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Alternative segments will continue attracting investment in 2020
14 January 2020 | Ana Tavares

At the end of the cycle, the reduction of opportunities, rentals increase and yields compression in Europe are leading investors to seek other assets capable of generating alternative returns. Infrastructure, accessibility, sustainability and space as service will be some of the themes which investors will be paying attention to in 2020.

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This is one of the main conclusions from a recent study from Savills, according to which «the limited amount of quality assets and the end of cycle feeling will lead investors to diversify demand across several segments and locations», explained Eri Mitsostergiou, Diretor at Savills European Research. «We are witnessing a growing number of investors focus their strategies on housing and alternative segments in Europe», she added.

The same is true in our country. Alexandra Gomes Portugal, Senior Analyst at Savills Portugal’s Research Department, added that the «the European reality is perfectly mirrored in Portugal, where in 2019 we started to see more consistently a growth in interest and demand for alternative segments, such as student residences’ projects». Regardless, she anticipated «the office segment will remain key for core investors, together with development projects».

Assets such as senior and student residences and other types of housing assets, are amongst the main assets sought by those who are looking for long-term returns, with prospects of yearly growth.

Demand for alternative work spaces should also remain high, at a time when the occupancy rates are at historical lows all over Europe, with rents increasing between 4% and 6% since 2014.