C&W: More Than 300,000 m2 of Logistics Space was Leased in Q1 2019

5 April 2019 – Eje Prime

According to a report published by Cushman & Wakefield, the volume of logistics space leased in Barcelona rose by 21% YoY in Q1 2019 to 227,000 m2. Meanwhile, in Madrid, 73,700 m2 of logistics space was contracted during the first quarter.

According to the consultancy firm, fifteen operations were closed in the Catalan capital during the first three months of the year and rents rose to €6.75/m2. Moreover, in Madrid, rents continued their gradual increase to reach €5.25/m2 in prime areas.

Original story: Eje Prime 

Translation/Summary: Carmel Drake

JLL: Investment in Offices in Barcelona Amounted to €611M in 2018

21 March 2019 – Eje Prime

According to the consultancy firm JLL, direct investment in the office sector in Barcelona amounted to €611 million in 2018. That figure represented 24.4% of the total investment in office spaces across Spain, which amounted to €2.6 billion. Direct investment in offices in Madrid reached €1.9 billion last year.

In Barcelona, the largest operation of the year in the office segment saw Blackstone acquire the Planeta building for €210 million.

Meanwhile, 356,000 m2 of office space was leased in the Catalan capital, up by 8%. The real estate firm forecasts an upwards trend with the leasing of office space amounting to 360,000 m2 in 2019, 368,000 m2 in 2020 and 370,000 m2 in 2021.

In terms of rental prices, prime rents grew by 8.6% in 2018 to reach €25.25/m2/month on average. JLL forecast that rents will rise by 5% p.a. until 2021 to €30.34/m2/month within five years.

Original story: Eje Prime 

Translation: Carmel Drake

CBRE: 100,000 m2 of Logistics Space was Leased in Zaragoza in 2018

12 March 2019 – Eje Prime

According to data from CBRE, 100,000 m2 of logistics space was leased in Zaragoza in 2018, up by 10,000 m2 compared to 2017. Most of the space was  absorbed by turnkey projects, and the majority of the new contracts were signed for spaces released by companies relocating to new sites.

The largest operation of the year involved the sale of two plots spanning 40,000 m2 on the Plaza industrial estate.

Demand is expected to remain active this year, right across Spain, boosted, in particular, by the emergence of e-commerce, which will continue to drive demand for urban hubs spanning between 3,000 m2 and 5,000 m2.

Original story: Eje Prime

Translation/Summary: Carmel Drake

CBRE: 1.9 million m2 of Logistics Space was Leased in 2018

29 January 2019 – Eje Prime

The logistics wave is showing no signs of letting up. Leasing in the sector amounted to 1.97 million m2 last year, a historical record, according to CBRE. The data includes Valencia, Zaragoza, Sevilla, Málaga, the centre of the country and Cataluña.

Meanwhile, investment in the sector amounted to €1.5 billion. The consultancy firm highlighted that the high demand and available supply is causing a boom in projects, above all in central areas of the country.

This mismatch between supply and demand is also driving up prices: prime rents in Madrid and its area of influence rose by 5% to €5.50/m2/month, whilst in Cataluña, they rose by 8%, to €7/m2/month.

Original story: Eje Prime 

Translation: Carmel Drake

French Fund Ojirel Buys a 7,360m2 Warehouse in Madrid

6 November 2018 – Eje Prime

International funds are continuing to back the Spanish logistics sector. The investment firm Organa III, created by the French real estate investment company Ojirel, has just acquired an industrial warehouse spanning 7,360 m2 in Madrid.

The asset, located in the municipality of San Agustín de Guadalix, was owned by a Spanish company specialising in logistics services. The contract specifies that the warehouse will continue to be operated by its previous tenant, a German multi-national specialising in automotive spare parts, for five more years.

The operation, which has been advised by the real estate consultancy firm Iremcap, “shows the growing interest from French real estate investment funds in the acquisition of real estate assets in Spain”, according to sources at the consultancy firm.

Madrid is one of the magnets in the country for logistics investors. Although the spectrum of the sector is increasingly broad and is spanning increasingly more regions, the area surrounding the Spanish capital is the most attractive for 63% of those surveyed in the latest edition of the International Logistic Fair (SIL), which is organised every year by the company Prologis.

