Overview | Trends | Supply | Transactions | Prices

Prime

Residential knightfrank.com/research Research, 2020-21

Fotografía: Daniel Schafer PRIME RESIDENTIAL 2020-2021 PRIME RESIDENTIAL 2020-2021

PRIME CONTENTS RESIDENTIAL 04 OVERVIEW 08 PREMIUM HOMES FOR PREMIUM CLIENTS – SOMETHING FOR EVERY TASTE

oin us as we carry out an in-depth analysis attributes that breathe life and soul into the city’s 10 J of the prime residential market, to find out trendiest neighborhoods. A STROLL THROUGH THE how COVID-19 has affected performance in this To evaluate market conditions for the city’s most CAPITAL’S TRENDIEST exclusive segment. We begin with a broad over- exclusive homes, we focused on properties valued NEIGHBOURHOODS view of the residential market as a whole, getting at over €900,000 and located in one of the city’s to grips with the latest data and venturing some main prime submarkets within the districts of projections for YE 2020 – and a few predictions Chamartín, , , Chamberí and the for 2021. Centre. We have combed through all the latest sup- 20 Our Prime Global Forecast report paints a cheer- ply-side data, studied key indicators, like transac- OUR ANALYSIS OF THE ingly optimistic picture for the prime residential tion volume, and traced the dominant price trends PRIME MARKET market in major global cities – including Berlin, over the last four years. Paris, London and, of course, Madrid – at the close It is becoming more and more common to find of 2021. super-prime residential apartments integrated into Demand analysis has always been key to under- luxury hotels, a concept that offers owners the ulti- standing this market, and in the present circum- mate in exclusivity, comfort and privacy. A number 22 stances, an accurate grasp of buyer profiles is even of notable examples can already be seen in , CAR, WHAT CAR? more important. Without it, we would struggle to such as the Mandarin Oriental Hotel in Barcelona or MADRID’S REWARDS COME TO judge whether the market is offering housing solu- the newly opened Four Seasons in Madrid. THOSE WHO WALK tions that meet demand-side needs. Compared with many other sectors, the prime Madrid’s historic core encompasses a mosaic residential market has proved remarkably resil- of charismatic neighbourhoods that add value ient to the pandemic’s bite. We will all be hoping to the market not only through their selection of that the coming year sees the economy get back prime properties, but through their unique sense on its feet – and that this sector rapidly regains its 24 Editorial and contents: Knight Frank Research of place and wide array of attractions. It is these pre-COVID vigor. BRANDED RESIDENCES [email protected]

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OVERVIEW

Residential transactions in Madrid over time TRANSACTIONS Y-O-Y SPANISH RESIDENTIAL MARKET 70,000 20% Assuming that the 2021

60,000 10% recovery materialises as 50,000 TRANSACTIONS Knight Frank’s Global Buyer Sentiment Survey has seen prices climb by 50,000 anticipated, transaction 0% his year, we have all been living through checked in with more than 700 potential buy- close to 30% compared to the historic low re- 40,000 numbers should bounce an unprecedented event, with the global ers across the globe between 5th and 23rd June corded in 2014, although in Q2 the open-market -10% economyT grinding to a standstill and growth 2020, a time where memories of the first lock- price for residential property came in at around 30,000 back by some 20%, both forecasts varying widely between countries. The down were still fresh in their minds. We found €2,590 per sq m, -1.4% short of the 2019 average. -20% 20,000 nationally and in the most recent projections from the International that one of the most prevalent motivations At the national level, we would expect the aver- -25% -30% Madrid market. Monetary Fund* suggest that Spanish GDP will among Spanish buyers was the desire to up- age price to be sitting 8% to 10% lower at the end 10,000 close out 2020 on a contraction of 12.8%, but grade their primary family residence, followed of this year than in 2019. However, 2021 growth 0 -40% with a gradual recovery within its grasp. Growth by the acquisition of a holiday home in a sunny is likely to hit around 6%, as slackening demand 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 should hit 7.2% in 2021, comfortably outpacing climate and access to quality medical care. meets a rise in supply. Forecast the predicted Eurozone average (5.2%). In the Community of Madrid, the final tally Source: Knight Frank Research / INE As for transaction volume, official statistics should reach approximately 50,000 transac- In Q2, the highest growth (relative to his- indicate that Spain posted more than 240,000 tions, almost 40% more than the 2013 low. toric lows for the 2004–2019 period) was completed sales reported in the period to Au- We are optimistic that 2021 will bring a robust posted by the autonomous regions of Ma- gust 2020, a dip of around 25% compared to the recovery, with transaction volume growing by drid, the Balearic Islands, Catalonia and the same period in 2019. By the end of the year, this 20% both in Madrid and at the national level. Canary Islands. In Madrid, prices jumped figure is expected to grow to somewhere in the by nearly 30% compared with the 2014 low, region of 330,000 – down roughly 25–30% year PRICES although the average open-market price for on year. To put this in perspective, this estimate Data from H1 2020 tells us that the average residential property in Q2 fell 1.4% short of is far removed from the levels recorded during price of an open market home in Spain was the 2019 figure at around €2,590 per sq m. the previous crisis; indeed, it’s almost 19% high- around €1,625 per sq m, only slightly lower than Compared to the Spanish market as a whole, er than the final reckoning for 2013. the average price in 2019 (€1,640 per sq m). The we would expect Madrid to trace a smoother path both in decline and recovery, with a slump of around -6% in 2020 giving way to growth of 4% in 2021. Residential transactions in Spain over time TRANSACTIONS Y-O-Y Meanwhile, keep an eye on the residential lettings market, which has weathered the

