A Cushman & Wakefield publication
MARKETBEAT PORTUGAL
WE DIDN'T COME THIS FAR, JUST TO COME THIS FAR.
AUTUMN, 2024
01
ECONOMY
02
OFFICES
03
RETAIL
04
INDUSTRIAL & LogIsticS
05
HOSPITALITY
07
DEVELOPMENT
08
INVESTMENT
09
SUSTAINABILITY
06
LIVING
EconOmic INDICATORS 2024
According to Moody’s Analytics, despite slowing down in 2024, Portugal will continue to stand out with an increase in GDP of 1.8%, one of the highest growth rates in the eurozone, following a 2.3% rise in 2023.
GDP
PRIVATE CONSUMPTION
EXPORTS
INFLATION
UNEMPLOYMENT RATE
+1.8%
+1.1%
+2.3%
+1.4%
+4.8%
6.3%
Global instability continues to cast a shadow on investment, with a slight recovery (1.1%) foreseen this year compared to last year. Inflation is expected to gradually ease, with expectations of it falling to 2.3% in 2024. In the labour market, following its upward trend in 2023, the unemployment rate in Portugal will continue its steady fall, to 6.3% this year.
After the first cut in interest rates in June, the European Central Bank again reduced benchmark interest rates by another 25 basis points in September this year. It is expected that this reduction in interest rates will fuel a recovery in investment and, simultaneously, boost private consumption, set to rise by 1.4% in 2024. External demand remains a key economic driver, with exports likely to grow by 4.8%, predominantly supported by the continued recovery in the tourism sector.
Source: Moody’s (October 2024)
EconOmic FORECAST 2025/2026
Over the next two years, GDP growth of 2.0% is projected both for 2025 and 2026.
+2.0%/ +2.0%
Moody's Analytics predicts that the European Central Bank will continue to reduce benchmark interest rates, reaching close to 2% by the end of 2025. In terms of Portugal’s inflation rate, in line with expectations for the eurozone, a moderate drop is expected, falling below the 2% target in the next two years (1.6% in 2025 and 2026). Employment is forecast to drop to 5.7% in 2025 and 5.3 % in 2026 – a 25-year record low.
Domestic demand will benefit from reduced inflation and less stringent financial conditions, with the implementation of the European Recovery and Resilience Plans boosting investment. Private consumption should stabilise at 1.5% by 2025, dropping to 0.6% in 2026.
+3.0%/ +2.9%
+1.6%/ +1.6%
+1.5%/ +0.6%
+3.8%/ +3.1%
5.7%/ 5.3%
GREATER LISBON
TAKE-UP
New Completions
Average Deal Size
Under Construction
Vacancy Rate
168,500 sq.m (+134%)
1,300 sq.m (+100%)
7.2% (+0.2 p.p.)
61,200 sq.m
234,800 sq.m
The Greater Lisbon office market experienced a significant recovery between January and September 2024, with a take-up of 168,500 sq.m. This represents a year-on-year increase of 134% - the second highest in the last decade. This positive trend is largely due to the completion of several large transactions, including five of over 5,000 sq.m accounting for 42% of the total take-up during the period.
Source: Cushman & Wakefield; LPI
TAKE-UP BY SEMESTER AND AVERAGE DEAL SIZE
Amongst the largest deals to date are two transactions in buildings still under construction in Parque das Nações (zone 5): the purchase of the 26,710 sq.m WellBe building by Caixa Geral de Depósitos, to house its future headquarters; and the lease of roughly half of Oriente Green Campus (15,840 sq.m) to the European University. The entire 17,010 sq.m of Álvaro Pais 2, fully occupied by a confidential entity in the New Office Areas (zone 3) and the pre-lease of Rato 11 (5,820 sq.m) by Deloitte Portugal in CBD (zone 2), also stand out. The first two zones boasted 58% of the demand; with the Financial Services sector accounting for more than a fifth of the take-up, driven by the largest deal recorded to date.
