C&W: Logistics Leasing in Madrid Rose by 19% in H1 2018

5 July 2018 – Mis Naves

According to data compiled by Cushman & Wakefield, during the first half of the year, companies leased 446,000 m2 of logistics space in the Community of Madrid, which represents an increase of 19% with respect to the same period in 2017.

The upward trend that was observed during 2017 in terms of logistics leasing in Madrid has been maintained so far in 2018 and has even intensified over the last few months, according to data compiled by Cushman & Wakefield. The levels of demand for logistics space in the Spanish capital are continuing to exceed all market forecasts.

Companies leased a total surface area of 446,000 m2 in the Community of Madrid during H1 2018, which represents an increase of 19% with respect to the same period in 2017. This data is particularly significant if we take into account that during the whole of last year, logistics leasing reached historical highs of 871,000 m2. Of the total for the half year, 51% of the surface area corresponded to the second quarter, given that 227,000 m2 of space was leased between April and June.

In this period, 21 contracts were formalised in total, and operations exceeding 10,000 m2 amounted to more than 157,000 m2, which accounted for 70% of the space leased during the last three months. The trend in terms of average rents continued to increase slightly and the availability rate is continuing to fall, in an environment in which construction activity is becoming increasingly intense.

In this context, characterised by a scarcity of available warehouses, the most important operation during the second quarter, spanning 33,000 m2, involved a turnkey operation. In addition, land purchases continued, which will lead to future announcements of new logistics warehouse developments over the next few quarters, according to Cushman & Wakefield.

Original story: Mis Naves

Translation: Carmel Drake

Permits for New Construction Grow by 8% in January

28 March 2018

During the first month of the year, 6,694 applications were registered for the construction of new homes, the highest figure for January since 2011.

The issuance of construction permits is continuing to grow robustly in Spain. In January, 6,694 applications were submitted for the construction of new homes, an annual increase of 7.3%. The Ministry of Development reported that it was the highest figure for the month of January in the last seven years.

The pace of new applications is thus continuing the trend seen over recent years. In 2017, Spain recorded its fourth year of growth, with a year-on-year increase of 26.1% in the number of submitted applications to 80,786.

When broken down by the type of applications, there 5,054 requests for flats within apartment blocks, accounting for 75.5% of the total number of authorisations. Also, permits for single-family homes grew by 8.25% in January, compared to the same month in 2017, to 1,640 applications.

Another trend that is being seen in the Spanish residential market is seeing a marked growth in housing rehabilitation. 2,175 visas were requested in January for home extensions and reform, an increase of 9.7% over the same month last year.

Original Story: EjePrime

Translation: Richard Turner


Moody’s: House Prices Will Rise By 8.6% Over Next 3 Years

3 November 2017 – El Economista

An increase in the proportion of the active young population and the greater affordability of housing will boost house prices in Spain by 8.6% over the next three years, according to forecasts from the ratings agency Moody’s, which has analysed the impact of demographic trends on prices in the residential real estate sectors of seven large European markets.

In the case of Spain, the risk rating agency forecasts a rise in house prices of around 5.6% in 2018, but then limits that increase to 1.4% per annum in each of the following years, until 2020.

“Low interest rates, an improvement in economic conditions and the higher proportion of the active young population will serve to boost the housing market”, says Greg Davies, analyst at Moody’s, adding that in the last decade, the proportion of young workers has increased by 8%.

The agency indicates that the current environment of low interest rates and the economic recovery, which is reducing the still high level of youth unemployment, are contributing to the affordability of housing in Spain, although it says that salary growth is still low, which is preventing some young professionals from buying a home, something that Moody’s expects to improve over the next few years.

In this sense, the agency points out that in 2014, around 14% of full-time workers in Spain earned less than 2/3 of the median income, compared with just 7% in Italy and 9% in France.

On the other hand, Moody’s underlined that Spain has experienced a decline in the demand for new build homes, whereas there has been a lot of activity in the second-hand market. Construction activity in the country currently represents just 40% of the volume recorded in 2007, reflecting, amongst other factors, the sovereign deleveraging, including the banking sector, which has led to a substantial reduction in residential investment.

Original story: El Economista

Translation: Carmel Drake

BBVA: Positive Outlook For Housing Market In 2015

3 March 2015 – El Economista

The positive outlook for economic growth, better employment figures and favourable financing conditions will drive further increases in house sales in 2015, which will be accompanied by a “moderate” increase in prices and a further increase in construction activity.

That is according to the latest “Real Estate in Spain – Flash Report”, prepared by the Research Department at BBVA, which also states that “2014 could be classified as the year in which the recovery of the real estate sector began”.

Sales recovery

The entity points out that, according to the General Council of Notaries (Consejo General del Notariado), demand for properties showed signs of recovery month after month during 2014, to close the year with 364,000 homes sold, up 19.1% compared with 2013. “That was the first increase since 2007 and it reflects the greater level of activity in the mortgage market”, says BBVA.

At the same time, data from the Ministry of Development shows that there was a 0.5% increase in house prices last year, again, the first increase since the start of the crisis.

This recovery in the key real estate parameters led to a 1.7% increase in the number of construction permits for new homes in 2014, which the financial institution notes “breaks the trend of seven consecutive years of decreases and makes 2014 the turning point in terms of construction activity”.

The report forecasts that this positive trend will really take hold in 2015. BBVA Research expects the Spanish economy to grow by 2.7% this year, with the creation of around half a million jobs and relatively stable interest rates.

“All of these factors indicate that there will be a further increase in house sales and that prices and construction activity will respond with further growth”, says the bank.

Original story: El Economista

Translation: Carmel Drake