15% COVID-19 crisis with aplomb; indeed, ren-

500,000 10% tal prices continue to grow in Spain, hitting

5% €11.30 per sq m in October. Among the many 400,000 potential impacts of the pandemic, house- 330,000 0% -5% holds are finding the costs of purchasing 300,000 -10% a home prohibitively expensive, typically

-15% requiring an outlay of between 20–30% on 200,000 -20% top of the sales price. This, combined with a labour market where flexibility and mobility 100,000 -25% -30% -30% are increasingly rewarded, is energising let- tings activity, with rental prices in cities like 0 -35% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Madrid reaching €15.70 per sq m by the end of October. Source: Knight Frank Research / INE *Forecasts updated by the IMF in October 2020.

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Outlook: annual variation Open-market prices*. in price Forecast variation in prime residential property prices Q2 2020 variation from the lowest average price recorded in 2004–2019 Madrid Spain Q2 2020 STRONG GROWTH (5%+) 15% 0% SLIGHT GROWTH (0.1% TO 4.9%) -3% 6% New-build: FLAT OR SLIGHT DIP (0%-4.9%) 10% 12% 6% € 1,900 / sq m STRONG DECLINE (-5%+) Resales: 5% 5% €1,600 / sq m 3% -1% 20%

1% 0% 2021 29% -5% -4%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Auckland Madrid Q2 2020 Cape Town Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 F F -2% 5% 12% New-build: €3,000 / sq m Berlin 34% Shanghai Resales: €2,600 / sq m Geneva Lisbon Source: Knight Frank Research Balearic Islands Q2 2020 -3% London New-build: €2,800 / sq m Los Angeles 7% Resales: €2,300 / sq m Bombay Madrid Dubai Catalonia Q2 2020 Melbourne Hong Kong New-build: €2,300 / sq m Miami PRIME New York Resales: €2,000 / sq m Monaco RESIDENTIAL 44% Paris Ceuta and Melilla Q2 2020 MARKET Sydney New-build: €1,900 / sq m Vancouver Resales: €1,700 / sq m Buenos Aires -10% < X ≤ 0% 20% < X ≤ 30% Vienna night Frank’s Prime Global Forecast sent Q2 prices tumbling, although we should 17% 2021 looked at data from 22 major ci- see a strong recovery in 2021. 0% < X ≤ 10% 30% < X ≤ 40% Canary Islands Q2 2020 Singapore K New-build: €1,700 / sq m ties, including Madrid, to form a view on In Madrid, the performance of the prime 10% < X ≤ 20% 40% < X Resales: €1,500 / sq m where prime residential property prices mi- residential market has been at odds with ght stand at the close of 2021 compared to both city and nationwide trends. Here, the Source: Spanish Development Ministry. *Open-market price, all property types included. where we are now. Based on projections for impact on the average price has been more supply and demand, what we know about muted, owing to sustained demand and the the impacts of the crisis in each market and view that prime Madrid property makes a Spain. Average rental price for residential property over time 2006 - October 2020. €/sq m the economic stimulus packages provided in good safe-haven investment. If prevailing each country, the forecast outlines an overall trends continue, prices should bottom out Sustained high demand, 2021 recovery scenario for each city included at around 4% in this segment by the end of 7.5 7.2 7.3 and the perception of in the analysis. Cape Town and Shanghai 2020, recouping 3% in 2021. 8.1 7.5 look set to lead the board in 2021, with fore- Data from the Global Buyer Sentiment 8.3 prime Madrid residential 7.7 9.5 cast growth of 5%. Hot on their heels are a Survey gathered between 5th and 23rd June property as a safe- cluster of European markets, including Ber- 2020 suggests that, in light of the pandemic