MAIN TRANSACTIONS
* Year-to-Date (YTD) as of September
TENANT
PROJECT
ZONE
AREA (sq.m)
Caixa Geral de Depósitos
Confidential
Monday By Urbania
Leaseplan / Ayvens
Luz Saúde
Universidade Europeia
Deloitte Portugal
WellBe
5
26,710
Álvaro Pais 2
3
17,010
Oriente Green Campus
15,840
Rato 11
2
5,820
Alfrapark - Building E
6
5,630
World Trade Center - Block 1
4,880
Marquês de Pombal, 2
1
3,850
Malhoa 17
3,820
Quinta da Fonte - Q43 (Fernão Magalhães)
3,780
Torres de Lisboa - Tower A
3,680
The vacancy rate rose by 0.2 percentage points (p.p.) to 7.2%. Furthermore, development activity remains solid, promoting the emergence of high-quality spaces aligned with current demand. The first three quarters of the year saw 61,200 sq.m of new completions, all of which are already fully occupied. Future supply remains high and is expected to reach 385,100 sq.m over the next three years, with the vast majority (234,800 sq.m) currently under construction, of which 46% has already secured occupation.
MAIN NEW COMPLETIONS
VACANCY RATE BY ZONE
Exeo Office Campus - Echo
4
Exeo Office Campus - Aura
EDP 2 Headquarters (expansion)
Taguspark - Novo Banco (expansion)
CONSTRUCTION TYPE
DEVELOPER
New
REfurbishment
Avenue
EDP
Taguspark
Zurich
21,500
11,400
16,800
8,200
3,300
MAIN PROJECTS UNDER CONSTRUCTION
Source: Cushman & Wakefield
Cais 5
Fidelidade - Álvaro Pais
Paços do Concelho
Norfin (Orion)
Fidelidade
Signal Capital
Oeiras City Hall
Atenor
41,100
38,400
5,900
30,500
26,700
EXPECTED COMPLETION DATE
2024
2025
República 5
Campo Novo – Building 1
Torres Colombo – North Tower
Camilo Castelo Branco, 43
Signal Capital / Sonae Sierra
French Family Office
Norfin (King Street)
Sonae Sierra / AXA IM
BPI Gestão de Ativos
11,200
5,800
9,500
35,100
9,400
2026
AVERAGE AND PRIME RENTS
Heightened demand for higher-quality buildings has led to further increases in prime rents in Lisbon, with the Prime CBD (zone 1) reflecting the largest variation in headline rents when compared to 2023, showing an increase of €1.5/sq.m/month.
GREATER LISBON: PRIME RENTS
GREATER PORTO
58,700 sq.m (+44%)
1,110 sq.m (+31%)
9.0% (+0.5 p.p.)
27,100 sq.m
116,200 sq.m
Source: Cushman & Wakefield; PPI
The Greater Porto office market maintained a positive trajectory, with a take-up of 58,700 sq.m during the first nine months of 2024, corresponding to a year-on-year increase of 44% and the highest volume since this indicator was first measured. Above 50 deals were completed, the highest number since recordings began. The two largest deals corresponded to the lease of entire buildings, among which the pre-let of 10,370 sq.m in the Mutual building, by a confidential entity. This made the CBD Boavista (zone 1) the most sought-after area, representing more than one third of the demand. The second largest deal includes the total occupation of the 5,090 sq.m Pharmacia building in CBD Downtown (zone 2), by an entity who also needs to remain confidential for now. The lease of 4,640 sq.m in Tecmaia – Plot 4 by Infineon stands out as the third largest deal in this period. The Consulting and Legal, as well as TMT's & Utilities sectors, were the most active, each representing between 28% and 46% of total take-up, respectively.
Source: Cushman & Wakefield; PPI * YTD September
Infineon
Tecmaia – Plot 4
7
4,640
Matosinhos Office Center
3,950
Sousa Aroso 959
2,950
PWC
Alten
Mutual
10,370
Pharmacia
5,090
Greater Porto’s vacancy rate increased by 0.5 p.p. to 9.0%, mainly driven by the completion of some buildings in the first semester, some of which are still available. Between January and September 2024, 27,100 sq.m were completed, of which 27% remain unoccupied. Concerning future supply, 150,300 sq.m are expected to be completed over the next three years of which 116,200 sq.m are under construction with a secured occupation of 36%. Development activity remains dynamic contributing to an increased supply of high-quality spaces in Porto.
