Spring Market
Study 2018
Trends 2019
Spring Market
Study 2018
Trends 2019
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Economy
p. 7-12
Offices
p. 13-24
Retail
p. 25-32
Industrial & Logistics
p. 33-36
Investment
p. 37-42
Residential
p. 43-48
Development
p. 49-50
Tourism
p. 51-58
4
5
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Economy
Introduction
2018 met and exceeded all forecasts that
had been outlined earlier in the year. The
dynamism of activity was transversal to all real
estate sectors, demonstrating unequivocally
the attractiveness of Portugal as a target
market for a diverse range of players.
The investment market was the great star
in 2018 and returned to a record historical
investment volume, surpassing three billion
euros, closing the year with a very significant
growth of 77% compared to last year.
Investment market growth
2017 vs 2018
77%
Retail and office portfolio transactions were
the main drivers of this strong result, with the
main players being investors from France, the
United States, Spain and the United Kingdom.
Other prominent stars were the office
sector. With 206,000 sq.m occupied, in
the Lisbon office market demand levels
continued to rise, with the main indicators
of performance in growth. The increase in
average area to 900 sq.m is indicative of the
entry of large companies in Lisbon and the
various expansion processes, which in the light
of the positive economic situation have been
resumed in the last two years.
The Oporto market has also increased its
attractiveness to international investors and
developers. With tremendous development
potential, new high-quality residential projects,
hotels, office buildings and a strong focus on
student housing come from partnerships of
international investors.
Targets of a notorious transformation
through urban rehabilitation and opening up
to the international investment markets, the
cities of Lisbon and Oporto have gathered a set
of factors very favorable to the establishment
of companies and of foreign investment.
Destinations of choice for a growing number
of tourists year after year, of retail operators
who spread new concepts and new brands
almost daily, are now also an example of cities
that have adapted to new forms of life, new
consumer profiles and new generations.
From the focus on city mobility to the
expansion of real estate concepts to new
market areas, from improving infrastructure
to increasing government initiatives aimed
at attracting more foreign investment,
Portugal continues to position itself in the
European ranking of countries offering very
competitive investment opportunities.
In 2019, business and consumer
confidence levels are expected to remain
positive, but it will be a year with some
challenges ahead where we can expect an
inevitable decline in activity in some sectors
of the real estate market due to the scarcity
of product supply.
6
Nonetheless, 2019 will continue to
record high levels of demand especially for
projects promoting new tourism concepts,
for the residential housing market, as well
as alternative segments such as Student
Residences, Senior Living, Co-Living and
Coworking to raise interest of an diverse range
of international investors.
Note also for the approval at the start of
2019, of the decree-law regulating the entry
of SIGI (Portuguese REIT – Real Estate
Investment Trust) in Portugal, which intends
to be an important instrument in the raising
and application of capital.
2019 will be a year of strategic thinking
and opportunity management in order to
foster all the opportunities that our market
offers, while continuing to attract sustainable
foreign capital.
7
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Economy
in Europe
European Economic Context
G2
The projections for 2019, released
by the main financial organizations
point to a set of risks:
The private consumption component
experienced slowdowns throughout
the year as the rate of inflation
increased and produced effects of
reducing households’ purchasing
power. However, strong job growth
allows maintaining confidence levels
on a positive ground and sustaining
private consumption.
Inflation Rate 2005 - 2018
5,0
EU 28
Spain
4,0
Euro Zone
Portugal
3,0
2,0
%
Less favorable
international context
1,0
0,0
Increased protectionist
policy enforcement
-1,0
-2,0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
GDP Evolution 2017 - 2019
Financial scenario
with more restrictive
conditions
Source EUROSTAT
3,5
Germany
Euro Area
France
Spain
3
Italy
Portugal
2,5
Possible worsening
geopolitical tensions
Unemployment Rate 2009 - 2023
%
2
30,0
1,5
Euro Area
20,0
0,5
%
0
2017
2018
G1
15,0
2019
Source FMI | BPI
Although 2019 is also a slowdown in
the European economic context, the
Portuguese economy is expected to
continue its growth trajectory, albeit
at a less accelerated pace.
Spain
25,0
1
Generalized uncertainty
in the global economy
and politics
Portugal
10,0
5,0
Once verified a growth of 2.5% in
2017, forecasts predict that Germany
will close 2018 with a growth of
1.6% and 1.9% for 2019, confirming a
pronounced slowdown in its activity
economic development.
8
G3
0,0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Source FocusEconomics
9
The unemployment rate continues its
downward trajectory, and to close in
pre-crisis figures.
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Portugal
Highlights
Economics Projections
8,0
7,0
6,0
%
5,0
+2.1%
(variation rate)
GDP
+2.3%
(variation rate)
Private consumption
4,0
3,0
G4
2,0
Employment should continue to
evolve, reflecting the growth of the
private sector, and it is also expected
to decelerate employment in the
public sector.
The unemployment rate is expected
to remain around 6.7% in the fourth
quarter of 2018 and 7% on average for
the year as a whole.
1,0
0,0
2018 (p)
2019 (p)
2020 (p)
2021 (p)
Source Bank of Portugal
GDP
Private Consumption
of Consumer Prices
Exports
Gross fixed capital formation
Employment
Imports
Harmonized Index
Unemployment Rate
G5
1.4%
Monetary and Financial Indicators 2009 - 2023
Inflation rate
15,00
Euribor – 3 Months
Treasury bonds – 10 years
10,00
7%
Unemployment rate
%
For the Portuguese economy, the most
recent forecasts published by the Bank of
Portugal point to a maintaining growth,
at a slower but steady pace, with the main
highlight being the maintenance of solid
growth in tourism exports in the coming years.
During the year 2018, the national
economy remained stable and in a positive
climate, given some international risks. The
favorable conditions of the financial markets,
the dynamism of the labor market and the
confidence levels of the economic agents
were maintained.
Particularly noteworthy is the reduction
of the unemployment rate to an expected
7% and with more pronounced reduction
forecasts for the next three years, which
could put the unemployment rate in 2021
around 5.3%.
5,00
0,00
2,2%
Employment rate
-5,00
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Source FocusEconomics
10
11
According to the data from the Bank
of Portugal, national public debt stood
at 244.9 billion euros, with the public
debt to GDP ratio expected to fall to
121.2% by the end of 2018.
In consumer credit, the application of
more restrictive rules to the granting
of credit to households, particularly
housing loans and consumer credit,
came into force in the second half of
2018. Notwithstanding, the application
of this measure recommended by
the Bank of Portugal to banking
institutions, did not halt the evolution
of credit growth to households.
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Offices
G6
Monetary and Financial Indicators 2016 - Dez 2018
3
Loans to individuals and non-financial corporations
Interest rates on bank loans – individuals, housing, new operations
2
%
1
0
-1
-2
-3
2016
2017
sep 2018
oct 2018
nov 2018
dec 2018
Source Bank of Portugal
12
13
A12
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
CRIL
PARQUE
DAS
NAÇÕES
AIRPORT
IC16
Lisbon Office
Market 2018
TELEPERFORMANCE
AGUALVA–CACÉM
CORIANT QUELUZ
PORTUGAL
■■ 8,000 sq.m.
■L■ARZone 5 (Parque das Nações)
IRCU
2ª C
■■ Infante Dom Henrique 342
AMADORA
■■ 8,487 sq.m.
A9
■■ Zone 6 (Western Corridor)
■■ Office Park Carnaxide
Trends 2019
For the second consecutive year, the
Lisbon Office Market hit a new record. At the
end of 2018, 206,428 sq.m. of office space was
occupied, an increase of 24% compared to the
previous year and a total recovery compared
to the historical figures observed in 2007
and 2008.
The recovery of the occupational market,
starting in 2014, translates into a high level
of demand, in which the great occupants are
beginning to have a very important weight
and also contribute to the prestige of Lisbon
in the international context.
In 2018, companies such as
Teleperformance and Google were among
the entities responsible for the largest
operations registered in the Lisbon office
market. In the case of Teleperformance,
it continued to absorb more surface for
the installation of its offices in Lisbon and
Google that elected Lagoas Park in zone 6
(Western Corridor) for the installation of a
Operations Center for Europe, Middle East
and Africa.
The continuous evolution of Lisbon as a
tourist destination along with the numerous
factors of attractiveness and competitiveness
offered comparatively to other European
capitals has been fundamental to increase the
perception of Lisbon as an ideal destination
IP7
A16
BENFICA
CHELAS
TELEPERFORMANCE
ENTRECAMPOS
STATION
■■ 7,779 sq.m.
■■ Zone 3 (Emerging Zone)
■■ Open’s Building
IC19
N117
A5
Google
A5
CRIL
■■ 5,162 sq.m.
■■ Zone 6 (Western Corridor)
■■ Lagoas Park
for the implantation of the headquarters of
large international occupiers as well as elected
city to start the opening of new companies.
