The joint venture that will build 4,500 affordable rental flats in Barcelona is born

The Barcelona City Council and the Barcelona Metropolitan Area (AMB) have just kicked off their alliance with private operators to solve the shortage of public housing, one of the great pending issues for the city and the surrounding municipalities. Neinor and Cevasa have been the companies chosen by the administrations to be part of Habitatge Metròpolis Barcelona, the mixed company that will build a total of 4,500 affordable rental flats in the next eight years, half in the city of Barcelona and the other half in the rest of the metropolis. The total investment will be 600 million euros.

The four partners formalized this Friday the capital increase necessary to launch the project. The increase consisted of a contribution of 12 million euros from the public administrations ---six million euros each---, and 12 million from NCIRent Residencial, a company created by Cevasa and Neinor.

Both companies now hold 50% of the capital of the mixed company, which was previously only controlled by the City Council and the AMB. With the entry of private operators, the administrations now own the remaining 50%, equally distributed. The construction of the 4,500 flats is expected to be carried out in four phases. This will materialize in different increases in share capital until reaching 58 million euros contributed by private partners and another 58 million euros by public partners.

The process to establish Habitatge Metròpolis Barcelona has not been easy. The project began to be conceived by the AMB in 2014, but was paralyzed by municipal elections, as recalled by the mayor of Cornellà de Llobregat and executive vice-president of the supramunicipal institution, Antonio Balmón, at the presentation of the mixed company. Later, the first tender called to find private partners was deserted and, in addition, legal problems arose that delayed it even further. "What matters is that we are starting now," Balmón stressed.

The first affordable rental flats will be in Barcelona, Sant Boi, Montgat and Sant Adrià

The first phase foresees the construction of 640 homes, which will have capacity for 1,600 people. They will be located on eight plots, provided by the administrations, half of which will be in Barcelona city and the other in municipalities of the metropolitan area.

Specifically, construction will take place in La Marina del Prat Vermell, La Sagrera, the Casernes de Sant Andreu (Barcelona), Saló Central (Sant Boi de Llobregat), Turó del Sastre (Montgat) and La Catalana (Sant Adrià de Besòs). It is estimated that these works will generate 1,000 jobs. In later phases, it is planned to build homes in Cornellà de Llobregat, Molins de Rei, Sant Andreu de la Barca, Viladecans, Castelldefels and Sant Vicenç dels Horts.

The rents for these flats will be between 400 and 700 euros per month, below market price. The administrations will enable mechanisms to cover the monthly payments of tenants who cannot afford them. The 4,500 homes will be for permanent rental, considering that the land will be ceded under surface rights, with the aim of maintaining public ownership and consolidating the expansion of the affordable housing stock.

The profitability that private operators expect to obtain from this operation is very long-term. According to the director of Cevasa, Donato Muñoz, profitability will be around 5% and will begin to be obtained from the fourth or fifth year after launch.