Spanish residential developer Neinor Homes and Orion Capital Managers' European Real Estate Fund V have acquired one land plot in Malaga, Spain, as part of their Spanish build-to-sell (BTS) joint venture (JV) to develop 429 new homes for sale.
The land plot is located in the Cortijo Merino neighbourhood, an expansion area close to Teatinos, where Neinor has delivered more than 300 housing units for sale and 146 for rent.
With this investment, Neinor and Orion have been able to reach their investment target commitment of €50 mln by acquiring three land plots located in the communities of Barcelona, Valencia and Malaga to develop 582 new homes for sale until 2028 with a potential GDV of €250 mln. Orion holds a 90% stake in this vehicle while Neinor owns the remaining 10% and is acting as delivery partner overseeing the project design, licensing, commercialization and construction.
Since announcing the joint venture in March 2023, Neinor has been able to raise €300 mln from a diversified pool of investors with complementary profiles in terms of product, target client, geographical exposure and expected returns. The 5-year objective is to raise a total of €500 mln between 2023 and 2027. Over the past nine months Neinor has been able to fulfil 60% of this objective.
Neinor expects to deploy €1bn in new land acquisitions by 2027, half of these are expected to come from new equity partners.
Mario Lapiedra, CIO of Neinor Homes, commented, 'In the prevailing high interest rates environment, we envisage an attractive land market in Spain to keep making acquisitions targeting 15-20% IRR in a country where fundamentals are still in place offering good risk adjusted returns.'
Gauthier Renaud, partner at Orion Capital Managers, added 'We are delighted to have invested our initial JV investment commitment alongside Neinor Homes in key cities in Spain.'
