WMarket '19 Review
We are very pleased to present the WMarket Review 2019. It is a study which aims to provide an up to date analysis of the real estate market in Portugal, and to give our clients a perspective on how the market has moved and is Iikely to move in the Welcome future. Worx - Real Estate Consultants is recognised for its innovative approach, its know how and its anticipation of market needs. The WMarket Review has already become a reference point in the real estate market. It is a vital tool which is noted for the quality of the information and for its high standards, which are the result of a lot of hard work by a multidisciplinary team.
We would like to thank everyone who has contributed to its development. 2018 proved to be another successful year for the This global dynamism is accompanied by a record year in Portuguese Real Estate Market. terms of revenues in Tourism. The promotion of a qualified offer of destinations and experiences in Portugal along The results, to beat historical levels, prove the degree of with the variety of hotel offerings has allowed the growth attractiveness that Portugal exerts on the radar of big and of this sector in recent years. important international players, proving to be a strong competitor in Europe. For this year 2019, some issues will be taken into account as in the case of the creation of SIGIs (Real Estate In the final balance sheet of 2018, the volume of Investment and Management Companies) in Portugal, investment reached the national record of approximately the national adaptation of REITs (Real Estate Investment € 3.2 billion transacted. We are therefore talking about Trust), with a strong influence of the concept adapted by transactions that can hardly be repeated over the next Spain, where they are denominated by SOCIMIs (Listed few years, given not only the volume of investment they Companies of Real Estate Investment). generate but also the diversity of locations of the assets belonging to them. The trend towards 2019 is optimistic Also the BREXIT phenomenon - will remain important and reveals the growing attractive climate that Portugal with Portugal as a strategic investment site in Europe and has shown. Student residences, assisted living and health liquidity volumes are expected to remain high. In turn, the facilities are new asset classes that will attract investors retail and office segments will continue to be the big stars to form diverse risk portfolios. This year, the traditional in 2019, with yield values moving into more stable ground. Investment Market will take its path and extend its range of assets to other uses. The consultant predicts that in this year 2019, the national economy alongside the logistics, retail, investment, office In the Office Market, the city of Lisbon has seen an increase and tourism sectors will make the Portuguese real estate in activity, which will only be curbed by the lack of new market even more attractive to foreign investment. offer that the market presents. Nonetheless, the dynamism of demand, which extends to the Port Market, will continue to be a constant, with international occupiers increasingly entering Portugal.
PEDRO RUTKOWSKI CEO [email protected] www.worx.pt
One Stop Welcome Trends Economy Investment Offices Retail Logistics Tourism Residential Advisor 15 29 35 47 67 77 85 103 111 www.worx.pt
Portugal is, for the second consecutive United Kingdom, Germany, Spain, year, the "Best Destination in France, the Netherlands continues the World". Tourism has been as to be the largest emitters of tourists. important and has an impact on the However, diversifying markets is a national economy as it does today. betting strategy that is at stake across They represent 13.7% of the national the board. As a result, in 2017, China (+ GDP, the country's largest exporter 41%), Brazil (+ 39%), Poland (+ 36%) of services (50.1%) and are expanding and the USA (+ 35%) grew the most. throughout the country. With the same results, you have They continue to increase in value, something to say about Portugal having A country to visit, with revenues increasing at a faster been receiving. rate than overnight stays, and as we move closer, we have a higher The items go back to a set of 10-year invest, live, study seasonality rate of all Mediterranean coins, which are part of the set of all countries 36.5% (2017). If so, to 33.5% the agents of the sector, interest rates by 2027, by researching in tourist and lines of action to position Portugal products that bring more people as one of the most competitive and throughout the year, such as Cultural sustainable tourist destinations in Tourism, Religious Tourism, Cycling the world. a cohesive, innovative and and Walking. competitive territory that values work and talent. An inclusive, open and One strategy is to extend tourism technological country, where tourism throughout the country and is a hub for economic development throughout the year. In 2019 we will and social and environmental pay special attention to Enotourism sustainability. and Tourism Literature, products with enormous potential for growth By 2019, the course is to grow in value and location in the country on and create the conditions for tourists large international growth areas. to want more time, get to know the Instruments such as the Valorizar territory and have more opportunities Program, the program to attract events to return, not just to visit how to live, and congresses, the Portuguese Trails, invest and create companies. Pathways of Faith or a bet on Wine Luís Araújo President of Turismo de Portugal Tourism and Gastronomy are available to offer a diversified.
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Portugal is now becoming an ever more being refurbished and others being for convenience and speedy delivery, appealing market for any Institutional reconverted from their old uses. are mounting pressure on operators Player. With sounder economic to build up stocks and be closer to fundamentals than in previous years, The office market is one of the real destination. With this trend likely to the country has managed to sail estate sectors that is on the limelight. continue and even accelerate further, through the world’s great recession, An obsolete stock, poorly efficient, the logistics sector is likely to see a with an outstanding score and in an coupled with a limited pipeline and a dynamic growth in the medium-to-long impressive style, with praises from its growing demand pressure, is pushing term. European peers. office rents higher. Expo and CBD, with their meagre vacancy rates, are a Additionally, further stability should With an expected annual GDP growth good example of this trend and shall be brought about by the very recent rate in the 2.0% region forecasted for see their rents increase steadily in approval of the SIGI regime (REIT) in the coming years, with a recovering the short to medium term, with the Portugal. This newly creation, if well Why Invest in private demand, a highly qualified spillover effect likely to positively affect designed, could definitely accelerate workforce and an historical level of the remainder of Lisbon’s office areas. the flow of stabler, longer-term capital Portugal? social moderation, the country offers These economic imbalances, coupled in an economy that is highly dependent a robust setting for any long term with the existing yield arbitrage, are on Foreign Direct Investment (FDI). A investment play. likely to continue over the short-to- final note to stress the importance of medium term and shall continue to a stable legal framework in promoting International companies have woken bring in more international investors an efficient allocation of capital and up to this reality and moved some into the market. allowing the foreseeability of cash of their shared services units into flows by investors. It should be the the country over the past years. The retail sector is also benefiting Portuguese Government’s objective to Additionally, Business Process from the positive economic defend this. Outsourcing (BPO’s) companies performance of the country. The have been quite hectic and followed Portuguese, traditionally avid shopping suit. This trend is undeniable with centre consumers, are now seeing more players like BNP Paribas, Google and disposable income available in their Teleperformance being a good example pockets to spend. High street retailers, of movers, with more companies are are also benefiting from this higher following this path. internal demand and the larger amount of tourists moving around the cities, João Cristina Growing tourism influx and favourable mainly in Lisbon and Porto. Director of Merlin Properties Portugal fiscal regimes have also played a crucial role, allowing an increasing inflow of Demand is also looking into innovative foreign demand and a speedy recovery ways of shopping, using online in the Hotel and Residential sectors. platforms to purchase goods. Growing This recovery is seen mainly in Lisbon’s online retail sales, their bullwhip effect, city centre, with several buildings and increasing consumer expectations
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In a cycle of strong growth of the or in the EU/EEA. Upon admission How the shape and form of investment in real estate, with record to trading, at least 20% of the shares Portuguese REITs will improve the levels of capital (over €3 billion) must be spread across investors with competitiveness of our market and coming into the sector in Portugal holdings corresponding to less than 2% the attractiveness of investment into in 2018, a long-awaited regime for a of voting rights. Portuguese real estate, will be one of Portuguese REIT-type vehicle came the most interesting trends to watch into force in February 2019, creating SIGIs must distribute as dividends at in 2019, when Lisbon stands out in a new form of listed real estate least (i) 90% of the profits resulting reputable market surveys among the investment company named SIGI from dividends on shares or income top cities to invest in this year. – Sociedade de Investimento e Gestão from participation units; and (ii) 75% of Imobiliária. the remaining distributable profits in Portuguese each financial year. The purpose of SIGIs is the investment in real estate assets for letting or other From a tax perspective, the Portuguese REITs: fostering forms of commercial exploitation, Government chose to apply to the including development and urban SIGIs the tax regime already in force the cycle regeneration projects, and rural land. for collective investment vehicles, SIGIs may also hold participations in which ensures a single stage of taxation other Portuguese SIGIs or other REITs at the level of the final investors, with registered within the European Union corporate income tax exemption or the European Economic Area (EU/ on income received by the SIGI and EEA). considered as having a “passive” nature. The composition of the portfolio of a SIGI must comply with two cumulative REITs have proven to be a successful thresholds: (i) the value of rights over investment vehicle in many mature property and share interests shall markets, much by virtue of their represent at least 80% of the total asset flexibility, liquidity, and the ability to value of the SIGI; and (ii) the value of combine the free-floating of shares rights over property subject to leases or with the professional management other forms of commercial exploitation of the assets in a highly transparent shall represent at least 75% of the total model. Jorge Salvador Gonçalves asset value. SIGI’s indebtedness cannot Partner of Garrigues exceed 60% of total asset value. These are understood to be key factors for the success of SIGIs in Portugal, Within one year after incorporation, even though there are uncertainties SIGIs’ shares must be admitted to deriving from certain limitations in the trading in a regulated market or in a regime approved. multilateral trading facility in Portugal
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ECONOMY '19
01 04 Stabilization of the unemployment Stagnation of public investment at rate at a level considerably lower very low levels. than the euro area average.
