• SOCIMIs Outlook

    June, 2024

The SOCIMI market in Spain is expected to continue the growth shown during the first months of FY24, driven by the economic recovery and growing demand for housing and commercial property. After FY23 of stagnant investment due to financial and political conditions, the SOCIMI market is regaining its dynamism and is as well bringing back vitality to the Spanish market.

The recovery is being driven by the entry of a new SOCIMI on Euronext Access (Elix Rental Housing Socimi II), the announcement of Alfin Patrimonial and Solvento to entry on the BME Scaleup market,and three transactions totalling €289 million, far exceeding the performance of the first three months of FY23.

Increased competition between markets has facilitated the entry of smaller SOCIMIs, thanks to reduced requirements and structuring and management costs. This has prompted real estate property companies with profitable assets to consider the option of becoming a SOCIMI in order to benefit from its tax regime.

Improvements in macroeconomic conditions are encouraging the creation of new SOCIMIs and the return of foreign investment, mainly focused in the acquisition of residential assets. Foreign investment accounts for more than 25% of the total capitalisation ofthe SOCIMIs, which shows as a very efficient vehicle for international investors. Family offices with real estate portfolios of more than €10 million are as well looking to create SOCIMIs to channel investment.

More than 30% of the SOCIMIs invest exclusively in residential, making it the star asset class, particularly with various build-to-rent business models, due to high house prices and ever-rising rents, followed by retail and offices. The living sector is also attracting investor appetite.