Also, the current more stable and favorable
economic environment has benefited from
the resumption of the expansion plans of
many companies, which are now taking
ESTRELA
A2
ALCÂNTARA
RESTELO
advantage of the time to change facilities
or expand within the same building and
to bet on improving their facilities and
working conditions. This was the case of
Coriant Portugal that carried out the biggest
operation of the year through the occupation
of 8,487 sq.m. in the Office Park Carnaxide.
Regus
■■ 5,230 sq.m.
SANTA APOLÓNIA
STATION
■■ Zone 1 (Prime CBD)
■■ Marquês de Pombal 14
CAIS DO SODRÉ
STATION
BELÉM
TOWER
25 DE ABRIL
BRIDGE
We chose to install our offices in Saldanha because the city
center reflects the differentiating, dynamic and agile way
in which we want to be in the Portuguese market. The fact
that we are surrounded by disruptive startups stimulates
our creative and innovative approach
– Marie Bonte, Biocodex
Take-up (sq.m) 2005 - 2018
GDP vs. Take-up 2005 - 2018
250 000
250 000
6,0%
Annual GDP Portugal
200 000
4,0%
150 000
2,0%
100 000
0,0%
50 000
-2,0%
sq.m.
206,428
166,819
143,798
144,513
126,529
77,802
101,974
87,649
50 000
105,674
201,432
115,628
100 000
148,662
sq.m.
150 000
161,675
200 000
232,623
Absorption volume
0
0
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
-4,0%
2005
2006
2007
2008
2009
2010
2011
Source Savills Research
14
2012
2013
2014
2015
2016
2017
2018
Source Savills Research
15
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Reason for hiring
For 2019, the main emphasis will be
on the renegotiation of spaces and
pre-lease transactions as the main
trends to be observed, in a year
that is expected to be marked by an
unavoidable fall in take-up.
13%
New company
in Lisbon
36%
Area
Expansion
The lack of a new supply and the urgent
need to change space has motivated the
emergence of two trends: on the one hand,
companies end up opting for more obsolete
installations, betting on light interventions
that better fit the space to their occupation
requirements . On the other hand, some
building owners are betting on the
repositioning and modernization of their
buildings to receive new tenants.
Between 2019 and 2021, 175,000 sq.m. of
new office space is planned for a total of 11
confirmed projects, with zone 5 (Parque das
Nações) receiving 36% of the new offer.
51%
Relocation
Source Savills Research
New supply 2004 - 2021
100 000
61,400
31,508
34,488
2015
28,562
2014
35,500
21,061
20 000
20,635
18,205
30 000
30,938
82,000
85,497
59,947
40 000
57,491
50 000
60,741
sq.m.
60 000
77,662
70 000
82,154
80 000
73,762
88,478
90 000
Parque das Nações was the zone chosen
for the implementation of one of the most
innovative and emblematic future projects of
the market, the EXEO Office Campus project
that integrates the phased construction of
three buildings in a total of 69,900 sq.m. of
office spaces and that will contribute to fill
the lack of a new quality supply in the Lisbon
office market.
Another major project with a completion
date for 2019 is the FPM 41 Office Tower,
located in zone 1 (Prime CBD) at Av. Fontes
Pereira de Melo 41 with a total of 18,538 sq.m.
and will be fully occupied by the consulting
firm KPMG and by PLMJ.
In the year 2018, Zone 6 (Western
Corridor) stood out from the remaining
market zones with a total take-up of 56,185
sq.m., followed by Zone 1 (Prime CBD) and
Zone 2 (CBD) with 33,943 sq.m. and 32,490
sq.m. respectively. The shortage of spaces
with larger areas in the most central areas
of the Lisbon office market, as well as the
technical quality of some buildings has more
frequently directed large occupants to zone 6
(Western Corridor).
In the year 2018, 29% of operations in this
market area were directed to areas above
1,000 sq.m., followed by spaces above 500
sq.m. with a weight of 13.5%. Alongside zone
6 (Western Corridor), zone 7 (Other zones)
also saw a remarkable recovery in its take-up,
with a total of 22,672 sq.m. of occupied spaces.
Although the location is one of the factors that
exerts more weight in decision-making, the
current shortage of spaces forces companies
to move between zones and to locate their
activity where there are office spaces with
potential to implement their activity, and for
a large percentage this may mean having to
make interventions to adapt the spaces to
their technical and layout needs.
Distribution of future supply 2019 - 2021
6%
Zone 7
12%
Zone 1
4%
Zone 6
13%
Zone 2
36%
Zone 5
21%
Zone 4
Source Savills Research
2017
GLA (sq.m.)
Nº deals
GLA (sq.m.)
Nº deals
Area
2017/2018
Zone 1
35 063
47
33 943
46
-3%
Zone 2
20 351
58
32 490
52
60%
Zone 3
22 883
25
37 954
32
66%
Zone 4
36 033
13
7 435
6
-79%
Zone 5
6 908
12
15 749
16
128%
Zone 6
43 553
85
56 185
59
29%
Zone 7
2 028
10
22 672
18
1018%
Total
166 819
250
206 428
229
24%
Source Savills Research | LPI
0
2007
2008 2009
2010
2011
2012
2013
2016
2017
2018
2019
2020
2021
Source Savills Research
16
2018
Market zone
10 000
2004 2005 2006
8%
Zone 3
17
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
The revolution
has come to stay
The revolution of the work spaces is
already more than a trend, is a reality that is
part of the Lisbon office market.
In 2018, Coworking spaces and Office
Centers absorbed a total of 19,363 sq.m. and
were occupied by companies such as Regus,
Golden Hub and LACS.
Like other European cities such as Dublin,
Madrid, Barcelona and Bucharest, where the
coworking spaces account for a market share
of less than 15%, the city of Lisbon presents
a very considerable growth potential. With
a market share of 9.3%, with a very dynamic
occupational market and a vacancy rate
under pressure, it is an attractive target for
investment and promotion of this kind of
concept of workspaces.
The international elevation from Lisbon
to the attractive destination city for Startups
opening and the holding of renowned
events related to the technological sector
has strongly encouraged the investment in
spaces of coworking and helped to spread
and implant in the daily life of the companies
new forms of work and synergies creative
and technological.
A12
Main Hub
CRIL
PARQUE
DAS
NAÇÕES
AIRPORT
IC16
Ideia Hub
IP7
A16
LX Office
QUELUZ
LAR
IRCU
2ª C
AMADORA
BENFICA
A9
The Lisbon office market continues to be
dominated by the occupation of offices with
areas up to 300 sq.m. (38%) and areas between
301 - 800 sq.m. (31%).
The vacancy rate remained under pressure
throughout 2018, a trend that will continue
until the entry of the new pipeline projects.
The Lisbon office market ended the year with
an vacancy rate of between 7.5% and 8%.
The lack of new supply has put under
more pressure some market areas, where the
availability of office space is practically zero,
being the case of zone 5 (Parque das Nações)
and Zone 4 (Secondary Zone)
CHELAS
ENTRECAMPOS
STATION
IC19
% of transactions per range of area 2018
Beato Creative Hub
2%
> 5.000 sq.m.
4%
3.001 a 5.000 sq.m.
11%
1.501 a 3.000 sq.m.
Sítio Marquês
N117
A5
LEAP
Golden Hub
38%
14%
801 a 1.500 sq.m.
A5
< 300 sq.m.
ESTRELA
CRIL
A2
LACS
No Office Work Lisboa
RESTELO
Second
STATIONHome
BELÉM
TOWER
25 DE ABRIL
BRIDGE
Source Savills Research
18
SANTA APOLÓNIA
STATION
CAIS DO SODRÉ
ALCÂNTARA
CoWork Lisboa
31%
301 a 800 sq.m.
BAIXA
CHIADO
19
VASCO
DA GAMA
BRIDGE
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Oporto 2018
Office Market
Market
Values
Trends 2019
Rents continued to rise during the year 2018,
with prime rent reaching 21 € / sq.m. / month.
Compared to other European cities, the Lisbon
office market offers the most competitive
rental values, demonstrating growth margin for
the coming years.
The entry of new projects of high quality
in the next two to three years will raise prime
rents that could reach 25 € / sq.m. / month.
Prime rents by market area 2016 - 2018
25,00€
2018
€13,50
€12,50
€13,50
2017
€17,00
€17,00
€16,00
€16,00
€15,47
€11,00
€14,00
€16,00
€15,00
€17,00
€17,00
€21,00
10,00€
€15,80
15,00€
€19,00
€/sq.m./month
20,00€
€20,50
2016
5,00€
0,00€
1. Prime Zone
2. CBD
3. Emerging Zone
4. Secondary Zone
5. Parque das Nações
6. Western Corridor
Source Savills Research
Kick – Off 2019
The beginning of 2019 confirmed the
forecasts for the end of 2018. In the end of
the first quarter of 2019, the office market in
Lisbon recorded a take-up of 41.779 sq.m. In
comparison with the same period of 2018, this
result shows a slight decrease of 3.6%.