That is also reflected in the numbers. 632,000 m2 of logistics space was leased in the Spanish capital during the first half of 2018. Similarly, more than half of the assets leased corresponded to warehouses with a surface area of more than 20,000 m2, according to the latest report published by CBRE.

Due to the boom in e-commerce, in particular, the market for industrial centres and warehouses in Spain is currently one of the strongest in Europe. Despite the high demand for assets, in cities such as Barcelona and Madrid, just 4% of stock is available, which is driving up rental prices. The experts indicate that the main challenge facing logistics firms between now and 2022 is how to “adapt existing properties to the new needs of companies”.

Original story: Eje Prime (by B. Seijo)

Translation: Carmel Drake

CBRE: Office Leasing in Madrid Records Best Third Quarter for a Decade

17 October 2018 – Real Estate Press

The office market in Madrid recorded its best quarter of the year between July and September with almost 142,000 m2 of office space leased. That figure makes it the sector’s best third quarter for a decade, according to the latest data published by the real estate consultancy CBRE.

“Leasing figures during the third quarter are traditionally characterised by less activity due to the holiday period, so this latest data highlights the strength of the office market in Madrid”, says José Mittelbrum, National Director of A&T Investor Leasing Offices at CBRE España. “Looking ahead to the end of the year, it is very likely that, if some of the large deals currently active in the market are closed, then 2018 will see office leasing figures in Madrid very similar to those of 2017, which amounted to more than 600,000 m2, figures that have not been seen since 2007”, added Mittelbrum. Since January, almost 400,000 m2 of office space has been leased, the best figure since 2008.

Increase in rents

The increase in demand, boosted by demanding occupants with respect to the quality of the properties, and the reduction of the available supply, especially in renovated buildings and new properties in the central business district (CBD), led to a YoY increase of 9% in prime rents during the third quarter of the year to around €33/m2/month.

Empty space in high-quality Grade A buildings has decreased by 26% over the last year, which has led to situations of competition between several candidates for the same building.

Since the lowest point of the previous cycle, prime rents have grown by 35%. Other submarkets are also rising: average rents, calculated on the basis of actual operations, between July and September, increased in all submarkets with increases of more than 30% in the CBD and Secondary Centre (inside the M-30) and of between 15-20% on the Northern (A-1) and Eastern (A-2) axes of Madrid. Rising rents and the prospect that this trend will continue is one of the reasons why the office market in Madrid is the priority objective for a large number of domestic and international investors.

Notable operations

Madrid Norte saw significant activity in the last quarter, with two high-profile operations: the rental of the Oxxeo building in Las Tablas to Cap Gemini (9,300 m) and the rental of 7,000 m2 in Torre Chamartín by Deloitte; both new build properties.

The Public Sector reaffirmed its return to the Madrilenian office market, by closing two of the ten largest operations in the third quarter, namely, the rental of 4,200 m2 in the Agustín de Foxá, 25 building by the Ministry of Finance and of 2,400 m2 in Fray Luis de León, 11 by the Community of Madrid.

Finally, the flexible space operators continued their expansion: WeWork moved into Castellana, 77 to occupy more than 4,600 m2 in that building, the first to obtain the WELL Qualification in Spain. It is worth highlighting that so far this year, 10% of the office space leased in Madrid was taken up by flex-space companies, compared with 4% in the third quarter last year.

Available supply

At the end of September, the available surface area in the Madrilenian office market amounted to around 1.22 million m2, equivalent to 9.7% of the total stock of offices in the capital, compared to 11.7% a year earlier.

Over the coming months, investors’ commitment to reposition existing offices means that iconic buildings are going to come onto the market such as the Los Cubos building in Plaza de España and the Axis building in the heart of Plaza de Colón (…).

Original story: Real Estate Press

Translation: Carmel Drake

Telefónica Seeks Use for 11,000 m2 of Offices After Failure to Find Tenant

2 October 2018

The telecommunications company put its North Building 3 up for lease a year ago. As yet, the company has found no takers willing to pay 16 euros per square meter per month.

