The Renta Corporación Group expands its international presence and launches its activities in New York
The Renta Corporación Group expands its international presence and launches its activities in New York
• The company thus boosts its internationalisation process and for the first time does so beyond European borders.
• Renta Corporación has already closed its first real estate deals in Manhattan
• Eduardo Rabassa has been appointed Managing Director for the US Market
Barcelona/New York, 2 October, 2007.- The Renta Corporación Group has taken one more step in its ambitious internationalisation process by entering the New York market. Renta Corporación’s international expansion began in Paris in 2002, followed by London and Berlin. The company had announced in recent months that it was involved in a market analysis process with the aim of boosting its international presence, without ruling out non-European destinations. César Bardají, the company’s CEO, states that “this decision has been closely considered and is a leap forward in our international expansion”. The company thus concludes the market test phase it began several months ago, during which it considered more than 300 building proposals in Manhattan. Bardají remarks that “we take on this new challenge with great excitement and with certainty of our success in this new destination, since it dovetails perfectly with our business model”. New York is indeed known for its great size and liquidity, both of which are key factors in Renta Corporación’s business model.
Renta Corporación Group’s New York expansion has initially focused on the island of Manhattan, one of the most liquid markets in the world, where there is a vigorous supply and demand. The tremendous opportunity for transformation in this market points to great success in the company’s activities. New York has a population of 8.2 million and welcomes 41 million visitors each year. If it were a country, it would be the tenth world power in terms of GDP. The island of Manhattan is the world’s largest city in terms of office space, with over 36 million square metres (390 million square feet), and its rent prices are still significantly lower than in cities such as London, Tokyo, Paris and Madrid.
Renta Corporación carries out its first operations at the very core of Manhattan.- The company has closed deals for the purchase of two properties, with hopes of acquiring new ones in the near future. One of the properties is located in the Tribeca neighbourhood, once an industrial district that has been revitalised into an area of thriving shops and luxury lofts that, due to its proximity to Wall Street, provides housing for financial workers. The building is residential and has five floors above ground level, with an overall surface area of more than 2,500 square meters (27,000 square feet) with the possibility of expansion. The second property is an eight-story office building located within walking distance of the Rockefeller Center. Both projects account for an investment of around 50 million euros. Strong demand continues to push prices up in Manhattan, which explains the high investment level in the city and the growing number of European and Asian investors, who are also driven by the strength of the euro and yen.
Renta Corporación will do business in the US through the RENTA CORPORATION holding company. This recently established company will also be the Group’s brand in the US market.
In the medium term, in addition to expanding its presence in Europe, the group plans to gradually develop its business in other US cities, subject to verifying local market suitability and implementing the network of qualified professionals necessary to successfully manage transformation projects. The company has implemented this same growth model with positive results in other cities where it has established itself, gaining successively greater experience.
Eduardo Rabassa, at the head of Renta Corporación in the United States.- Eduardo Rabassa has been appointed country manager for the US after having closely collaborated with Renta Corporación in recent months in developing this market, implementing the network of professionals necessary for managing the business and testing the suitability of the market to the company’s business model. With a journalism and advertising degree from the Universitat Autónoma de Barcelona, Rabassa has built his career in marketing (Panasonic and Grundig), business development and general management. He has lived in Brazil, the Philippines and, for over six years, in the US, where he has held several positions, namely Vice-President of Business Development and Latin America for Richardson Brands, a subsidiary of Grupo Agrolimen, and Division General Manager for Cirsa Corporation.
Increasing international activity for Renta Corporación.- The Renta Corporación business model involves the acquisition and transformation of properties, buildings and land in big cities characterised by high real estate liquidity. The goal is to adapt property to local needs, creating great added value in a short period of time prior to selling it.
The company’s international activity acquires increasingly greater relevance. In 2006 it accounted for 36% of sales, and the company intends to maintain this internationalisation process to achieve its ambitious growth and profitability objectives while ensuring the best possible diversification and risk control for the company. Renta Corporación thus projects that in the medium term international investments will account for at least 50% of the business. This should be possible with a combined increase of activity in cities where it is already present and an expansion into new markets as part of a structured process of profitable growth.
Excellent H1 business results.- During this period Grupo Renta Corporación boosted net profits vs. year ago by 30% up to €32.7 million, in keeping with forecasts for the year. Sales have grown by 36% to €433 million, with a real estate portfolio of €1.289 billion, a growth of 53%. This property portfolio and a steady acquisition activity are key factors pointing to the high level of transformation projects in the pipeline for the company in the next several years.
Barcelona, 02 october 2007.