By 2019, renegotiation processes will be one
of the major trends emerging in response to
the lack of market supply and an urgent need
to fill market demand.
In 2018, the Oporto office market registered
more than 40 operations in an approximate
volume of 80,000 sq.m.
The high demand by multinational
companies and large occupiers has been
responsible for the increase in take-up, which
are expected to increase over 2019.
The several projects for the rehabilitation
and re-qualification of old buildings have
played a fundamental role in increasing the
available supply of offices in Oporto. To these
rehabilitation processes, there is also a set of
factors that give the city an increasingly degree
of attractiveness, namely:
■■ Qualified talent, particularly directed to
the Technological Area;
■■ Entrepreneurial city, which counts with
the presence of several startups and
incubators;
■■ Strategic geographical location with
direct connection to all European
capitals;
■■ Tourism market in growth, with a weight
of 18% in the total of the Country;
■■ Great potential of requalification of
existing buildings for new projects
directed to several real estate sectors.
Regarding future projects, 10 new projects
are expected in the coming years, representing
an addition of more than 150,000 sq.m. of
office space, contributing to the market’s
responsiveness to demand that is expected to
continue to increase.
This is the case of Porto Office Park (POP)
Building, with 31,000 sq.m., that it’s scheduled
for the end of 2019; Porto Business Plaza
Building - Campo 24 de Agosto, which will add
15,500 sq.m. of new supply and the Post Office
Palace in Aliados with 16,800 sq.m., whose
conclusion is also expected in 2019.
For the large occupants will be a year of
strategic analysis and consideration for new
projects that will enter the market and that will
raise the quality standard of the stock of the
Lisbon office market.
20
21
N13
N14
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
A28
A41
FRANCISCO SÁ CARNEIRO
INTERNATIONAL AIRPORT
N107
N107
N13
PERAFITA
MAIA
A3
MAR
SHOPPING
A4
EXPONOR
VIA
NORTE
A28
N105
VIA
RÁPIDA
CIRCUNVALAÇÃO
ROAD
ASPRELA
ZEP
N12
s
A20
VCI
11%
Downtown
17%
Boavista
13%
Other Zones
3%
Gaia
2%
ZEP
20%
Maia
34%
Matosinhos
CITY'S
PARK
PINHEIRO
MANSO
AVIZ
INTERFACE CASA
DA MÚSICA
CONSTITUIÇÃO
lhã
es
oavis
ta
ANTAS
r nã
Av. da
B
Boavista – Prime CBD
MARGINAL
ARRÁBIDA
BRIDGE
Downtown Area
PAVILHÃO
ROSA MOTA
os
DOWNTOWN
RIBEIRA
iad
Cam
po A
legre
Av. A
l
R. d
o
Av.
Fe
BOAVISTA
A1
oM
aga
MATOSINHOS
NORTE
SHOPPING
Henrique
D. Afonso
Av.
PORTO DE LEIXÕES
CRUISE TERMINAL
Distribution of take-up by market zone
The axis of Maia was the stage of the
expansion of PROZIS, which occupied 14,500
sq.m. in the Business Center of Maia and
which gave to this market zone a 20% weight
in the total take-up in 2018.
The Boavista zone, with 17 transactions
in 2018, continues to be a destination for
many occupiers, particularly dedicated to
the service business and TMT’s & Utilities
activity. This zone received one of the
largest transactions of the year, through the
occupation of 8,500 sq.m. in the Boavista
Office Center by Farfetch.
A4
CAMPANHÃ
CAMPO 24 DE AGOSTO
BUS TERMINAL
CAMPANHÃ
INTERMODAL TERMINAL
Deals Done 2018
S. BENTO
STATION
N209
FREIXO
BRIDGE
LUÍS I BRIDGE
Eastern Zone
Source Savills Research
N13
A28
N14
Maia Business Center
ZEP
GAIA
Matosinhos
DEVESAS
STATION
■■ Prozis
A41
■■ 14,500 sq.m.
FRANCISCO SÁ CARNEIRO
INTERNATIONAL AIRPORT
N108
A44
N107
Maia
Vila Nova de Gaia
PERAFITA
A1
N222
MAIA
A20
A3
MAR
SHOPPING
A4
Matosinhos area accounted 34% of the
total volume of GLA occupied in the Oporto
office market, with the occupation of Edifício
Urbo by BNP Paribas totaling 15,000 sq.m.
contributing significantly to this result. With
close to 26,000 sq.m. transacted in 2018, this
was the zone chosen for the installation of
new companies in Oporto, such as SODEXO,
COFCO International or COCUS Portugal.
VIA
■■ BNP Paribas
NORTE
■■ 14,976 sq.m.
A28
PORTO DE LEIXÕES
CRUISE TERMINAL
N105
CIRCUNVALAÇÃO
ROAD
MATOSINHOS
VIA
RÁPIDA
VCI
PINHEIRO
MANSO
Boavista Office Center
AVIZ
BOAVISTA
■■ Farfetch
■■ 8,500 sq.m.
MARGINAL
ASPRELA
ZEP
N12
Quatro Rote Building
A20
■■ Global Media Group
■■ 5,700 sq.m.
CONSTITUIÇÃO
ANTAS
DOWNTOWN
RIBEIRA
CAMPANHÃ
ARRÁBIDA
BRIDGE
A1
LUÍS I BRIDGE
GAIA
22
A4
URBO BUSINESS CENTRE
EXPONOR
Featured Office
Market Zones
N107
N13
23
A44
FREIXO BRIDGE
N108
N209
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Retail
Market Values
The rents in Oporto office market have
registered increases, based on high demand
and also justified by the improvement in the
quality of new projects promoted and which
have attracted a greater number of occupiers,
many of them international. For 2019, it
is expected that the market will continue
to see an increase in rental figures, albeit
lighter and explained by the entry of new and
modern projects, which will raise the bar of
the market.
Market Zones
Rents
CBD
€18,00
Downtown
€17,00
Gaia
€12,50
ZEP
€12
Maia
€12
Matosinhos
€13,00
Oriental
€12,50
Source Savills Research
24
25
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Retail 2018
Trends 2019
gastronomy, culture, art and nightlife gain
ground and competitive advantage over other
more conventional models.
The increase in supply in the heart of
major cities fuels the curiosity and appetite
of tourists, for the opportunity to stroll
through tight streets surrounded by traditional
buildings full of culture and history.
Retail turnover index (Total excluding fuel)
120,0
115,0
Sector of Food
& Beverage dominates
high street stores openings
110,0
105,0
100,0
95,0
Jan 2019
*Nov 2018
Jul 2018
Set 2018
Mai 2018
Jan 2018
Mar 2018
Nov 2017
Jul 2017
Set 2017
Mai 2017
Jan 2017
Mar 2017
Nov 2016
Jul 2016
Set 2016
Mai 2016
Jan 2016
Mar 2016
Nov 2015
Jul 2015
Set 2015
Mai 2015
Jan 2015
90,0
Mar 2015
In 2018, the Retail Trade Index increased
3.9%, 0.2% less than 2017. Note that since 2013,
the volume of sales of the retail trade market
in Portugal has increased 73%, reflecting the
recovery of consumer confidence.
The retail market was once again marked
by the dynamism of high street, which has
seen a solid and growing trend, attracting
new retailers daily and promoting the
opening of new concepts that have greatly
contributed to the transformation of the
main urban centers.
Lisbon and Oporto have been examples
of cities, where the growth of the high street
retail has been notorious. The strong tourist
flow that increases year after year in both
cities has fueled market demand and the
entry of new domestic and international
retailers, showing no signs of slowing down.
By changing consumer habits, the important
influence of new generations of consumers,
the introduction of new innovations and
technologies, the high street retail has
undergone a dramatic change and plays a
fundamental role in the rhythm of the main
Portuguese cities.
There is a growing appetite for innovative
concepts that have differentiation advantages
in a highly competitive growth market.
Concepts like the LX Factory that mix fashion,
Source INE
Traffic index Shopping centers
140,0
2016
2017
2018
120,0
100,0
(%)
80,0
60,0
40,0
20,0
0,0
Jan.
Fev.
Mar.
Abr.
Mai.
Jun.
Jul.
Ago.
Set.
Out.
Nov.
Dez.
In 2018, Savills collected a sample of 231
new high street stores in Lisbon. About
75% of the new openings are target for the
food & beverage sector. All other activities
showed a residual weight, with the fashion
sector accounting for 9% of new openings.
Amongst the brands that opened new stores
in 2018 we highlight My Auchan, Portuguese
Bakery, Selfish, Canning Shop, Zé Avillez’s
Cantina, CrossFit Move on, Jamie’s Italian,
H3, Santini, Berenice, Ground Burger, Go
Natural, Casa Lisboa, Local, FitnessPark,
Chaos, OKAH, H3 Express, OMEGA, Electric
Tiger, VANS, Minipreço and Wells.
