Summer activity in Spain has recorded a high level of investment in real estate, with a volume of 3,000 million euros, and a cumulative figure of 10.3 billion euros since the beginning of the year.
If corporate operations, which were very important last year, are also taken into account, 2016 has exceeded the accumulated T1-T3 2017 by 3,000 million euros. These figures have been confirmed by the Investment Insight Spain report, prepared by consultants Cushman and Wakefield.
The volume of investment at the end of 2017 is expected to exceed 12 billion euros in a high, straight line that is expected to be very active, given the processes open in the market, and the energetic appetite of investors. The expected growth in production and employment for the next few years supports the potential profitability of purchasing in Spain. In any event, the search for quality assets that can meet the requirements of institutional investors is becoming progressively more arduous due to the shortage of quality products, which is common to other main locations of investment in Europe.
With a 30% share, in the volume invested in 2017, retail assets lead the rankings, and has been generated mainly by acquisitions of shopping centers.
Office assets remain the second largest asset with an investment volume share of 24% of the total volume in Spain. Investors are concentrated in Madrid and Barcelona, and account for 90% of the investment in this type of asset. In Barcelona all of the 2016 figures have already been exceeded, with a cumulative investment of 800 million euros, twice the record figures of last year.
The tourist sector maintains its attraction to hotels which show an exponential growth in investment. This has gone from an investment of 1.2 billion euros in 2016, to 2,000 million euros by the end of September 2017. The highest concentration of hotel acquisitions has been recorded in the areas of the Costa Brava, Costa del Sol, Palma de Mallorca, the Canary Islands, and Madrid.
Logistics assets have also attracted great interest, especially in cruise ships located in Madrid and Barcelona. The volume of investment in this type of asset has not stopped growing since 2012, and between T1 and T3 of 2017 there has been a volume of investment of 811 million euros, 100 million more than in all of 2016.
Investment in alternative assets has also been remarkable this year.
After a process of rapid compression of returns on all assets, these have begun to stabilize in the prime segment of retail and offices. This stability reflects a lower growth of capital values that is offset by growth in revenues. Other cases reflect stability in the price of assets. For assets such as hotels, logistics and alternatives, although there is still room for compression, demand will maintain at the high end in 2018.