Sareb has contributed €29,550 million to GDP in the seven years since its creation
In its first seven years, Sareb has provided a total of €29,548 million to the Spanish economy. Equating to 0.45% of GDP, according to estimates included in the 'Report on the Socioeconomic Impact of Sareb (2013-2019)' published by EY.
In 2012, Sareb was tasked with divesting a €50,781 million portfolio comprised of developer loans and properties acquired from nine banks that were given government funding. After its first seven years, the Company has reduced its portfolio by €18,117 million (36%) 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 10% 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 €7,165 million. Additionally, at YE 2019 Sareb had repaid €15,676 million of debt, equating to 31% 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 2019 also takes into account the associated interest paid by the Company which amounts to €5,388 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 €1,319 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 (51%), Property Tax (IBI) and Other Taxes (42%), whilst the rest comprised individual income tax (IRPF) (4%) and payments to Social Security (3%).
Driving local economies
Sareb's business activity has had a direct and positive impact on the regions where its properties are located. Payments of service charges and Property Tax (IBI), as well as maintenance costs and payments to its servicers that conduct the commercial management of its properties (Altamira Asset Management, Haya Real Estate, Servihabitat and Solvia), have totalled €2,661 million since 2013.
We would note that in Catalonia, where Sareb owns a large number of properties, the Company has divested more than €533.2 million from its real estate property portfolio since it was first founded. Also of note are figures from the Region of Valencia (€436.9 million), the Region of Madrid (€315.5 million) and Andalusia (€313.7 million).
Sareb has also helped to drive local economies, by investing €227 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 Andalusia (€61.6 million), followed by the Region of Valencia (€43.1 million), Catalonia (€42.9 million) and the Region of Madrid (€34.6 million).
As part of its mandate, Sareb has reduced the number of debtors by 4,647 (26.7%) and sold 106,450 properties. In the seven years since its founding, the Company has promoted letting as an alternative to divestment and currently lets more than 8,150 homes and some 2,280 commercial properties.
Employment and social housing
As a result of its activity, Sareb has created more than 45,300 direct, indirect and induced jobs. This figure includes, among other factors, the goods and services contracts that Sareb assigns to its various suppliers.
In addition to its divestment mandate, since the Company's founding it has operated a programme in collaboration with autonomous regions and town councils, in an effort to alleviate the problem of social housing in Spain. Sareb has a total stock of circa 10,000 properties available to these institutions, and over the last seven years it has signed agreements to assign social housing to almost thirty public administrations. To date it has allocated over 2,400 homes to these councils – benefitting up to 9,600 people – leaving a further 7,600 properties available for the same purpose.