The refurbishment and renovation of
many buildings in Lisbon has brought, to day
light, new high street retail spaces. Still, for a
demand that has been increasing, the current
supply remains scarce, in particular in the
heart of the city and the prime axes.
The increase in traditional commerce and
convenience, motivated by the new habits of
consumption and the rhythm of life of the
consumers, has allowed the resurgence of the
more traditional “Neighborhood retail concept”,
creating in this way new axes and commercial
poles that serve the local populations.
There are already several cases of success of
brands that have bet on smaller retail formats,
aimed at the more convenience concept,
especially food, located in secondary zones,
as is the case of My Auchan, Minipreço, Meu
Super, among others.
New high street stores by activity sectors Lisbon
Hyper / Supermarkets | 2%
Gift shops | 2%
1% | Bookstores
5% | Decoration / Design
9% | Fashion & Accessories
3% | Fitness
75%
Food &
Beverage
Source APCC
26
3% | Beauty / Cosmetics
Source Savills Research
27
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
High Street – Lisbon Prime Rents
160
The pressure on rents continued
throughout 2018, in particular on the retail
axes with greater demand and shortage of
supply. For 2019, prime rent is expected to
maintain its upward trend in the high street
segment, mainly in the Lisbon Downtown and
Oporto areas.
For shopping centers and taking into
account the maturity of the sector, there
are no expressive rises in the prime income
values. The expansion and modernization
processes of some shopping centers will allow
an increase in supply, but significant increases
in prime incomes are not expected.
120
€/sq.m./month
Market
Values
140
140
100
80
90
90
2012
2013
100
100
2014
2015
120
110
75
70
60
40
20
0
2010
2011
2016
2017
2018
Source Savills Research
High Street – Porto Prime Rents
80
70
70
€/sq.m./month
60
50
50
50
2016
2017
40
40
30
20
10
0
2015
Prime Axis
The zones of the Chiado and Historical
Center remain like the prime axes of the
high street retail of Lisbon. Wanted mainly
by leading brands in the fashion sector, they
now also offer a varied range of bars and
restaurants, art galleries combined with
frequent events that promote and attract
more consumers to the city center. Aimed at
the mass-market consumers and benefiting
from a high tourist flow, it has gained ground
to the prestigious Av. Da Liberdade, currently
practicing higher prime income figures.
In 2018, the Prime zone of Chiado registered
a prime rent in the order of 140 € / sq.m. /
month and the Baixa area of Lisbon stood at
130 € / sq.m. / month, and these figures are
Source Savills Research
Shopping Centers Prime Rents
expected to increase in the year 2019, driven by
demand pressure and lack of supply.
Cais do Sodré and the entire renewed
riverside area also continue to mark their
commercial profile and become more and
more established as consolidated retail zones,
offering innovative concepts, strongly focused
on the restoration sector and the presence of
some more alternative fashion brands.
At Av. Da Liberdade, where the prime
rent is at 90 € / sq.m. / month, the demand
for retailers of prestigious fashion brands,
directed to the luxury segment, prevails. In
2018, Av. Liberdade received the first OMEGA
store in Lisbon, the new Massimo Dutti
Concept Store and the French brand Maje
and Sandro.
120
Oporto
In 2018 several new stores opened in Oporto
like Eleven Lab Concept, Brazilian, Bae, Hagen
Dazs and Gossy.
As in the case of Lisbon, Oporto has
registered a high demand that is also very
much in favor of food and fashion sectors,
driven by the increase in tourism in the city
and by a more dynamic activity to promote
new real estate projects that bring more
inhabitants and workers to the city center.
Rua de Santa Carina, Avenida da Boavista,
Clérigos are part of the most emblematic
shopping streets in the city of Porto, where
some famous brands are implemented. To
these streets, new commercial axes such as the
Flores / Mouzinho are now joined.
95
100
100
100
2017
2018
85
€/sq.m/month
Lisbon
2018
80
75
75
75
2012
2013
2014
60
40
20
0
2015
2016
Source Savills Research
28
29
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Shopping centers:
Time to make a difference
The Shopping Centers market, after the
openings that were planned for 2017, did not
register new entries in 2018.
Having reached a high degree of maturity,
the Shopping Centers market in Portugal
is currently dominated by new positioning
strategies and innovative bets on the concepts
offered to the public.
In this sense, the expansions of Oeiras
Parque, Colombo Shopping Center, Norte
Shopping, Glicínias and Dolce Vita Tejo are
planned.
For 2019 is scheduled to open LIS Shopping
in April, a retail park located in Leiria with
a gross leasable area of 7,700 sq.m. Also the
region of Madeira will receive the Savoy Palace
Commercial Gallery, part of the Savoy Palace
hotel project.
Requalifications:
■■ Oeiras Park
This requalification consists of an
increase in the GLA of the shopping
center, number of floors and the
improvement of the center space through
new themes and new leisure areas.
■■ UBBO (Dolce Vita Tejo)
It will be the first resort shopping center
in Portugal and will be called UBBO.
It will bet on an innovative concept of
leisure, entertainment, gastronomy and
shopping, responding to the demands of
new consumers.
■■ Norte Shopping
Expansion of the car park area, increase
of retail area which will comprise a
food-court, new shops and services and
changing of cinemas area.
■■ Glicínias Plaza
In an investment of 40 million euros,
the Glicínias Plaza located in Aveiro will
undergo renovation works which include
the construction of two new floors,
extending the offer to 120 stores, totaling a
gross leasable area of 41,000 sq.m.
■■ Centro Colombo
It is expected to expand and reorganize the
food-court area and increase the offer in
the retail area in about 17,000 sq.m.
Evolution of shopping center openings in Portugal 2000 - 2017
With increased competition and the range
of commercial offerings, coupled with the
demand of consumers themselves, offering
unique shopping experiences is no longer
an option and has become imperative to
guarantee the success of the shopping center.
If food courts are usually the first target
zones of the modernization and expansion
processes, rethinking a new positioning is now
far beyond that. It also extends the offer to
services that complement the “experience”
of moving to the consumer’s shopping center,
such as health clinics, dental clinics, gyms and
other leisure spaces.
300000
250000
sq.m.
200000
150000
100000
50000
Distribution of shopping center stock by region
18%
North
29%
Greater
Lisbon
16%
Greater Porto
3%
Madeira & Azores
10%
Algarve
16%
Center
8%
Setúbal
0
2000
2001
2002
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Source Savills Research
Source Savills Research
30
31
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
7.2
million people use
mobile internet
E-Commerce:
In Portugal, e-commerce has a huge margin
of growth and is nowadays a sales channel
complementary to the store experience. The
new consumer profile that privileges a complete
knowledge of the product in a fast and creative
way, has led more retailers to adopt new
strategies of modernization and improvement
of the store experience.
Although it is below the European average,
e-commerce in Portugal has been growing
gradually year after year. For many retailers, the
digital world has opened up as a new opportunity
to win more consumers, raise awareness of their
brands across borders, and more innovatively
communicate their marketing efforts.
Industrial
& Logistics
77%
of total mobile phone
users use smartphone
Proportion of persons aged 16-74 who used e-commerce
60%
37%
34%
55%
31%
53%
31%
50%
47%
26%
22%
18%
15%
20%
25%
40%
42%
40%
57%
EU - 28
44%
Portugal
37%
of residents in Portugal
from 16 to 74 years used
e-commerce in the year
2018 (+ 3% 2017)
0%
2010
2011
2012
2013
2014
2015
2016
2017
2018
Source INE
67%
Proportion of persons aged 16-74 who used e-commerce
for products or services ordered
of residents in Portugal
use or have installed
applications on their
smartphone
70%
9%
Movies
or music
14%
Medicines
10%
14%
Computer
Software
E-learning
material
16%
23%
Books, magazines
and newspapers
Computer
hardware
25%
Telecommunication
services
19%
27%
10%
Bilhetes de
transporte, ou...
20%
30%
30%
36%
40%
48%
50%
60%
60%
Electronic
Equipment
Spectacle
tickets or …
Household
items
Accommodation
Food, beverages,
tobacco, …
0%
Source INE
32
37%
of the population makes
purchases online
Source INE | ANACOM
33
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
80,0
60,0
40,0
20,0
Jan 2019
Nov 2018
Jul 2018
Sept 2018
May 2018
Jan 2018
Mar 2018
Nov 2017
Jul 2017
Sept 2017
May 2017
Jan 2017
Mar 2017
Nov 2016
Jul 2016
Sept 2016
May 2016
Jan 2016
Mar 2016
Nov 2015
Sept 2015
Jul 2015
May 2015
Jan 2015
Mar 2015
0,0
Source INE
*Industrial Production Index (Adjusted for the Effects of Calendar and Seasonality)
Top 10 Deals Done 2018
Building
Dia Alverca
Palmela 5
Location
Tenant
Area (sq.m.)
