Our income is from the management and sale of two types of assets in our portfolio: developer loans and real estate. Our expenses are financial, commercial, property maintenance, arising from the transformation of assets and those required to maintain our business structure.
Below is a breakdown of our income and expenses taken from our most recent Annual Activity Report.
Sareb’s income is from, on the one hand, the management and sale of loans. And, on the other, from the sale and rental of the properties acquired from the banks rescued in 2012 and 2013; from those obtained subsequently with the transformation of loans and from property development.
In 2020, Sareb generated around €1,422 million in revenue. 39.9% (€567 million) from the management of properties and 59.6% (€848 million) from the management of loans.
Sareb’s income from the management of loans
In 2020, a large part of the income from the management of loans, specifically, 31%, was from the liquidation of collateral properties (those guaranteeing the loans) and from Sales Growth Plans (SGP). The remainder was obtained from the amortisation and recovery of the debt (31.3%), from the cancellation and sale of loans (21.3%) and from interest paid on the loans (16.2%).
Sareb’s income from the management of properties
In 2020, with regard to income from the management of real estate assets, most was obtained from the sale of houses and ancillary properties (garages and storerooms), 76%. This was followed by the sale of land and commercial properties (shops, offices, bars and restaurants), with 19% and, to a much lesser degree, from income from rentals and other items (5%).
Of the properties sold, 85.5% are Sareb’s properties, while the remaining 14.5% are sales made through agreements with developers (SGP).
In terms of the profile of the purchasers of Sareb’s residential properties, these are mainly Spanish; the foreign companies and individuals that purchased in 2020 are a minority.
To simplify and condense Sareb’s main expenses, it is useful to classify them in four main blocks:
1. Maintenance and community expenses
These are expenses incurred by Sareb to maintain and adapt its properties and for the payment of expenses associated with community fees. In 2020, this block of expenses stood at €110 million.
2. Company expenses
These are expenses required for the company’s activities and operations. Among others, they include wages and salaries or the facilities in which Sareb works. In 2020, the expenses arising from Sareb’s business structure stood at €116 million.
3. Expenses for commissions and servicing
These are expenses required for the sale of the assets, such as the commissions we pay to the sales companies or expenses associated with the actual sale of the properties. In 2020, this expense stood at €124 million.
4. Financial expenses
These expenses correspond to the payment of the swap we took out in 2013 to protect ourselves from an increase in the interest rate associated with our senior debt. In 2020, this expense stood at €548 million.