Sareb has contributed €27,300 million to GDP in the six years since its creation
In its first six years, Sareb has provided a total of €27,329 million to the Spanish economy. Equating to 0.41% of GDP, according to estimates included in the ‘Report on the Socioeconomic Impact of Sareb (2013-2018)’ published by the consultancy firm EY.
In 2012 the Management Company for Assets Arising from the Banking Sector Reorganisation (Sareb) was tasked with divesting a €50,781 million portfolio comprised of developer loans and properties acquired from nine banks. After its first six years, the company has reduced its portfolio by €16,541 million (32.6%) and has helped to clean up the financial sector, as well as drive activity in the real estate market. The divestment of its financial and real estate asset portfolio is a clear indicator of its economic importance, given that it allows both sectors, which account for 16% of the Spanish economy, to recover and develop.
According to the EY report, Sareb’s direct, indirect and induced contribution to the Spanish economy amounts to €6,399 million. Additionally, at YE 2018 Sareb has repaid €15,020 million of debt, equating to 29.5% of its total debt. To date, the company has complied with repaying the debt guaranteed by the Spanish State, as well as the associated interest.
The total contribution to GDP between 2013 and 2018 also takes into account the associated interest paid by the company which amounts to €4,842 million. A large part of this includes €2,785 million that was paid directly to the nine banks that received state aid and transferred their assets to Sareb.
Sareb has also contributed €1,068 million in taxes to public funds, making it one of the largest contributors in the real estate sector. The majority of tax payments corresponded to non-deductible VAT (49.1%), Property Tax (IBI) and Other Taxes (43.6%), whilst the rest comprised individual income tax (IRPF) (4.7%) and payments to Social Security (2.6%).
Driving local economies
The active management of Sareb’s real estate assets has had a direct and positive impact on the regions where the properties are located. Payments of service charges and Property Tax (IBI), as well as maintenance costs and payments to its servicers (Haya, Solvia, Altamira and Servihabitat) for carrying out local management, have totalled €2,350 million since 2013.
We would note that in Catalonia, where Sareb owns a large number of properties, the company has divested almost €468.8 million from its real estate property portfolio since it was first founded. Also of note are figures from the Region of Valencia (€386.6 million), the Region of Madrid (€284.4 million) and Andalusia (€278.9 million).
Sareb has also helped to drive local economies, by investing €133 million to-date in constructing new-build housing on land that it owns, as well as completing developments that were transferred to it unfinished. The most investment has been made in the Region of Valencia (€32.5 million), followed by the Region of Madrid (€32 million), Catalonia (€26.6 million) and Andalusia (€22.8 million).
As part of its mandate, Sareb has reduced the number of debtors by 23.6% to 4,106 and sold more than 89,500 properties. In the six years since its founding, has promoted letting as an alternative to divestment and currently lets more than 7,500 homes and some 1,000 commercial properties.
Employment and Social Housing
As a result of its activity, Sareb has created 40,760 direct, indirect and induced jobs. This figure includes, among other factors, the goods and services contracts that Sareb assigns to its various suppliers.
Alongside its divestment campaign, Sareb has shown a great commitment and contribution to social housing in Spain. Since its founding, the company has signed collaboration agreements to transfer social housing to 10 autonomous regions and seven city councils, committing 2,367 homes and helping 5,893 people in the process.
Distribution of property portfolio management costs by region
Amount invested in developing land and completing unfinished developments by autonomous region