Alverca
Dia
24,915
Palmela
Conforama
15,488
Azambuja 5
Azambuja
Torrestir
15,408
Industrial Park Porto Alto
Porto Alto
CTT Expresso
13,235
Logistics Plattform Taboeira
Aveiro
Bosh
12,524
Logistics Warehouses Quinta da Arrogela
Alverca
Logic
20,000
Póvoa de Santa Iria
Logic
9,385
Building Mirandela
Loures
Confidencial
7,663
Palmela 6
Palmela
Luís Simões
6,905
Azambuja
Luís Simões
6,460
LogPlace Póvoa de Santa Iria
Azambuja 5
Occupier:
Jump Bicycles
Portugal (UBER)
Occupier:
LFP
Occupier:
Extraspace
Alto do Colaride
Reogi Building
Logispark Montijo
Rua Cidade
de Cordova
3.668 sq.m
1.000 sq.m
3.700 sq.m
2.499 sq.m
Cacém
Prior Velho
Montijo
Alfragide
Source Savills
Market Values
For 2019 a rise in rents is expected in a
very scarce supply and 100% based on used
warehouses. The lack of supply will also
lead to the renegotiation of contracts with
rent revisions, which in the more central
axes, close to urban centers that offer a
greater concentration and proximity to other
complementary services, could mean a slight
increase in income values.
Prime Rents Logistics Axes
€5,00
2016
€4,00
€3,00
€2,00
€1,00
€0,00
Sacavém – Alverca
Alverca
– Azambuja
Loures – Vialonga
Montijo
– Alcochete
Source Savills Research
34
2017
2018
3,50€
100,0
Occupier:
Nunes & Guisantes
Investimentos
Imobiliários
4,50€
Industry Turnover
Operations 1st quarter 2019
2,75€
Industrial Production Index*
120,0
At the begining of 2019, the market
continues to show a positive feeling of
confidence on the part of operators,
encouraging the resumption of promotion and
investment in this real estate segment.
Several operators began construction of
new warehouses and new logistics centers in
2019, reaffirming the need for the market to
receive new projects.
Lidl Portugal already started with the
construction of the new warehouse in Santo
Tirso with 48,000 sq.m. Also Rangel and Marb
SA. opened the new 6,500 sq.m. industrial
logistics operations center in Braga and
Dachser inaugurated its logistics operations
center in Coimbra in order to meet the growth
forecast for the coming years.
3,25€
Industrial Activity Indicators
140,0
With no new openings and no new projects,
the national industrial real estate industry
faces several challenges, at a time when the
market requires rapid response capacity.
With the exception of the development of
around 40,000 sq.m. of speculative supply
promoted by Merlin and integrated in the
Lisbon North Logistics Platform located in
Castanheira do Ribatejo, no new promotions
are foreseen accentuating the industry’s lack
of attractiveness compared to other real
estate segments.
However, despite the industrial & logistic
sector observing lower occupancy and
promotion levels, the current commercial
strategies of logistics operators should have a
positive impact on the dynamism of real estate
activity in this segment.
The focus on improving the purchasing
and delivery experience, the gradual growth
of e-commerce and the consequent need to
modernize distribution chains and increase
operational capacity have led many operators to
look for new facilities or to adjust them to the
new operational and stock requirements. The
expansion of e-commerce as a new sales channel
is now seen as an opportunity to encourage
promotion in the industrial & logistic sector.
The reformulation of the distribution cycle
due to the increase in the weight of e-commerce,
is based on variables such as speed, efficiency
and convenience that should produce effects in
the search for facilities with smaller dimensions,
very close to the urban centers and that are
provided with good road access, transport
network and easy access to labor.
In 2018, a total investment of 140 million
euros was registered in the industrial &
logistics sector, with the sale of the Sonae
Platform in Azambuja to WP Carye for 43
million euros and the sale of two logistics
platforms Day to Square Asset Management
for 33 million euros, to be the most important
operations in this sector.
3,75€
political and economic developments in the
external context.
The take-up volume recorded in 2018
was achieved through the occupation of
used warehouses and expansion of existing
facilities with a large percentage of the
investments to be made by the occupants
themselves. Alverca - Azambuja axis
recorded the highest take-up volume with
approximately 70,000 sq.m, followed by
Palmela - Setúbal (28,594 sq.m) and Loures Vialonga (23,682 sq.m) axes.
4,00€
In 2018, the real estate market directed
to the segment of industry and logistics
maintained a low dynamic activity level, with
the promotion of new projects practically
nonexistent. The observed take-up amounted
to a total of 180,300 sq.m, which represents a
decrease of 17% compared to the same period
of 2017.
The slowdown in exports and domestic
demand is one of the contributory factors
for this decline, coupled with a lack of new
supply and a degree of uncertainty regarding
4,00€
Trends 2019
Kick – Off 2019
€/sq.m./month
Industrial & Logistics 2018
Palmela – Setúbal
Alfragide
– Carnaxide
Sintra – Cascais
– Oeiras
Source Savills Research
35
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
TORRES VEDRAS
A8
AZAMBUJA
A1
ALENQUER
Investment
CARREGADO
A10
VILA FRANCA
DE XIRA
MAFRA
A13
A21
N10
CREL
ALVERCA
LOURES
N118
IC16
SINTRA
N119
ODIVELAS
IC19
IC30
LISBON
AIRPORT
AMADORA
ALCOCHETE
LISBON
CRIL
A5
CASCAIS
OEIRAS
MONTIJO
ALMADA
BARREIRO
IC20
MOITA
A12
SEIXAL
IC32
A2
PALMELA
SETÚBAL
Sacavém – Alverca
Carregado – Azambuja
Loures – Vialonga
Montijo – Alcochete
SESIMBRA
Palmela – Setúbal
Alfragide – Carnaxide
Sintra – Cascais – Oeiras
36
37
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Investment 2018
Trends 2019
The market continues to experience
historically low interest rates,
accompanied by capital market volatility
and high levels of liquidity.
In 2019 and despite a decrease in the
volume of real estate investment due to the
shortage of prime product, the domestic
market will continue to mark its position on
the radar of international investors, with the
city of Lisbon to be compared with cities such
as Madrid and Barcelona.
Lisbon has been the example of a market
that has managed to stand out among investors
looking for cities with growing influxes of
young students and tourism, now opening up
their range of investment possibilities to other
alternative segments, such as student residences.
Total Real Estate Investment Volume 2007 - 2018
Top 2018 Transactions
3 500
Building
3 200
3 000
2 500
Seller
Buyer
Investment Amount (€M)
Sintra Retail Park, Fórum Sintra and Fórum Montijo
Blackstone
Grupo Auchan - Imochan
411
Almada Fórum
Blackstone
Merlin Properties
407
Teixeira Duarte
Kildare
375
Baupost
AXA Investment Managers
230
ECS
CONFIDENCIAL
106
Deutsche Bank
Grupo Carlyle / Explorer Investments
100
Lagoas Park
2 200
1 300
363
268
731
745
224
500
544
1 000
554
1 500
Dolce Vita Tejo
1 800
2 000
1 115
Million €
2018 confirmed the attractiveness of
Portugal in the real estate investment market.
For the second consecutive year and setting
a new historical record, Portugal has affirmed
itself as a destination of choice for the
investment strategies of international players
from various parts of the globe, with high
levels of liquidity and directed to prime assets.
In 2018, 3.2 billion euros of real estate
investment were recorded, representing a
significant increase of 77% compared to the
volume of investment registered in 2017.
This expressive rise is a reflection of the
positive progression of a set of factors that
have contributed to the excellent performance
of the national real estate investment market.
The sustainable growth of the national
economy, accompanied by political and
social stability, the dynamism of the business
community in particular in the cities of Lisbon
and Oporto, the excellent performance of
the labor market, the gradual increase in
rents and the contribution of the tourism
sector to the national economy, have been the
underlying factors that sustain the demand for
investment in Portugal.
In addition to the aforementioned factors
and from a European perspective, the market
continues to experience historically low
interest rates, accompanied by capital market
volatility and high levels of liquidity.
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Source Savills Research
Investment volume by sector 2018
13%
Mixed-use
3%
Others
30%
Offices
5%
Hotels
4%
Industrial &
Logistics
45%
Retail
Source Savills Research
In 2018, portfolios and assets were released
to the market in the retail and office sectors,
with these two sectors accounting for 75% of
the total investment.
In the retail sector, 1.4 billion euros were
registered, for which contributed the sale of
Sintra Retail Park, Forum Sintra and Forum
Montijo to the Auchan Group for 411 M€, the
sale of Almada Forum for 407 M€ to Merlin
38
Properties and sale of Dolce Vita Tejo to AXA
Investment Managers for 230 M€.
In the office sector was closed the sale of
Lagoas Park to the British fund Kildare Partners
in the historical value of 375 M€.
2018 was also a year of greater
diversification of investor interest in other
real estate sectors. The industrial and logistics
segment continued to maintain a positive track
Torres de Lisboa - Buildings E, G, H
Penha Longa Hotel & Golf Resort
Source Savills Research
record with a total investment of around 140
M€, with the sale of the Sonae platform to WP
Carye for 43 M€ to top the list of transactions
in this sector.
