Forcadell Reports That Take-Up of Logistics Assets Up 33% Y-o-Y in Catalonia

8 November 2019 – Between July and September of this year, operators snapped up 132,509 square meters of logistics assets in the province of Catalonia, an increase of 33% year-on-year. Operators took up a total of 465,352 square meters of surface area in the first nine months of the year, comparable to the year before, according to a new report by the Spanish real estate consultancy Forcadell.

Prime logistics assets have provided an average yield of seven euros per square meter per month. Second and third-tier assets paid six and 3.5 euros, respectively.

Original Story: Eje Prime

Adaptation/Translation: Richard D. K. Turner

INE: Mortgage Lending Rose by 16.5% YoY to €42.7bn in 2018

27 February 2019 – La Vanguardia

Last year, 345,186 mortgages to purchase homes were signed in Spain, up by 10.3% compared to 2017, but the banks again refrained from fully opening the financing tap: the average loan amount increased by just 5.6% to €123,727, according to data presented on Wednesday by Spain’s National Institute of Statistics (INE).

The growth in the average amount is only slightly higher than the increase in house prices (which rose by 3.9% on average last year, according to data from the Ministry of Development, albeit by much more in the large cities and their metropolitan areas, where the bulk of demand is concentrated). “The banks are adopting a conservative strategy, that’s for sure”, said Oscar Gorgues, Manager of the Chamber of Urban Property in Barcelona – “because they are still very mindful of the excesses of the boom years. For that reason too, we can say that the real estate market is healthy and there is no risk of a bubble”.

The data from INE shows that after five years of recovery in the real estate sector, the number of mortgages granted is still 71% lower than the 1.24 million mortgages granted by the banks in 2007, the last year before the burst of the real estate bubble.

According to real estate firms, the caution on the part of the banks means that the main factor causing families, and especially young people, to rent, is the fact that it is impossible for them to obtain a mortgage loan. By contrast, according to the real estate firm Forcadell, around one third of homes are now purchased without a mortgage, in operations undertaken by investors (…).

According to data from INE, the value of all of the new mortgages constituted to purchase homes last year amounted to €42.7 billion, up by 16.5% compared to 2017, due to the combined effect of increases in the number of operations and the average loan amount (…).

Original story: La Vanguardia (by Rosa Salvador)

Translation: Carmel Drake

Coworkings: the New King of the Real Estate Sector

15 February 2019 – Eje Prime

Millennials, flexibility, start ups…All of the socio-demographic trends are inevitably leading to one common place: coworking offices. Flexible workspaces have become the great promise of the real estate sector but their largest operator, IWG, generates just 15% of its revenues from them and WeWork is multiplying its losses year after year. What risks does the model have? Can it withstand a recession without the guarantee of the traditional five years of mandatory occupancy? And what if Amazon and Facebook, its tenants of today, end up becoming its main competition?

In 2017 alone, the total volume of flexible workspace in the twenty largest markets around the world grew by 30%, equivalent to 1 million m2. Since 2014, the sector has doubled, and in cities such as London, they account for 20% of the office space leased, according to a report from JLL. In Barcelona, that figure already amounts to 12%.

The consultancy firm forecasts that the European stock will grow by between 25% and 30% per annum on average over the next five years and will account for 30% of some corporate real estate portfolios by 2030. But those predictions hide the major challenges that are threatening the great promise of the sector.

One of the main challenges facing the model is that the operator is tied to a given property for at least five years, like in the case of a traditional office, but its tenants have contracts that last for months or even hours. When the next crisis hits, what guarantees does the owner have that the operator will be able to continue paying the rent?

“On paper, that does seem like a risk, but the reality is that the coworking phenomenon was launched during the crisis”, explain sources at Savills Aguirre Newman. All sectors suffer when there is a recession, but traditional offices are hit harder because whoever cannot bear those costs can afford a coworking space”, argue the sources at the consultancy firm.

