residential Market News: Portuguese Real Estate Intelligence

SPX Reinforces in Algarve with 850 Beds in Quinta Do Lago
October 22, 2021 – Ana Custódio SPX has finalised a deal with CGD, boosting its presence in the Algarve. After acquiring the prestigious tourist-residential complex The Keys, SPX - International Asset Management has completed another transaction in the region, this time for two plots of land in the exclusive Quinta do Lago development. The sales by Caixa Geral de Depósitos involves mortgage loans secured by two plots of land, occupying a total area of 7.6 hectares, for real estate development within the resort. The land for tourist-residential use, given as a guarantee for the acquired mortgages, adds a construction potential of 45,600 m2 (28,200 m2 +17,400 m2) to the 45,000 m² SPX already owns in this complex in Almancil. Added to the other 72 residential units it is selling in The Keys, the investor will now have the possibility to create 850 new beds. With an above-ground construction potential of 28.200 m2, enough for up to 500 beds, the plot designated AL1 is located in the northern part of Quinta do Lago. Next to the multisports complex “The Campus” is plot ET3, with a construction potential of 17,400 m2 and 350 beds. JLL again provided support for SPX throughout the process, providing buy-side advisory, and commercial and technical DD, valuation and development strategy services. SPX also counted with the help of Morais Leitão’s legal team, coordinated by partner João Torroaes Valente from the Corporate Real Estate department. According to Gonçalo Santos, Head of Capital Markets at JLL, “this deal highlights investors’ continued interest in the Portuguese resort market, where over the last twelve months, several hundred million euros have already been invested in the acquisition of assets for development. Having entered the Portuguese market with an initial investment of over 95 million euros in acquiring The Keys, with these new acquisitions SPX definitely becomes a key name in this industry in Portugal and in Quinta do Lago in particular, which, as this operation confirms, has been at the top of investors’ list for almost five decades in the Algarve.” Translation: Richard D K Turner
Mondego Capital Partners Place €50-Million Bet on Portuguese Real Estate
October 22, 2021 – Ana Custódio The real estate developer Mondego Capital Partners is growing its portfolio of projects with acquisitions in historic neighbourhoods. Mondego Capital Partners is focusing on Portuguese real estate with an additional investment of 50 million euros, the real estate developer said on Friday. The investment involves a set of unique buildings for residential projects with special emphasis on creating large residential areas. With the acquisition of new real estate projects in historic neighbourhoods such as Baja-Chiado/Alfama, Avenida Sidónio Pais and Avenida 5 Outubro, Mondego Capital Partners is boosting its portfolio of real estate projects with a total investment of 50 million euros in Lisbon. Gonçalo Ahrens Teixeira, a partner at Mondego Capital Partners, said: "We are seeing a post-Covid growing demand for luxury residential projects, especially for large-area flats. With these recent acquisitions, we will be in a position to provide flats with areas exceeding 200 m2 to the market." Translation: Richard D K Turner
Interest Rate on Mortgages Fell to 0.785% in September
October 20, 2021 – Ana Custódio The average outstanding principal and monthly instalment stood at 57,334 euros and 237 euros, respectively. Today, the National Statistics Institute released its analysis of Implicit Interest Rates on Mortgage Loans for September. According to INE, the interest rate fell to 0.785% in September (vs 0.792% in the previous month), and the capital outstanding stood at 57,334 euros and 237 euros, respectively. For contracts signed in the last three months, the interest rate rose from 0.689% in August to 0.702% in September. The average capital in debt rose 219 euros to 57,334 euros, and the average instalment rose by one euro to 237 euros. The implicit interest rate on mortgages fell to 0.785%, down 0.7 basis points month on month. According to INE, the interest rate on contracts signed in the last three months was 0.702% (vs 0.689% in the previous period). For financing for Housing Purchase, the most relevant mortgage loans, the implicit interest rate for all contracts fell to 0.800% (-0.7 b.p. in comparison to August). Contracts signed over the last three months saw the interest rate increase by 1.8 b.p. m-o-m to 0.697%. According to the analysis and considering all contracts, the average value of the instalment rose by one euro to 237 euros. Of this amount, 37 euros (16%) correspond to interest payments and 199 euros (84%) to amortised capital. The average instalment rose by 7 euros to 311 euros for contracts signed in the last three months. In September, the average outstanding principal for all contracts increased by 219 euros compared to the previous month, reaching 57,334 euros. For contracts entered into in the last 3 months, the average amount of capital outstanding stood at 119,518 euros, 1,558 euros more than in August. Translation: Richard D K Turner