05 02 Export growth, but below the Trends Moderate rise in interest rates. growth of imports. 03 06 Slowing down the pace of GDP Reducing the deficit to 0 over the growth and gaining purchasing next two years, even though it has a power. government debt in excess of 120% of GDP.
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INVESTMENT '19
01 04 In 2019, a commercial investment Difficulty in forming portfolios value of more than 2 billion euros of more than 300 million euros, should be registered again. comparable to those transacted in 2018.
02 The scarce supply of logistics / 05 industrial, office and residential, will Student residences, assisted justify the bet on large projects of residences and health facilities will promotion and new construction. continue to be strongly sought by investors.
03 Large-volume investment will 06 continue to be primarily carried out The yields should stabilize with by foreigners, especially French, the maintenance of Portugal as a Spanish, North American and focus of international interest, with Chinese. the Golden Visa program and the tax benefits to be one of the main motes to foreign investment, mainly in the Lisbon and Porto centers.
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OFFICES '19
01 04 06 08 The projects planned for 2019 will With the approach of Brexit, the Prime rents should increase by The takeover of 2019 should continue to be insufficient to meet Portuguese market should be the around 5% in each market area, stabilize around the values of existing demand. target of a consultation for those given the strong activity in the 2018 due to the lack of supply in a who want to relocate their office Portuguese market that will scenario of high demand. from the English squares, but keep continue over the next few years. 02 it in the territory of the European The establishment of pre-lease Union. 09 agreements in projects not yet 07 The bargaining power will remain finalized, along with an increase in The shortage of supply in the essentially on the owners' side, with the renegotiation processes, will be 05 Lisbon market has caused many a tendency to increase rents per part of the range of trends of 2019. The Ribeirinha area will continue to multinationals to equate the city sq.m. be the one that runs away from the of Oporto to establish their offices, traditional office format present in so that this city will continue in 03 the Lisbon CBD. the target of many occupants who The lack of supply along with the intend to expand / re-locate their urgency of occupation, will put on operations in European territory. the market buildings considered obsolete, that do not correspond to the totality of the needs of the tenants.
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RETAIL '19
01 04 Technological innovation as one of Trend of increase in the number the pillars of growth of the sector in of local shops that combine the Portugal. traditional and the cosmopolitan, attractive for national citizens and tourists. 02 Growth of online turnover, with a tendency to have a large absorption 05 of the physical trade of medium-low Maintenance of consumer value goods confidence levels, leaving consumption around 2018 levels.
03 Investment of stagnant root / very 06 close to zero value, based on the Modernization of the food courts of expansion of existing shopping the shopping centers and increase centers, with their adaptation to of the areas of culture and leisure of the new habits of the population, the same ones. more demanding / surgical in their choices.
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LOGISTIC '19
01 03 Development of logistics platforms With no prospect of creating a focused on: significant supply in 2019, rents are expected to increase slightly a. Automation compared to the values in 2018, as a b. Interoperability result of the strong demand and the c. Energy Efficiency clear shortage of logistics platforms d. Decarbonization that meet the requirements e. Collaborative Economy demanded in the market.
02 Continuation of the trend of need to build root projects to meet current needs, which can only be supplied with new platforms or with the expansion of existing ones.
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TOURISM '19
01 03 05 The main tourist indicators are The bet on differentiating concepts Maintenance of the interest of expected to show a performance and market niches, such as the international operators in entering increase, with July, August and health and wellness segment, will the Portuguese market through September contributing largely continue to be one of the strongest the purchase or rental of hotel to this growth trend, but also to trends in the national tourism units. These are available to wait November, particularly in the city of market and will be determining for rehabilitation or conversion Lisbon with the Web Summit, which factors for the diversification and processes, due to the inflated has had an interesting impact in the modernization of the offer. amounts requested for the purchase hotel performance of the Capital. of existing units and that will still have a requalification investment in 04 many cases. 02 Increase in the corporate market Portugal will continue to affirm driven by the exposure of the itself in the luxury tourist market, cities of Lisbon and Porto as 06 for the greater differentiation of destinations for the establishment Existence of growth margin of ADR products and attraction of markets of multinational companies and indicator (Average Price per Sold with greater purchasing power. venues for international events and Room). conferences.
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RESIDENTIAL '19
01 03 Maintenance of the shortage of Maintenance of interest in urban residential supply mainly directed rehabilitation projects by foreign to middle-class families in the investors, in part due to the tourist municipality of Lisbon. boom and stable political and social environment.
02 With the limitation of the licenses 04 for Local Accommodation in some 2019 will have as great opportunity areas of Lisbon and tax benefits for the investment in new construction real estate other than for own and directed to the middle class, permanent housing use, they should especially in the surroundings of slow down the use of new fractions Lisbon where there are good and acquired for short periods. fast accesses to the center of the capital.
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Portugal has presented a very satisfactory macroeconomic trajectory.
According to the statistics of the Bank of Portugal (BP), our country has in all the fields considered here a better performance than the euro zone average, except for public consumption / investment.
2018 2017 2018* 2019* 2020* ECONOMY (%)
Purchasing Power Portugal 1,2 0,9 0,4 0,3 (Variation) Euro zone 1 0,3 0,1 0
* prediction
Source: Bank of Portugal
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"The crisis will come sooner or later. We need to be ready and better prepared to face the challenges."
Valdis Dombrovskis
2017 2018* 2019* 2020* Annual change (%) "Portugal came out of the Gross Portugal 2,8 2,3 1,9 1,7 Excessive Deficit Procedure Domestic Product Euro zone 2,5 2 1,8 1,7 last year and last week Portugal 1,6 1,4 1,5 1,4 Inflation the Commission concluded Euro zone 1,5 1,7 1,7 1,7 A large part of the trust that international companies have placed in Portugal comes from issues such as Portugal 2,3 2,4 1,9 1,7 that the imbalances are no Private political and social stability, security, the country's strong Consumption longer excessive, who would Euro zone 1,7 1,5 1,7 1,6 wage competitiveness compared with other Western Public Portugal 0,2 0,7 0,1 0,2 nations, as well as the consequences of the climate of have believed a few years Consumption Euro zone 1,2 1,4 1,4 1,3 economic recovery of the euro zone. ago and who would have Portugal 7,8 5 4,6 4,3 Exports This year, our country achieved a growth of 2.3% in the believed?" Euro zone 5,6 3,1 3,8 3,6 year 2018, which, if we disaggregate by its components (public consumption, private consumption, investment Portugal 8,1 5,1 5 5 Jean-Claude Juncker Imports and trade balance), we came to the conclusion that Euro zone 4,2 3,5 4,5 3,9 private consumption year (year-on-year change of 2.4%), Portugal 3,3 2,3 1,2 0,9 such as exports (up 5% on the previous year), but still Employment Euro zone 1,6 1,4 0,9 0,8 failed to balance the trade balance, with a deficit of 0.3 % - to record the good performance of the services balance Portugal 8,9 7 6,2 5,6 "Portugal is in a spectacular Unemployment Rate (surplus) but not enough to compensate the balance of Euro zone 9,1 8,3 7,8 7,4 goods deficit. recovery, but it is not yet one of the seven largest * prediction economies in the euro zone."
Source: Bank of Portugal Pierre Moscovici
31 32 (Millions €) 33 Purpose of Credit Source: Pordata 0 2 4 6 8 10 12 14 16 Total change
2015 27,46% Total
2016 Mortgage loans 23,50% expected to become lower as the years pass. be considered very encouraging since growth rates are growth. However, the scenario, althoughpositive, cannot another two years, under aclimate of confidence and a highpublicdebt), make the economy beand for at least the deficit forecast in the coming years (although still with (0.9%), the declinealready achieved andalmostnullity of All this combined with the gain inpurchasing power Credit for consumption andother purposes 2017 26,13% Source: Eurostat Deficit (% GDP) Public Debt (%) 7,2 2014 2,5 4,4 2015 125,7% Portugal 2
2 2016 1,6 86,7% Euro zone 3 2017 Portugal 1 www.worx.pt Euro zone 0,7
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COMMERCIAL INVESTMENT VOLUME IN THE EUROPEAN MARKETS
The year 2018 was again positive for most of the main European markets, with a total commercial investment of more than 260 billion euros.
The European office market maintained the trend of predominance of the office sector as the one that had the 2018 most weight in the total transactions (44.90%). In Spain INVESTMENT and Portugal, it was the retail sector that contributed mainly to the results achieved (36.66% and 44.58% of the total commercial investment, respectively), with these two countries being the exception among all markets analyzed.
