Spain Enjoys Record Commercial Property Year

Category: Commercial Real Estate

Commercial real estate set a new record in Spain for both cash investment and investment volume, reports World Property Journal. Knight Frank, a global real estate consultant, has said Spanish commercial property investment totaled €8.8 billion ($9.6 billion USD) in 2015, the latest data on record. It is reportedly the highest investment total since 2008. Volume also set a record, increasing 13 percent year over year.

High-end retail 52 percent of investments

According to the report, the biggest draw for investors by far was shopping centers and “high street” retail, with €4.6 billion ($5.2 billion USD) representing a 52-percent market share. Office real estate investment was not too far behind, with €3.3 billion ($3.7 billion USD) or 38 percent of the total.

The article reports that, while still a smaller share, logistics property investment has seen growth that is exponential, thanks to higher yields. Hotel property is close behind, reportedly due to a robust recovery of the tourist sector.

Spanish REITs, local investors dominate

Part of the growth in commercial property is said to be down to so-called SOCIMIs, Spain’s version of the real estate investment trust (REIT). Beginning in 2013, these trusts have reportedly grown to a market share of 55 percent.

By country, nearly half of Spanish commercial investment is reportedly domestic, with the caveat that SOCIMIs are considered domestic entities, even if their capital is international. Continental Europe, including the United Kingdom, Germany, and Switzerland, holds a 22-percent share of investments, while North American and Asian investments amount to 12-percent and 11-percent market shares, respectively.

Posted on: Tuesday, April 18, 2017