In the hotel sector, the hotels
Intercontinental Palácio das Cardosas and
Penha Longa Hotel & Golf Resort were sold for
a total of 155 M€.
The mixed-use segment with a 13% share of
total investment in 2018 was represented by
the sale of the Fidelidade Golden Portfolio to
Apollo’s Americans for 425 M€.
The sector of alternative uses, although with
a weight of only 3% already shows one of the
great trends of the investment market for the
next years. In the segment of Senior Living
the sale of the Montepio Residence located in
Parque das Nações to an international investor
is an example of the interest that this type
of asset has exerted in several investors and
international promoters.
With a profile aimed at a higher risk, which
also have more attractive returns, there is
currently a market that denotes a demand
for international investors with plans for
development and acquisition of senior
residences in Portugal. The same applies to
the student housing market, which has been
expanding in the national market, particularly
in the cities of Lisbon and Porto.
Roundhill, MPC Capital Group, The
Student Hotel, Mile Stone are already
present in Portugal and have been the main
responsible for the acquisition of land in the
cities of Lisbon and Porto for the promotion
of student residences.
Investment distribution by source of capital 2018
2%
Asia
2%
Others
23%
USA
24%
France
3%
Germany
16%
UK
10%
Portugal
20%
Spain
Source Savills Research
The development sector continued its
growth trajectory in 2018, with several major
operations to be closed successfully. An
example of this was the closure of the sale
of the land of the former Feira Popular in
Entrecampos for a total amount of 273.9 M€
to Fidelidade Property, the sale by BPI of the
former buildings belonging to the Pension
Fund of Banco BPI, Norfin for 68.5 M€ and
the sale of the emblematic block of Swiss
Pastry to the Spanish investors of Mabel
Capital for 72 M€.
39
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Geographical diversification
remains in 2018
International investors accounted for 90%
of total investment in Portugal.
In 2018, French investors (760 M€),
followed closely by US investors (743 M€) and
Spanish investors (645 M€) dominated the
investment table.
Over the past five years, the national
investment market has witnessed a reversal
of the weight of national investment versus
cross-border investment, with international
investment being increasingly dominant and
with domestic investors (mostly real estate
investment funds and family offices) to not be
able to compete in this race.
In 2018, this tendency is very noticeable,
with the focus of the national players, in
2010
2011
2012
2013
90%
77%
87%
2014
2015
2016
23%
13%
2009
14%
0%
14%
20%
2008
Throughout 2018 yields were registering
declines in the segments of offices, high
street and industrial & logistics between 25
and 50 basis points.
Despite the compression of yields and
comparatively with European markets, we
can see that in the office segment, Lisbon
is the market offering the highest prime
yields, only surpassed by Warsaw (4.75%) and
Athens (7%).
82%
82%
82%
Internacional
2017
10%
57%
73%
87%
86%
60%
40%
Throughout 2018 yields
were registering declines
in the segments of offices,
high street and industrial
& logistics between 25 and
50 basis points.
18%
18%
18%
Nacional
86%
43%
80%
13%
100%
27%
Investment by origin of investor (%)
particular of the banking entities, more
focused on the resolution of bad credit.
Taking advantage of the positive economic
climate and the excellent momentum of the
real estate investment market, NPL’s operations
have intensified in the last two years.
Prime Yields European CBD Offices
Paris
3,00%
Netherlands
3,25%
Madrid
3,25%
Vienna
3,50%
Stockholm
3,50%
Milan
3,50%
3,60%
Bruxels
3,75%
Oslo
3,90%
Berlin
2018
Source Savills Research
Prime Yields Evolution
Luxemburg
4,00%
Dublin
4,00%
London
4,00%
12,00
Offices (Gross)
High street (Gross)
Shopping Centers (Net)
Industrial & Logistics (Gross)
10,00
Retail Parks (Net)
%
4,25%
Prague
8,00
4,50%
Lisbon
6,00
4,00
4,75%
Warsaw
2,00
7,00%
Athens
0,00
2011
2012
2013
2014
2015
2016
2017
2018
0,00%
2019
1,00%
2,00%
3,00%
4,00%
Source Savills Research
40
5,00%
6,00%
7,00%
8,00%
Source Savills Research
41
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Residential
Challenges 2019:
■■ Trade tension between the US and
China that could affect the growth
of the world economy;
■■ BREXIT;
■■ Political succession of Germany;
■■ Standardization of monetary policy
of the European Central Bank;
■■ Result of the European elections.
■■ In 2019, the market should register a total
amount of investment between 2,000 2,500 billion euros;
■■ The domestic investment market will
continue to attract international investors
who have adopted strategies to diversify
their portfolio and are now betting on
smaller markets and offering a range
of attractive opportunities, with good
prospects of return on investment;
■■ Greater caution regarding the potential
political and financial risks of the
international market;
■■ The approval of the SIGI (Portuguese
REITS - Real Estate Investment Trusts)
decree-law corresponding to SOCIMI
in Spain, could bring about a greater
dynamism of the market and the greater
diversification of investors, attracting
more foreign capital, especially directed
to the housing rental sectors, urban
rehabilitation and offices;
■■ The acquisition of land for promotional
purposes will continue to assert itself as
a strong sector of investment capture.
The development of projects dedicated
to alternative uses, such as Student
Residences, will be one of the main trends
in 2019 in the real estate investment
market, along with the promotion of office
buildings in response to the high dynamics
of the occupational market;
■■ The NPL market will continue to
liberate asset portfolios for the market
and capture an important share of
international investment.
Kick – off 2019
At the beginning of 2019, the real estate
investment market has already closed some
important transactions, namely in the office
and mixed use segments.
This was the case of the sale of the Fernão
Magalhães’s Tower and Arts building, both
located in Parque das Nações, to Merlin
Properties by Credit Suisse for a total amount
of 112 M€.
The British fund M7 Real Estate has also
invested in the acquisition of 16 assets in the
Lisbon, Oporto and Center regions for logistics
assets, offices and office parks and retail parks,
for a total investment of 55.7 M€.
The closing of the first quarter of 2019 is
expected to show a sharp fall of close to 50%
compared to the same period of 2018, when the
Dolce Vita Tejo Shopping Center and the Sintra
Retail Park, Sintra Forum and Montijo Forum
were integrated. in the Rio Tejo portfolio.
Notwithstanding this slowdown and the
shortage of prime product experienced by very
satisfactory demand, the market continues to
offer good investment opportunities.
The retail and office sectors continue to
capture the interest of several international
investors and lead the ranking of transactions.
42
43
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Residential
In 2018, the residential market in Portugal
continued to observe a very positive growth
behavior. According to information released by
INE, in the year 2018, 178 691 dwellings were
sold, of which 85.2% were for used dwellings.
Compared to the same period last year, this
result shows an increase of 16.6%.
In total, the domestic residential market
accounted for 24.1 billion euros of transactions
in 2018 (+ 24.4%).
The regions of the Lisbon Metropolitan Area
and North region accounted for 64.6% of total
transactions in 2018.
For these numbers, urban rehabilitation
plays a very significant role, as well as the
purchase for placing on the tourist rental
market, which have undoubtedly been the two
most dynamic factors in the residential market.
However, the purchase and sale of homes
for own use and directed to national buyers
remains at modest levels and which translate
a mismatch of current supply to the demand
profile. The scarcity of new construction
thought to be of root for Portuguese middleincome families is one of the main challenges
facing the residential development market.
Throughout 2018, a total of 22 062
buildings were licensed in Portugal, of
which 5 164 of these buildings are for urban
rehabilitation, 16 898 buildings for new
In 2018
buildings and of which 11 375 were for family
housing (67.3%).
The Lisbon Metropolitan Area accounted for
15.5% of buildings licensed in 2018, with a total
of 2 069 buildings (84.2%) for family housing.
The North region had a total of 8,580
buildings, of which 23.3% were directed
to urban rehabilitation and 70% to new
buildings, with family housing with a weight
of 75.4%.
