The Madrid office of Hines has announced that it has acquired Calle Salustiano Olozaga, 11 in Madrid from Monteverde, a Madrid-based residential developer. The six-story, 40,675-ft² (3,780-m²) vacant apartment building is located in Salamanca, Madrid's most affluent residential area, adjacent to the French Embassy and near the famous Puerta de Alcala monument. This project represents the first asset purchased by the Hines European Value Added Fund (HEVAF).
"Salamanca is a prestigious area comparable to Mayfair in London, and the demand for high-end residential properties in Madrid remains very strong," said John Gomez-Hall, head of Hines' Spain operations. "Salustiano will offer some of the finest residential space in the city."
Plans for renovation include the construction of approximately 16 luxury apartment units, two unique office spaces on the ground-floor level and 18 private parking spaces. Construction and sales will begin in June 2006 with completion expected in August 2007.
"We are pleased to announce the first acquisition for HEVAF, and expect more to follow soon," said Lars Huber, a director with Hines in London who is also the fund manager. "With this vehicle, we plan on acquiring investments with potential, and applying Hines' expertise to add value."
HEVAF is capitalized with $370 million (287 million) of equity commitments provided by German and Swiss institutions. HEVAF will invest primarily in office projects, but there is an allocation for other product types. Hines will focus on acquiring buildings in Western European countries, targeting France, Germany, Italy, Spain and the UK, and will seek to add value to acquisitions through tactics such as renovation, strategic leasing or re-leasing, improving operational efficiencies and refinancing.
"The Hines European Value Added Fund is the continuation of our strategy to widen our European activities," said Executive Vice President Michael Topham. "In 2002, the firm formed the Hines European Development Fund and we are in the process of forming our European Core Fund."
After more than three successful decades in the United States, Hines entered the European market in Berlin in 1991. Since then, the firm has developed projects in: Barcelona, Berlin, Düsseldorf, London, Madrid, Marbella, Moscow, Munich, Milan, Paris and Warsaw. The firm's European portfolio consists of 40 projects totaling more than 12.1 million ft² (1.1 million m²).