In a roundtable discussion moderated by Richard Betts, Co-Founder & Head of Content of Real Asset Media, addressed the commercial real estate opportunities in Portugal, having on stage representatives from DEKA Immobilien, Panattoni, AXA Real Estate, and Lighthouse Properties.
Arantxa Prado, Senior Director Capital Markets at Panattoni Europe, began by stating that Portugal has very solid fundamentals and clear nearshoring potential in Europe. “The only downsides relate to the space restrictions and making land available still being a complex process”. She also noted that despite the increase in competition, the size of the market, or in other words, the liquidity for the exit strategy, still represents a challenge for investors, believing that’s why we see a shortage of transactions. However, she assured that some modern projects of greater scale and quality will soon emerge, especially through the growth potential of e-commerce, which has yet to be significantly implemented in the country.
Investors, tenants and lenders have raised their standards in regard to ESG. This was one of the conclusions highlighted by Bevan Williams, Head of Asset Management at Lighthouse Properties, who reiterated that in respect to retail is even more evident since there are no new buildings - “we are buying 20-year-old assets, and the dynamics of retail imply the need to constantly renew these spaces and optimizing assets to fit the retailer’s needs”. Bevan Williams also defended that retail is truly back, and it’s now very easy to raise equity and access debt to purchase good performing shopping centers.
Taking advantage of managing several funds, Esther Escapa, Head of Acquisitions and Developments at AXA Investment Managers, shared the company does not discard any asset class, agreeing that finding liquidity to anticipate an exit strategy is fundamental. “We are already present in the office and hotel sectors, and we keep seeing potential in those sectors due to limited supply. For now, Lisbon is the focus, where we are developing a high-end, well-located and sustainable office complex”.
“Sustainability is no longer just a matter of having a sustainable building, you need to have tenants onboard and choose them wisely”
Dagmar Übelhör, Acquisitions & Sales at DEKA Immobilien, acknowledged that as a German investor technical aspect have always been a must, but profitability now shares the priority list together with ESG. “We are very focused on carbon footprint and with getting tenants onboard to go a further step on the S and G…after all we build our reputation also based on the companies who occupy our buildings”.
When provoked by Richard Betts about dream assets in Portugal, the speakers Wishlist included: Hotels for Deka (an asset class they still haven’t invested in Portugal), city-center land and with good access to the energy grid for Panattoni, large dominant shopping centres, with no Capex needs and perfectly BREEAM rated for Lighthouse Properties, and a well-located Private Build to Suit Accommodation (PBSA) asset for AXA.
A full Special Story on the Portugal Real Estate Summit 2024 can be read HERE.
