Torre Spínola KF
Investment was concentrated mainly in Madrid, which closed the year with a yoy increase of 28%, surpassing 2.300 million euro, whereas Barcelona reached close to 1.500 million euro.
This is the conclusion that can be taken from the last Snapshot Oficinas (Office Snapshot) compiled by real estate consultant Knight Frank, which remarked that «2019 was an historical year for the office segment registering the best numbers in terms of investment, while increasing the uptake when compared to 2018».
The report explains that this increase was caused by the fact that the office segment keeps being a goal for investment funds, which maintain their bet on it and were responsible for 50% of the operations in Madrid and Barcelona. The investors’ appetite is clearly shown by the yields’ contraction, which reached 3.50% in Madrid and 3.75% in Barcelona.
Partner and Head of Commercial at Knight Frank, Jorge Sena, explained that «currently, the market is characterised by an enormous liquidity and lack of product, both in the core and the value-add segments. Demand remains at a good level, despite the offer being unable to follow it in terms of new projects, guaranteeing a positive evolution for rents in all areas. This generates confidence in investors, especially within the Madrid office market and we are sure that a good product with solid tenants in a prime area can generate returns close to 3%, given the existing level of competence».
During the last months of the year, the CDB (Central Business Distrit) was once again the area where more terrains were contracted and where the most transactions took place, followed by the Secondary Centre and the A1 and M30 surrounding areas. The average prime rent was set at 31 euro/sqm/month, with the areas within the CBD registering the highest average rent, 35 euro/sqm/month.