Completed Buildings Lisbon Metropolitan Area
Houses sold
Buildings licensed
in Portugal (+18.5%)
15,000
7 893
3 421
Buildings completed
in Portugal (+16.1%)
Licensed Buildings
for Family Housing
Buildings licensed in the
Lisbon Metropolitan Area
1 729
1 148
Buildings completed in the
Lisbon Metropolitan Area
Buildings completed
for Family Housing
30,00%
4 000€
2017
€/sq.m
2010
2011
2012
2013
2017
5,00%
2018
0€
Source INE
44
Setúbal
Seixal
Palmela
Montijo
Moita
Barreiro
Almada
Odivelas
Sintra
Oeiras
Mafra
Loures
0,00%
Lisbon
2016
10,00%
1 000€
Sesimbra
2009
1 500€
Alcochete
2008
15,00%
Amadora
2007
2 000€
Vila Franca
de Xira
2006
20,00%
Cascais
2015
0
2005
25,00%
500€
1 729
915
2014
1 276
1 011
1 495
1 085
1 000
2 460
3 082
3 671
4 510
2 000
2004
Change 2017/2018
2 500€
3 000
2003
2018
3 000€
5 494
5 990
5 760
5 258
5 940
4 000
6 252
3 500€
6 000
Nº of buildings
22,062
Sale Price/sq.m Lisbon Metropolitan Area
7 000
5 000
178 691
Source SIR
45
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Urban Rehabilitation
Nº of sold houses Lisbon Metropolitan Area
Area of Lisbon
20,0%
4 500
2017
4 000
2018
Change 2017/2018
10,0%
0,0%
3 000
2 500
-10,0%
2 000
-20,0%
1 500
-30,0%
1 000
-40,0%
500
0
It should also be noted that other areas of
the city considered more secondary have been
witnessing a very significant price increase.
The parish of Ajuda showed a 42.2%
increase compared to 2017 and the parish of
Beato, considered the new emerging zone of
Lisbon, saw a 41.7% increase in its average sale
value/sq.m.
Sales price/sq.m Average
Setúbal
Sesimbra
Seixal
Palmela
Montijo
Moita
Barreiro
Almada
Alcochete
Odivelas
45,0%
6 000
2017
2018
Change 2017/2018
5 000
Source SIR
40,0%
35,0%
30,0%
4 000
€/sq.m
25,0%
3 000
20,0%
15,0%
2 000
10,0%
1 000
5,0%
0,0%
S. Vicente
Sto António
Sta Maria
Maior
Penha de
França
Misericórdia
Estrela
Campo de
Ourique
Belém
Avenidas
Novas
Arroios
Areeiro
Alvalade
Marvila
Campolide
Beato
Alcântara
0
Ajuda
Amadora
Vila Franca
de Xira
Sintra
Oeiras
Mafra
Loures
Lisbon
-50,0%
Cascais
Nº of House
3 500
The URA of Lisbon registered in 2018 a
total of 5.92 billion euros, which represented
13,150 transactions.
The parish of Santo António, which is
part of the prime area of Lisbon (Avenida da
Liberdade axis), registered the highest average
sale/sq.m in 2018, standing at 5,076 € and
representing a 13% increase over 2017.
Also the parishes of Misericórdia and Santa
Maria Maior observed average values of sale/
sq.m superior to 4,000€/sq.m.
Source SIR - RU
Area of Oporto
In 2018 and according to the data released
in the SIR - RU Portal, 844 houses were sold
at an average price of 2,336€/sq.m in the
Oporto market.
In general, all areas recorded increases in
their average sale value/sq.m, except for the area
of Corujeira (-9.28%) and Massarelos (-5.00%).
The Bonfim and Baixa areas saw very steep
increases in their average sales figures, in the
order of 77% and 45% respectively.
46
47
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Development
Kick – off 2019
In 2019, the residential market should
begin a path of greater stabilization and
consolidation of prices, more directed to the
segment of residential homes used.
The promotion of projects targeted to the
prime segment will continue to increase, and
a visible price adjustment is not yet expected
and will have effects on the dynamics of the
residential market.
The introduction of new forms and housing
regimes that reflect new lifestyles, begin to
bring to light models of housing based on
concepts of shared economy and co-habitation.
If in some European countries concepts
are already in a phase of perfect gearing and
fully integrated in the residential market, in
Portugal the first steps are now taking place
and international investors are beginning
to appear with an interest in betting on the
Portuguese market for the implementation of
Co- Living.
The residential market is one of the most
permeable segments of the volatility of
socioeconomic factors, the changes in habits
and generations that inevitably bring with
them profound changes of thought.
The revival of the rental market is an
example of this change, but also of the current
financial inability of Portuguese households
to be able to buy houses at the current market
prices. The lease scheme will continue in 2019
to be one of the options for a very significant
percentage of the resident population in
Portugal.
48
The announced Accessible Rents Program
promoted by the Portuguese Government,
as well as with a very residual weight, the
initiative of international promoters put on
the market some fractions of their projects
affected by the affordable rents scheme,
pave the way for the return of the younger
population to the center of the cities and
in this way contribute to the continuous
dynamism and revitalization of the urban
centers.
It is also increasingly evident the concern
of international promoters and investors in
knowing the profile of the national consumer
and the national reality. Concern that is
expressed in the desire to develop projects
aimed at the middle class.
49
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Tourism
Development 2018
The development sector is changing
the urban centers of the main cities of
the country; in Lisbon the effects of this
investment segment have given a new life to
the oldest and most degraded areas, promising
to boost secondary zones.
The development transactions were
between € 5,000 / sq.m and € 6,000 / sq.m in
the two most emblematic transactions that
took place in the historic center of Lisbon.
Pastelaria Suiça (already in an advanced state
of degradation) and the BPI block, which,
together, add up to an investment of more
than 125 million euros.
The projects planned for the city
of Lisbon promise to modernize
and create new centralities for the
Portuguese capital.
The projects planned for the city of
Lisbon promise to modernize and create
new centralities for the Portuguese capital.
They are in total more than 520.000 sq.m
that will be developed for almost all the
market segments (logistic / industrial is
the exception). Of note is the integrated
Entrecampos operation, which will add more
than 200,000 sq.m for housing (700 fires for
affordable rental and 279 for free market),
commerce, offices and social facilities,
creating a new centrality in the modern city of
Lisbon with green spaces, more ecological and
energy efficient, being the largest operation in
the city since the rehabilitation of the eastern
zone (Parque das Nações).
In all of the planned projects, there are
more than 2,000 new housing fires, still
insufficient to fill existing demand, and
mostly directed to a medium-high and
high range.
Other secondary zones of the city of
Lisbon, such as Praça de Espanha / Sete Rios,
Alcântara, Belém / Ajuda and the riverside
axis between Santa Apolónia and Oriente,
will absorb the remaining 320,000 sq.m,
with special emphasis on the development of
Beato Creative Hub , currently with 30,000
sq.m and with an expansion project up to
100,000 sq.m, and the construction of 600
new dwellings in the Braço de Prata, in an
area of 244,000 sq.m.
The combination of several factors, such as
the large size of the land and buildings targeted
for intervention, the location of the buildings
and the good accessibilities, the interest that
Lisbon continues to generate among investors
and the need to increase the current supply
of the most varied segments. to these assets /
projects a versatility that becomes synonymous
with a fast flow in the market.
The origin of the capital continues in its
great majority to be coming from outside the
country, standing out:
■■ Fidelidade (China)
■■ Vic Properties (Austria)
■■ Mabel Capital (Spain)
■■ Anchorage Capital Group (USA)
■■ Grupo SANA (Portugal)
■■ Paris INN (France)
Kick-Off 2019
2019 also showed positive signs in the
development business during the first quarter.
The purchase of CGD’s old block on Rua do
Ouro in Lisbon’s downtown by Grupo SANA
was one of the transactions that prove the
maturity of this market and the attractiveness
that will continue to deserve.
The future use of these projects should
remain in line with the projects of the last
years, with the destination of the assets being
predominantly taken to the residential and
hotel segments.
50
51
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Tourism
2018
Guests by region 2018
7 000 000
6 269 500
6 000 000
5 000 000
Weight of Tourism
Revenues / Global
Exports:
18.6%
Weight of Tourism
Revenues / Exports
of Services:
51.5%
Weight of Tourism
Revenues / Exports
of Goods:
29.2%
(units)
Since 2014 that Portugal has been
gaining, more and more prominence in the
international tourist market. If the country
was already recognized and rewarded for its
beaches, cultural heritage and gastronomy,
the dynamization of the sector promoted by
the various national entities and the entry
of new hotel operators, also brought a new
breath to the national economy.
The weight of the tourism sector in the
national economy is proof of the fundamental
role of wealth generation, with tourism
revenues accounting for 8.2% of GDP.
In the balance of 2018, this sector once
again demonstrated the solidity that
characterizes it and the interest it generates
with foreign tourists who continue to
represent the largest share of tourists who
choose Portugal as a holiday destination. The
recognition of Portugal as a quality tourist
destination has been well known and every
year prizes of international renown are
collected, as was the case of the prize awarded
by the World Travel Awards for Best Tourist
Destination in the World in 2017 and 2018.
Not only the main and most traditional
tourist destinations in Portugal (Lisbon,
Oporto and the Algarve region)
have been strongly promoted by the
internationalization of the “Portugal” brand,
but also other less traveled destinations,
start to offer a quality and qualified hotel
offer, mainly directed to the tourism of niche,
oriented to new concepts (well-being, health,
tourism winemaker).
The metropolitan area of Lisbon was the
region with the largest share of tourists’
preference, with 29.78% of total hotel guests,
followed by the North and Algarve regions
with 20.56% and 20.02% respectively. The
Autonomous Region of Madeira accounted
for 6.56% of the total overnight stays of
the year, followed by Alentejo and the
Autonomous Region of the Azores with 4.96%
and 2.90% respectively.
