Lagasca Project Return: Real Estate Investment in Madrid’s Barrio de Salamanca with 11.45% IRR
We have completed the liquidation of the Lagasca project, a real estate investment developed in Madrid’s Barrio de Salamanca together with the manager VG Investment, which allowed us to return over €3.5 million to 811 investors, with a final return of 29.30% and an IRR of 11.45%.
The project closed with a result above the initial forecasts, both in total return and annualized profitability, despite requiring an extension of the initially planned term.
Luxury Home Renovation
The Lagasca project consisted of a real estate investment in one of the most established and sought-after residential areas of Madrid: the Barrio de Salamanca. From the beginning, the goal was to optimize the asset’s value through active management and subsequent divestment, in a market characterized by very limited supply and steady demand, both nationally and internationally.
When the project was opened to investment on Urbanitae, it presented several factors that supported its approach:
- Prime location in central Madrid.
- A residential market with high liquidity.
- An experienced manager in this type of asset.
- The initially planned term was 18 months, structured as 12 months plus a possible 6-month extension, as established in the contract.
More Time to Deliver Higher Returns
Ultimately, the project was liquidated over a natural term of 32 months, equivalent to a weighted term of 28 months, thanks to partial returns made during the life of the project.
It is important to highlight that the term was extended twice, always with investors’ approval, with the aim of optimizing the asset’s marketing and maximizing value at the time of divestment.
These extensions allowed the project to adapt to the market pace and exceed what was initially foreseen in the contract, prioritizing better economic results over an early exit under less favorable conditions.
Results Above Initial Estimates
The final balance of the Lagasca project is as follows:
- Planned term: 18 months (12 + 6 extension)
- Final term: 32 months (28 months weighted)
- Estimated CoC: 15.75%
- Final CoC: 29.30%
- Estimated IRR: 10.50%
- Final IRR: 11.45%
The difference between the initial estimates and the final result highlights the impact that active management of the divestment schedule can have, especially in prime market assets, where the timing of the sale is a key factor.
During the life of the project, partial returns were made, allowing investors to recover part of their capital before the final liquidation and improve the result in terms of time-weighted profitability.
Thanks to this structure, the project achieved a final return of 29.30%, with an IRR of 11.45%, figures that clearly exceed the initial forecasts and reinforce the attractiveness of this type of operation in established locations.
An Example of Value-Oriented Management
The Lagasca project return is a good example of how, in certain real estate investments, flexibility in timing and proper alignment with investors can translate into better final results.
The combination of a prime location, a clear strategy, and decision-making agreed upon during project execution allowed the operation to close with a return significantly higher than initially expected.
We continue to work to offer our investors opportunities that, in addition to being based on solid fundamentals, feature continuous monitoring, transparent communication, and management focused on maximizing value at every stage of the project.
