68 / 110
68 // iberian.propery / 2017
dossier// ISSUE: TOP IBERIAN Investors
The Portuguese property market is currently showing un-
paralleled momentum. Investment opportunities are many
and diverse, across every sector. Due to relatively recent
laws, ranging from labour laws to favourable tax regimes,
as well as laws that impact real estate directly, Portugal has
been in high demand among corporations, investors and
individuals, whether to set up business, invest or live. If we
add the country’s fantastic intrinsic characteristics (climate,
cuisine, proximity to the ocean, low cost of living), as well as
those of its cities and the proficiency of its qualifiedworkforce
to speak several languages, we have a “
cocktail
” of benefits
that are hard to match!
Since none of this is possible without real estate, the res-
idential and office markets are running high and the best
investment opportunities involve property development in
these two sectors, although there is also a lack of new logis-
tics product. There is a great shortage of grade A offices to
accommodate the high demand from large occupants who,
beginning five years ago, decided to bring a significant part
of their services to Portugal. Furthermore, there is a growing
lack of residential product for Portuguese consumers who
do not have the purchasing power to live in the city centre.
And as the “
icing on the cake
”, the Portuguese economy has
displayed increasingly better indicators. In the first quarter of
this year, the GDP increased 2.8% compared with the same
quarter the previous year and unemployment dropped
below 10%. Much of this growth is due to Tourism, which
is another sector that presents excellent opportunities and
there are various investors ready to invest in anything that
has “
beds
”. Revenue from tourism in Portugal increased
10.7% in 2016 compared with the previous year, surpassing
12.6 billion euros.
The fact that Portugal has excellent universities, two of which
are listed in the ranking of the world’s top 50 universities,
has made the number of foreign students rise bymore than
75%, originating from more than 200 different nationalities.
The great challenge is to find “
investable
”, quality products in
every sector, since real estate development was stagnant for
many years. It is crucial to produce properties now that rents
are rising and prices in the residential market have reached
unprecedented levels. It also still remains a challenge to
mobilise large-scale financing, especially from Portuguese
banks, which almost all underwent restructuring in one way
or another and are only now beginning to breathe again
and slowly return to the market, although there are still
many past issues to be resolved. This may also represent
a good opportunity: banks are now recapitalised, with new
shareholder structures and, having recorded impairments
for a number of years, are now ready to come to market to
sell assets or loan portfolios now that the pricing gap has
also contracted.
In conclusion, there are many opportunities and the “
stars
are aligned”
, but we must tread carefully when climbing
the risk curve.
Francisco Horta
e Costa
CBRE Portugal
Managing Director
«The great challenge is to find “investable”,
quality products in every sector, since
real estate development was stagnant
for many years in Portugal»