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MK Premium Arrives in Portugal as a Part of its Plans to Invest €50 million in 2018

15 December 2017

The family-owned company belonging to the brothers Daniel and Sergio Leiva will open offices in Porto and Lisbon in January, looking to double in the coming year the €25 million turnover that it expects to make in 2017.

MK Premium is going on a trip. The family-run business whose headquarters are in Barcelona will open its first two international offices in Porto and Lisbon next month. The company, which specialises in the residential market, hopes to confirm a take-off that is already underway. In November, the group landed in Madrid with an office on the Paseo de la Castellana. Its owners, the brothers Daniel and Sergio Leiva, are already prepared to sign off on three new assets at the beginning of the year, two in Tetuán and one in Lavapiés. These properties will consolidate their presence in the Spanish capital, where they have already invested 2.4 million euros in their first building, located in the neighbourhood of Chamberí. “Our goal for 2018, is to invest €50 million in the purchase of between eighty and one hundred properties,” Daniel Leiva, co-founder of MK Premium, told EjePrime.

The Leiva brothers’ arrival in the real estate sector is, in a certain way, a happenstance. “We had been looking for an opportunity in the market (in 2012) since prices had dropped a lot as a result of the crisis and my brother and I thought it would be a good time to invest, but as a familial investment, not as a business,” Leiva revealed. However, after the two acquired and rehabilitated a property in Barcelona, the return on their investment made them rethink their business strategy. “Until then, we were a teleshopping company,” the co-founder of MK Premium explained. The company was called Media Home and was dedicated to marketing products online, including home fitness equipment.

With part of the capital they acquired through their teleshopping business, Daniel and Sergio Leiva invested in Roig del Raval street, “the step in a journey which brought us to where we find ourselves now,” the executive stated. Just a couple of weeks before closing the financial year, the company is already expecting to reach 25 million euros of turnover. “The truth is that this year has been very good to us. In June, we had already exceeded our turnover for all of 2016 (13.5 million euros),” the Leiva’s explained.

The company expects to end the year with 25 million euros in turnover and nearly one hundred assets acquired in 2017 alone

MK Premium’s speciality is the purchase and rehabilitation of buildings in precarious environments. “We invest in real estate that is in disuse because of possible problems with inheritances or other factors,” the executive stated. The brothers began investing in Barcelona, where they have acquired more than a hundred assets over the last five years. The company now intends to transfer their business model to the Spanish capital.

The timing of residential assets

The family-run business has a loyal clientele from a distant country. “We have a list of some 50 Israeli investors who are highly interested in Spain’s housing market. Among them, there are a dozen that are frequent, even assiduous, investors,” the executive said. Currently, 70% of the company’s clients come from Israel and Tel Aviv in particular. “Consider that the square meter there sells for 10,000 euros,” Leiva stated.

The key to the company’s specialisation in this type of product is timing. “We have looked at all types of investments, from plots of land to top of the line commercial premises, but what interests us the most is the timing necessary to get the highest profitability, and there the area that attracts the greatest interest of investors is that of apartments,” the executive said.

MK Premium will invest 20 million euros during its first year in Portugal, where it will open offices in Porto and Lisbon

Metamorphosis after the crisis

The Leiva entered the real estate sector in full crisis. Therefore, they had watched the metamorphosis that the residential market had experienced since 2012: “When we started, prices were very low, and when this happens it is easier to buy and more challenging to sell. Now we are at the opposite point; there is much more demand than supply; Now it costs more to buy, and it is easier to sell. MK Premium has increased its department for acquisitions from one to eight professionals just to meet existing demand.

Expansion to Portugal

The company’s arrival in Portugal has led it to double their goals. With the opening of offices on the Avenida da Liberdade in Lisbon and Avenida dos Aliados, in Porto, the Leiva are confident that they will manage a turnover of “about 50 million euros” in 2018, divided between the two countries. For this, the company expects to make investments of 30 million euros in Spain and 20 million euros in Portugal.

“We believe that we can gross the same amount in Portugal as we did in Spain,” the executive said. “It is a much smaller market, but there is a mix that we see as being very opportune, as there are many abandoned buildings and, therefore, many owners who want to get rid of their properties. This, added to the growing demand for real estate, gives us a lot of business opportunities,” the executive concluded.

MK Premium’s stated goal for its acquisitions during the next twelve months is set at over a hundred assets. Since 2012, it has invested just over 90 million euros, buying 150 assets. The family-run business will begin its trip in only a couple weeks, and see where their travels take them.

Original Story: EjePrime – Jabier Izquierdo

Translation: Richard Turner