10.4 2013 7.6 2012

2014 lin and Madrid. experience, almost 65% of Spanish residents 2011 haven investment, have 2010 2015 Our report, The Prime Global Cities Index, would choose to stay in the same city in the 2016 cushioned the pandemic’s 7.7 2009 studied growth in prime property prices in event of moving to a new home. This is a 2017 10.9 blow in this sector. more than 40 cities all around the world. It very telling snippet of information for the 2008 8.2 2018 ranked Madrid in ninth place over the ear- residential market, both nationally and in ly part of 2020, with year-on-year growth of Madrid: in all other countries included in the 2007 2019 11.3% 4.6%. The disruption unleashed by the pan- survey, the percentage giving this answer is 8.8 demic from March onward unsurprisingly significantly lower at 40%. 2006 Oct 2020

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A PRIME HOME HIGH-RISE APARTMENT GROUND-FLOOR APARTMENT WITH GARDEN A home in a multi-storey property where Apartment occupying the ground floor of a shared FOR EVERY residents enjoy shared use of common areas. property, enjoying exclusive use of a private garden. Tends to have well-proportioned rooms and Like the penthouse apartment, this option has seen PRIME BUYER more than one bedroom. its stock soar in the wake of the pandemic, which has pushed gardens higher up the list of priorities for most buyers. YOUNG PROFESSIONALS FAMILIES AND SINGLES RETIRED PROFESSIONALS DUPLEX/TRIPLEX APARTMENT An apartment arranged over two or three SINGLE-FAMILY HOME Profile: Profile: Profile: floors in a shared building. In most cases, this Self-contained home, usually set in its own grounds • +25 years • +35 years • +55 years allows for a more varied ambiance and clearer and offering spacious family accommodation. • Single or living with partner • Single or living with partner, with or • Single or living with partner, with or divisions between rooms. Often arranged over several levels, this is the best without dependent children without adult children • Urban lifestyle option for those who cherish their privacy, as the • Urban and country lifestyle • Urban and country lifestyle building is not shared with neighbours. Requirements: APARTMENT/STUDIO Regarded as the optimal place to see out a lockdown • At least 1 bedroom Requirements: Requirements: A more compact home where a single, open- thanks to the privacy and space it affords, both inside • 1 or 2 parking spaces • At least 3 bedrooms • At least 3 bedrooms plan space fulfils multiple functions, or where and out, the single-family home is one of the best- • At least 2 parking spaces • At least 2 parking spaces • Modern properties with high-tech only the bedroom is separate from the rest of performing property types in the market. specifications • A spacious home in a property offering • A home all on one level with outdoor the living space. These preferences are unlikely to change in the near high-quality shared space (swimming space • Good access to public transport future, particularly as remote working seems here to pool, gardens, children’s play area, etc. and/or the airport • Good access to public transport and stay. For many families, setting themselves up with a • Good views • Convenient main road access main roads PENTHOUSE APARTMENT comfortable workspace will become a key concern. • Proximity to workplace and/or school • Good views Apartment occupying the top floor of a This hunch is supported by the results of the Global Source of income: property, usually with the added benefit of a Buyer Sentiment Survey: 65% of Spanish respondents Source of income: Source of income: • Family wealth generous terrace. state that the lockdown has left them leaning more • Media professions – sport, politics, • Family wealth • New elite professions: Sought after partly for its superior city views. toward a single-family home than any other property entertainment, etc. advertising, technology, sport, • Earlier professional success Although this type of property has always type. Moreover, almost 75% state that having extensive etc. • Own business and investments • Own business and investments been highly prized, the pandemic has pushed landscaped areas and plenty of outdoor space is a demand to new heights, as buyers feel a need priority for them, and 64% now rate an office or work Preferred homes: Preferred homes: Preferred homes: for more outdoor space. area more highly than they did before.

IN HIGH DEMAND IN THE WAKE OF THE PANDEMIC

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MADRID’S TRENDIEST NEIGHBOURHOODS

NEW-BUILD SUPPLY

Menéndez Pelayo 41

IBIZA

Montalbán 11

JERÓNIMOS

NIÑO JESÚS

Palacete Ramón y Cajal

PACÍFICO

ADELFAS

Source: Knight Frank Research | Idealista Data *Data collected in Q2 2020. Our analysis is based on properties in prime neighbourhoods within each district, starting from €900,000.

