Hines operates across funds, JVs, and listed platforms. In Spain, how do you decide which vehicle is most appropriate for a given opportunity — and what does that choice signal about your conviction, risk tolerance, and intended hold period?
All potential deals sourced by our teams across the globe are discussed in a weekly call attended by our Global Investment Committee members and representatives from our various investment vehicles, including our institutional and private wealth funds, direct capital sources and REITS. The deals that our Investment Committee decide to take forward are then allocated to the appropriate investment vehicle. This collaborative approach ensures the right deal finds the right vehicle and allows us to best serve our investors and clients through a truly integrated, global approach.
The acquisition of Lar España was a landmark move. Beyond the asset quality, what made the listed SOCIMI structure the right vehicle for Hines at that moment — and what were the key financing, governance, and execution challenges in taking control of a public platform?
The acquisition of Lar España was a landmark transaction for Hines, not only because of the quality and diversification of a clearly consolidated portfolio, but also because it was a corporate capital markets transaction led by Hines European Real Estate Partners III together with Grupo Lar, supported by a significant bridge financing provided by Morgan Stanley and Santander. At Hines, we considered a listed structure such as a SOCIMI to be the right vehicle at that time, as it offers a robust framework in terms of transparency, reporting, and corporate governance. SOCIMIS are the Spanish equivalent of Anglo-Saxon REITs, a well-established international format that has played a key role in the Spanish real estate market by helping to relaunch the sector after the 2008 Global Financial Crisis.
That said, a transaction of this nature requires particularly rigorous execution. The main challenges were concentrated in three key areas. First, the design of the financial structure, which needed to ensure balance sheet strength, flexibility, and a smooth transition. Second, governance, by incorporating best practices associated with a listed company and appropriately managing a change-of-control process. And third, operational execution, where close collaboration between teams was essential to preserve business continuity and to move forward with discipline along the platform’s defined roadmap.
During December Hines has decreased its stake in HLRE, giving entry to a new holder. What were the most critical decisions around leverage, liquidity, and investor alignment that motivated that divestment?
The reduction of our stake in HLRE reflects a capital optimisation decision fully aligned with our investment strategy. Through its investment vehicle, Hines European Real Estate Partners III, Hines successfully syndicated approximately 33% of its interest in Lar España to existing investors and a new strategic partner, with the objective of reducing concentration risk and validating the investment thesis. The transaction, completed in December 2025, strengthens the shareholder structure, improves the balance between leverage and liquidity, and preserves the platform’s ability to execute its strategy in the ordinary course of business.
Hines have historically used joint ventures to scale in new markets. In Spain, what role do JVs play today compared to wholly owned platforms — and how do you structure them to balance local expertise with institutional discipline?
Joint ventures continue to be a very relevant tool for Hines in Spain and play a complementary role alongside our wholly owned investment vehicles. Over time, this model has allowed us to scale into new asset types and markets, while maintaining a flexible approach tailored to each opportunity.
From a structural perspective, we always seek a very clear balance: on the one hand, leveraging our own expertise where it adds the most value –particularly in execution, active asset management, and deep market knowledge– and on the other, applying rigorous institutional discipline in decision-making, risk management, and governance and reporting standards.
Ultimately, the objective is for the joint venture to add capabilities and accelerate value creation, without diluting the consistency of the investment and management approach that defines Hines.
From a global investment committee perspective, how is Spain currently perceived within Hines? Has the country moved up the risk curve in recent years, and what underwriting assumptions are most debated internally — pricing, liquidity, regulation, or exit depth?
The perspective for Spain is positive. In a context where the geopolitical environment is becoming increasingly complex, we continue to be guided by fundamentals and economic data. From this perspective, Spain has delivered a strong performance, which supports a constructive view: GDP closed 2025 at 2.9%, well above the eurozone average of 1.3%. At the same time, household consumption has strengthened, supported by rising purchasing power, moderating inflation, and sustained employment growth. Notably, the unemployment rate fell below 10% for the first time since 2008, following the creation of 605,400 jobs in 2025.
In terms of real estate investment volumes, and according to the latest CBRE data, 2025 closed with a record €18.4 billion invested, representing a 34% increase year-on-year and the highest level recorded since 2018. Once again, when compared with other European markets, this is a very positive outcome.
Overall, Spain is currently in a favourable phase, with constructive fundamentals and positive prospects, which continues to underpin strong investor interest in the country.
As we look toward 2026, where do you expect activity to concentrate: equity, private credit, or hybrid structures? Which type of capital do you believe will have the clearest edge in Spain — and why?
We feel our capital mix is pretty unique in the market and allows us to be agile and fast moving to capitalise on the best opportunities that our local teams are discovering.
The European markets are attracting high capital flows right now, both from close to home and also from the US and Asia as global real estate investors look to capitalize on growing momentum on the continent. Both of our European perpetual funds – Hines European Core Fund (HECF) and Hines European Property Partners (HEPP) – raised record levels of institutional capital in 2025 as the firm’s investment pipeline grew 70% year-on-year. Spain for us is a key investment destination and we are deploying capital from across the risk spectrum here.