Another of the risk factors is that coworking offices have capitalised on the lack of available office space in the centre of cities and also, on the shortage of appropriate spaces for the new ways of working within traditional companies (…).

“The players driving the sector are multi-nationals that are looking for appropriate spaces for their innovation teams or for project-based work”, says Manel de Bes, Director of the Office department at Forcadell.

But, what will happen when the offices of these large companies have adapted to the new scenario? “At the moment, most companies are in the experimental phase; if they consider that the trials do not meet their needs, they will be able to return to more conventional models”, explains JLL’s report (…).

From rock star to conservative player

Within the coworking phenomenon, the rock star is WeWork. The New York-based company, which became the largest lessee of offices in its home city last year, is worth USD 20 billion, but it recorded losses of USD 723 million in the first half of last year.

“Its model is based on taking over the best buildings, in the most prime areas and then competing with other operators on price: it is not sustainable”, argues a competitor in the sector. “Sooner or later, they will have to raise their prices”, he assures.

IWG’s model is more conservative. That firm has an umbrella of five brands and thirty years of history. “We have gone through three or four cycles and we cover our backs: first, by diversifying in terms of the type of tenant to minimise risk. We also ask the owners to invest and we do not select the best buildings or at any price”, said Philippe Jiménez, head of the group in the Spanish market (…).

De Bes from Forcadell forecasts that “Over the medium term, just four or five operators will remain: those that lease 200 m2 or 400 m2 in secondary areas will exit the market”. In fact, the market is already becoming more concentrated: since 2015, the five most important operators have accounted for 50% of all of the new flexible workspace in Europe (…).

Original story: Eje Prime (by Iria P. Gestal)

Translation: Carmel Drake

Forcadell: 370,000 m2 of Office Space was Leased in Barcelona in 2018

13 February 2019 – Eje Prime

The office market in Barcelona is breaking records. In 2018, 370,000 m2 of space was leased in the city, up by 8.8% compared to 2017. According to the consultancy firm Forcadell, that trend was due to three main factors: interest from international companies, demand from tech companies and the boom in coworking.

Up to 60% of the surface area leased in 2018 corresponded to companies from overseas. According to the report from the consultancy firm, the interest from those companies in Barcelona is attributed to the city’s “entrepreneurial and innovation eco-system”, which is complemented by a commitment to technology, which has attracted companies such as Everis, Oracle and Indra.

In just one year, coworking operators have doubled the amount of space leased in Barcelona, renting out a surface area of 46,700 m2 in 2018. According to this report, the Catalan capital is the European city that has seen its office space increase by the most in percentage terms.

Original story: Eje Prime 

Translation: Carmel Drake

Barcelona Gets Ready for the Residential Equivalent of Coworking: ‘Coliving’

29 January 2019 – Idealista

Whilst last year, coworking was one of the most repeated words, this year, it seems that the residential equivalent is on everyone’s lips, specifically, the new formulae for housing, ‘coliving’. So much so that Barcelona is already preparing to receive the first operators: the Consortium of the Zona Franca, a public entity tasked with the economic revitalisation of the city of Barcelona and its metropolitan area, is already managing licences to open the first coliving centres in the La Marina neighbourhood.

Although the names of the firms that are going to make their debuts in Spain under this model are unknown for the time being, sources in the sector say that they have already started to process the first permits for projects that are in an initial phase. “Just like coworking has become a successful phenomenon for the office market in Spain over the last 2 years, so professionalised coliving wants to follow in its footsteps and try its luck in the residential market”, explain sources at the real estate consultancy firm Forcadell.

“The large international investment funds, in their search for alternative assets that offer higher returns, are studying the Spanish market to implement this model, which has already proved successful in other countries such as the USA, Germany, the UK and Japan (Tokyo)”, say the sources at Forcadell.