Retiro | Jerónimos

The capital’s cultural and architectural jewel. own distinct ambiance, now one of the most ex- This is where we find the Parque del Buen Reti- clusive residential areas in town. Offering the ro, a public garden with a rich history and one of chance to live right in the heart of this global Prime supply Madrid’s most famous parks. European city, but cloistered from the urban – average price: The most upscale tract is home to tourist-friend- bustle, and forming a natural border with the ly attractions like the Botanic Garden, the Prado Parque del Retiro, Madrid’s premier green spa- € 8,650 Museum, the Naval Museum, the Church of San ce, Jerónimos is a sensational place to live. Jerónimo el Real (for which the area is named) Its flourishing cultural scene has been enhan- per sq m and, of course, one of the capital’s most iconic ced further by the recent arrival of ultra-modern monuments, the Puerta de Alcalá. bars and restaurants, turning the area into a It’s a refined, elegant neighbourhood with its must-visit tapas destination.

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Claudio Coello 108 Serrano 85 Claudio Coello 121

Esquina Bécquer GUINDALERA Claudio Coello 11

Marqués de Príncipe de Salamanca 11 Vergara 76 Núñez de Balboa 86

Don Ramón de la Cruz 26

RECOLETOS Alcalá 141

FUENTE Lagasca 38 DEL BERRO

Velázquez 23

Jorge Juan 53 8 Jorge Juan 93

Source: Knight Frank Research | Idealista Data *Data collected in Q2 2020. Our analysis is based on properties in prime neighbourhoods within each district, starting from €900,000. Salamanca Castellana | Recoletos | Goya

A cluster of art galleries around Calle Villa- Salamanca is one of Madrid’s most archi- nueva help draw in footfall for the area’s many tecturally distinguished districts. high-end stores. The is Initially laid out as a residential suburb, the axis around which the city revolves, home over time it began to diversify, attracting to a profusion of international headquarters. other uses including business, diplomacy Calle de Goya is another hotspot; here we and, especially, retail. Here we find some of find the biggest names in fashion, convenient- the capital’s most exclusive thoroughfares, Prime supply ly interspersed with an eclectic range of cafés like Calle de Serrano and Calle de Velázquez, – average price: and restaurants. At night, the atmosphere is plus the so-called Milla de Ora (Golden Mile) electric as revellers flock to its famous bars and that runs through the heart of Salamanca. nightclubs. Also on this street is the WiZink Sprinkled along are € 9,000 Center, a major venue for sporting events and impressive monuments, major museums per sq m arena concerts. and galleries (like the National Archaeolog- Calle de Alcalá, a prominent artery which ical Museum and Museo Lázaro Galdiano) begins from the Puerta del and runs for and renowned restaurants offering the latest over 10 km, is a true shopper’s paradise, with a innovations in fine cuisine. dizzying array of brands to choose from.

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Chamberí / / Ríos

Perhaps the most quintessentially madri- neral Museum in Rios Rosas. The evening’s leño neighbourhood on our tour, and one of entertainment is taken care of by numerous the richest in history, is Chamberí. Nestled in theatres and cinemas: good options include Madrid’s historic core, it’s known for its state- the Teatro del Canal, Teatro de la Abadía, ly ambiance and classical style. Between its Teatro Galileo, the Teatros Luchana and Cine many museums, theatres and entertainment Pas and Cinesa Proyecciones, both in Calle venues, culture vultures will find plenty to Fuencarral. keep them occupied, while more sybaritic ple- Also worth a wander are Calle Zurbano and asures can be enjoyed at one of its many res- Prime supply Plaza Olavide in the unspoiled neighbour- – average price: taurants and bars. hoods of Trafalgar and Almagro. The former is There’s a dazzling range of cuisine to be lined with imperious mansions, stores, restau- enjoyed, and standards are high. You can’t go € 7,500 rants and museums, while the latter is a plea- wrong with Calle Ponzano in the Rios Rosas sant spot for an open-air aperitif. neighbourhood, where you can sample a va- per sq m Calle Ríos Rosas, for which this area is na- riety of tapas and linger over the best-pulled med, is another interesting street, home to draught beer in Madrid. Those who prefer to the headquarters of the Spanish Ministry of feed the mind are spoiled for choice, with hi- Labour, Migration and Social Security. It’s ghlights including the Sorolla Museum and also the chosen address of a number of private Metro Museum in Almagro and the Geomi- schools, such as the Scuola Italiana.

