Spain’s real estate sector posts second best year in a decade, says The Carlton Group
Spain’s commercial real estate investment sector rose to approximately EUR9 billion in 2014, exceeding the most optimistic forecasts, according to a new report by The Carlton Group.
2014 was the second best year within the last decade in terms of volume for Spanish commercial real estate investment, (surpassed only by 2007 when the value of each asset was significantly higher), the report said.
“Spain has once again become a relevant destination for real estate investors and the positive trend is expected to continue over the next few years,” says Javier Beltran, Managing Director of Carlton Iberia (Spain and Portugal) and head of Carlton’s Madrid office.
The report cites the “unparalleled arrival” of a very large number of international institutional and “off radar” investors from Asia, Middle East, Latin America, North America and Europe, along with the new Socimi, the Spanish REITs, that have contributed to the increased volume and value of commercial real estate transactions in Spain.
In 2014, the most desired Spanish assets for investors were prime office buildings and shopping centers, (two of the largest shopping centers in Spain were transacted during 2014), along with hotel, logistic and car park sectors, the Carlton report said.
Many investors have also started to buy “well located land development sites” in Madrid, Barcelona and Spain’s Southern coast. This has contributed to an increase in construction activity that is also expected to rise in coming years.
The report points to the increased number of international investors, the general improvement of the Spanish economy, along with the renewed interest in Spanish banks’ lending capacity as contributing factors to a revaluation of real estate assets that is expected to continue during the next few years.
It also attributes a very robust hospitality investment market to the record number of international visitors coming to Barcelona, Balearic and Canary Islands, Madrid, Marbella, Valencia and Alicante over the last two years.
Prices in the Spanish residential market are stabilising and have shown slight increases in some areas of main cities, with the trend expected to increase price and activity, the Carlton report said.
The report concludes that Spanish real estate markets are “becoming more professional and international and all that is very good news,” says Carlton’s Beltran.