In a sector as established as the real estate sector, what does Testa Homes bring as an innovative or unique compared to the competition?
Our differentiated offering is that we’ve built a professional, efficient and tenant-focused multifamily platform, which is unusual in this sector. As an established player in the market with over ten years’ experience, we have always been committed to transforming the operating model: we manage the entire rental cycle with our own technology and teams, and standardising processes has enabled us to provide speed, transparency and quality to our tenants.
Furthermore, because we own the buildings we manage, we can take a holistic approach to maintenance and refurbishment, enhancing the resident experience. This has enabled us to achieve a stabilised occupancy rate of 97% and reduce vacancy times, improving our rotation and response capacity.
We are also committed to innovation and sustainability and offer Spain’s leading technologically led multi-family platform. We have delivered initiatives such as a tenant portal, digital keys in more than 4,000 homes, more than 4,200 solar panels installed across 63 buildings, 15,000 energy-efficient LED lights as well as a 100% green energy supply. In summary, we’re raising the bar on what tenants in Spain can expect through a robust, modern and service-oriented model.
How did you become a leader in the rental sector? What were the main milestones in the transformation of the company?
Our strong performance is thanks to a lot of hard work. We started with a traditional management model, as has been the norm in the sector, and decided to fundamentally transform the way we operate by standardising processes, developing our own technology and using data to drive better decision making.
This has helped us to fine-tune every stage of the rental cycle, from the moment a property becomes vacant until it is occupied again, reducing void time, driving efficiency and, most importantly, significantly improving the quality of the service we offer to our residents.
Today we have a modern, technologically-supported platform, capable of scaling and adapting to an increasingly demanding market, with a management team uncompromisingly focused on the resident experience. This is what has positioned us as a leader within the sector, and proven that not only is multifamily renting possible in Spain, but it can also thrive.
You have indicated that the new institutional supply of multifamily remains relatively low in Spain. What structural barriers continue to limit the growth of professionalised rental, and what is needed to unblock it?
In recent years, we have seen growing interest in the rental market in Spain as it offers solid fundamentals and stability in future cash flows. Despite the fact that capital inflows are growing, especially in segments such as multifamily, we still have a way to go to compared to certain European markets such as Germany or the United Kingdom, where investment in the residential sector is double or even triple what it is in Spain. This leaves us with an enormous margin for growth in our sector, and the need to attract the necessary capital to further professionalise the rental market and unlock its full potential.
To attract more capital, we need to continue to offer stability and a robust legal framework. One that is committed to political consensus and dialogue and encourages investment, with clear, predictable long-term rules. One that reinforces public-private collaboration and provides certainty in urban planning and administrative procedures.
Regarding the legal obstacles and inefficiencies in the licensing process that create major bottlenecks to encouraging new construction. In your opinion, what changes would make the biggest difference to speed up housing delivery?
Although the latest figures from the Ministry of Transport and Sustainable Mobility show that new building permits grew by 17% in 2024, the pace of construction is still too slow to meet current demand. Against a backdrop of rising prices and a housing shortage, we cannot rely exclusively on new construction.
This is where Testa Homes comes into play. By refurbishing existing buildings and giving them a new lease of life, we can avoid the long lead times involved in the transformation of land, and bring new housing to market faster and more efficiently.
We’ve invested 280 million euros across our portfolio in two main areas: 200 million euros to renovate 75% of our residential stock - equivalent to a unit investment of 14,000 euros per home - and 80 million euros to improve common areas, with the creation of 145 new ‘amenities’.
While these actions directly benefit our tenants, they also contribute to environmental sustainability and revitalising the urban environments in which we operate.
75% of your portfolio is concentrated in Madrid. Are you planning to expand to other areas or market segments?
Indeed, Madrid is currently the core of our business, where we currently have 10,000 homes under management, and is seeing strong growth in the number of people choosing to live in multifamily properties. However, we are keeping a close eye on other cities such as Valencia, Malaga and Seville, which have great potential for population growth and economic dynamism.
In terms of asset type, our focus is on the multifamily or traditional rental segment, but we are exploring opportunities in alternative assets, such as flex living. Furthermore, at Testa Homes, we manage both free and subsidised housing, and one of our core objectives is to support the pipeline of affordable housing stock in Spain.