A flurry of investment deals have reignited confidence in the Spanish retail investment market, with €912m (£796m) of assets already traded this year, according to Savills in Madrid.
This comes after a slightly slower year in 2016, when €2.9bn was transacted in the Spanish capital, down 7% on the year before.
Major deals of the year so far include Intu’s €430m acquisition of the Xanadú shopping centre in Madrid from Ivanhoé Cambridge Group and the Alcalá Magna shopping centre, which was sold to Socimi Trajano, managed by Deutsche Bank, for €100m in January.
Intu is preparing to bring on a joint venture investment partner for this development and has already begun discussions with interested parties. However, the market is not without its risks.
Speaking to EG, Martin Breeden, development director at intu, said: “The investment market continues to be strong in Spain, and we have already had a number of calls about potential investors which would be interested in partnering with us, but we remain open-minded about who it might be. You have to invest very carefully in Spain – there are a lot of shopping centres but there are not a lot of good ones. Like in the UK, the shopping centre business is becoming more specialised, so you need a really strong management team and brand.”
Savills Investment Management has also invested in Spanish retail. It has bought a retail warehouse cluster near San Sebastian for €16m. It is its first retail deal in Spain since the global financial crisis and was made on behalf of its Europe II – Retail fund.
The property, acquired from a local developer, has Mercadona, Spain’s leading grocery operator, as its lead tenant, along with DIY operator Brico Depot.
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