BarcelonaThe Catalan financial group Solventis has launched a fund, Fondviso, with which it wants to raise 650 million euros to build social rental apartments that, according to its promoters, would save tenants 30% of the cost – between rental income and cost of water and energy–. The aim is to build 12,000 homes in Spain, more than 3,100 in Catalonia, in the next 10 years.
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The proposal, as explained by the group’s general manager, Joan Carles Canudo, and the director of real estate investments, Toni Bosch, consists of a new model of public-private collaboration. To do this, the idea is to get land under lease – if it’s public for 50 years and if it’s private for 35 to 50 years – with reversion of the assets to the owners at maturity. Fondviso would be in charge of the promotion and construction, while the public operators (housing associations of the State, of the communities and of the town councils) would be in charge of the management and would pay a fee to Fondviso. This fee would be 94% of rental income, while the other 6% would be used for maintenance and repairs.
According to Bosch, this makes it possible to lower the final cost of the rental, since the risks are divided, because Fondviso would assume the risk of development and the public operators the risk of demand (finding tenants) and credit (ensuring the payment of the rents ). In addition, part of the savings will also come because the middlemen’s margins will be lower, since Fondviso, through its investees, is directly in charge of the development and, therefore, the developer’s margin disappears.
The system, according to Bosch, would make it possible to increase the supply of public housing for rent to administrations without increasing their debt. “With the same investment effort, that is to say, with the 350 million euros of direct investment foreseen in the plan of the Generalitat for the coming years, the Government could quintuple the capacity to develop affordable housing and could add in the current park between 16,000 and 18,000 homes,” explains Bosch.
2,000 M€ investment
Fondviso has already registered with the National Securities Market Commission (CNMV) and hopes to raise its first 200 million euros before the first quarter of next year to start operating, according to Canudo. The investors (participants in the fund) will be institutional, both public and private, Spanish and international.
The aim is to reach a total capital of 650 million euros to mobilize an investment of around 2,000 million in the next 10 years.
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