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13 June 2018 – ABC
The performance of the office sector in Madrid at the end of 2017 bodes well for a “historical” 2018. That is according to all of the investment indicators managed by the real estate experts. Some very positive data for the region, which consolidates the Spanish capital’s position as the most attractive place for companies to locate their headquarters. In fact, it continues to be the greatest magnet for securing capital in the office market with a business volume of €1,324 million – 61% of the aggregated total – compared with €835 million in the Catalan capital. In terms of rented office space, 570,000 m2 was leased in Madrid, compared with 300,000 m2 in Barcelona.
Those are the findings of a recent report about the sector compiled by the consultancy firm Knight Frank, which forecasts greater activity in the sector in Madrid this year due to the rotation of assets by the Socimis and funds to fulfil their business plans. In Madrid, more than 40% of the total investment in 2017 involved funds, which, together with the Socimis outperformed other real estate players during the second half of last year.
The notable differences between the two regional capitals have increased as a result of the effects of the political instability caused by the independence drive and the decrease in tourism that has hit Cataluña. The experts consulted highlight that the rate of company creation has decreased in Cataluña since last summer, whilst in the Community of Madrid, the numbers have increased, with more than 185,000 companies registered with the Social Security at the beginning of 2018.
“The Spanish capital continues to be the key location due to its wide range of opportunities. Net absorption has been increasing for several years and rental prices are still very competitive in comparison with the main European centres”, explains Raúl Vicente, Director of Offices at Knight Frank. Nevertheless, the experts indicate the path that the city should take to become a “super city”. “In terms of the major challenges that it will have to overcome, they include mobility, adaptation to the technological revolution that we are living applied to the service of the city, efficiency, access to housing and an office supply that is commensurate with international demand, amongst others”, highlights the report.
The average price of offices in Madrid’s CBD has been rising in recent years. Prices in the capital now exceed €8,000/m2 on average, whilst in Barcelona, they amount to €6,900/m2. The highest price paid last year was for the former Barclays headquarters in Plaza de Colón, which was purchased from Barclays by CBRE Global Investors for €14,000/m2.
Other notable operations stand out including the purchase of Torre Serrano by Infinorsa and the sale of the Isla Chamartín Business Park to Tristan Capital and Zaphir Asset Management for €103 million. Also, the acquisition of the Palacio de Miraflores on the Carrera de San Jerónimo for €60 million by Remer Investment and of the Los Cubos building by Henderson Park and Therus Invest for €52 million (…).
Original story: ABC (by Adrián Delgado)
Translation: Carmel Drake