This was one of the main conclusions drawn at a breakfast dedicated to debating «Investments that defined the new real estate cycle» in Porto, a joint organization by Iberian Property and Cushman & Wakefield on the past 14th of May in that city, which gathered ten specialists and investors around the table.
According to Óscar Sá, in charge of urban renewal at Cushman & Wakefield’s office in Porto, «we have all the conditions to extend this virtuous cycle in the real estate market», since «all sectors still have a lot to give and to grow». Which doesn’t mean, however, that we shouldn’t be cautious, because «we need to be aware of the cycle stage we are in», remarked Francisco Carmona, Head of Real Estate Development at Via Célere in Portugal.
«There is still a lot of activity and a lot of optimism, but when it comes to prices it is clear that there is more caution than a year ago», recognizes Eric Van Leuven, Executive Partner and Head at Cushman & Wakefield in Portugal. An idea confirmed by Grupo Ferreira Holding’s CEO, Rui Ávila, warning that «these days, you can no longer buy an asset expecting it will keep increasing its value indefinitely» in the short term.
And, at a time when Porto remains firm in its goal to consolidate itself as an international destination for people and services, this issue takes on a more significant role, since «Porto is and has always been a destination where prices are very important», considers Tiago Violas, Grupo Violas Ferreira’s CEO; and «if we don’t have the right prices, we won’t be competitive in Europe», adds Óscar Sá.
Offices are back in town
Offices have proven to be one of the main stages for the change that is taking place in Porto’s real estate market. They «are being brought back to the city, in a trend that is being set internationally», mentioned Eric Van Leuven.
«To bring the offices inside the city helps in increasing the population’s disposable income», defends Tiago Violas, Grupo Violas Ferreira’s CEO.
Besides that, «being in the centre and close to public transport will increasingly become major assets for the new offices, since the younger generations want to be in the city centre and that works as an important factor to keep and attract new talent», defends Tiago Violas.
An opinion shared by António Castro Henriques, administrator at SDC Investimentos, who considers that «Porto being a small city when compared to other cities in Europe, should adapt its offer to these requirements, since proximity, quality of life and competitive costs are its main competitive advantages».
New housing attracts international investors
Considering that «the current challenge is to further adapt the offer to the latent demand», as stated by Rui Ávila; the mid-range housing market and alternative housing, such as student housing, are starting to gain more interest from investors, especially from international investors.
«This virtuous cycle within transactions, services and tourism also carries a greater demand for housing», states Francisco Carmona, explaining that at Via Célere «we are repositioning ourselves to meet the needs of the Portuguese families».
Confident about the future, Carlos Marnoto considers that «Porto’s market still has room to grow. But we have to look from every angle and with caution when moving forward, especially concerning prices, because although this virtuous cycle is here right now, growth won’t remain strong for ever».
Looking beyond the municipality’s borders is another consensual subject among specialists. For João Nuno Magalhães, Predibisa’s CEO, «Gaia and Matosinhos are and will increasingly become alternatives to Porto’s city centre», both in terms of services and in terms of housing.