• The Return of Shopping Centre Transactions in Spain

    June, 2024

Shopping centre transactions in Spain are going through a booming period, standing out for offering a very attractive risk-return ratio. Since the beginning of 2024, there has been a significant increase in investor’s interest in this asset class, which has been reflected in an increase of product available in the market compared to previous years.

According to specialised industry brokers, investment volume in shopping centres in Spain reached €740 million by May YTD, almost six times more than the total recorded in 2023 (€126 million), highlighting the growing interest of investors in this market segment. Investment funds accounted for 72% of investment, with notable transactions such as the purchases of Islazul and La Salera. Funds are leveraging in the stable returns and growth opportunities provided by these assets, particularly in the post-pandemic context where prime space demand remains high and supply is limited.

These moves underline also the growing interest in the Spanish market due to its potential for profitability and stability in the performance of commercial assets. Demand for these spaces remains robust, driven by a recovering and strong consumer market. Operators’ interest in these assets continues to rise, evidenced by a 28% increase in new openings during 2023. The positive trend in shopping centre transactions highlights a broader confidence in the market’s resilience and adaptability.

Prime yields in shopping centre have reached 6.5%, the highest level in eleven years. The recovery of the post-pandemic economy has revitalised retail trade, increasing demand for retail space. Factors such as excellent footfall and sales performance, as well as competitive rents compared to other European markets, have contributed significantly to this resurgence.