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Spanish Property Investment Near Record Levels

Madrid, investment hotspot. Photo credit: cuellar / Foter / CC BY-NC
Madrid, investment hotspot. Photo credit: cuellar / Foter / CC BY-NC

Property investment in Spain hit 10,200 million Euro in 2014, second only to the boom year of 2007, explains an article in the Spanish daily El Mundo, based on a new report from the property consultants CBRE.

By quarter, the lion’s share of deals done in Spain last year were closed in the last quarter of 2014, suggesting that investor interest increased as the year progressed. 3,396 million Euro were investment in Spanish real estate between September and December, 50 per cent higher than the same period in 2013.

The increase in Spanish investment reflected the trend in Europe, where investment in property assets increased 32 per cent in 2013 to 218,000 million euros. In the last quarter alone it reached 78,000 million euros, the highest quarterly investment levels since 2006.

Spain lies in sixth place in investment ranking for the last quarter ahead of countries like Norway, Denmark and Italy.

New Debt

As far as property debt is concerned, the total amount in Europe went up by nearly 23,000 million Euro in 2014, to 978,000 million. According to CBRE, new debt issued in 2014 increased by 47 per cent compared with 2013, although in absolute terms this figure is lower than half the amount in 2007.

The consultancy firm explains that this rise in new debt is because of the increase in the size of the property investment market. The total value of investment transactions in Europe increased 32 per cent last year to reach 218,000 million euros.

Furthermore, there has been an increase over the last year, particularly in Spain, of high risk investors using leverage to boost their their returns.

CBRE’s conclusions, which include residential investment, back up a recent report from BNP Paribas showing that commercial real estate investment in Spain surged 85% last year, meaning that 2014 Was A Record Year For Spanish Commercial Property Investment.

Spanish Property Insight adapts and translates selected articles from the local press for the benefit of non-Spanish speakers.

This adaptation / translation is based on the following article (in Spanish): La inversión inmobiliaria en España se anota una cifra récord

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