BLP advise Propinvest on debt for €1.9bn acquisition

Propinvest has announced the completion of the €1.9bn acquisition of the Global Headquarters complex of Banco Santander in Boadilla del Monte in Madrid on 12 September 2008.

This transaction represents the largest single European real estate acquisition ever completed. Bank debt to assist the acquisition has been provided by a consortium of banks.

Propinvest was advised on the debt side by Berwin Leighton Paisner LLP. 

The award winning HQ complex comprises 175,000 sq. m. of offices and ancillary accommodation on a site of 165 hectares. Over 9,000 employees work at the location.

The property is secured on a 40 year triple net lease (without break) payable by Banco Santander SA, a AA rated Bank. The rental cash flow from the lease increases annually on a compound and upward only basis by 175% of the prevailing Eurozone CPI (inflation) rate.  The initial annual rental income is €83m. The rent and inflation linked uplifts provide an anticipated nominal value of €9bn over the term of the lease.

Banco Santander SA is the world’s third largest bank by profit and the fourth largest by market capitalisation.  Operating principally in Spain, the United Kingdom, Europe and Latin America, it has 129,000 employees, 65 million customers, over 10,000 branches and 2.3 million shareholders.

A spokesman from Propinvest commented: “This highly complex transaction has been undertaken in extremely challenging financial markets. To have funded this matter in such an environment is a testament to the quality and opportunity of this unique and exceptional investment. We are grateful to our banking partners and our professional team all of whom have been outstanding.”

The BLP team was led by Joginder Anand, assisted by partners Laurence Rogers and Jo Solomon and associates Rickaby Shearly-Sanders, Ellie Griffin and Sarah Kennedy, all in the Real Estate Finance team.  Joginder said: “We are delighted to have assisted Propinvest in this high profile deal.”

Garrigues advised Propinvest on the Spanish and real estate aspects of the deal.  The Garrigues team was led by Felipe Yannone.

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