With their arrival, these operators will professionalise a common practice in Spain of house sharing, by adding sophisticated aspects more typical of student halls. The coliving projects that have been developed to date comprise complexes with bedrooms and individual bathrooms on the one side and large common areas with movie theatres and games rooms (with ping pong, pool. etc.), libraries, gyms, restaurants and swimming pools, amongst others, on the other side.

According to Toni López, Partner at Forcadell and Director of the company’s real estate area, “the millenials have changed the way of consuming and have championed a change of thinking around property ownership, experience and use; it is logical and inevitable that this trend will expand to the real estate sector”. They are a generation that values experiences and seeks to optimise resources to the max, paying only for the use and experience of an asset, without incurring the cost and hassle involved with its ownership.

Medici and Corestate, the first brave players

Medici and Corestate have become the first groups to look closely at Spain for their new homes under the coliving formula (…). The German company Medici has joined forces with the German fund Corestate to invest more than €1 million in the development of business across all of Europe. In the Spanish market, the company will operate under the Quarters brand and it is already negotiating its first coliving project in Barcelona (…).

Medici already has three coliving buildings in Berlin, with capacity for 45 residents and nine apartments; and two more in the USA, in cities such as New York and Chicago, where the monthly rents range between USD 1,100 (€967) and USD 1,500 (€1,320) (…).

Original story: Idealista (by Custodio Pareja)

Translation: Carmel Drake

Forcadell: 486,946 m2 of Logistics Space Leased in Cataluña in First 9 Months

10 October 2018 – Eje Prime

The Catalan logistics sector is seeing its figures soar. With three months still to go before the end of the year, the industrial segment of the real estate sector has already exceeded the total volume of space leased in all of 2017, with 486,946 m2 leased during the first nine months of 2018, according to data from the real estate consultancy Forcadell.

The report from the Catalan consultant points out that during the third quarter of 2018, 99,557 m2 of logistics space was leased, up by 28% YoY. That figure means that the leasing volume to date exceeds the figure recorded by Forcadell at the end of last year (459,451 m2).

The second ring of Barcelona is leading the increase in the Catalan logistics sector, accounting for 47% of the operations signed during the third quarter.  In total, seven operations were registered in this area between June and September, with 50,341 m2 of industrial land leased.

The second ring was followed by the first ring, which accounted for 40% of operations and a total leasing volume of 43,216 m2. The third, with some plots located in the province of Tarragona, accounted for 13% of the transactions in this market in Cataluña.

The Director of Industrial and Logistics at Forcadell, Gerard Plana, said that “new construction projects are continuing to offset the lack of available supply”. Seven of the fifteen operations that were completed during the third quarter in Cataluña involved new build or turnkey assets.

In terms of the largest operations signed during that period, they included Henkel’s new 24,000 m2 warehouse in Montornès del Vallès and the 10,520 m2 warehouse that Mercadona leased from Goodman in Barcelona’s Zona Franca area.

Original story: Eje Prime

Translation: Carmel Drake

JCDecaux Leases 2,500 m2 Warehouse in Badalona (Barcelona)

7 September 2018 – Eje Prime

JCDecaux España has arrived in Barcelona. The outdoor advertising company has just signed the lease on a 2,500 m2 warehouse on the Besós industrial estate, in the urban area of the Catalan capital. The operation has been brokered by NCI Asesores Inmobiliarios.

The French company will allocate this space to offices, its fleet of vehicles and the storage of tools and other materials. JCDecaux España is going to invest between €300,000 and €400,000 in the remodelling of the warehouse, according to explanations provided to EjePrime by NCI Asesores Inmobiliarios.

The company that owns the warehouse is a leading player in the food sector and is in turn owned by an investment group.

JCDecaux recorded revenues of €3.472 billion in 2017. The group, founded in 1964 by Jean-Claude Decaux, owns more than a million advertising boards in more than 75 countries. Moreover, the multinational employs 13,040 people all over the world.

