SUCCESS CASES
Fuencarral case
That in 1996 TrueBroker turned a run-down area of Madrid into the most innovative, young and beloved shopping street in the city is a major milestone. For us, it is the natural consequence of TrueBroker's distinct vision in the retail real estate market.
In 1995, Fuencarral Street was not at its best. The condition of the buildings was poor and the neighborhood was not very select.
TrueBroker detected two important changes: On the one hand, the definition of the concept of exclusivity worldwide, opening up to a range of more disruptive products, daring in design and less conservative.
And, on the other hand, a new generation of young people appeared in Spain, who were no longer guided by their parents as consumer models, but by their own generation, which conditioned their consumer behavior in a different way. Depending on whether their economic capacity was greater or lesser, they had access to brands of higher or lower price, but they were guided by that behavioral line that was not there before. It was no longer "the son like the father", but the son with his own references, regardless of his economic capacity.
This resulted in the search for a space of rupture and avant-garde for its purchases, with design and innovation as signs of identity.
The consumer was ready, but what about the city?
Globally, there were many brands that were already aware of this new change in the young population, but in Madrid there was no space for this commercial fabric that could accommodate them. The Salamanca district, which was very conservative, had its classic fashion patterns deeply rooted and, on the other hand, there was the downtown area, which had a low economic capacity and very cheap products.
If Madrid lacked such a space, it had to be created.
The first thing TrueBroker did TrueBroker did was to study what requirements, from an urban planning point of view, the street had to have. Our research had made us understand the importance of this issue, so we compared areas in Madrid that people naturally passed through and yet were not commercially developed.
We came to the conclusion that, in the previous stage, the Salamanca neighborhood had been the great commercial area of Madrid, to the detriment of the downtown area, which was very neglected.
We chose three areas and, when the Madrid City Council named Fuencarral Street, which was our preferred option, the preferred axis for the rehabilitation of buildings, between Gran Vía and Barceló, it was clear to us that this was the ideal place for our project.
With a small paper dossier, our CEO began to develop a different methodology that had never been used before in our industry, and that would be the germ of the method we have developed over 25 years.
We started to go to the major European trade fairs, which our industry did not usually attend, to visit the main cities of the world and their commercial fabric, looking for brands whose products fit with this project and that either were not present or did not have visibility in Madrid.
Pabloexplained our different vision regarding this change that was taking place in the consumer and the street he was developing for brands like his.
He called the brands until he managed to convince the expansion manager of one of them. Then to their Country Manager, then to the headquarters outside Spain, and so on, one by one, until 130 brands were brought in.
One of the most important assets we had with them was the commitment to continue working to add actors of the same profile, making the street grow over time, allowing them to be in a street of great commercial value, at very low prices.
They were five very hard years, almost without means, but with a very satisfactory result. The first 8 brands produced a lot of echo in the market and, from then on, the growth of Fuencarral Street was unstoppable. This generated an excellent relationship with the owners and tenants of the street who, to this day, continue to trust us.
Those who bet in the beginning, multiplied by 20 times the price they had paid for the premises 7 years earlier. The first sale and purchase made by TrueBroker in 1996 was sold for 35 times the price in 2012.
In 2016 we made a very detailed study of the 120 premises in the street with a methodology that takes into account the lack of homogeneity of the properties. In our database for the last 25 years, we have registered all the assets, with their characteristics, and the changes of tenants with their turnover and rental price paid, being able to quantify how much TrueBroker's performance influenced the revaluation of the street.
From the beginning, in 1996, until 2015, the value of commercial premises had increased by 2,000%, thanks to our project. To date, we have completed more than 130 transactions in a street with 120 stores.
Currently, Fuencarral is one of the streets with the highest growth and commercial demand, both in terms of number of premises and capital gains, and one of the most important in Europe.
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