Espronceda 32

Modesto Lafuente 26

VALLEHERMOSO RÍOS ROSAS Bretón de los Francisco de Herreros 44 Ricci 13

Españoleto 19

Fuencarral García 142 Paredes 64 García Paredes 4 Génova 7 ALMAGRO Martínez Campos TRAFALGAR José Abascal 48

La Esquina de General Arrando

Francisco Residencial Alfonso X 4 de Rojas 2 Santa Engracia 43

Medellín 3 Palafox 9 Montesquinza 5

Santa Engracia 51 Source: Knight Frank Research | Idealista Data *Data collected in Q2 2020. Our analysis is based on properties in prime neighbourhoods within each district, starting from €900,000.

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Centre / / /

Here, we’re in the cradle of historic Ma- trict with a noble and eventful history. It drid, where the city’s story began. Instantly encompasses the area known as Las Letras, recognisable, the Chueca area has undergone including Calle Huertas and Plaza de Santa significant regeneration in recent years and Ana, famous for their impressive selection is now a popular leisure, shopping and bu- Prime supply of bars and terraces. Among this neighbour- siness hub. Its architecture exudes the spirit – average price: hood’s many attractions are the Teatro Espa- of old Madrid, with narrow streets leading ñol, the Ateneo de Madrid, Casa Museo Lope to hidden squares, overlooked by handsome € 7,300 de Vega, the Convent of the Barefoot Trini- buildings with dainty balconies. Not to be tarians, Teatro de la Zarzuela and the Caixa- missed is the San Antón market, one of Ma- per sq m forum arts centre. drid’s most beloved foodie destinations. Finally, we come to the Palacio Real (Royal Las Cortes, named for the Spanish Con- Palace) and Plaza de Oriente: both vital stops gress of Deputies, is another part of the dis- on any self-respecting visitor’s itinerary.

UNIVERSIDAD CARRANZA 15 BARQUILLO 11

JUSTICIA FUENCARRAL 77

FERNANDO VI 19

SOL FOUR SEASONS PALACIO PRIVATE RESIDENCES

ZORRILLA 19

CORTES

CEDACEROS 3

EMBAJADORES

Source: Knight Frank Research | Idealista Data *Data collected in Q2 2020. Our analysis is based on properties in prime neighbourhoods within each district, starting from €900,000.

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Calanda Homes

Duque de Pastrana 7

CASTILLA

Paseo de la Habana 147 NUEVA ESPAÑA

Rosa Jardín 16

HISPANOAMÉRICA Habana 75

CIUDAD JARDÍN

Pablo Aranda 3

Source: Knight Frank Research | Idealista Data *Data collected in Q2 2020. Our analysis is based on properties Chamartín in prime neighbourhoods within each district, starting from / Nueva España / El Viso €900,000.

Huddled in the district of Chamartín is one is one of the city’s best-connected neighbour- of Madrid’s most exclusive enclaves. hoods, boasting the Chamartín train station, Home to celebrities and wealthy dynasties, Prime supply the main interurban bus station and metro li- El Viso is a predominantly residential neigh- – average price: nes 1, 9 and 10. bourhood that promises peace and quiet, secu- This neighbourhood is also where we find rity and exclusivity. Points of interest include € 6,650 the courthouse and Fundación the National Music Auditorium and the Science Canal, which hosts a range of stimulating exhi- Museum. per sq m bitions. The chosen location for Madrid’s two Nueva España is another sedate residential landmark office buildings, known as the Torres enclave, hosting several national embassies. Kio, it has now become one of the city’s leading Castilla, known to locals as Plaza de Castilla, business centres.

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Available stock by new-build Available stock by resale MADRID PRIME property type property type