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Germany, and France were the European countries with the highest volume of transactions. Of note were the 16% increase in the English market, while the important markets in France, Germany and Spain stagnated in the results obtained in 2017. (43%), the Netherlands (42%) and Distribution of Investment Volumes in Portugal (38%). the Main European Markets (without Portugal)
Offices Retail Commercial Investment Volumes Industrial and Logistics Hospitality
Others Source: BNP Paribas Source: BNP/Worx 2017 2018 UK Italy Spain France Poland Ireland Belgium Portugal Germany
18,42% Netherland Czech Republic Czech
6,07% 44,90% 3 300 4 000 3 500 1 800 28 000 28 000 58 000 58 000 9 000 8 150 11 100 19 000 4 400 6 000 10 500 10 500 54 435 65 000 2 000 3 500 1 997 3 200 13,52%
17,09%
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The inherent risk of investment continued to merit the The stable political climate, the signs of economic confidence of world players, who were able to enjoy the recovery, fiscal incentives for investment, the dynamics of yield compression trajectory that lasted for 6 years, but in the employment market and the prospects of maintaining general terms there were only declines, but a stabilization the positive performance of these factors led Portugal to of those already verified in 2017 So the forecast repeat the 2017 commercial investment growth rate in announced in 2017 that Germany and France should 2018 , about 38%, which has made this last year a record keep their prime yields stabilized for 1 to 2 years with a performance. Volumes subsequent growth trend should still be considered. of Investment Prime Yields by City
2018 2017 2018 Commercial Real Estate Amsterdam 3,5 4,15 Investment in Portugal Amsterdam 3.800 Barcelona 3,75 3,75 Barcelona 1.300
Berlin 2,8 2,9 Berlin 7.000
Bruxels 4 4,65 Source: Worx (M €) Bruxels 2.800
London 3,5 3,5 London 23.858
Paris 3 3 Paris 15.500
Dublin 4 4,25 Dublin 2.750 2011 2017 2015 2013 2012 2016 2014 2018 Frankfurt 3,05 3,1 2010 Frankfurt 8.500 2009
Hamburg 3,05 3,2 Hamburg 4.500
Madrid 3,2 3,2 Madrid 3.600
Milan 3,25 3,5 Milan 3.000
Munich 2,8 3,1 Munich 7.000
Prague 4,5 4,75 570 684 239 179 417 839 2 000 1 000 1 900 3 200 Prague 1.200 Rome 4,15 4,1 Rome 1.400
Warsow 4,75 5,15 Warsow 2.000
Luxemburg 4,25 5 Luxemburg 1.322
Lisbon Lisbon 1.500
Source: BNP/Worx Source: BNP/Worx (M€)
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REAL ESTATE INVESTMENT COMMERCIAL This was a unique year in terms of the number of large Segments of Commercial IN PORTUGAL businesses, with Immochan's purchase of 3 malls worth Investment in Portugal 411 million euros, Almada Forum for 406.7 million euros Student residences, assisted living and health facilities by Merlin Properties, of Lagoas Park by the Kildare Fund are new asset classes that will attract investors to form for 375 million euros and Dolce Vita Tejo by AXA IM for diverse risk portfolios. The main transactions of 2018 are 230 million euros. shopping malls, office parks and logistics platforms. We are talking about transactions that are difficult Retail to replicate over the next few years, given not only Main Business the volume of investment they generate, but also the Offices diversity of asset locations, of which Fidelidade's amount *Others of 410 million euros. In this particular case, it is important Hospitality Source: Worx to mention that the portfolio consists of a large portion **Mixed Use of assets for residential use (which would make it away Logistic/Industrial from commercial investment data), but due to the volume invested in the acquisition of the portfolio and the size Building Location Setor Buyer Value (€) (more than 270 assets), we consider it as an integral part of the commercial investment volume of 2018. Source: BNP/Worx *Includes the Golden Portfolio Portfolio Retalho Blackstone Various Retail Immochan 411 000 00 ** Retail/Offices (Sintra Retail Park, Forum Sintra e Forum Montijo) The top of the commercial investment transactions in Apollo Global Portfolio Golden Various Residential 410 000 000 Portugal in 2018 show that 75% of the total volume is Management concentrated in the 11 largest transactions, while in 2017 Almada Forum Almada Retail Merlin Properties 406 700 000 the concentration was 54%. 5,99% 5,36% Lagoas Park Quinta da Fonte Offices Fundo Kildare 375 000 000 4,32% AXA Investment Dolce Vita Tejo Amadora Retail 230 000 000 Managers
Portfólio Project IBRA Lisbon Offices + Retail Varde 140 000 000 16,37% 44,03% Torres de Lisboa EGH Lisbon Offices Confidencial 105 000 000
Grupo Carlyle + Penha Longa Sintra Hospitality 100 000 000 Explorer Olimpo Real Estate Porfolio Retalho Various Retail 86 000 000 Socimi (Ores) 23,93% Hotel Intercontinental Porto Hospitality GCP Hospitality 55 000 000
Portfólio Sonae MC Various Retail LCN Capital Partners 55 000 000
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In the total of more than 60 transactions, in the year ORIGINS OF THE INVESTMENT Provenance of 2018, the retail segment was the most outstanding, Commercial Investment having raised 1.4 billion euros of total investment, Regarding the origins of the investment, the foreign compared to 742 million in 2017, in large due to the high prevalence was again verified with a total of 90% of the amounts obtained with the transactions of the shopping transactions carried out, compared to 10% by national centers and retail parks. On the other hand, compared players, which, even with a decrease in market share to the same period, the hotel segment lost weight in the compared to 2017 (15%), managed to increase the volume France 759 000 000 23,83 total transactions of the year, from being the one that invested (290 million euros in 2017 to more than 330 USA 744 450 000 23,38 won the largest share of the transactions in 2017 to a million euros in 2018). volume corresponding to 4.87% of the transactions, which Spain 645 500 000 20,27 corresponds to 155 million (€ 817 million in 2017). France came to take the lead in the list of foreign UK 498 750 000 15,66 investors (in a year in which investment from outside Portugal 336 020 000 10,55 Portugal increased by 66.96% over the same period Germany 84 000 000 2,64 last year), totaling around 24% of the total commercial Asia and Middle East 72 250 000 Distribution of Investment investment volume in our country, followed by the United 2,27 States of America with 23.38% (including the acquisition Italy 17 500 000 0,55 Volumes of the Golden Portfolio) and then Spain (20.27%). Switzerland 13 000 000 0,41
It is important to note that, even though the largest Netherland 10 200 000 0,32 Source: Worx (M €) number of transactions has national origin, the average Others 3 750 000 0,12 Logistic/Industrial 142 000 000 number of transactions was 17.6 million euros; however, France with considerably fewer transactions achieved Source: Worx (€/%) an average of 151.8 million euros, the US 82.7 million euros and Spain 71.7 million euros. This indicates that the 155 000 000 Hospitality Portuguese investor continues to be unable to compete with other international players in business involving amounts (generally) over 100 million euros, which was the Mixed Use 157 500 000 maximum achieved in a national transaction, in this case the Penha Longa hotel by the group Carlyle in conjunction with Explorer.
Others* 528 700 000 The UK investment share was also 15.66%, with an average of EUR 83 million in transactions (again few transactions but high value). Offices 781 470 000
Retail 1 419 750 000 * Includes Golden portfolio
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Foreign Real Estate On the side of the Americans and the British, the origin of Prime Yields per Sector Commercial Investment the investment came mainly from funds, similar to France, with the increase of corporate and private investors, with
real estate companies representing the largest share of Source: Worx investment coming from Spain. In Portugal, private funds 2018 2017 2009 161 000 000 and investors accounted for most of the business.
2010 123 000 000 Offices 5,00 5,00
2011 64 000 000 Industrial and Logistic 6,25 7,00
2012 53 000 000 Retail (Shopping Centers) 5,00 5,00
2013 156 000 000 Street commerce 4,75 4,75
2014 687 000 000 Hotels 5,50 6,50
2015 1 789 000 000
2016 1 165 000 000
2017 1 706 000 000 Prime Yields Prime Yields per Sector
2018 2 848 400 000 Industrial and Logistic Hospitality Offices Retail Source: Worx
Source: Worx (€) 2011 2017 2015 2013 2012 2016 2014 2018 2010 2009 (%) 2008 Type of Investor 10
9 Founds 1 663 800 000 52,25 8 Consortia 132 500 000 4,16 6,25% Corporate 449 400 000 14,11 7 Private Investors 148 350 000 4,66 5,50% 6 Real Estate Companies 560 000 000 17,59 5 4,25% Others *** 230 370 000 7,23 4 4,25% Source: Worx (€/%) 3
*** Includes: family offices, management funds, institutional investors, insurance companies and others. 2
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The year of 2018 was again marked by the different dynamics in the European office markets.
