From less to more. This is how CBRE envisions the economic panorama in its “Real Estate Market Outlook 2024” report, predicting a slight growth in real estate investment volume for this year. The consultancy estimates that this increase will range between 5% and 10%, leaning closer to the latter percentage and potentially reaching €12.5 billion in transactions. A positive development, albeit conditioned by macroeconomic factors such as inflation and interest rates, and the socio-political context, with the Ukraine conflict in focus.
The sector continues the path initiated in the last months of 2023, confirming that the market correction has peaked. In this regard, a report by Colliers highlights the positive signs of the period. Overall for the year, investment fell by 40% compared to 2022, reaching €11 billion. However, the last quarter added €3.9 billion, a 104% increase from the same preceding period and a 31% increase year-over-year.
Among the various investment segments, hotel assets positioned themselves among the most sought-after, capturing, according to Colliers, 38% of the total investment, amounting to €4.248 billion. Thus, last year exceeded all forecasts, trailing only behind the 2018 records.
Portfolio transactions, the engine of investment
Portfolio transactions were the most relevant, with a 94% increase compared to 2022, representing 65% of the volume. In total, they comprised 110 hotel assets and 14,320 rooms with an investment of €2.615 billion.
Within the vacation assets, the islands attract a significant portion of the investment. With €1.175 billion, the Canary Islands closed 39 transactions, the same as the Balearic Islands, although in their case, the amount was €796 million. In both cases, the determining factor was the major operation involving GIC and HI Partners, which included 27 assets in the Canary Islands and 19 in the Balearic Islands.
In the urban segment, Madrid emerges as a leader, concentrating 14% of the volume. Meanwhile, Barcelona stands out by doubling the investment received compared to 2022, reaching €582 million. Málaga closely follows, attracting investments worth €560 million.
New accommodation models in focus
However, hotels have not been the only avenue for tourist real estate investment. A new accommodation formula is beginning to emerge among investor interests. These are the so-called Serviced Apartments and Branded Residences. The former concept refers to accommodations that offer services typically associated with hotel establishments. The latter identifies units integrated into residential or hotel complexes, designed and managed by major hotel operators, typically within the luxury sector.
Colliers, in its 2023 Branded Residences report, outlines the rise of this model and its growth potential in the next four years, expecting to exceed 1,200 units. And although for now, the Canary Islands, Madrid, and Barcelona concentrate a good portion of the offer with 278 operational units, the Costa del Sol is emerging as the preferred destination for future projects.
Among the major investors, we find top-tier chains such as Four Seasons, Mandarin Oriental, Marriott, or Accor. But the consultancy also points out that they have attracted the interest of major brands from the automotive or fashion world, such as Fendi, Missoni, Dolce & Gabbana, Karl Lagerfeld, or Lamborghini.
Private investors, on the other hand, focus on the services apartments format. Owners can reserve 60 days a year for personal use while renting out the property for the rest of the year.