It was heralded as a major real estate transaction: Telefónica announced that it was looking for a tenant or tenants for one of the buildings in the tower complex comprising its headquarters in Madrid that were left unoccupied after the company’s restructuring in recent years. The firm is now looking for a use for the 11,000 square-meter space after it failed to find a tenant willing to pay the 16 euros per square meter per month requested.

In April of last year, the telecoms operator contacted Spain’s leading real estate consultancies asking them to bid on a contract to lease the company’s unused offices. Cushman & Wakefield was one of the firm’s chosen to find a tenant to monetise the empty building. The property has five floors (four upper floors and one below ground), 180 interior parking spaces and 11,112 square meters.

The market price for the leasing contract was stipulated at 16 euros per square meter per month, along with 5.50 euros/m2/month for condominium fees. Telefónica’s plan was to generate annual revenues of 2.1 million euros and income from condominium fees of 733,000 euros, a total of almost three million euros in rent.

However, official sources at the company confirmed that no interested parties have offered to take up residence in the building. China’s Huawei has demonstrated an interest but was unable to complete the move to the District, located in the area of Las Tablas, in the north of Madrid.

Building sales

Leasing the property is still considering a possible but, in the meantime, the telecoms firm presided over by José María Álvarez-Pallete is still looking other possible uses. “[We] are analysing different internal projects,” the provider stated, declining to rule out any alternatives. The firm had already considered using the space to house tech start-ups, both in-house and externally financed.

Sources at the company insist that they have not set a specific deadline to find a use for the building. The next-door North 2 is also currently unoccupied, and the possibility of leasing had also been considered previously.

During the last two years, Telefónica has sold several buildings in the city of Madrid. One in the neighbourhood of Argüelles went for about 25 million euros; another near the well-known Plaza de España sold for about €32 million, and its former headquarters in Rios Rosas Street raised €150 million euros for the telecoms and broadband provider.

The District, 10 years as Telefónica’s headquarters

The Telefónica District, formerly known as District C, was inaugurated in 2008, after three years of construction in an area of 370,000 square meters. The operator concentrated its activities in its new headquarters in a total investment of more than 500 million euros.

The need to transfer thousands of employees who had previously worked at dozens of sites left many facilities empty, some of which had been leased and many others owned. The latter were, for the most part, sold to try to finance some of the investment in the District.

Original Story: La Información – Jesús Martínez

Translation: Richard Turner

Barcelona’s Logistics Market Grows by 74% in H1, Boosted by e-Commerce

4 July 2018 – Eje Prime

E-commerce boosted the logistics market in Barcelona during the first half of the year. During the first six months of 2018, 390,678 m2 of logistics land was leased in the Catalan city and its surrounding area, representing an increase of 74.4% with respect to the same period last year.

According to data from Savills Aguirre Newman, e-commerce operators “are acting as the drivers of the market”. One example of this is the rental of a 48,000 m2 warehouse by the French operator Vente Privee (owner of the Spanish firm Privalia) in La Bisbal de Penedès.

During the first quarter of the year, 186,047 m2 of land was leased in the logistics market, whilst during the second quarter, that figure increased to 204,631 m2. In total, 36 transactions were closed during H1, compared with 22 during the same period in 2017.

“Another trend that has become apparent during the first six months of this year is that of turnkey projects, which have been undertaken in the Logistics Activities Zone (ZAL) as well as in the first industrial ring”, says Savills Aguirre Newman. These projects include the construction of a cross-docking warehouse for Cilsa and a warehouse for Saica in Sant Esteve Sesrovires.

In light of the increase in demand, the available stock in the areas closest to Barcelona is now less than 2.5%, according to the real estate firm, which is leading to the development of new projects.

“The lack of buildable land, as well as of constructed products, is leading new players, such as investment funds and property developers, to take positions in the logistics sector to incorporate new high-quality products”, adds Savills Aguirre Newman.

Another trend is the increase in the size of space leased per operation, with up to 8 transactions involving more than 20,000 m2 (compared with just two operations of those dimensions during the first half of 2017).

