ADOLFO RAMÍREZ-ESCUDERO, CBRE Spain President
CBRE expands its professional services offer to meet the growing demand for rental housing asset management. In order to achieve it, the company reached a commercial agreement with Zittus Management, specialised in housing properties’ management, administration and maintenance services, which will be executed by Zittus Management.
«Given the current growth in rental housing in Spain, institutional investors which invested in this segment are faced with a lack of operators specialised in managing this type of assets, who are also capable of managing large portfolios and have a vast geographical presence. At CBRE we have been acting so as to meet the growing demand for this service and support these companies in managing their assets», explained Adolfo Ramírez-Escudero, president of CBRE España.
«The arrival of institutional investors is only the first step towards the professionalisation of this segment, which up until now was characterised by an obsolete housing stock in the hands of private owners. This professionalisation continues with the construction (or BTR in the case of build to rent) or rehabilitation (in the case of Private Rented Sector or PRS) of dwellings which will be adapted to the needs and mindset of the occupant and is completed with the offer of a professionalised management service for those dwellings, which focuses on the user experience, as is already happening in other real estate segments, from hotels to shopping centres and office buildings», added Ramírez-Escudero.
The full management of rental assets allows owners to focus on daily services and actions, both in terms of supporting their tenants (such as managing contracts or solving incidents and complaints) and in terms of the building’s maintenance (management of service providers, adjustments and refurbishments, etc.). The service also includes the coordination of legal actions, when necessary, as well as marketing and communication campaigns which might be needed (for example, organising views for potential new tenants) for the marketing of those dwellings with an optimised rotation and all that is needed to maximize revenues and receive the best returns on investments.
For Joaquín Ros, Zittus Management’s president, «our goal is to boost the professional rental market in Spain. In order to do it, we developed a modern tech platform exclusive and self-managed on which, physical and legal planification, maintenance, development and marketing are all incorporated within a single system. All companies involved in the same process use the same platform, which provides a high capability of adaptation and reporting». He further added that «we have our own portal for marketing, besides integration with the main real estate portals. And the tenants have another portal, designed to provide fluid bidirectional communication, where information regarding the state of the contract is stored, where incidents can be reported and where products such as telecommunications, TV digital platforms, insurances, financing and an endless array of services which can provide a more comfortable stay, can also be stored».
Co-leading the development of this new specialised service – whose execution will be 100% in charge of Zittus Management’s team – is Alejandro Sancho, Zittus Management’s CEO, who has a trajectory of more than 15 years in real estate where he occupied leading positions at Anticipa Real Estate, Copernicus and Idealista, amongst others. Representing CBRE España, will be Samuel Población, national director of Housing and Terrains and Soledad López-Cerón, director of Property Management at the company which manages 11 million sqm in the Iberian Peninsula.
Rental housing in Spain
According to recent numbers from CBRE, the rental housing segment proved itself to be one of the most resilient against Covid-19. The pandemic arrived when housing investment was showing signs of robustness with investment in 2020 surpassing 1.7 billion euro in PRS and BTR, a yoy increase of around 4%. In light of the lack of PRS (finished and rented) product, interest for terrains to develop BTR increased. In fact, the BTR volume traded registered in 2020 stood out, surpassing 1.4 billion euro, which represents more than double the trade of 2019.
For Ramírez-Escudero, «the growth trend for rental assets will increase as access to buy houses becomes increasingly harder. In this sense, terrains for future build to rent projects will be amongst the most in demand in the coming years, without leaving behind the interest on the traditional build to sell model, lest we forget that new construction destined to be sold continues representing 12-14% of all dwellings sold».
Investment on the Spanish multifamily market will keep growing in line with the increase forecast for the rental housing segment. Between 2005 and 2019 the percentage obtained by the rental housing segment in Spain increased around 45% reaching 4.4 million units. Until 2024, it is expected to grow a further 15%, representing more than 27.3% of all of Spain’s housing stock, explained CBRE.