Investments in Zaragoza’s Logistics Sector Up 400%

14 November 2019 –In the first nine months of the year, firms in Aragon have invested 128 million euros, an increase of 400% compared to all of 2018. Investments in October and November have so far added another 45 million euros to the tally. The figures have established Zaragoza as a major logistics pole after Madrid and Barcelona, accounting for 10% of the investment in Spain as a whole.

A study prepared by CBRE notes that the increase is largely tied to two major transactions in the Plaza logistics centre, involving a total of 145,000 square meters. The deals have typically offered returns of between 5% and 6%.

Original Story: Heraldo – Chus García

Adaptation/Translation: Richard D. K. Turner

Developers Focus on Spain’s Largest Cities as Smaller Towns Are Left Behind

8 November 2019 – The recovery of the Spanish property market since its nadir in 2013 has been relatively slow and concentrated in the country’s largest cities. In that year, developers applied for just 34,000 construction permits to begin work on the development of new homes. The year 2006 saw the last decade’s peak of a staggering 860,000. Last year, municipalities issued 100,351 new permits, when market sources state that Spain’s needs between 100,000 and 150,000 per year to keep up with demand.

The recovery, however, has been limited to the country’s largest urban centres. Major developers have so far largely ignored Spain’s smaller cities and towns, leaving any needed construction there for much smaller, local builders with limited financial capacity.

Last year, developers concentrated the majority of their investments (51.6%) in just five provinces: Madrid, Barcelona, ​​Malaga, Alicante and Bizkaia, which together account for just 36% of the country’s inhabitants. Ten provinces account for 65% of the homes built, while another 40, which account for 45% of the country’s total population, saw just 35% of the requests for new construction permits.

Original Story: Cinco Dias – Alfonso Simón Ruiz

Adaptation/Translation: Richard D. K. Turner

Residential Construction Falls in Barcelona

8 November 2019 – Crane rentals for construction projects fell by 8% in 2018, according to a new study by CBRE. While the cause of the fall is not clear, construction has primarily fallen in the residential sector. New residential construction projects fell by 4% this year, from 272 last year to 260 in 2019.

The construction of offices, hotels and commercial establishments rose by 37% to 37 projects, while there were another 25 projects involving residences for senior citizens and students.

Original Story: Catalunya Press

Adaptation/Translation: Richard D. K. Turner

Tightened Lending Standards Put Drag on New Developments

8 November 2019 – Developers are complaining of a lack of financing in the sector due to tightened lending standards and the high cost of alternative financing. Spain’s banks are looking to reduce their exposure to the real estate market, at a time when many of them still have extensive amounts of NPLs and REO on their balance sheets. At the same time, alternative financing vehicles often have interest rates reaching up to 10%, making many potential developments economically unviable.

A conference on financing and alternative investment in the real estate sector, organised by the IE Real Estate Club and the Urbanitae real estate investment platform, saw market sources discuss the problems facing the sector.

Developers argued that banks should provide more financing to that they can build the 150,000 homes a year the country requires. Currently, sources say that banks will only extend financing to only the largest developers who can 30% to 40% of the financing using equity. Smaller firms with less access to capital are often unable to get 100% for new developments.

Original Story: Expansión – Carlos Lospitao

Adaptation/Translation: Richard D. K. Turner

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

Spanish Government to Create Land Bank for the Development of Affordable Rental Housing

28 October 2019 – The Spanish Government announced that it was working on a plan to cede public land for the development of affordable rental housing through a series of auctions. The head of the Ministry for Development, José Luis Ábalos, stated that the ministry is working on a plan to auction the surface rights to public land for 50 years so that private developers can build and manage affordable rental housing. The government is looking to address the recent increase in prices.

The ministry is looking to create a single land bank, using land from several different ministries. The government hopes that this management model, if successful, will be replicated at a regional level.

Original Story: Cinco Dias

Adaptation/Translation: Richard D. K. Turner

Employment in Real Estate Sector Suffers Fall of 4.6% in the 3rd-Quarter of 2019

28 October 2019 – Employment in real estate sector fell by 4.6% y-o-y in the third quarter of this year, its first fall in six years. The number of people employed in real estate activities dropped to 150,200 professionals, according to data from the National Statistics Institute’s (INE) Active Population Survey (EPA).

The decline marked the first year-on-year drop since the second quarter of 2013, when employment fell by 16%, amid the European real estate and financial crisis.

Original Story: Eje Prime

Adaptation/Translation: Richard D. K. Turner

Contracted Logistics Space Reaches 1.9-Million-m2 in the Year to September

21 October 2019 – The Spanish logistics sector allocated 1.19 million square meters in the year to September, a decrease of 14% compared to the year before. At the same time, however, investments increased by 16% to €1.302 billion, according to data from CBRE.

The allocation of logistics centre in downtown areas reached 432,000 square meters during the same period, a fall of 31% y-o-y. The market, however, reacted calmly to the decrease, as other transactions are expected to be finalised this year, according to the consultancy. Contracted space is expected to reach 600,000 square meters this year.

Rental costs continue to lead the market in Madrid and Catalonia, at 5.5 euros and 7 euros/m2/month, respectively.

Original Story: La Vanguardia / Europa Press

Adaptation/Translation: Richard D. K. Turner

Stoneweg Sells a Penthouse for €5,550/M2 in Tetuan

15 October 2019 – Stoneweg has just sold a flat in one of the two high-rise apartment buildings it is building in Tetuán, Madrid. The Swiss firm managed to sell one of the penthouses for a record sales price of 5,500 euros per m2.  The two 25-storey towers are located at Paseo de la Direccion 246.

The three-bedroom penthouse, which a total surface area of ​​195 m2, sold for 60% above the average price for the district of Tetuán. The price is even above the average for the district of Salamanca, the most expensive in Madrid, at 5,148 euros per m2.

Original Story: Idealista

Adaptation/Translation: Richard D. K. Turner

Dark Clouds Gather Over Spain’s Real Estate Market as Housing Sales Fall by 21% in August

14 October 2019 Market watchers have been issuing warnings recently regarding a potential slowdown in Spain’s residential real estate market. After years of rapid growth, and after prices have reached new heights due to constrained supply, talk has turned to a moderation in growth or even some level of stagnation.

Last week, the country’s National Institute of Statistics (INE) released data on the sale of homes in August that seemed to confirm such fears. A total of 35,371 housing sales occurred in Spain in the month, the lowest figure since August 2015. The retrenchment affected both the sales of new (-21%) and existing homes (-21.1%), the latter of which accounts for approximately eight out of every ten sales. Monthly sales took a bigger hit, falling by 26.1% from July to August, the biggest decline for that month of the last five years.

Original Story: El Mundo – Marcos Iriarte

Adaptation/Translation: Richard D. K. Turner