Investment in Tertiary Assets Set to Soar Up 162%

18/11/2014 – El Economista

Spain’s housing sector revives as investment returns to the pre-recession levels. Tertiary asset sales are expected to amount to €8.4 billion in 2014, outperforming the €3.2 billion score from 2013 by 162%, Aguirre Newman portends.

Year-to-date, closed transactions total at €6.2 billion, of which €2.3 billion was spent on retail and €1.6 billion on offices.

The deals were sealed in 2014 because investment funds have been eyeing the Spanish market for several years. First, there arrived the opportunistic investors, striving at bargains and profits flowing from price recovery.

According to experts who attended the meeting organized by the Federation of Real Estate Advisors (Jornada de la Asociación de Consultoras Inmobiliarias, ACI), up to 300 companies arrived in Spain with an intention to invest. However, many left empty-handed as they had not managed to meet buying targets, explained Andres Escarpentes, CEO of JJL.

The REO Assets

Only several of the funds stayed, mostly because they had acquired a platform for REO asset management and together with that an access to detailed analysis on the market development.

Also, one shall not forget about the impetus the freshly listed Socimis (REITs in Spain) gave to the market, accounting for 34% of the entire YTD investment. However, specialists are afraid that any of them might fail to meet objectives.

Speaking of the residential segment, Alberto Prieto, general director at Knight Frank, specified that some areas start to run out of quality products and, as a consquence, pull the prices up.

Finally, Adolfo Ramirez Escudero, president of CBRE, forecasted that in 2015 the sector will spot new debt providers in more ‘normal circumstances’.


Original article: El Economista (by Alba Brualla)

Translation: AURA REE