According to data from the international real estate consultancy JLL, total real estate investment in Spain registered 141% more than in the first quarter of the same period of 2021, with 3,817 million euros. In this case, the investment in offices, logistics and retail stands out, which was 1,716 million euros in the first quarter of 2022.
On the other hand, the volume of logistics investment during the first quarter of 2022 reached 865 million euros, which represents an increase of 432% compared to the same period of the previous year and an increase of 65% compared to the fourth quarter of 2021.
So this is the best investment figure recorded in the logistics segment in a first quarter since 2017 and, in addition, marks the highest year-on-year growth in the last five years. Around 80% of the total volume of transactions in the quarter corresponds to logistics portfolios.
As highlighted by Sergio Fernandes, director of the JLL investor area, “between January and March 2022 we have reached levels higher than those of 2021 in almost all segments driven by the capital available in the market and the recovery experienced by almost all real estate segments.
JLL highlights in its analysis that the growing investor interest has also resulted in a compression of returns in the logistics segment, reaching 3.75% in both Madrid and Barcelona, which shows a decrease of five basis points compared to the quarter above and fifty basis points in the annual comparison.
From the consultancy they consider that 2022 will once again be a record year for logistics investment, as some investors prepare funds to invest in Spain and new logistics hubs will emerge, which will bring important investment transactions.
The accumulated investment in retail between January and March 2022 was 428 million euros, which represents an increase of 113% in the annual comparison and 51% compared to the previous quarter.
Shopping centers also stand out, with 162.5 million euros invested, exceeding the volume of the fourth quarter of 2021 by 333%. They are followed by the High Street sector (with 153 million euros invested), supermarkets (107 million euros in transactions) and medium-sized parks. Investment in retail continues to focus mainly on prime assets. Thus, the core product represented 80% of all transactions during the first quarter of 2022.
The total investment in offices in Madrid and Barcelona between January and March reached 423 million euros, with an increase of 87% in year-on-year terms, favored in part by the good start to the year in the capital. Compared to the previous quarter, volumes are down 47% as the 2021 close beat expectations.
Regarding yields, in Barcelona they have been compressed ten basic points in the prime markets, settling at 3.4%. In Madrid, they remain stable at 3.25% due to the lack of existing product, although there is interest from investors. On the part of the living sector, which includes the residential, student residences and healthcare sectors, investment during the first quarter of the year reached 1,141 million euros, which represents an increase of 92% compared to the first quarter of 2021.
This increase is mainly due to the increase in investment in the ‘build-to-rent’ verticals, which reached 997 million, which represents an increase in absolute terms of 592 million euros, 146% more than to the first quarter of the previous year. The period January-March 2022 marks the quarter with the highest investment in the residential sector since data is available.
In addition, JLL points out that this figure reflects the consolidation of the multifamily sector as one of the first real estate investment sectors. Therefore, from the consultancy they expect that by 2022 the sector will continue to demonstrate its strength. Strong investor interest continued to compress prime yields at the start of 2022, down to 2.9% in Madrid and 3.1% in Barcelona.
Regarding the hotel sector, so far in 2022, 27 transactions have been registered for a total value of 960 million euros, with outstanding operations in portfolios and trophy assets. From JLL they foresee that both investment funds and institutional investors will continue to play an important role in this market throughout the year.
