Portugal 2021E – Logistics and Offices Investment Forecast
2021 is expected to be a dynamic year for the real estate sector in Portugal, with total investment expected to exceed c.€3 billion, led by the logistic and office sectors.
The logistic sector is predicted to be one of the most active in 2021, due to low vacancy rates combined with high demand. Logistic take-up totalled c.230,000 sq.m. in 2020 (+31% vs. 2019), with Built-to-Suit developments accounting for c.80%, reflecting the lack of properties available and the need for new developments. Rents of last mile logistics are estimated to increase to c.€5/sq.m./month due to lack of supply and increased land price. Prime rents in suburban locations will remain stable, as logistic operators will prefer to develop their own warehouses rather than accept rent increases.
Offices will continue to attract capital, with transactions worth over €100 million currently in the pipeline. Offices take-up in Lisbon and Porto for 2021 is estimated to reach an aggregate of c.200,000 sq.m., while prime office rents are forecasted to remain stable at c.€26/sq.m./month in Lisbon and c.€19/sq.m./month in Porto.