RESIDENTIAL MARKET 4% BEDROOMS 4%

>7 22% SUPPLY 31% 5-6 f all of the prime locations studied, Available supply by number Transactions by prime Chamartín has the most abundant of bedrooms. locations. 4 Last 12 months Oavailable supply, sitting on almost 40% of the New-build Resales 3 total. Within this district, the Nueva España 400 30% neighborhood stands out with 25% of all new- 350 52% 1-2 build housing and 15% of resale housing. An- 300 30% other one to watch is El Viso. New-build hous- 250 21% 23% ing is in short supply here (5%), but buyers 200 24% 19% have a greater choice of resale property than 150 anywhere else in Madrid – around 20% of the 100 21% 21% 21% 50 21% 11% citywide total. 0 Coming up close behind are Salamanca and Source: Knight Frank Research | Idealista Data (*) 1-2 3 4-5 5-6 >7 6% Chamberí, each with around 20%. Salaman- ca’s Castellana neighbourhood should be on Source: Knight Frank Research | Idealista Data (*) transactions in this district’s prime locations. in the district (8%), where the average It is worth highlighting that so far, at Centro Chamartín Chamberí Retiro Salamanca any prime buyer’s radar, with 12% of the city’s In Salamanca, the Castellana neighbourhoods price reached around €7,800 per sq m. least, the average price in prime locations in new-build supply and 15% of resale5% supply. came out on top, with 10% of all transactions in By the time Q2 2020 came around, Europe Chamartín has been entirely unaffected. One district, with 7% of available resale supply and Source: Knight Frank Research | Idealista Data (*) Meanwhile, Chamberí’s Almagro neighbour- prime locations. was in the first throes of the pandemic, which explanation for this may be that the pandem- just 1% of new-build supply. In nearby Palacio, hood is sitting on almost 20% of new-build While most of the demand for prime resi- hit Spain in March. ic and subsequent lockdown have altered de- all available supply in the prime segment is supply and a little under 15% of resale supply. It’s a very different picture for resale dential property in Spain is still domestic in Average prices in prime locations slumped mand-side needs and preferences, with more resale property, at 3% of the citywide total. Finally, the Centro area commands 17% of property: more than 60% of available homes origin, there has been a considerable rise in the by around 5% in the Centro district, coming in people seeking homes with generous green Finally, Retiro is the toughest submarket the city’s prime residential stock. The Justicia in this category offer between four and six number of international buyers snapping up at around €7,300 per sq m. Salamanca proved space, gardens or extensive terracing. to crack, with just 5% of the city’s total prime neighbourhood is the most interesting in this bedrooms. homes in the capital – particularly from Mex- more resilient – here, the average price in This area accounts for a considerable share residential stock. One- and two-bedroom homes represent ico, Venezuela, Asia and the Middle East but prime locations fell by just 1%, although buy- of the supply of prime single-family homes This district contains the Jerónimos neigh- about 10%, while the largest properties (sev- also other parts of Europe. ers who aspire to this district need to stump up that tick all these boxes, with prices exceeding bourhood included in our analysis, which of- en bedrooms plus) amount to just 4%. €9,000 per sq m. €8,000 per sq m. fers 7% of Madrid’s prime resale property but Distribution of available supply by PRICES just 1% of new-build. prime area. TRANSACTIONS Madrid is one of the world’s most desirable Resales and new-build (%) When the city’s total prime residential According to the latest available data, the cities for prime residential investment. property supply is broken down by type, it is district that posted the greatest volume of The city offers competitive prices compared Average price by prime district clear that the most readily available homes (€/sq m) transactions in the prime residential segment with other European capitals and a quality of are those with three to six bedrooms. Q2 2017 2018 2019 2020 over the last 12 months was Centro, account- development now beginning to rival that of Across all property types, there is far more 10,000 ing for 30% of the total. London, Paris and New York. resale property to be had than new-build; in 9,000 Drilling down further, we find that the To attract attention at the global level, a 8,000 36% fact, it’s virtually impossible to find a prime neighbourhoods of Universidad and Justicia property needs an exceptional location and/or 7,000 new-build home with more than seven bed- each racked up almost 15% of all transactions an iconic, often starchitect-designed building. 6,000 rooms. completed across prime locations included in It also needs to boast a portfolio of exclusive 5,000 The most generous selection of new-build 4,000 our study. services – that’s quite hard to find, which is 21% 21% properties is in the three-bedroom brack- 3,000 Chamberí and Salamanca, adjacent to Cen- why there are so few outstanding prime oppor- 17% 2,000 5% et (around 50% of the total), followed by tro, are level on 20%. In Chamberí, the Alma- tunities in the capital at present. 1,000 four-bedroom (22%) and one/two-bedroom gro neighbourhood saw more activity than In prime Madrid locations, average prices 0 Centro Chamartín Chamberí Salamanca Retiro homes (21%). Retiro Salamanca Centro Chamartín Chamberí anywhere else, securing almost 20% of all have been climbing since 2019, surpassing an- ything seen in recent years. The steepest jump Source: Knight Frank Research | Idealista Data (*) Source: Knight Frank Research | Idealista Data (*) *Data collected in July 2020. Our analysis is based on properties in prime neighbourhoods within each district, starting from €900,000. between Q2 2018 and Q2 2019 was recorded

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CAR, WHAT CAR?

