The Madrid City Council has unveiled the new Southern Strategy, an ambitious urban transformation plan that envisions the construction of 160,000 homes and interventions across 5,600 hectares in nine districts in the south of the capital. The announcement was made by Mayor José Luis Martínez-Almeida, who framed the project as a key initiative to rebalance the city and position the south as a new hub of economic and residential growth.

The strategy will affect the districts of Latina, Carabanchel, Usera, Villaverde, Puente de Vallecas, Villa de Vallecas, Moratalaz, Vicálvaro, and San Blas-Canillejas, home to 44% of Madrid’s population. The plan aims to boost housing construction, particularly affordable housing, regenerate former industrial areas, strengthen public transport, and consolidate a network of green spaces connected to each other and the natural environment.

One of the most significant projects will be the development of Abroñigal, which will transform 300,000 square meters of the former Adif logistics grounds into a new residential area with buildings of at least 14 floors, alongside educational, social, and cultural facilities. The operation depends on the prior relocation of railway activities to Vicálvaro, a necessary step to free up the land.

The Southern Strategy also includes the revitalization of productive areas, the consolidation of the green belt, and the continuation of the Metropolitan Forest, as well as various urban improvement projects in the affected neighborhoods. The model emphasizes a combination of residential and business uses to foster economic activity and job creation.

The project will require agreements with the central government for its development, and according to municipal forecasts, its formal processing will begin in the next term, with an expected execution horizon of approximately ten years.

The total investment amounts to €1.284 billion, of which €77 million will be allocated to facilities and €18 million to the rehabilitation and remodeling of parks and green areas in 2026, marking the budgetary start of the initiative.

At CG Capital Europe, we work hand in hand with international funds, institutional investors, and corporates to identify, structure, and execute real estate investment opportunities across all asset classes in Spain including retail, living, hospitality, logistics and offices. With privileged access to global capital, deep market insight, and a proven track record in complex transactions, we deliver strategic advisory services that enhance value creation and investment performance. Spain’s solid market fundamentals, together with investors’ growing appetite for prime and sustainable assets, continue to drive strong momentum in the sector, positioning CG Capital Europe as a trusted partner for those seeking to capture the most attractive opportunities in one of Europe’s most dynamic real estate markets.

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