The headquarters of JCDecaux is located in Neuilly-sur-Seine, close to Paris. In Spain, the company currently carries out its activities in another warehouse in the municipality of Badalona, with more than 500 workers. At this stage, it is unknown whether the new centre leased on the Besós industrial estate in Barcelona will replace or be added to the portfolio of centres that the multinational owns in Cataluña.

Cataluña: a logistics epicentre 

JCDecaux’s operation follows another deal closed on Wednesday by CN Logística. That company, specialising in logistics for the health, food, consumer goods, industrial and promotional sectors, has leased a warehouse spanning 7,400 m2 in the town of Parets del Vallès in the province of Barcelona, which has been advised by Forcadell.

In Cataluña, logistics demand grew by 50% during the first quarter of the year with respect to the same period in 2017. Until March, 187,000 m2 of land was leased in the Mediterranean region, according to data from the consultancy firm Cushman&Wakefield.

The volume leased during the first quarter was also 73% higher than the quarterly average for the last five years. In Barcelona alone, eighteen transactions were closed during that period, 38% more than the thirteen operations that were signed during the same period a year earlier, according to a report prepared by Savills Aguirre Newman.

By area, 44% of the operations were closed in the Barcelona and Baix Llobregat areas. Similarly, the volume of space leased in counties such as Vallès also rose, to account for 38% of total demand in Cataluña during that period, and in other areas with logistics activity such as Camp de Tarragona, Penedès and Girona.

In addition, the average size of the space leased during the first quarter grew by 8% and amounted to between 10,000 m2 and 12,000 m2. Prime rents in Barcelona currently amount to €6.50/m2, which represents a YoY increase of 8%.

Original story: Eje Prime (by Berta Seijo)

Translation: Carmel Drake

Protecmed Buys a 1,300m2 Logistics Warehouse on Outskirts of Barcelona

14 May 2018 – Eje Prime

Protecmed is strengthening its logistics presence in Barcelona with a new warehouse. The engineering firm has acquired an industrial complex with a total surface area of 1,309 m2 and an outdoor patio area measuring 600 m2 on the El Plà de Bruguera industrial estate, located in Castellar del Vallès, according to a statement issued by the company.

The environmental engineering company, which specialises in solutions for treating drinking water and wastewater, has strengthened its presence on the outskirts of Barcelona with this purchase. Nevertheless, the company, which is undergoing an internationalisation process with projects around Europe, as well as in South America and North Africa, has established its headquarters in Sant Cugat del Vallès.

Located forty kilometres from Barcelona, Protecmed’s new warehouse represents another yet investment in the logistics market in the Catalan capital. During the first quarter of 2018, logistics absorption grew by 50% in Barcelona, with 185,982 m2 of space leased in total, according to data from the consultancy firm Forcadell. 

Original story: Eje Prime

Translation: Carmel Drake

Pontegadea Lets 3,000 m2 of Office Space in Barcelona to Lidl

2 May 2018 – Eje Prime

Pontegadea, the real estate company owned by Amancio Ortega, is continuing to make its investments in Barcelona profitable. The group has just closed the rental of some of its office space, spanning more than 3,000 m2, to the German supermarket giant Lidl, according to market sources speaking to Eje Prime. Pontegadea has rented part of a building that it owns in Plaza Catalunya, in the centre of Barcelona, which it purchased from BBVA in 2013 for more than €100 million.

Lidl is going to occupy four floors in the building, which together span a total surface area of 3,155 m2. Currently, the building, which was originally intended to house the corporate headquarters of a large group, is being marketed on a floor by floor basis. On the lower storeys, the property is home to one of the flagship stores that Zara has in the centre of the Catalan capital.

Following this rental operation, which has been brokered by the real estate consultancy firms JLL and Forcadell, Lidl is going to sublet the space from BBVA (given that, for the time being, the rental contract is in the name of the banking entity) in order to locate its offices in the centre of the city. The property is going to house the e-commerce and CRM teams, which will serve the group’s business throughout Europe. Although the most iconic part of the building is located in Plaza Catalunya, the building’s entrance is located at number 13 Calle Bergara.