The squares of Paris, Munich, Berlin, Frankfurt, Hamburg, Amsterdam, Brussels, Prague and Rome ended up registering slight declines in the area, with the city of Lisbon registering the best value of the last decade, 2018 with 206,428 sq.m. Although far from taking the main OFFICES European markets, the value achieved is still a very positive sign of the dynamism of the city of Lisbon, which, given its size (unmatched by the urban centers of Paris or London), has coming to gain more and more interest and international projection.
47 48 49 Source: BNP/Worx Take up
2 369 842 Paris
2 300 000 (sq.m.) 1 177 744 London
1 300 632
995 000 Munich
950 000
913 000 Berlin
825 000
796 000 Frankfurt spreadEurope. throughout expected given the scarcity of available areas, which will of the last10 years in2018,aslightdrop in the take-up is observed. In 2019, in the caseof Lisbon,after the record general the trend of expansion for the year of 2018 was in general, were not significant/ worrisome, so that in whose observed variations are due to externalities which, in mostEuropean citiesis a signof anactive demand slowdown inoffice demand. Theincrease inprime rents of take-up insomeplaces doesnot meanaconsiderable to conclude that the phenomenonof aslightreduction has seenadeclinein the first few months, whichleadsus However, noneof the cities we have taken intoaccount
700 000
600 000 Warsow
650 000
613 000 Hamburg
560 000
552 982 Madrid
560 000
353 984 Milan
435 000
407 379 Amsterdam
385 000
304 345 Barcelona
380 000
354 404 Dublin
360 000
400 347 Bruxels
340 000
398 053 Prague
320 000
204 351 Luxemburg
211 000
166 819 Lisbon 2017 206 428 www.worx.pt 217 854 Rome 2018
50 160 000 51 Source: BNP/Worx Prime Rents
115,58 London
115,58 (€) 70,83 Paris
70,83
55,83 Dublin
55,83
50,00 Luxemburg
50,00
45,83 Milan companies. market, the scarcity of areas with the size soughtby problem that alsobegins to beprevalent in the Lisbon more competitive pointof view. However, they face the and in the city of Dublin, revealing themselves from this the highest(again) in the centers of London andParis in the European citiesstudied, with rates still far from Hamburg registered the lowest unemployment rates In 2018, the Germancitiesof Berlin,Munich and
49,17
41,00 Frankfurt
44,00
37,00 Munich
38,50
35,00 Rome
36,67
34,17 Amsterdam
35,67
33,00 Berlin
35,00
31,00 Madrid
34,00
26,50 Hamburg
28,00
25,83 Bruxels
25,83
23,50 Barcelona
25,42
22,00 Warsow
22,50
21,00 Prague 2017 22,00 www.worx.pt 20,50 Lisbon
21,00 2018 52 53 Source: BNP/Worx Vacancy Rate
2,00 Berlin
1,80 (%) 3,30 Munich
2,50
5,10 Hamburg
4,50
4,65 Luxemburg
4,80
6,50 Paris scene. and increasing Portugal's exposure to the international employment anddecliningunemployment, risingexports due to stableeconomic growth in the country, rising with nosignsof slowing demandin2019. This islargely 2008, when a take-up of 232,399sq.m. was achieved, closing the yearyears, similar ofwith values tothose market hasonce again surpassed the record inrecent With agrowth of around 24% in2018, the Lisbonoffice
5,20
7,50 Prague
6,00
6,15 London
6,20
8,90 Frankfurt
7,60
8,10 Dublin
7,60
8,30 Bruxels
7,90
10,30 Amsterdam (sq.m.) 206 428 Take up2018
8,00
8,58 Lisbon
8,00
8,09 Rome
8,30 (sq.m.) 166 819 Take up2017
10,07 Barcelona
9,50
10,20 Madrid
9,70 8% Vacancy rate
12,00 Warsaw 2017 10,00 www.worx.pt 11,70 Milan 2018
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LISBON
If, on the one hand, demand will not decline, supply will continue to be unable to meet market demands, not only in Portugal but a little throughout Europe, because of the stagnation of take-up levels or the very likely slight decrease, is due to the immediate shortage of available areas and not to the decrease in demand.
CAMPO GRANDE PONTE VASCO DA GAMA ALVALADE BENFICA Prime Rents CAMPO PEQUENO MARQUÊS AREEIRO PARQUE POMBAL DAS NAÇÕES Source: Worx, LPI MONSANTO CAMPOLIDE
RATO Z1 Z5 Z3 Z2 Z6 BAIXA Z4 PONTE 25 DE ABRIL ALGÉS (€)
CAIS DO SODRÉ CHIADO 2016 2017 2018 25
20
15
10
5
Prime CBD CBD Emerging zones Historic Zone Parque das Nações West Corridor Others 21,00 17,00 14,00 17,00 17,00 13,50 Z1 Z2 Z3 Z4 Z5 Z6 Z7 0
55 56 57 Source: Worx,LPI Take Up per Zones -Lisbon Source: Worx,LPI Lisbon Prime Rents
35 063 2017 Z1
33 943 2018 (sq.m.)
20 351 Z2
32 490
22 883 Z3
37 954
36 033 Z4 Zone 7 Zone 6 Zone 5 Zone 4 7 435 Zone 3 Zone 2 Zone 1
6 908 Z5
15 749
43 553 Z6
56 185 2017 85 58 47 25 10 12 13
2 028 Z7* 2018 46 59 32 52 18 16 6
22 672 the city of Lisbon. as the area with the largest take upof Corridor Oesteonce again standsout effective start. other plannedprojects but without confirmation as toits 45,000 sq.m.,reaching 85,000 sq.m. with the inclusionof coming years will increase the capacity of this area by supply available; however, the projects confirmed for the most soughtafter throughout 2018butpresents ascarce Zone 5(Parque dasNações) continued to beoneof the occupancy scenarios. view of energy efficiency andadaptability to various large and versatile spaces, especially from the pointof idea that companies have beenlooking for increasingly observed in the general market. This helps to cement the than last year but with ahigher total area, which isalso There were 59operations in total, less transactions being of note the presence of GoogleinLagoas Park. income primepracticed, alsocontribute to this choice, The accessibility to the city of Lisbonand the stilllow services. increasingly assertitself asamagnet for technological meeting the required needshasmade the West Corridor the fact that itis the only offering area capableof Although not the preferred choice for mostinvestors, and representing 27%of the total take upareas of Lisbon. a total of 56,185 sq.m.,29%more than in the sameperiod biggest take upof the metropolitan area of Lisbon, with in 2018itreturned to being the zone that obtained the By 2017ithadalready achieved this achievement and www.worx.pt 58 www.worx.pt
Zones 1 and 3 with the completion of the third tower of History of Vacancies - Lisbon Colombo and the renovation of the Monumental building in Saldanha square will contribute a total of 45,500 sq.m., thus confirming another 90,500 sq.m. until the end of Source: Worx, LPI 2021.
It is also worth mentioning the Intercampos Integrated 2016 2017 2018 Operation (zone 2), considered the new CBD of the city of Lisbon, which, when completed, will bring 140,000 sq.m. Zone 1 6,96% 4,68% 5,33% of offices to the Portuguese capital (with no completion date yet). Zone 2 8,51% 7,25% 6,01%
Lisbon continues to be an attractive city for Zone 3 9,31% 7,07% 9,14% entrepreneurship, which translates into the need to create innovative and creative spaces, such as the Beato Zone 4 7,75% 5,12% 2,88% Creative Hub (20 buildings and a total of 35,000 sq.m.), whose genesis (according to the site official) is a good Zone 5 3,56% 2,83% 4,11% example of what is expected of this type of space: Zone 6 22,48% 20,18% 17,86%
- Bring together the most innovative, and different people; - Be a space open to the community, public access Total 10,21% 8,58% 8,00% and lived to the rhythm of the city; - Preserve architectural and industrial heritage; - Have better wifi and internet network in Europe; - Have differentiated services for the resident community; - To be the best place to work; - (...)
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Volume of Absorption by Business Sector
TMT's & Utilities Business Services Others Finantial Services Consultants and Lawyers Top 10 Occupations 2018 Construction & Real Estate Products Consumption
Pharmaceutical and Health Source: Worx, LPI State, Europe and Associations
Zone Business Sector Area (sq.m.) Occupier
6 Office Park Carnaxide 8 487 Confidencial 3,40% 3,34% 5 Infante Dom Henrique, 342 8 000 Teleperformance Portugal, S.a. 2,78% 2,08% 3 Open 7 779 Teleperformance Portugal, S.a. 5,67% 32,82% 1 Marquês de Pombal 14 5 230 Regus
9,44% 6 Lagoas Park 5 162 Confidencial
7 António Pedro, 111 4 897 Confidencial 11,81% 7 Santa Bárbara 4 500 Lacs
2 Caravelas - Pinta 4 116 Critical Software 28,66% 4 LACS 4 000 Confidencial
6 Q43 - Fernão Magalhães 3 780 Trust in News, Unipessoal, Lda Source: Worx, LPI
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PORTO
MAIA
MATOSINHOS
ZEP
ORIENTAL BOAVISTA 2018 was a year that marked the history of the occupation of offices BAIXA
FOZ DO DOURO PONTE DO FREIXO in the city of Porto especially by the VILA NOVA DE GAIA
PONTE increasing take up and the choice D. LUÍS I PONTE DA ARRÁBIDA of the city by companies worldwide recognized as the case of BNP Paribas or Prozis.
