Record real estate investments in first quarter in Spain

by Lorraine Williamson
real estate Spain

MADRID – In the first quarter of 2022, a record amount was invested in real estate in Spain. The expected total amount of €3.373 billion represents an increase of 136% compared to investments in the first three months of 2021. 

JLL, one of the world leaders in real estate and investment management, recently reported this. All real estate sectors are benefiting from this growth, but it has increased most strongly in the logistics sector. Rental housing, in which the highest amount was invested, also proved to be an attractive segment for investors in the first quarter, even outperforming the generally popular investments in offices and retail space. 

The increased interest from international funds in new-build homes resulted in a record amount of investment in this sector. At €1 billion, this was an increase of 147% compared to the first quarter of last year. The largest investment was made by the German fund Patrizia, which invested €600 million in 1,500 new-build homes for the rental market. 

Demand for distribution centres more than quadrupled 

The real estate market that grew the fastest in this first quarter was the logistics segment. An increase of no less than 430 percent has been registered here compared to the first quarter of 2021. The significant increase in online sales has resulted in a greater demand for logistics centres. JLL anticipates that €863 million has been invested in this quarter. The largest investor was EQT Exeter, which bought four distribution centres in Madrid and Guadalajara for around €280 million. 

This year, after a long period of uncertainty, investments in hotels are also making a comeback. In the first quarter, €921 million were invested, which is 130% more compared to the first quarter of 2021. According to real estate advisor JLL, investments in this segment will continue to increase from now on. 

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Largest real estate investment of the past 5 years 

The real estate investment forecast of €3.737 billion in the first quarter not only represents a recovery from the pre-pandemic investment level, but even exceeds the figures of the last five years and is even higher than the first quarter of 2017, when also a record amount of real estate investments were made. 

“Despite the current circumstances of inflation and geopolitical tensions, the outlook for the coming months is positive. Real estate is considered safe long-term assets,” said JLL. 

Last year the recovery of real estate investments in Spain started. Then there was an increase of 41% compared to the previous year and an amount of €12.658 billion was invested in real estate. 

Related article: Will Spain face real estate bubble in 2022?

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