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Corestate Spanish JV in €240m development deal

The Madrid multi-use tower development is the Zug-based firm’s first deal with its two Spanish partners.

A Corestate Capital joint venture is to develop a multi-use tower with an investment volume of €240 million next to Cuatro Torres, the medical and financial hub of Madrid.

The deal marks the first investment for the joint venture, Iberian Corestate Capital Advisors, which was established in February between the Zug-based private equity real estate firm and Madrid-based asset management firm Inmobiliaria Espacio and its sister company OHL Desarrollos, a property development company.

The development site in Madrid measures 721,000 square feet and allows for a footprint of 361,000 square feet. Around 560,000 square feet of this space shall be devoted to public use, set as a condition by the authorities of Madrid. The particular use, for instance in the context of a hospital, university or administration is presently being evaluated.

The remainder, up to 188,000 square feet, will be used as commercial area with a retail concept complementing the multi-use of the tower, for example through providing supermarkets, restaurants and child care facilities. Three underground floors offer 2,000 parking units. The other 360,000 square feet of the total plot are reserved for the development of a green area offering the public space for recreation and leisure.

“We are very excited that this major project marks the kick off and market entry of Iberian Corestate Capital in Spain. The five towers will contribute an important part to the long-term 'Castellana Norte Urban Development Project' as the towers represent the gateway to the business district in Madrid,” commented Sascha Wilhelm, Corestate’s new chief executive.

Corestate promoted Wilhelm from chief operating officer earlier this month. He is the firm’s first full-time chief executive since Philip Burns left Corestate in October 2013.