According to the Forcadell reports, the professional property investment market in Spain has been in an upward cycle since 2014. Last year, the investment volume exceeded €18,800 million, almost 40% higher than in 2017.
Situation in investment sectors:
As usual, the hotel sector captured the highest investment (€4,900 million in 2018), surpassing its high-water mark once again. The Canary Islands and the Balearic Islands were the leaders in the holiday segment, capturing half of the hotel investment during the year. Alongside this sector, professional investment specialising in retail assets has again taken a leadership position in the real estate market with 22% of the total capital invested in 2018, a year when as many as 15 shopping centres opened in Spain. Within this context, small investors are focussing on secondary assets, which require a lower investment volume and yield higher profits.
Moreover, logistics assets again exceeded industrial assets and are continuing to grow thanks to the boost from e-commerce. The office investment market has fallen due to the lack of product on sale and banks plan to divest as much as €12,500 million in unproductive assets, mainly residential.
As for plots for all kinds of uses, residential plots were not only the most in demand in 2018 but also rose in value in provincial capitals other than the main cities in Spain.
Current situation and prospects:
Investment funds are still leading the investment market in Spain, especially international funds, as 65% of the capital invested in the last year comes from abroad, although it is very often managed by local operators.
The property market in Spain is now in a mature stage of the expansion cycle with stable yields and increasingly moderate price rises. Student halls of residence and flexible offices are gaining an increasing share of the investment market. Lastly, it is worth noting that Blackstone, the US investment fund, has been the most prominent player in the Spanish real estate market, carrying out the most important transactions in the sector in 2018.
Everything points to property investment continuing on a good path in the coming years. Invest safely through diversification. Invest with Propcrowd.