Spain is one of the most attractive real estate markets in Europe, with significant growth potential, making it a top priority for investors, according to global real estate services firm Cushman & Wakefield.
Their analysis indicates that 84% of prime assets in the office, retail and logistics sectors across Europe are currently undervalued, presenting an opportunity for capital appreciation as these markets align with fair price levels.
The Cushman & Wakefield report reveals that countries such as the United Kingdom and Germany, with 100% and 89% of their prime markets undervalued respectively, top the list of investment opportunities.
Spain, meanwhile, ranks a prominent fourth and stands out as a key market in strategic sectors such as retail, logistics and hospitality, supported by favourable price adjustments and a positive macroeconomic environment.
Furthermore, the country's economic growth, with a projected GDP increase of 2.8% in 2024, surpasses the European regional average, driven by strong domestic demand and a resilient labour market.
This favourable context, alongside the stabilisation of bond yields and an improvement in the risk premium, positions Spain as one of the most "promising" markets in Europe, capturing the attention of investors looking to capitalise on the real estate recovery process.
Retail and logistics, drivers of growth
In terms of investment, Spain's retail sector has seen a year-on-year growth of 79% in the first nine months of the year, largely driven by the recovery of tourism in key cities such as Madrid and Barcelona.
During the same period, the hotel sector attracted the majority of capital, accounting for 26%, also benefiting from the tourism recovery and reinforcing its position as one of the most attractive areas for investment.
The TIME Score index, which measures investment attractiveness, rates Spain’s logistics sector at 3.5, positioning it as the leader in investment opportunities, followed closely by retail and offices, both with a score of 3.4.
Offices, in particular, have shown strong performance, with their TIME Score rising from 1.9 in Q3 of 2022 to 3.4 in Q3 of 2024. These sectors, currently in a recovery phase, are experiencing growing demand and positive transaction projections for 2024.
Eusebi Carles, partner at Capital Markets & Consultancy at Cushman & Wakefield Spain, has emphasised that Spain is "at the forefront" of the real estate recovery in Europe.
"Opportunities in retail, logistics and hotels provide an appealing mix of stable income and capital appreciation potential. In offices, we also anticipate a notable improvement in activity levels. With strong GDP growth and the expected future evolution of interest rates, we foresee a significant increase in investment volume in the coming months," said Carles.