AXA snaps up Santander banking properties for €308m

On behalf of two institutional investor clients, the French insurer has purchased 381 banking assets from a REIT launched by the Spanish bank in February.

The real estate investment management business of French insurer AXA has completed the acquisition of 381 banking assets in Spain in a deal valued at €308 million, it announced today.

AXA Real Estate Investment Managers struck the deal on behalf of a joint venture between two of its institutional investors, neither of which it named, with URO Property Holding, a Spanish REIT owning more than 1,100 Santander-occupied properties.

URO was floated in February by Santander as a tax-efficient means of holding banking properties that were sold and leased back in 2007, but were since retaken after its owner defaulted on its debts and filed for bankruptcy. Santander is the REIT’s largest shareholder, while other banks including Caixabank and BNP Paribas are also shareholders.

Although it contains only about 2 percent of Santander’s banking properties, URO is nonetheless the largest real estate company listed on the Spanish stock market with assets under management valued at €1.6 billion – prior to the sale to AXA.

The assets involved in the sale to AXA comprise 968,000 square feet of space, fully let to the bank on leases extending to between 24 years and 26 years. They are predominantly situated in Anadalucia, Cataluna, Castilla y Leon, Pais Vasco and Madrid.

The acquisition by AXA follows a trail of other investments by the French insurer that span back to 2013 when it acquired an office portfolio in Barcelona from Generalitat de Catalunya for €172 million.

Hermann Montenegro, head of asset management and transactions for Spain at AXA Real Estate, commented: “This latest acquisition underpins AXA Real Estate’s conviction in the Spanish real estate market, having purchased what we believe to be a portfolio offering significant value let on a long lease to Santander.”