Returning Consumers Drive Demand For Shopping Centers Up

12/06/2014 – Independent

According to Gema de la Fuente from Madrid-based Savills branch, investment volume in shopping malls may hit up to €1.5 billion in 2014, which is ten times more than in 2012.

Cut in unemployment rate and return of low-cost lending foster improvement in Europe´s fifth-largest economy.

Moreover, as Andres Escarpenter, realtor and CEO of JLL in Spain claims the values of shopping malls in prime areas shot up by 15% over the past year.

Spanish banks also position themselves to draw benefits from the upturn in consumer demand. For instance, Santander acquired a considerable stake in El Corte Ingles´s finance affiliate, whereas Popular vies for Citi´s business in Spain.

CaixaBank and Bankia also turn back to consumers with the first increasing lending by 40%. In fact, all entities relaxed criteria for the first time since 2010.

However, an expert from the sector assures sustainable improvement in loan granting will not be possible before 2017 when the real trigger (jobs and more favourable circumstances) materialized on the housing market.

As per INE´s data, household wealth of Spanish families increased by 0.4% in the first quarter over the previous one. Unemployment reached 27% in September 2013 pulling down sales for 38 consecutive months. Consumer lending plummeted by 44% since mid-2008.

To illustrate growing interest on the side of investors, London-based Orion´s investment fund acquired the other 50% of stake at 82.648 square meter park Puerto Venecia in Zaragoza, paying €144.5 million to British Land. In 2009, Orion purchased the Plenilunio shopping center in Madrid. The fund strives at buying powerful malls so that in case of bankruptcy of smaller ones, it may snap their market share.

Another United Kingdom – born firm Intu Properties Plc. allied with Canada Pension Plan Investment Board and purchase the Parque Principado shopping center in Asturias.


Original article: Indpendent (by Charles Penty & Sharon Smyth)

Summary: AURA REE