In this way, Lidl is continuing to generate work for the real estate sector in Spain. As Eje Prime revealed, the German supermarket chain has recently put up for sale its portfolio of real estate assets in the country. More than 109,000 m2 of retail space, industrial assets and land, which the German giant has acquired since it first arrived in Spain in 1994 form part of the package put up for sale by the company.

To carry out this operation in Spain, where the company is also purchasing new land, Lidl attended the Barcelona Meeting Point real estate fair in October, where it had one of the largest stands in the room, which it used to explore real estate agreements, including the sale of part of its property portfolio (…).

Lidl has been operating in Spain for more than 22 years, during which time it has invested almost €2.6 billion in the purchase of land, retail premises and store openings. Now, the company has initiated a new phase of expansion and so it is looking for properties, including both industrial and commercial land (…).

The office business is growing in Barcelona 

Leasing of office space grew by 20% in Barcelona during the first quarter of 2018 with respect to the same period in 2017, and forecasts indicate that this business is going to continue to grow over the coming months. The city recorded a leasing volume that was 17% higher than the quarterly average for the last five years, whereby confirming the strong demand.

Of the 125 operations signed during the first few months of the year, 7% corresponded to contracts for spaces spanning more than 2,000 m2. Most of the space leased (47%) was signed in New Business Areas, with the leasing of new space by companies such as PepsiCo and Securitas, which moved into a stock that today has an occupancy rate of 93%, as revealed by Eje Prime.

Meanwhile, the Paseo de Gracia-Diagonal area and city centre closed the quarter with a joint market share of 37% of the total space leased. The remaining 16% opted for projects located on the outskirts of the city (…).

Original story: Eje Prime (by Custodio Pareja)

Translation: Carmel Drake

Forcadell: RE Investment Fell by 3.5% in 2017 to €13.5bn

27 February 2018 – Eje Prime

Investment in real estate continued to perform well last year but actually fell with respect to 2016. In total, €13.5 billion was invested in the domestic real estate market in 2017, which represents a decrease of 3.5% compared to the €14 billion that was registered during the previous year, according to data from the consultancy firm Forcadell.

Spain was the fourth-ranked country in Europe in terms of the most money received in the sector, behind only Germany, France and the United Kingdom, in that order. Moreover, Madrid and Barcelona were the two cities that received the most demand, accounting for 85% of the total capital invested in the domestic real estate market last year.

The office market was the sector that stood out the most in terms of investment volumes. And within that sector, Madrid and Barcelona, which together captured €2.455 billion of investment, were the main drivers of the segment, accounting for 95% of the total. In those two cities, prime rents reached 4.25% in Madrid and 5% in Barcelona.

On the other hand, the good performance of the housing sector also allowed an upturn in the residential sector, which saw investment of €3 billion in 2017, a level of activity not seen in that market since 2008, according to the consultancy firm. Besides the two major capitals, Valencia, Sevilla and Bilbao were the three cities that saw a significant increase in the field of residential development.

The logistics sector was the most profitable

One of the areas that is growing by the most at the moment in the Spanish real estate market is the logistics sector. Despite having the lowest rents per m2, the segment offers great returns from the point of view of real estate investment. The strong leasing figures and scarce supply close to large cities are generating interest from funds, primarily international players, who want to build new large industrial spaces measuring between 3,000 m2 and 50,000 m2, to rent them out.

Retail, on the other hand, continued its record figures from 2016 throughout last year with an investment volume that reached €4 billion. Moreover, land became very sought-after once again in the real estate sector, which had great demand, above all, in the residential market.

Looking ahead to 2018, Spain is expected to continue to represent a country of great interest for real estate investors, both domestic and international. Moreover, Forcadell forecasts that fundraising will increase significantly, both in terms of the number of players involved and the volume disbursed.

Original story: Eje Prime

Translation: Carmel Drake