July 31, 2017
Redevco Iberian Ventures, the joint venture between pan-European retail real estate investment management company Redevco and funds managed by global alternative asset manager Ares Management, L.P. (NYSE:ARES), has acquired Mercado San Miguel, the renowned covered gastronomic market in Madrid, for €70 million. The seller is a consortium of private Spanish investors.
The food market at San Miguel Plaza in the heart of the historic centre of Madrid is one of the city’s major attractions and is a designated heritage-protected building in Spain. Constructed in wrought iron and glass, the 1,764 square meter building is divided into 30 high-end grocery and delicatessen stalls as well as 13 restaurant stalls. As a magnet for foodies and a fixture on Madrid’s tourist trail, the property has no vacancies and a long waiting list of prospective tenants.
Andrew Vaughan, Redevco’s CEO, said: “The purchase of Mercado San Miguel reflects our vision of where retail is heading taking the consumer a step beyond a simple transaction to provide an experience that they enjoy and want to share. This architectual gem of a building in close proximity to Madrid’s top attractions is an anchor point in the city, where visitors go to shop for groceries and enjoy a unique food and beverage offering. We expect to enhance the operations’ performance through active asset management and customer experience improvements.”
Bill Benjamin, Partner of Ares Management and Head of the Ares Real Estate Group, said: “Mercado San Miguel boasts an attractive location in a major tourist area in central Madrid as well as a strong, defensive brand in a changing retail landscape. This fits the JV’s investment strategy, which focuses on acquiring defensive retail assets on the Iberian Peninsula that offer opportunities for value enhancement through repositioning and execution of operational improvements. This is in line with Ares’ longstanding real estate strategy across Europe.”
Ares and Redevco announced the creation of Redevco Iberian Ventures in September 2015, targeting €500 million of value-add and opportunistic investments in retail properties on the Iberian Peninsula. Today’s announcement follows the recent sale of a portfolio of nine retail parks across Spain to Vukile Property last month as well as the sale of the Portimao Retail Park in Portugal to Olimpo Real Estate SOCIMI, S.A in May 2017.
Advising Redevco Iberian Ventures on the acquisition of Mercado San Miguel was DLA Piper and KPMG. The seller was advised by Aguirre Newman and Freshfields.