Unlike the city of Lisbon, where the largest occupations have hardly exceeded 8,000 sq.m., in Porto, thanks to the versatility of the new spaces and the fact that many of them are of recent construction, the top 3 of the take up was occupied by areas superior to 8,000 sq.m., reaching up to 15,000 sq.m., in this case the installation of the 'back-up' headquarters of the French headquarters of Boavista Baixa Oriental ZEP Maia Matosinhos Vila Nova de Gaia BNP Paribas in the Urbo building through a pre-lease Z1 Z2 Z3 Z4 Z5 Z6 Z7 agreement.
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With regard to rents, the city of Porto still has considerably lower levels compared to the Portuguese capital, about 20% below the prime of Lisbon, and this is an engine of competitiveness for the northern city which, along with modernization of its buildings and increasing expected supply, can make it a real alternative to Lisbon in the medium term.
Top 10 Occupations
Source: Worx
€/sq.m./month Zone Business Sector Area (sq.m.) Occupier
4 Serviços Financeiros 15.000 BNP Paribas
Source: Worx 5 TMT´s & Utilities 10.880 Prozis
2017 2018 1 TMT´s & Utilities 8.500 Confidencial
Z1 - Boavista 12€ - 16€ 16€ - 18€ 2 TMT´s & Utilities 5.700 Global Noticias
Z2 - Baixa 8€ - 11€ 14€ - 16€ 2 Serviços Empresas 5.250 Regus
Z3 - Oriental 10€ - 12€ 6 Serviços Financeiros 2.400 Sodexo
Z4 - ZEP 10€ - 12€ 11€ - 13€ 2 TMT´s & Utilities 1.920 Talkdesk
Z5 - Maia 10€ - 12€ 6 TMT´s & Utilities 1.600 Cofco International
Z6 - Matosinhos 12€ - 14€ 1 TMT´s & Utilities 1.300 Voltalia
Z7 - Vila Nova de Gaia 8€ - 13€ 11€ - 13€ 6 outros 1.000 Klockner Pentaplast
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The retail market in 2018 presented a general stagnation in the creation of new shopping centers.
Without any project inaugurated in 2018, the gross leasable area (GLA) available is still 2.9 times higher 2018 than in 2001. Without betting on the construction of RETAIL new shopping malls, the strategy has been to renovate the equipment and expand the already (including the expansion of the largest shopping center in the north, Norteshopping, in Matosinhos - Porto, but not yet completed).
67 68 69 Source: Worx,LPI Stock by Commercial Format Factory Outlets Retail Parks Shopping Centers 14% 6% 80% 10% Source: Worx,LPI Commercial GLA by Region 10% Center Great Porto Great Lisbon 16% 9% 3% Autonomous regions Setubal Peninsula South North 28% 24% (sq.m) 0 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 GLA (sq.m.) Source: Worx 2003 GLA other new formats GLA new shoppingcenters Commercial equipmentstock
2008 Shopping Centers GLA 3 000
2013 equipment stock Commercial 3 700000 www.worx.pt
70 2018 71 Source: Worx Lisbon Openings 2018 7,1% Fitness Others Decoration &Design Fashion & Acessories Restaurants 3,7% 1,4% 5,7% 82,1% same trend. indicators, since the 0,2 are connected and follow the it is worth considering the relationship between both cities, but this isnot the only explanatory factor, but ofin thesetwo impact largely tourism wasdue tothe The increase inprimeincomes inboth LisbonandOporto (7.1%). Closing the top 3 we find the fitnessservices (3.7%). the openings, followed by clothing stores andaccessories businesses, which represents 82.1% of the final cake of can see that the tendency isclearly to opencatering registered more than 3hundred openingsin2018, we If we focus on the boominstreet commerce, which etc.). specialized homedelivery services, restaurants incasinos, 1.8% of the openingsinother types of stores (such as openings taking place inexisting shoppingcenters, and the openingsin the entire Lisbonarea, with 6%of the trade market, which represented a total of 92.2%of The great dynamicsof 2018occurred in the street (€) 0 20 40 80 100 120 140 city of Porto 20%. in Lisbon were 18%more expensive than in2017, with the increased by 5.3%,retail parksby 16.7% andstreet shops of 1.3%.On the other hand,primeshoppingcenters revenues up11.4%and the number of guests anincrease tourists are spendingmore andmore inour country, with decrease of 0.5% in the year 2018,itshouldbenoted that With the number of overnight stays registering aslight Source: Worx,LPI Lisbon Prime Rents 2009 90€
2011 85€
2013 95€
2015 110€
2017 130€ www.worx.pt
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Projection 2018 EUROPEAN FRAMEWORK
Guests In terms of Europe, the Portuguese retail market is still
Source: TravelBI behind the largest European markets, with a first-quarter Overnights growth of 18% from 2017 to 2018, with a maximum of 130
Total revenues Total €/sq.m./month. Tourism revenues Tourism
1,30 6,30 11,4 Retail Prime Rent - Europe
Source: BNP/Worx
-0,50 €/sq.m./month 2018 €/sq.m./month 2019
(%) London 2 237,00 2 237,00 Prime Rents Lisbon and Porto Paris 1 833,33 2 000,00
Vienna 405,00 NA
Source: Worx, LPI Retail Prime Rents (€/sq.m.) Munich 370,00 370,00
Berlin 320,00 315,00
Milan 316,67 325,00 Retail Parks 10,50 Dublin 306,75 306,75
Frankfurt 295,00 290,00
Shopping Centers 100,00 Rome 291,67 300,00 Hamburg 275,00 270,00
Barcelona 275,00 NA Street Commerce 60,00 Porto Madrid 270,00 NA Amsterdam 250,00 NA
Street Commerce Prague 220,50 228,22 130,00 Lisbon Lisbon 130,00 130,00
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Central London continues to be the most expensive, E-commerce followed by Paris and Vienna, where (in both) the trend 2017
for the coming years is a growth of the observed values, 2025
unlike what happens in the various German squares, Source: Tourism of Portugal where expects a slight decrease in the values practiced in 2019; it is a slight decline (2% on average), but still figures will remain far from the Portuguese prime rent registered in the city of Lisbon.
4,6 8,9
Retail Prime Yield
Source: BNP/Worx (%) (Thousand Millions €) 2018 2019
Bruxels 2,9 3
Prague 3,25 3,2
Paris 2,5 2,6
Berlin 2,9 2,95
Frankfurt 3,1 3,15
Hamburg 3 3,05 The Lisbon openings of: Munich 2,9 2,95
Milan 3 3,15 Online Trade in Portugal, although still far from the CANTINHO VINTAGE Rome 3,3 3,5 European average, follows a clear upward trajectory. Dublin 3,25 3,5 Growth prospects become even safer when you look at MASSIMO DUTTI growth data from online commerce: 13% of Internet users Amsterdam 3,25 3,25 in 2009 were online shopping, with the number rising to LATTE ANA Barcelona 2,9 2,95 37% in 2017; only in this last year the growth was 12.5% CALHEIROS Madrid 3,1 3,3 over the same period of the previous year, and a higher CONCEPT STORE London 3 3,1 value is expected for 2018. In addition to the possibility of expansion in the Portuguese market, the export market is 4,5 4,5 DON LOPO Lisbon also one of the foci of the retailers.
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The low availability rate of the Portuguese logistics market has provided a considerable increase in the acquisition prices of logistics platforms, making them attractive assets for the most varied portfolios, diversifying them and increasing their value.
Proof of this was the recent investment of 43 million euros by W.P. Carey in 50,000 sq.m. in the logistics park 2018 of Azambuja, in the concrete case of an asset that is under LOGISTICS a triple lease to Sonae MC. As this is a class of assets most sought throughout Europe, it is expected that with a future increase in the national supply, the Portuguese prime yield may become more appealing in the overall calculation of the cities analyzed.