Chamartín

Bernabéu MADRID’S REWARDS COME Stadium

TO THOSE WHO WALK Parque Azca Berlín

Nuevos Ministerios

Knight Frank manages an extensive portfolio in the prime residential Natural Science National segment, including a selection of properties in Madrid’s most sought-after Teatros Sorolla Museum Auditorium del Canal Museum locations aimed at buyers ready to bump up their quality of life. Below are just a few examples of upcoming developments in the districts Chamberí explored in this report, as well as some exclusive homes available now.

Salamanca

CENTRE RETIRO SALAMANCA Plaza del Dos de Mayo Archeological First up is an opportunity to own a share of a Imagine living inside a work of art, lingering Enjoy the ease and tranquillity of a perfect Plaza de Museum WiZink Templo España Center building that exudes classical chic, featuring over breakfast with views of the Parque del weekend in the country, but on a Monday Debod Puerta de wrought-iron bay windows and a contrasting Retiro while you plan your weekend escape morning in Madrid. When you wake up to Círculo de Alcalá designer interior, just a five-minute cycle to Valencia, Seville or Barcelona on the AVE... your own bioclimatic garden, with a pleasant Royal Bellas Artes Palace from the finest exhibitions at the Museo del After all, it’s less than a fifteen-minute stroll fifteen-minute cycle to your office in Azca, Centre Prado. Ten minutes, and you can be at the to station. city life has never been more relaxed. Plaza Thyssen Puerta del Sol, hunting down the latest album Mayor Museum *based on c/ Montalbán 11 *based on c/ Alcalá 141 Teatro from your favourite band. Español Prado Museum *based on c/ Cedaceros, 3 Retiro

CHAMBERÍ For more information regarding these specific Puerta El Rastro Unwind in the wellness zone or in your amply properties or others, please visit: www.knightfrank.es de Toledo CHAMARTÍN La Casa Atocha proportioned living room with its cathedral Encendida Reina Now that your favourite restaurant in Paseo de ceiling, before decamping to the Parque del Sofía la Habana is less than a ten-minute bike ride Retiro with a good book – five minutes in the Museum away, you have every excuse for luxuriating saddle, and you’re there. As you make your in your salt-water infinity pool a little longer, way back home, be sure to stop off in Calle admiring the stunning city views. Serrano to indulge in a little light shopping. Bicycle lanes

*based on c/ Duque de Pastrana 7 *based on c/ Génova 7 Planetarium

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HOTELS AND BRANDED RESIDENCES: A BOLD NEW CONCEPT FOR LUXE

In a whole host of countries, leading luxury hotel brands are setting their sights on a new market, reserving part of their properties for “super- prime” residential apartments. This new concept offers the right owner an unbeatable combination: an exceptional level of service, outstanding location, exclusive leisure facilities and the added value of buying into a recognisable hotel aesthetic.

Baccarat Hotel. New York

his new trend opens up an intriguing are occupied elsewhere. opportunity for those seeking exclu- Real estate professionals entrusted with sivity,T privacy and discretion. Even better, marketing these homes have a chance to of- many of these homes have been designed fer their clients an upscale property bathed by world-renowned architects – some even in the halo-effect of a prestigious brand, not come with original art works on their walls. to mention the reassurance and cachet of all Buyers looking for this level of luxury gen- those luxury touches associated with a five- erally own properties in other parts of the star hotel. world. They see branded residences as an New York is one of the most iconic cities opportunity to acquire a second home where to have gone down this route. The glass tow- they can enjoy their down time in style, at a er of the Baccarat Hotel & Residences rises more leisurely pace, without having to wor- elegantly against the central Manhattan ry about the upkeep. These apartments can skyline, combining a 12-storey hotel with even be turned into an additional income 38 floors housing 60 exclusive residential stream – many are let out while their owners apartments.