4 334 900
4 213 500
4 000 000
3 198 200
3 000 000
2 000 000
Source Travel BI
1 380 500
1 044 500
1 000 000
609 900
0
North
Center
Lisbon
Alentejo
Algarve
Azores
Madeira
Source INE
21 M
Guests
Guests by Type of Accommodation 2018
66.1 M
Overnights
15%
Others touristic
accomodation
7,30%
Tourist resorts
3,90%
Touristic apartments
€48.6
RevPar
€16,614 M
61,10%
1,30%
Hostels
Hotels
11,50%
Apart-Hotels
Tourism Revenues
Source TravelBI
52.1%
Occupancy rate bed
65.1%
Room occupancy rate
Source Travel BI
52
53
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Overnight stays in hotels by category
45 000 000
2017
5 000 000
3 940 010
10 000 000
3 893 530
15 000 000
8 966 117
7 468 976
20 000 000
8 956 583
25 000 000
2018
Lisbon
19 844 498
30 000 000
19 507 960
35 000 000
7 625 386
39 827 049
40 376 011
40 000 000
0
Total
5*
4*
3*
2* / 1*
Source INE
The hotel category absorbed 61% of
overnight stays in 2018 (half of which are in
4-star hotels, 22% in 3-star hotels and 19% in
5-star hotels).
71% of the guests were foreigners, which
registered a residual increase of 0.1% over
the year 2017. Of note was the behavior of
domestic guests, which increased by 5.8% over
the same period in a market that continues to
be dominated by foreign tourists.
The cities of Lisbon and Oporto also
continue to affirm themselves as Business
Travel destinations, stage of congresses and
other events of international dimension. An
example of this is the Websummit Event that
is going to stay in Lisbon for the next 10 years.
Main Markets Issuing Overnights (Lisbon) 2018
Demand
The WebSummit event, which annually brings
to Lisbon more than 60 thousand people,
represents a strong national investment in the
expansion of infrastructures, considered as a
requirement for the maintenance of the city as
a destination for the event.
The metropolitan area of Lisbon had 6.3
million guests and 14.5 million overnight
stays, a slight increase of almost 2% and 1.1%,
respectively, compared to 2017. The Portuguese
capital follows the national trend with 73% of
guests to be foreigners. To record the increasing
weight of Brazilian tourists in the Lisbon and
national market, being the nationality that along
with the Spanish and French, leads the market
of the Portuguese capital and grows in strength
in the rest of the country.
1 230 000
1 220 000
1 210 000
1 200 000
1 190 000
1 180 000
1 170 000
1 160 000
Lisbon 2018
Total
Revenues
RevPar
Occupancy
Rate per
Room
€ 1 147,8M
€ 78,30
75,8%
9,4%
7,7%
-0,6%
1 150 000
1 140 000
Brazil
France
Spain
Source Travel BI
Total revenues in hotel establishments
4 000 000
410 054
405 538
87 622
94 513
1 081 237
106 487
1 032 452
1 147 784
101 176
500 000
279 595
1 000 000
272 725
431 029
1 500 000
482 698
2 000 000
1 067 286
2 500 000
3 397 827
3 000 000
2018
3 602 367
2017
3 500 000
0
Total
North
Center
Lisbon
Alentejo
Algarve
Azores
Madeira
Offer
Openings 2018
Category
Number of rooms
Lisbon has been witnessing the opening
of new hotel units over the last few years
by various national and international hotel
chains. The rebranding operations, not only
in the city of Lisbon but also in the rest of the
country, have marked the new openings with
the absorption of small national groups and
international renaming, thus giving credence
to the national market and giving signs that
the international groups have Portugal as a
destination to take into account.
EXE Liberdade
3*
163
Eurotars Duque Loulé
3*
140
Easyhotel Lisbon
3*
101
Eurostars Museum
5*
91
Real Maxime Hotel
4*
70
Hotel da Baixa
4*
66
WC Beautique Hotel
4*
40
Mera Prime Gold
3*
38
Altis Prata
4*
22
Source INE
54
Source Savills Research
55
Spring Market Study 2018 – Trends 2019
Spring Market Study 2018 – Trends 2019
Oporto
Algarve
Main Markets Issuing Overnights 2018
Demand
The North of the country registered a total
of 4.3 million guests in 2018, 4.6% more than
in 2017. In Oporto, we saw a greater balance
in the number of domestic guests vis-à-vis
foreign guests (50.2% and 49.8% respectively),
with the number of foreign guests growing by
5.5% compared to 2017.
Main Markets Issuing Overnights 2018
Demand
With 4.2 million guests, which represents
a continuous growth of 5% since 2016, it is
not yet the region with the largest number of
guests in the country, it is nevertheless the
one with the highest number of overnight
stays, a total of 18 , 8 million, of which 77%
come from outside the country.
1 200 000
1 000 000
800 000
600 000
6 000 000
5 000 000
4 000 000
3 000 000
North 2018
Algarve 2018
Total
Revenues
RevPar
Occupancy
Rate per
Room
400 000
Total
Revenues
RevPar
Occupancy
Rate per
Room
2 000 000
€ 482,7M
€ 46
64,2%
200 000
€ 1 081,2M
€ 54,20
65,0%
1 000 000
12%
8,7%
0,2%
4,7%
1,4%
-1,1%
0
0
Source Savills Research
Spain
France
Brazil
UK
Irland
Spain
Source Travel BI
Offer
About 90% of the retirement offer are
hotels, in Lisbon. In Oporto the hotel offer has
been growing gradually, having contributed
to obtain several internationally renowned
prizes. In 2018, Oporto opened up 10 hotel
units. Pipeline opened a further 25 hotels in
2019 by the hand of hotel chains such as Hoti
Hotels, Turin, Pestana Hotel Group, Vila Galé
and PortoBay Hotels & Resorts.
Openings 2018
Category
Number of rooms
Pestana Porto
– A Brasileira City Center
& Heritage Building
5*
90
Porto Royal Bridges
4*
70
Selina Porto
3*
54
Vila Galé Collection Braga
4*
127
Source Savills Research
56
Source Travel BI
Offer
Algarve has a greater diversity of types of
accommodation compared to the cities of
Lisbon and Oporto: 66% are hotels, 23% are
apartments or tourist villages, and 10% are
aparthotels, having been gradually increasing
consonant with the rest of the country of the
number of hotel units.
In 2018, the Algarve received new hotel units
such as Jupiter Albufeira Hotel (400 rooms),
Jupiter Marina Hotel Portimão (150 rooms)
and the refurbished The Prime Energize Hotel
in Monte Gordo with 105 rooms.
66%
Hotels
23%
apartments
or tourist
villages
10%
aparthotels
57
Spring Market Study 2018 – Trends 2019
Kick-Off 2019
2019 will be a year in which the high
demand for Portugal as a tourist destination
will continue. It is expected that the
dynamization of areas considered as nonprime destinations, such as the interior of the
country, will continue to contribute strongly
to the local economy and to the increase of
tourism in the regions concerned.
Portugal will continue to establish itself as
a destination of choice for specific niches. The
bet on increasingly exclusive segments will
be one of the most explored areas throughout
the year, in order to create a territory
whose experiences offered complement and
contribute to the country’s continued drive in
the main international tourism routes.
On the other hand, it is also worth noting
the continued interest of international hotel
brands in the domestic market, a living proof
of the prestige and trust that international
players place in our country, with very
probable new acquisitions of hotel assets for
rebranding or adaptation of assets previously
allocated to other segments.
The pipeline of new openings in 2019 for
the whole country, adds to the opening of
109 new hotel units, with Lisbon and Oporto
accounting for 56% of the new offer.
In the first quarter of 2019, seven new
hotel units opened and also three openings
regarding rebranding projects. This was the
case of the former Hotel Guadiana in the
Algarve, now called the Grand House Hotel
(5 *), the Eve Senses Hotel in Faro and the
Carvi Beach Hotel Algarve.
In new projects, opened the Monchique
Resort & SPA (185 rooms) in the Algave region
and in Oporto we highlight the inauguration
Vila Galé Douro Vineyards (47 rooms).
58
Savills Research
We’re a dedicated team with an unrivalled reputation for producing well-informed and
accurate analysis, research and commentary across all sectors of the UK property market.
Paulo Silva
Patrícia Melo e Liz
Alexandra Portugal Gomes
Rodrigo Canas
Head of Country Portugal
paulo.silva@savills.pt
Chief Executive Officer
patrícia.liz@savills.pt
Market Research
alexandra.gomes@savills.pt
Director Agency
rodrigo.canas@savills.pt
Cristina Cristóvão
Joana Rodrigues
Paula Sequeira
Director Agency Retail
cristina.cristovao@savills.pt
Director Architecture
joana.rodrigues@savills.pt
Director Consultancy
paula.sequeira@savills.pt