Zara founder's real estate assets top 6 billion euros in 2015

MADRID (Reuters) - Amancio Ortega, Europe’s richest man and founder of global fashion group and Zara owner Inditex, held more than 6 billion euros ($6.6 billion) in prime real estate assets at the end of 2015, corporate filings showed on Tuesday.

People walk by one of Zara's stores in central Madrid December 14, 2011. REUTERS/Susana Vera

The famously-reclusive magnate’s real estate investment arm, Pontegadea Inmobiliaria, booked assets of 6.06 billion euros at the end of 2015, up 8.3 percent from the previous year, making it one of the biggest property companies in Spain.

Ortega, who turned 80 this year, consolidated most of his private interests into holding company Pontegadea Inversiones last December, with him at its helm and his wife Flora Perez and a close business partner listed as his vice-chairmen.

Pontegadea Inversiones, which holds a 50.01 percent stake in Inditex alongside billions of euros in real estate investments, had income of 810 million euros in 2015 from Inditex dividends, up 5.2 percent on the previous year, the corporate filings show.

In total, Ortega’s controlling stake in Inditex amounts to 59.29 percent, with a stake of just over 9 percent held separately to Pontegadea Inversiones.

Using massive dividend payouts from Inditex, which have nearly doubled over the last five years, Ortega has made largely debt-free purchases of prime buildings from London to New York, becoming a major commercial real estate player over that period.

“All the buildings he buys are in prime districts. It’s a steady, reliable income stream, almost like a sovereign bond,” said Carles Vergara, finance professor at IESE Business School.

Ortega’s first big real estate purchase was Torre Picasso, an office building in Madrid, bought in 2011 around the time he handed the daily running of the world’s biggest clothing retailer to chief executive officer Pablo Isla.

Since then he has bought properties including an office block in London’s Mayfair; a stretch of London’s prime shopping drag Oxford Street; and the historic cast-iron clad E.V. Haughwout Building in SoHo, New York, which housed a world- famous cut glass and porcelain store in the 19th century and featured the world’s first passenger elevator.

Ortega not only rents out his commercial property to Inditex stores like Zara and upmarket label Massimo Dutti at market rates, but also to rivals such as H&M of Sweden and Gap of the United States.

In Madrid, he owns No. 32 on the Spanish capital’s main shopping drag Gran Via. The Art Deco building, built as one of the city’s first grand-scale department stores in the 1920s, now houses biggest store in Spain for arch-rival Primark.

In February, Ortega made his first foray into Asia, buying a 22-storey plaza in Myeongdong, Seoul’s trendy shopping district.

Despite bouts of media speculation about a possible listing of the holding company, there are no plans to take Pontegadea public, a company spokesman said.

($1 = 0.9079 euros)

Editing by Sarah White and David Clarke