‘The financing market is opening up and the risk premium of the Spanish Bond has decreased from 660 basis points at the peak to 250 bps at present. This figure anticipates the upcoming recovery in the Spanish market,’ he added.

Beltran joined Carlton Group in 2012, when the company opened an office in Madrid. Beltran: ‘We saw an opportunity in Spain and Portugal on the long term and we created a highly experienced team with six people. Since then, we have been mandated on €500 mln worth of real estate sales in the country. Our office benefits from Carlton's network of 65,000 investors worldwide which is of great help in Spain where at the moment around 95% of the capital comes from international sources. Foreign investors like Spain because they reckon we have already gone through the worst.'

While the investment market is improving, Beltran said the main bottleneck remains the financing side of some deals. 'Corporate finance skills is going to be key in the future. Against this background, we are exceptionally well positioned in Spain because we have a large structured and corporate finance experience and we are able to run the whole sales process, including raising/refinancing debt and equity.'

Currently, Carlton is exclusively advising on the sale of a large shopping centre in Southern Spain, two office buildings in Madrid, a seven hotel portfolio on the Canary Islands, as well as the Reids Palace hotel in Madeira, Portugal.

Earlier this month, the Carlton Group was exclusive advisor on the sale of the Westin Valencia hotel in Spain on behalf of Spanish financial group Bankia's real estate arm Bankia Habitat. 'Carlton was able to customise and execute a comprehensive marketing, financing and due diligence strategy which produced multiple non-contingent, hard bids,' he said. Overall, it's understood that over 50 investors underwrote the acquisition opportunity.

The Westin Valencia building dates back to 1917 and was transformed into a five-star hotel in 2006. It offers a total of 135 rooms and suites.

Carlton Group's European arm has offices in Madrid, Frankfurt, Milan, Athens, and Tel Aviv.