Spanish REIT Merlin Properties has acquired a 14.46% stake in Madrid Nuevo Norte, a €7.3 bn regeneration project in the Spanish capital, for €168 mln.
The vendor of the stake was Spain's San José construction group, which retains a 9.5% share in the scheme. The deal makes Merlin the second largest investor in the urban project, with banking group BBVA holding the remaining 74%.
According to media reports, the deal involves Merlin providing San José with a project loan.
Madrid Nuevo Norte, previously known as Operation Chamartin, involves some 3.3 million m2 of land and will comprise the creation of around 10,500 new homes, comprising around 35% of the project, plus 60% of offices, retail, hotels and restaurants, and the remainder public spaces including parks and transport.
The project, which has been on ice for 25 years due to political and planning deadlock, was greenlit by the local council this summer. The plan seeks to take the Chamartin railyards underground, replacing them with a 120,000 m2 park.
In its latest incarnation, the project is set to involve around 20% of affordable housing and prioritise public transportation, placing private buildings near the train station. Construction work is scheduled to start in late 2020, with completion in stages up until 2044.
