HOOPP enters the Spanish rental market
The Healthcare of Ontario Pension Plan (HOOPP) from Canada is in talks to acquire nearly half of the residential portfolio managed by Ares Management in Spain. These assets are managed through Avalon Properties. This could be HOOPP’s first direct investment in the Spanish real estate sector.
Deal structure and portfolio overview
The package under discussion does not include properties built on public land under concession schemes. These assets were excluded due to disagreements over their valuation. The negotiations concern approximately 50% of Ares’s residential portfolio, estimated at €600 million. The entire Spanish residential real estate portfolio managed by Ares is valued at around €1.3 billion.
Most of the portfolio consists of apartment buildings intended for rental, located in the Madrid autonomous community. In total, Ares controls more than 3,500 apartments across the country through Avalon Properties, although not all of them are part of the current negotiations. Assets connected to public land raise questions about their final valuation, which has prevented their inclusion in the deal.
Terms and potential implications of the deal
According to participants, the sale process is overseen by the consulting firm JLL. If the deal is successfully completed, HOOPP will become a key partner within the structure consolidating these assets. This will allow for a partial payout to investors and a redistribution of capital, while some shareholders and the Avalon management team will remain among the owners.
HOOPP’s potential investment comes amid growing interest from international investors in the rental housing sector in Spain. According to industry analysts, this sector is becoming one of the main drivers of investment in 2025. The reason is steady demand and the desire of major funds for assets with predictable returns.
Market Impact and Outlook
For HOOPP, which manages assets exceeding 123 billion Canadian dollars, Europe is becoming an increasingly important region. The fund is already pursuing a real estate investment strategy and, according to available information, has engaged specialized consultants for the deal.
If an agreement is reached, it will further validate the confidence of major institutional investors in the Spanish rental market. Experts note that such transactions reinforce the trend of international funds entering Southern European markets, which offer attractive stable rental income and currency diversification.
At the same time, the difference between facilities on private and public land highlights the complexity of evaluating projects implemented through concession schemes.