77 78 79 Source: BNP/Worx Prime Yields -Europe Vienna Paris Prague Bruxels Berlim Frankfurt Hamburg Munich Dublin Rome Milan Amsterdam Lisbon London Madrid Barcelona Warsaw (%) 2018 4,20 4,20 4,20 5,40 4,20 4,50 4,90 5,50 5,50 5,50 5,70 5,70 6,25 5,25 5,75 5,75 4,15 2019 4,20 4,20 4,20 4,20 4,50 5,40 5,30 4,25 5,70 5,70 5,70 6,25 5,15 NA NA NA 6 Source: Pordata weight in the Portuguese economy. which currently represents around 10%of the total with greater dynamismin the national logisticssector, efficient infrastructures alone willnot be synonymous the simple(and possible) increase insupply with more platforms and the construction of new facilities. However, on the expansion andmodernization of the current trend of the sameperiodof 2017, with operations focused The Portuguese industrial/logisticmarket followed the Portuguese Trade Balance in2017 NATIONAL MARKET (€ million) 6 256,4 Germany
9 504,4
1 787,2 Angola
278,9
943,9 Brazil
1 219,5
841,7 China
2 051,4 efficiency is very noticeable. in which case the need for modernization andincrease of activity, and the interconnection to roads andrailways, Friday), to the need to coordinate with other sectorsof commercial traffic (for example at the time of a Black need to beable to beinaperiodof suddenincrease in logistics platforms face challenges ranging from the AccordingLogisticsPortuguese tothe Association,
13 860,7 Spain
22 452,6
2 843,6 USA
994,2
6 887,9 France
5 105,1
1 949,3 Italy
3 771,3
145,7 Japan
333,2 PRIME RENT
2 209,1 Netherland
3 734,6 OFFER
3 643,6 UK Exports DEMAND 1 863,4 www.worx.pt 13 660,2 Others Imports
80 18 180,6 Machines, Other CapitalGoodsand Their Accessories Other Consumer Goods Transport Material and Accessories Industrial andUnspecified Supplies In Other Category Food &Beverage 81 Source: INE Annual Nominal 2018/2017 Export of Goods- Variation Rates Business perspectives on Total challenges tothem. which directly affects logisticsplatforms andcreates new materials andaccessories expected to grow by 24.1% %, by 7.3%, with the expected performance of transport from outside the EUincreased by 3.7% andintra-EU 2016, 6.4%and7, 5%respectively. To this end,exports increase lower than that observed in2017compared to revisions of this indicator, albeit with a year-on-year export of goods, and there have beenseveral upward 2018 was a year of optimistic forecasts regarding the Extra EU -4,30% 31,70% 3,70% 3,70% 1,90% 1,20% Intra EU 22,60% 6,50% 3,60% 7,30% 3,70% 1,90% 24,10% 6,40% 3,30% 5,70% 1,70% Total 2% (Millions €) Source: INE Total portugueseexports in2017 0 10 20 30 40 50 60
2010 37267,9
2011
2012
2013
2014
2015 Accessories Materials and of TransportExports ↑ 24,10%
2016 www.worx.pt 55 029,3
82 2017 www.worx.pt
The growing increase in online commerce has brought The maintenance of demand for office and warehouse a series of new requirements and adaptations of equipment together with modernization and versatility the logistics platforms to meet the requirements requirements has meant that the prime rents of of a more efficient service and able to respond the Lisbon areas have shown a general stabilization quickly to consumers; more than ever, the speed and compared to the same period of 2017, highlight the zone personalization in service are criteria required by 4 - Corridor West that presented a rise of 20%. consumers who, with the vast offer they have, quickly find alternatives to their needs.
Evolution Prime Rents Lisbon Evolution Prime Rents per zone
Source: Worx, LPI Source: Worx, LPI
2018
Zone 1 - Axis Carregado - Azambuja 3,50€ 2017 2013 2018 2001 2005 (€) 2009 Zone 2 - Axis Póvoa de Santa Iria - Alverca 3,50€ 6 Zone 3 - Axis Loures MARL - Vialonga 3,50€
5 Zone 4 - Corredor Oeste 4,50€
4 Zone 5 - Lisboa (Matinha - Prior Velho) 5,00€
3 Zone 6 - Axis Montijo - Alcochete 3,00€
Zone 7 - Axis Palmela - Setúbal 2,75€ 2 5,50 6,00 5,00 4,00 5,00
1
0
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This report was prepared based on accumulated data for the period January-November 2018 published by INE, Turismo de Portugal, Travel BI and Worx's own resources.
Portugal continues to affirm itself in the tourist market, by the greater differentiation of products and attraction of markets with greater purchasing power. Considered to be the World's Best Tourist Destination by the World Travel Awards, the country continues to add points in the international scene, achieving a level of exposure and recognition.
Data available to date (January-November 2018) show 2018 that there was a slight drop in overnight stays of 0.2% TOURISM and a 6% increase in total revenues. It means that although there are fewer nights in our country, the tourists spent more during their time in the rooms.
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Factors such as the expansion of tourist activity to less traditional months, with two-thirds of the growth going into the "low season"; the increase in employment in tourism (+ 44 thousand, a growth of about 7% in the sector), the diversification of markets, with significant -0,2% +1,6% +6% growth in the American, Polish and Brazilian markets and international recognition, demonstrate the capacity of tourism to generate more revenue, more employment and to increase, more and more, the activity throughout the year and the territory. Overnights Guests Total Revenues
Portugal Year 2018 Var. 18/17%
Guests 19 827 500 1,6 +10% 18,9% 52,5% National Residents 7 661 800 3,9 International Residents 12 165 700 0,2
Overnight stays 54 795 100 - 0,2 Tourism Tourism Revenues in Global Exports In Services Exports National guests 15 671 500 5,3
International guests 39 123 600 - 2,2
Total Revenues (million €) 3 431 400 6,0
Rooms revenue 2 539 300 6,5
9,4% Occupancy rate per bed 54,0
Occupancy rate per room 67,4 -2,4
In Total RevPar (€) 54,6 4,7 Employment
Source: Travel BI, Worx (accumulated data for the periods between January-November)
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AVERAGE STAY
According to INE, Portugal received 12.7 million foreign guests. If on the one hand there were 50 thousand more foreigners in Portugal, they are 821 thousand less dormant than a year before. Compared to the year 2018, the average stay period decreased by 1.5% and the average length of stay of 2.5 nights was estimated.
The data accumulated from January to November allow us to conclude that in 2018 British tourists maintained the leadership of the group of foreign countries that registered more nights, in a total that surpasses the eight millions of nights.
Nights per issuing market Total 21%
Source: Travel BI, Worx (accumulated data for the periods between January-November)
10% 54 795 112 54 770 481 5% 2017 USA Italy Spain 2018 Brazil France -2% Others Belgium Portugal Germany -3% Growth rate 3% 0% Netherland 0% 0% International Scandinavian -8% -3% -4% Kingdom United -12% 855 639 831 004 1 795 745 5 177 626 3 786 512 3 819 257 1 884 212 1 250 974 1 213 048 1 790 587 2 305 361 8 265 541 5 412 983 5 412 1 498 535 1 808 071 2 064 581 3 736 602 3 892 081 8 301 034 9 008 747 2 038 282 8 268 530 15 671 497 14 889 144
89 90 91 Source: Travel BI, Worx (accumulated data for the periodsbetween January-November) Tourist Revenue by Country of Origin 2018 2017
1 618 Germany
1 425
351 Angola
223
397 Belgium Belgian issuingmarkets (-0, 8%)andDutch (-0.6%). tourists from Brazil (10%), asopposed to the falls in the variations were the United States of America (21%)and In relation to the sameperiodof 2017, the mostsignificant
387
535 Brazil
497
759 USA
759
1 820 Spain
1 586
2 292 France
2 187 markets for tourism revenue in2018. Germany remained the mostimportantEuropean As in2017, the United Kingdom, France, Spainand countries," hesaid. so that this expansion translates intoreal benefits for all "we have aresponsibility to manage onalastingbasis General Zurab Pololikashvili was quoted assaying. But, global growth anddevelopment," UNWTO Secretary- sector iscurrently oneof the mostpowerful enginesof "The growth of tourism inrecent years confirms that the growth of 3% to 4%in the number of tourists worldwide. In 2019, the World Tourism Organization (WTO) points to a
600 Netherland
529
366 Irland
371
315 Italy
302
2 474 UK
2 188
363 Switzerland
315
11 890 Total 10 769 www.worx.pt 92 93 Source: Travel BI, Worx (accumulated data for the periodsbetween January-November) Revenues from the Pension by Region
275 North
316
150 Center
156
691 Lisbon
768
40 Alentejo
48 North (from 275 to 316million). the regions of Lisbon(from 691 to 768 millioneuros) and in allregions, more evident in the hotels integrated in Compared to 2017, the results show a transversal growth the Northern region with more than 300millioneuros. Algarve region with more than 422millioneuros and euros inrevenues per room in2018, followed by the Hotels in the Lisbonregion received almost800million
403 Algarve
422
54 Azores
60 2017
170 Madeira 2018 174 units. significantly distancing themselves from the1*and2** of the 5*and3unitsoccupy the second and third places a value of Income of superiorsbillion. The hotel revenues around 75%,and within this typology, the unitsof 4* with highlight the weight of the contribution of the hotels with typologies of tourist enterprises,itisimportant to In relation to the Income of Rooms in the different * Source: Travel BI, Worx (accumulated data for the periodsbetween January-November) Revenue Hotels by Category* apartments andother global revenues excluding tourist villages and
2 462 Hotels
2 652
860 5*
919
1 106 4*
1205
357 3*
380 2017 www.worx.pt 138 2* e 1* 2018
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The inaugurations of the Eurostars Museum (5 *) units The average price per room sold has continued to of the Hotusa Group, with 91 rooms, are outstanding increase from year to year, standing at € 81.0 in 2018. As throughout the year; the Vila Galé group added 77 rooms for the price per room available (RevPAR), there has been to Sintra's hotel offer with the opening of Vila Galé Sintra an increase between 2012 and 2018. The occupancy rate Resort Hotel (4 *). They opened in the north the Vila Galé has also risen over the years to 67% in 2018. Collection Braga (4 *) with 127 rooms, Pestana Porto - A Brazilian City Center & Heritage Building (5 *) with 90, Douro 41 Hotel & Spa (4 *) and Porto Royal Palace 4 *).
