Investment in residential property assets in Spain rose by 13% to €444.21 million in the first quarter (Q1) of the year, according to a new report by real estate investment manager CBRE.
The report revealed that the total sum invested in property assets in Spain reached €3.417 billion, 50% more than Q1 of 2016.
Retail premises experienced the most growth, accounting for 40% of the total investment. There have been a number of large scale investments in commercial centre projects in Spain by international companies; British developer Intu has plans to invest €550 million in creating a new shopping and leisure centre complex on the Costa del Sol. In total international investors accounted for 70% of the total amount of investment made, the report shows.
Spain has long presented an ideal option for investment but none more so than in the last year; large scale companies are looking to leave the UK due to Brexit and set up headquarters in Madrid. In fact, Madrid accounted for 28% of total investment in Spain last year. Other favourite investment destinations were Barcelona (16%), Las Palmas, Fuerteventura, Mallorca, Málaga and Valencia (7-8%), according to accountancy firm EY.
The acquisition of office premises accounted for 19% of total investment and hotels 17%. Spain has succeeded in climbing the rankings and becoming the third most attractive country for hotel investments behind Germany who came second and the UK who, despite uncertainties from Brexit, came first, according to a different survey by CBRE.
Residential property, logistics and other trophy assets accounted for 13%, 7% and 4%, respectively.
The pace of property asset investment will slow over the rest of the year, according to financial website The Corner, but the high levels of liquidity in the market combined with a lesser degree of political uncertainty, will allow annual investment to rise higher than in 2007 to nearly €10 billion.