Four Seasons Hotel, Madrid

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Featuring interiors designed by Tony In- and artisans collaborated on the interiors in grao, these luxury residences offer access to a bid to fulfil the expectations of the world’s the hotel’s facilities, including a lounge with most demanding buyers. Prices start at €2 Branded residences fall views of MoMA, a spa with swimming pool million, although a penthouse apartment will into the categories known and a French-style restaurant. set you back a lavish €93 million. Dubai, where luxury is a way of life, will Not to be outdone, Europe has launched as “super-prime” and this year unveil the Royal Atlantis Resort and its own version of this trend. London leads “ultra-prime”: these are Residences, a 43-storey complex including a the way with the partnership between Man- properties aimed at the hotel and 231 private apartments with assort- darin Oriental and the super-luxe One Hyde ed floorplans. A star-studded list of designers Park development, designed by Richard Rog- super-wealthy, and despite the COVID-19 crisis they One Hyde Park, London have made a real buzz, with a significant number of sales. Hong Kong, New York, Los Angeles and London have all done a brisk trade in ultra- prime homes, despite the difficult climate caused by the pandemic.

Mandarín Oriental Hotel. Barcelona

ers and boasting a spectacular location just the Madrid Four Seasons. The development €15,000 per sq m. a five-minute stroll from Harrods. Residents includes 22 luxury apartments to be mar- Residents enjoy access to the hotel’s facili- can enjoy a selection of indulgent perks such keted as Four Seasons Branded Residences. ties and services, including the spa and swim- Pandemic or no pandemic, travel as their own butler, maid service and 24-hour Occupying the upper floors of the complex, ming pool, plus their own private entrance to will always be an aspirational privi- security. each apartment features a unique design, the on-site restaurants. lege, not only for those longing for an Branded residences fall into the cate- with the average price standing at around Meanwhile, Barcelona is experimenting exotic getaway but also for second-ho- gories known as “super-prime” and “ul- with a fresh take on this trend: the hotel chain me owners in other parts of the world.

tra-prime”: these are properties aimed at the The Royal Atlantis Resort & Residences, Dubai Mandarin Oriental is developing 34 sumptu- super-wealthy, and despite the COVID-19 ous apartments on super-prime Paseo de Grà- Living through lockdown seems to crisis they have made a real buzz, with a sig- cia, entirely separate from the hotel itself. have heightened interest in acquiring nificant number of sales. Hong Kong, New Owners will be attended by a team of 20 pri- a second home overseas. York, Los Angeles and London have all done vate staff, and will have the use of the nearby a brisk trade in ultra-prime homes, despite hotel and its facilities. According to the results of the June the difficult climate caused by the pandemic. These ultra-prime hotel–residence hybrids 2020 Global Buyer Sentiment Survey, In London’s case, there were actually more are generating a lot of interest, primarily from Spain has become the world’s second transactions involving homes priced at over international clients. The hotel brand offers most sought-after destination since $22 million than in 2019, as Knight Frank’s lat- a new way to add value and stand out from the pandemic began. est report on this segment reveals. the competition, so we should not be too sur- In Spain, seven historic buildings have prised to see more hotel groups exploring this been combined into an impressive home for option in the future.

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Residential Research Carlos Zamora Rosa Uriol Partner, Head of Residential Head of Research +34 600 919 041 +34 600 919 114 [email protected] [email protected]

COVID-19: Across Europe and beyond, market activity is being impacted in all sectors due to the Novel Coronavirus (COVID-19) outbreak. As at the date of this report, we consider that we can attach less weight to previous market evidence for comparison purposes, in providing our opinions on the market. Given the unknown future impact that COVID-19 might have on the real estate market and limited recent comparable data, this report is meant to provide market insights as we see them at this time but we wish to highlight the material uncertainty which may cause swift changes in the market. Please get in touch with our team if you would like to discuss in further detail or receive an update regarding market conditions.

Knight Frank Research provides strategic advisory services, consultancy services and forecasts Knight Frank Research publications to a wide range of clients across the globe, including developers, institutional investors, are available in Spanish at: knight- financial bodies, corporate institutions and any other type of client with specific property frank.es/investigacion-de-mercados requirements. Important notice: © Knight Frank España, S.A.U. 2021. This report is published for knightfrank.com/ general information only and is not to be relied upon in any way. Although high standards have been and in English at: used in the preparation of the information, analysis, views and projections presented in this report, research no responsibility or liability whatsoever can be accepted by Knight Frank España, S.A.U. for any loss or damage resultant from any use of, reliance on or reference to the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank España, S.A.U. in relation to particular properties or projects. Reproduction of this report in whole or in part is not allowed without prior written approval of Knight Frank España, S.A.U. to the form and content within which it appears. Knight Frank España is a Sociedad Anónima Unipersonal registered on the Mercantile Register of Madrid with Registered Tax Number (CIF) A-79122552. Our registered office is located at Suero de Quiñones 34, 28002 Madrid.

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