In total, the new hotel units have added 1,024 rooms to the existing room offerings, with two new hotels presenting a unit size of more than 100 rooms.
1* 2* Income per Room Hotels per Year Openings by Region Openings by category 3* 4*
Source: Travel BI, Worx (accumulated data for the periods between January-November) Occupancy rate ADR RevPAR Source: Travel BI, Worx (accumulated data for the periods between January-November) 5*
2018
4% Lisbon 8 8% 2012 2017 2015 2013 2016 2014 2018* 25% Porto and North 7
66% 67% 63% 61% Center 4 57% 51% 53% Alentejo 0
56,5 56,8 58,3 61,0 68,2 73,7 81,0 Algarve 4 29%
Setúbal Peninsula 0
Azores 0 34%
Madeira 2
29 30 33 37 43 49 55 Total 25
* data until November 95 96 www.worx.pt
Top 5 national openings LISBON
The Portuguese capital was considered the main city
Source: Tourism of Portugal, Worx (National Register of Tourist Enterprises - RNET) destination in the world and the main tourist destination in the city by the World Travel Awards of 2018. In addition to this distinction also the Hotel Corinthia of Lisbon was awarded with the prize of Hotel World Leader in Hotels Hotel Category Rooms 2018, the Olissippo Lapa Palace Hotel with the 2018 World Class Classic Hotel Award and the Sintra Parks, Hotel Apartamento Vila Galé Sintra ***** 136 World Leader in Conservation 2018.
EXE Liberdade *** 163 In turn, Lisbon was considered the most "cool" city in Europe by the American television network CNN. It easyHotel Lisbon *** 101 commends the offer of nightlife as well as the "fascinating
Hotel A Brasileira - Porto ***** 90 streets" of historic neighborhoods. The proximity to fantastic beaches is also noted as a great asset, as is the Maison Albar Hotels Le Monumental Palace ***** 76 gastronomic offer.
NORTH
The destination Porto and North of Portugal has unique and special landscapes. The National Geographic Society ranked the Douro as the 7th most iconic destination in an international ranking that evaluated more than 133 destinations. The city of Porto was voted the "Best European Destination" by European Consumers Choice and highlighted by the New York Times as a destination to visit.
CENTER
This is a land of contrasts that offers you the best of the sea and the mountain. Where you can discover the roots of our nationality, the best of our gastronomy and wines and an unequaled cultural heritage.
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This is a region that brings together 100 magnificent MADEIRA counties. Places that breathe History, legends, customs and traditions, where all scenarios are magical and Madeira was voted the "Best Island Destination in the release pure energy, where you can know or rediscover World" in 2015, 2016, 2017 and 2018 by the World Travel the heartbeat of a country. Awards. In 2013, 2014, 2016, 2017 and 2018 the island of Madeira won the prize of "Europe's Leading Island Throughout the year four new hotels were inaugurated, Destination", having competed in this category alongside the Casa de São Lourenço - Burel Panorama Hotel (5 *), major tourist destinations such as the Canaries, Baleares, with 40 rooms; the Convento do Seixo Boutique Hotel & Sardinia, Malta, Cyprus, among others. Spa (5 *), with 48 rooms; the Thomar Boutique Hotel (3 *) with 48 rooms and the Pousada da Vila. The four hotels In each edition, in addition to electing the best European are located, respectively in Guarda, Castelo Branco, Leiria hotel units, the World Travel Awards (WTA) organization and Santarém. also names the best hotels in each country, where Madeira hotels have been distinguished with these awards in the most diverse categories, thus recognizing ALGARVE the quality of the hotel's facilities and excellent service in the Region. The Algarve has put in place plans to attract more tourists in the low season and the results are already notorious; Throughout the year a new hotel unit was inaugurated, last October the Faro airport had a higher number of the Hotel Pestana Royal (5 *), with 648 rooms, in the passengers than in August 2015. There were more than Autonomous Region of Madeira. 900 thousand passengers in October 2018; in 2017, [there is no final data yet for 2018] 70% of the increase in overnight stays in the region happened outside the high AZORES season. The archipelago of the Azores is composed of nine The return to the Algarve by bicycle, scheduled for islands divided into three groups: Eastern, Central and February 2019, is one of the points of the strategy of Western. Located in the immensity of the Atlantic Ocean, scrutiny of traditional seasonal tourism. On the other this archipelago of natural beauty ready to be explored hand, the 365 Algarve program - which has many cultural was deserved of some distinctions by the national and activities - goes into action from October to May. The international press. government has already indicated that the fourth edition of this initiative will start next October. The Azores were recognized as one of the most beautiful destinations in Europe by the European Best Destination; Throughout the year two new hotel units were are among the top ten most sustainable destinations in inaugurated, including the opening of the Lagos Avenida the world and were considered the best destination of the Hotel (4 *) with 92 rooms and the Pestana Gramacho Atlantic at the IBT Berlin fair; the Fajã dos Cubres, on the Residences (4 *) with 96 rooms. island of São Jorge, was considered one of the 7 wonders of Portugal - Aldeias, in the Aldeias de Mar category;
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Openings 2018-2020 were also recognized as one of the most beautiful by region destinations in Europe by the European Best Destination, the Association that promotes the best destinations in Europe in several categories and was considered the most beautiful place in the world by the Dutch - Belgian Source: Worx, Turismo de Portugal (National Register of Tourist Enterprises - RNET) edition of the National Geographic Traveler , on a list of 20 locations for holidays or business trips in 2016.
New hotel openings were registered in 2018.
Lisbon Porto and North Center Madeira Algarve Alentejo Azores
5% 3%
8%
10% 34%
16%
24%
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500 houses sold per day in Portugal
The year of 2018 continued the good performance that was registered in 2017, having surpassed the number of 2018 transactions in about 25,000. During the year, about 500 RESIDENCIAL houses were sold per day, which totaled between 176,000 and 183,000. These figures represent growth between 15% and 20% over the same period of the previous year. In total, these figures exceed the years 2013 and 2014 (APEMIP data).
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Average Selling Price per sq.m. *
Source: SIR 2016 2017 2018 2018 vs 2017 In addition to the impetus given by Sto António 5.236,41 € 6.035,33 € 6.266,97 € 3,84% urban rehabilitation, especially in the Sta Maria Maior 4.474,25 € 5.585,13 € 6.176,90 € 10,60% city of Lisbon, the economic and social Misericórdia 4.589,58 € 5.821,59 € 6.143,07 € 5,52% situation that benefited the other Belém 3.873,19 € 4.546,49 € 5.208,87 € 14,57% segments of the real estate market Avenidas Novas 4.002,76 € 4.466,57 € 5.137,24 € 15,02% also had a strong impact on the Estrela 3.843,80 € 4.869,59 € 5.111,22 € 4,96%
Alvalade 3.032,32 € 3.596,28 € 4.900,27 € 36,26% residential market.
