The growth cycle, started in 2014, should continue during the next few years, in particular in the real estate development and new construction sector.
The leaders of REITs Merlin and Colonial and developers Neinor, Aedas, Metrovacesa and Vía Célere told Cinco Dias that there was a very fast recovery of the commercial real estate market, with record investment in the last few years, namely due to the creation of the REIT regime and the increasing interest from international investors.
For Ismael Clemente, managing director at Merlin Properties, «external events, such as a world geopolitical and economic shock, or a strong slowdown in China’s economic growth which ends up affecting Europe or the tension because of the situation in Catalonia» may be some of the threats to the sector. «It is uncertainty that "kills" the markets and the economy in general, especially the legal uncertainty caused by the sudden change in political and economic orientation from governments».
For Juan José Brugera, Colonial’s CEO, the sector’s evolution happens in parallel with the economy, «although this evolution is more moderate in terms of growth, the “fundamentals” that boost the Spanish economy remain firm and solid, with no expected change during the coming two or three years».
The recovery was slower in the housing development sector. However, the market is still in a «large positive cycle, notwithstanding some one-off correction, based on a strong demand for new constructions», comments David Martínez, Aedas Homes’s CEO. «The lengthening of this cycle depends on all the actors who take part in it».
Juan Velayos, Neinor Homes’s CEO, believes that «there is a balance between offer and demand, which, it seems, will extend for the next 2 to 3 years. It’s likely that this period will keep registering a positive development», but the sector should «build a stable market, despite the economic cycles, which is less prone to its effects».
For José Antonio Gómez-Pintado, the sector’s growth is unlikely to stop in the mid to long term. «The only circumstance which could refrain this growth would be the lack of terrains, which would limit the developers’s ability to build new housing, and hence meet the demand’s needs with competitve prices».
It is certain that there is «a positive dynamic in the residential market, with fundamentals which remain solid, supported mainly by a strong labour market and the dynamics of the mortgage market», says Jorge Pérez de Leza, Metrovacesa’s CEO. «The economy keeps growing at a healthy pace and, despite some signs of deceleration, we estimate at least 3 more years of economic growth».