CG CAPITAL EUROPE: Real Estate sector in Spain promising coming months

Following a year marked by the Covid-19 pandemic, the appetite from investors in the Real Estate sector in Spain is growing thanks to higher vaccination rates (c.80% population fully vaccinated) and encouraging evolution of the economic forecasts. Building on the volume transacted in H1 2021, we expect a period of great plenitude in the number of transactions during the coming months.

After H1 2021 with c.€5,489 million of total direct investments jointly by all assets typologies (led by logistic, residential and hospitality assets) the confidence towards RE sector has boosted and it is expected to reach a direct investment volume of c.€10,000 million. This figure is predicted to be achieved based on c.50 ‘hot’ operations, with a likely volume of c.€4,500 million.

Not only the short term is thought to be promising for the Real Estate Sector, but also the medium and the long term seem pretty encouraging with c.€4,000 million and c.€1,500 million of transactional volume already in the pipeline of investment firms, according to the latest reports.

By typology, hospitality assets will stand out among other Real Estate transactions, with a predictable c.35% of the total transactional volume in monetary terms and c.60% of the total achieved figure. Giving place to value-added operations in which the assets will undergo repositioning plans, in order to meet increasing demands for high quality and personalized customer experience.

Offices and logistic assets will go along with the hospitality sector, with pipelines of c.40 and c.20 transactions and c.€2,200 million and c.€1,500 million, respectively.

Alternative financing will play a key factor to achieve the forecasted investment volume, as it has been doing during the last year, covering the need for financing not proportioned by the more traditional banks.

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