AXA IM - Real Assets has completed the forward purchase of a 919-unit affordable housing for rent portfolio in the Madrid region of Spain for €150m. The portfolio’s vendors are Tectum Real Estate, a dedicated build to rent company, and Locare Real Estate, a development company with extended expertise in affordable housing.
The portfolio is spread across seven different assets which are at various stages of their development processes, with one asset already complete and fully occupied, three currently under construction and the remaining three due to imminently commence having already obtained building permits. Due to be delivered between 2020 and 2022, each asset will be transferred to AXA IM - Real Assets upon completion and fully leased. All the units in the portfolio, which will be one of the largest portfolios of affordable housing to be built in Spain, will be offered under the Madrid Community official protected housing regime, VPPB and VPPL(2), which supports the provision of housing at affordable rental levels to eligible citizens that meet specific criteria.
Each asset will comprise a mix of one, two and three-bedroom apartments, all purpose-built for the rental market and to a high specification. Tenants will have access to a range of amenities including an on-site concierge, swimming pools, children play areas, private storage units and resident parking. All seven assets are located in consolidated residential areas presenting high demand for affordable housing in the greater Madrid region and benefit from strong transport infrastructure, with easy access to the city’s main ring roads and public transport network.
Esther Escapa, Head of Transactions and Development (Spain & Portugal) at AXA IM - Real Assets, commented: “This transaction provides us with a unique opportunity to support the provision of much needed high-quality yet affordable housing in the Madrid region, a market which has historically had low levels of such suitable stock. Despite the current uncertainty caused by the COVID-19 pandemic, we are confident in the resilience of the economic and demographic trends that have underpinned the demand for this type of residential accommodation, allowing us to generate stable long term income on behalf of our clients.”