Country Report Spain Q1-2021
“Demand for residential and logistics properties is particularly high at the moment.”

Dear readers,

“Investment volume in the first quarter of 2021 has fallen compared to the first quarter of 2020. However, it is difficult to compare the two periods as it was believed that we were witnessing the conclusion of a cycle even prior to the onset of the coronavirus pandemic. What’s remarkable is that 70 % of investments were made by foreign investors, suggesting that the market remains extremely attractive to them. In addition, there was a shift in demand within the asset classes: demand in residential and logistics properties is particularly high at the moment, but office real estate is also extremely popular and offers larger volumes compared to logistics properties. The hotel and retail segment is suffering, with the exception of food retail and retail parks. Another factor exacerbating the overall situation is that it is proving difficult to finance some properties due to reticence among banks. That being said, overall economic expansion of 6.4 % is expected in 2021 – one of the highest figures forecast in Europe.”


Your Maria Teresa Linares Fernández

Contact

Ms María Teresa Linares Fernández
Managing Director Spain

Phone: +34 618 109905
E-mail: Maite.Linares@Deutsche-Hypo.de

REECOX Spain nearing pre-crisis level

The positive performance of Spanish real estate market activity continued into the first quarter of 2021. Compared to the previous quarter, the REECOX value rose by 3.2 % to its current level of 175.1 points, meaning that the index has now more or less returned to its pre-crisis level.

Slight relief in tension on Spanish stock markets

Following the extremely volatile development of Spanish stock markets since the beginning of last year – at times with double-digit quarterly rates of change – the dynamic performance appears to be cooling off. Spain’s leading share index, the IBEX 35, continued to develop positively, rising by 6.3 % to 8,580 points. 

Spain’s FTSE EPRA NAREIT real estate index also made a significant contribution to the positive overall development. After consistent price rises since November 2020, it is now trading at roughly 23.1 points. This equates to a quarter-on-quarter increase of 7.5 %. The positive development of the stock markets is also reflected in the Spanish business climate as measured by the Economic Sentiment Indicator (ESI). This indicator now stands at 96.9 points, the highest figure recorded since February 2020, following a 6.7 % quarter-on-quarter increase.

Synopsis of Input Variables and Real Estate Economic Situations Q1-2021

Country

Stock Index

Real Estate Economy Index

Economic Indicator

Base Interest Rate

Interest Rate 10-Year Government Bonds

Q4-2001/2102/21Q1-21Delta (%)
Q4-20 / Q1-21
DE
upup
do
upup
eq
up
311.0
303.1
309.4
328.9
5.8
GB
up
up
upup
eq
upup
185.3
184.0
188.8
203.0
9.6
PL
do
up
upup
eq
upup
172.7
174.9
178.4
181.7
5.2
NL
upup
up
upup
eq
up
178.5
181.4
181.2
188.2
5.4
FR
upup
eq
upup
eq
upup
219.8
219.0
223.0
229.0
4.2
ES
up
up
upup
eq
upup
169.6
171.4
170.6
175.1
3.2