Neinor Homes, the leading Spanish residential developer, and Urbanitae, leading platform with 65% of the market share, that raises equity and debt financing for real estate projects in Europe, have agreed to create a joint-venture to invest up to €150mn in the Spanish build-to-sell (BTS) segment in the coming 18-months.

Since 2017, Urbanitae has been able to raise €200mn between equity and debt to finance 141 developments across the most sought-after locations of the Spanish market. Of these, it has delivered a total of 28 projects achieving 16.6% average annual returns for its investors. Urbanitae’s platform is fully regulated by the Spanish market regulator, CNMV, and its investor base is built around local investors in the Family Office and Retail segments.

Urbanitae will hold an 80% stake in the JV, while Neinor has the remaining 20% and act as delivery partner manager overseeing the project design, licensing, commercialization, and construction. As part of the agreement both parties are already analysing different investment opportunities.

The co-investment strategy plays a key role within the business plan announced in March 2023 as Neinor puts a greater emphasis on its balance sheet optimization pursuing equity-efficient acquisitions. Between 2023 and 2027, Neinor expects to invest c.€1bn in new land acquisitions of which €500mn are expected to come from new equity partners.

The JV signed with Urbanitae is the third vehicle closed by Neinor in a period of just 7-months and represents a 60% achievement vs the 5Y objective of €500mn. This illustrates a strong investment appetite for Spain as well as the scalability of the new business line created by Neinor and its aim to become the new investment manager for the Spanish Living sector.

Equity efficient and sustainable growth is a perfect fit to Neinor’s value proposition with one of the most attractive shareholder remuneration policies in Europe, targeting dividend distributions of €365mn over the coming two years representing c50% of the current market cap while maintaining a conservative balance sheet with prudent debt ratios.

Borja García-Egotxeaga, Neinor Homes’ CEO comments that: “We are extremely pleased to have signed this agreement with Urbanitae and we are looking forward to a longstanding and successful partnership. Moreover, in a short period of time, we have been able to raise €300mn for our recently created JV business strengthening Neinor’s investment capacity with a significant firepower to deploy over the coming quarters. Meanwhile, the Spanish market has continued to show its strength and resilience consolidating its positioning as one of the safest residential markets worldwide.”

Jordi Argemi, Neinor’s Deputy CEO and CFO says: “As we have thoroughly explained during 1H23 results, in a short period of time, we have shown a solid execution across the three main value drivers of our business plan, being the crystallization of Neinor’s BTR portfolio, equity efficient growth through JV’s and increasing visibility over forthcoming dividend payments. This solid execution attests credibility and rigour to the strategic plan announced earlier this year, in line, with what this management team has achieved over the last 5 years.

Diego Bestard, Urbanitae’s Founder and CEO says: "We are delighted to walk this path with Neinor. From its inception, Urbanitae has had the goal of becoming a serious player in the alternative investing and financing space for real estate developers while at the same time, giving access to institutional-grade investments to small and medium sized investors. With over €200mn funded and +100 developments in our portfolio, we can confidently say we have achieved our goal. This JV with the leading developer in the Spanish market is proof that Urbanitae is a viable investing and financing solution for all types of developers."