Parque das Nações 3.771,25 € 4.218,76 € 4.707,78 € 11,59% This time, while the residential market of Porto Total 3.390,86 € 4.261,44 € 4.668,16 € 9,54% appreciated around 29%, the transactions effectively Campo de Ourique 3.043,51 € 3.709,45 € 4.602,87 € 24,08% verified in Lisbon led to a generalized price increase of 9.54%, standing out the Marvila parish that saw the price S Vicente 3.093,68 € 4.053,71 € 4.502,17 € 11,06% rise (from € 1,809.85 to € 3,850.04, plus 113.58%), largely Arroios 3.073,44 € 3.706,67 € 4.295,92 € 15,90% because this is a recent search area in the city of Lisbon, Alcântara 3.123,21 € 4.946,94 € 4.134,63 € -16,42% with the Braço de Prata practiced, along with the growing interest in the innovative spaces of the surroundings that Marvila 1.574,72 € 1.809,85 € 3.865,47 € 113,58% reconcile family life with art and the alternative. Campolide 2.376,69 € 3.257,32 € 3.850,04 € 18,20%
Areeiro 2.656,14 € 3.183,45 € 3.824,40 € 20,13%
S Domingos de Benfica 3.174,19 € 3.729,50 € 3.804,86 € 2,02%
Carnide 2.339,56 € 2.902,08 € 3.752,91 € 29,32%
Ajuda 2.177,48 € 2.939,13 € 3.622,68 € 23,26%
Lumiar 2.788,10 € 3.008,17 € 3.568,50 € 18,63%
Penha de França 2.127,77 € 2.917,89 € 3.442,62 € 17,98%
Benfica 2.447,65 € 2.561,89 € 3.182,63 € 24,23%
Beato 1.914,90 € 2.465,92 € 2.995,17 € 21,46%
Olivais 2.367,60 € 2.660,80 € 2.985,21 € 12,19%
Sta Clara 1.510,30 € 1.785,08 € 2.229,49 € 24,90%
* values for the 3rd quarter of each year 105 106 www.worx.pt
Average Selling Price per sq.m. – New* Average Selling Price per sq.m. – Used*
Source: SIR Source: SIR 2016 2017 2018 2018 vs 2017 2016 2017 2018 2018 vs 2017
Sta Maria Maior 5.373,28 € 6.709,63 € 7.843,52 € 16,90% Misericórdia 3.830,56 € 5.023,34 € 5.695,96 € 13,39%
Sto António 6.251,38 € 6.775,21 € 7.045,74 € 3,99% Sta Maria Maior 3.945,59 € 4.942,55 € 5.485,87 € 10,99%
Misericórdia 5.885,33 € 6.626,78 € 6.912,57 € 4,31% Sto António 3.626,29 € 5.167,58 € 5.422,03 € 4,92%
Alvalade 3.969,22 € 4.047,70 € 6.641,63 € 64,08% Parque das Nações 3.739,79 € 4.193,94 € 4.797,92 € 14,40%
Belém 4.808,50 € 5.489,46 € 6.476,95 € 17,99% Avenidas Novas 3.521,00 € 4.103,77 € 4.725,68 € 15,15%
Estrela 4.646,61 € 5.807,50 € 6.438,77 € 10,87% Belém 3.418,17 € 3.817,63 € 4.550,12 € 19,19%
Estrela 3.408,44 € 4.038,39 € 4.541,67 € 12,46% Total 4.804,39 € 5.640,92 € 6.009,54 € 6,53% Campo de Ourique 2.743,16 € 3.425,17 € 4.393,01 € 28,26%
Avenidas Novas 4.848,49 € 5.078,02 € 5.866,19 € 15,52% S Vicente 2.779,13 € 3.620,78 € 4.384,44 € 21,09% Marvila 1.830,55 € 5.847,99 € Total 2.898,86 € 3.603,40 € 4.196,57 € 16,46% Campo de Ourique 4.153,47 € 5.041,10 € 5.507,90 € 9,26%
Alcântara 3.833,16 € 6.399,57 € 5.429,56 € -15,16% Alvalade 2.942,48 € 3.573,71 € 4.171,75 € 16,73%
Arroios 4.685,35 € 4.810,80 € 5.385,64 € 11,95% Arroios 2.723,03 € 3.261,79 € 3.871,92 € 18,71%
Areeiro 3.560,78 € 3.643,85 € 5.230,00 € 43,53% Campolide 2.370,91 € 3.228,98 € 3.846,01 € 19,11%
S Vicente 4.106,63 € 5.162,19 € 4.967,33 € -3,77% Alcântara 2.821,89 € 3.058,53 € 3.788,57 € 23,87%
S Domingos de Benfica 4.124,69 € 4.820,15 € 4.225,39 € -12,34% Areeiro 2.565,67 € 3.158,38 € 3.782,06 € 19,75%
Carnide 2.821,89 € 4.185,93 € S Domingos de Benfica 2.688,54 € 3.047,34 € 3.728,87 € 22,36%
Parque das Nações 4.485,11 € 5.306,56 € 4.044,41 € -23,78% Ajuda 2.081,60 € 2.680,27 € 3.509,96 € 30,96%
Lumiar 3.531,94 € 3.736,72 € 4.029,92 € 7,85% Lumiar 2.507,78 € 2.733,93 € 3.479,28 € 27,26%
Ajuda 3.434,51 € 3.750,69 € 3.932,68 € 4,85% Carnide 2.298,80 € 2.866,12 € 3.449,79 € 20,36%
Campolide 2.494,78 € 3.597,50 € 3.896,05 € 8,30% Penha de França 2.104,73 € 2.656,42 € 3.396,66 € 27,87%
Penha de França 2.496,36 € 3.983,57 € 3.864,37 € -2,99% Benfica 2.412,19 € 2.472,42 € 3.174,69 € 28,40%
Olivais 3.674,62 € 3.313,26 € 3.567,13 € 7,66% Beato 1.913,00 € 2.382,26 € 2.950,44 € 23,85%
Beato 2.917,70 € 3.346,55 € 14,70% Olivais 2.046,79 € 2.406,56 € 2.834,54 € 17,78%
Benfica 2.841,60 € 3.913,77 € Marvila 1.556,71 € 1.786,62 € 2.537,17 € 42,01%
Sta Clara Sta Clara 1.503,73 € 1.752,21 € 2.189,72 € 24,97%
* values for the 3rd quarter of each year * values for the 3rd quarter of each year 107 108 www.worx.pt
Average Selling Price - Prime Segment*
Source: SIR With a lower stock of demand, especially in Lisbon's 2016 2017 2018 2018 vs 2017 urban center, and even without large root projects that create a massive supply capable of controlling prices, the Sta Maria Maior 8.932,41 € 11.483,08 € 10.110,08 € 13,39% acquisition of fractions already used has been the main Sto António 8.313,89 € 10.674,77 € 10.006,15 € 10,99% driver of price growth. This sector increased by about Misericórdia 8.801,92 € 10.268,58 € 9.549,82 € 4,92% 16.46% compared to 2017, while housing in a new state Belém 7.429,85 € 9.811,34 € 8.951,97 € 14,40% saw a generalized rise in prices in the municipality of
Lisbon. This average increase was 6.53%. Total 2.898,86 € 3.603,40 € 4.196,57 € 16,46%
Estrela 7.060,29 € 9.079,49 € 8.048,78 € 16,73%
Avenidas Novas 7.287,25 € 9.158,68 € 8.046,17 € 18,71%
Parque das Nações 7.517,73 € 7.094,34 € 7.480,66 € 19,11%
Campo de Ourique 6.603,42 € 8.555,04 € 7.460,90 € 23,87%
GOLDEN VISAS Alvalade 6.663,31 € 7.403,10 € 7.257,92 € 19,75%
Marvila 3.913,66 € 7.695,34 € 7.254,90 € 22,36% • € 838 M in 2018 (-0.6% on 2017) • 1,409 visas granted (+ 4,2% vis-à-vis 2017) Alcântara 6.666,67 € 7.968,75 € 7.205,93 € 30,96% Arroios 6.095,25 € 7.510,34 € 7.073,26 € 27,26% Majority of the investment is made in the residential S Vicente 6.900,46 € 6.840,54 € 6.853,88 € 20,36% market. In December 2018, 84% of the total volume captured by this program was destined to this market. Campolide 6.148,08 € 5.639,53 € 6.140,16 € 27,87% Countries with the most beneficial: China, Brazil, Turkey, Ajuda 5.928,57 € 5.669,48 € 5.912,99 € 28,40%
South Africa and Russia Areeiro 5.666,61 € 6.600,00 € 5.901,05 € 23,85%
Lumiar 5.406,41 € 5.233,51 € 5.273,67 € 17,78% Since the beginning of the Gold Visas program a total of 6,757 were awarded: S Domingos de Benfica 5.213,09 € 5.133,61 € 5.202,31 € 42,01% Beato 5.111,11 € 4.422,22 € 4.958,75 € 24,97% - 2012: 2 Penha de França 4.679,15 € 6.327,20 € 4.884,13 € 24,97% - 2013: 494 - 2014: 1.526 Olivais 5.266,65 € 4.549,32 € 4.809,59 € 24,97% - 2015: 766 Carnide 4.683,02 € 4.857,61 € 4.775,12 € 24,97%
- 2016: 1.414 Benfica 4.579,44 € 4.566,96 € 24,97% - 2017: 1.351 3.676,38 € 3.805,25 € 24,97% - 2018: 1.409 Sta Clara
* values referring to the 3rd quarter 109 110 www.worx.pt
Worx has started 20 years ago in Portuguese Real Estate Market. Over time, we have positioned ourselves in the right place, becoming one of the main real estate consultants in Portugal, a benchmark in the sector and an alliance member One of BNP Paribas Real Estate.
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