Original story: Eje Prime

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

Spain’s Logistics Crowns: From Madrid’s M-40 to the Port of Barcelona

24 April 2018 – Eje Prime

Madrid and Barcelona are the kings of Spain and their crowns attest to that fact. The two largest cities in the country are surrounded by three rings that, in addition to accounting for most of the country’s logistics traffic, provide clear answers to the three main questions being asked in the sector: what, how many and how are products demanded. The first ring is a testament to the strength of last mile delivery driven by e-commerce; in the second ring, a large proportion of products are stored on rotation; however,  the third ring, where the largest warehouses are located, saw the most space leased last year.

In general terms, 2017 was a record year for the logistics markets in Madrid and Barcelona. Together, both cities signed rental operations for space spanning more than 1.2 million m2, which represented an increase of 12% with respect to the figure from the previous year and the best result in the last decade, according to the Logistics – The revolution of a booming market report, compiled by the consultancy firm JLL.

The reasons for this boom in terms of transport and storage stem from the strong performance of the Spanish economy and, more specifically, the boom in e-commerce, which is starting to change the way the logistics market operates, in the knowledge that, over the next few years, demand for urban space to handle online purchases is going to double.

Madrid was the Spanish city that saw most evidence of the strong performance of the sector last year. In the county’s capital, 800,000 m2 of logistics space was leased in 2017, with 64 operations signed (21 more than in the previous year), twice as much as in 2016. This increase in the absorption of space was spread across the three rings that surround the autonomous region and the neighbouring provinces of the adjacent region of Castilla-La Mancha.

In the first ring, the M-40 and the M-50 account for most of the activity, with a high rotation of stock due to the last mile effect. In that enclave, towns such as Alcobendas, Barajas (with high demand due to its proximity to the airport), Coslada, San Sebastián de los Reyes and San Fernando de Henares all stand out. In addition, in this area, but closer to the capital, Vicálvaro and Getafe to the north and south, respectively, are also key locations.

The M-50 is in an intermediate point, which on its way out of Madrid has important places for storage and logistics distribution. With an average rotation rate, a large number of the warehouses whose markets have a regional reach are located in Fuenlabrada, Valdemoro, Alcalá de Henares and Torrejón de Ardoz, amongst other towns.

Amazon, from Toledo to the centre of Madrid

For buyers in the centre of Madrid to receive packages purchased on Amazon in a matter of hours, the second ring is fundamental. The e-commerce giant has set up shop in the Toledan town of Illescas, where it leased 103,000 m2 of space to store the immense volume of stock that it must have available for rapid distribution all over the Spanish capital.

Nevertheless, the ring that absorbs even more space of the so-called central area of the country is the third ring, accounting for 39% of the surface area leased last year. There, Leroy Merlin leased 60,000 m2 of space, after moving into the Meco Industrial Estate. At a distance of between 30km and 60km from Madrid, large warehouses serve as storage for operators who have lower stock rotation and an area of influence that normally spans the domestic sphere. In addition to Meco, in this space, towns such as Azuqueca de Henares, Seseña, Alovera and Ontígola stand out, amongst others.

The Port and El Prat: the key points in Cataluña’s logistics market

In Barcelona, the epicentre of the logistics centre is divided in two: the Port and El Prat. Both are located in the first ring of the Catalan capital and serve as hubs for intermodal and high stock rotation operations, according to the report from JLL. The international consultancy firm explains that this ring is the gateway to southern Europe for goods coming from the Far East and Southeast Asia, which means covering the whole Mediterranean Arc from this point.

There, cross-docking and freight activities that facilitate last mile delivery dominate. The Zona Franca and its logistics park, the air cargo centre at El Prat, Sant Boi de Llobregat, Viladecans and Mas Blau are some of the enclaves that are home to the first ring market.

Nevertheless, and despite the e-commerce boom, it was in the second ring around Barcelona where most logistics space was leased last year. That area was home to 55% of the 460,000 m2 total surface area leased in the Catalan capital, which represented a drop of 30% with respect to 2016.

Original story: Eje Prime (by Jabier Izquierdo)

Translation: Carmel Drake