Ariane (Perafita)
Noto Office Center
Porto Business Plaza – Phase II
Refurbishment
Padrão Casual
Silvip
Capitólio
IDS Group
Violas Ferreira
4,000
3,700
7,000
5,100
Brasília Building - Av. Boavista
Latino Coelho, 85
Metyis Campus - Phase II
TecMaia - Plot 4
Viva Offices
9
Geo Investimentos
GFH / Sonae Sierra
Metyis
ABB
5,500
18,800
6,500
6,200
Fernão de Magalhães, 127 (Magnet)
SPARK Matosinhos
M-ODU (Matadouro)
HOP (former La-Vie)
Osborne+Co / Adriparte
Quest Capital / Tikehau Capital
Castro Group
Porto City Hall
17,400
15,000
14,500
12,200
Like in the capital, the scarcity of quality supply in Porto has driven increases in most rental values of €0.5-1/sq.m/month.
TRends
Well-being and ESG are seen as the cornerstones of office spaces by the market
Hybrid model and the redefinition of occupancy
Increase in flex offices and relocation
EVOLUTION of lease agreements
urgence of demand revival and increase in prime rents
Workspaces are increasingly focusing on employee well-being, with natural light, green areas, and amenities such as gyms and meditation rooms. These factors, along with sustainability demands and ESG certifications, are becoming key drivers for the attractiveness and functionality of buildings.
The hybrid work model, adopted by most companies, is redefining office occupancy. Collaborative zones and rotating workspaces are gaining popularity, creating more flexible spaces that meet the new workplace dynamics.
Demand for flex offices is growing, reflecting the need for greater flexibility and adjustment to the new market trends. Companies are also relocating their offices in an effort to entice employees back to the office, creating more appealing and functional hubs.
Long-term lease agreements becoming more commonplace, in particular 10-year leases with a break at year 7, , or 5-year leases without a break clause. This enables fit-out costs to be amortized over the period, giving companies more bargaining power and ensuring greater stability when it comes to long-term commitments.
Demand for offices is picking up in addition to heightened pressure for quality spaces. This trend, coupled with Portugal as an attractive option for multinational operations, is driving up prime rents, which continue to rise in the main office areas.
RETAIL SALES INDEX
110 (+2.9%)
During the first half of 2024, the retail sector continued its upward trend, notably in terms of future supply of retail parks and number of new openings. Until July, the sales volume in the retail sector saw a year-on-year growth of 2.9%, particularly due to the increase in sales of food products (+4.2%). Additionally, despite a slowing growth rate, e-commerce continued its positive outlook, with the percentage of consumers making online purchases increasing by 1.2 p.p. to 44%.
Total
104 (+4.2%)
Food Retail
116 (+1.9%)
Non-food Retail
E- COMMERCE
Consumers who made purchases / orders online
Source: INE; data deflated and adjusted for calendar and seasonal effects; Index base 2021 = 100; YTD
Source: APCC; year-on-year variation for the first half of the year.
Mouse hover to view the notes
Source: INE
+7.8%
Sales
6.8%
Footfall
Footfall and Sales Index in Shopping Centres
6,600 sq.m
143,200 sq.m
Pipeline
Retail Schemes
Until 2027
In the quarter prior to the survey
As for the performance of shopping centres, the Portuguese Association of Shopping Centres (APCC) reported a rise in sales (+7.8%) and the number of visitors (+6.8%) over the first half of 2024. The 6,600 sq.m GLA Arco Retail Park in Santo Tirso, was completed, with tenants including Action, Hôma and Sport Zone. The pipeline for the next three years indicates that an additional 143,200 sq.m of GLA will be completed, almost half of which is under construction. Most of this new supply (87%) is in retail parks.
SUPPLY OF RETAIL SCHEMES
RETAIL SCHEMES
Source: Cushman & Wakefield * Pipeline
NEW OPENINGS
According to Cushman & Wakefield’s proprietary transactions database, the first nine months of 2024 saw 590 new openings, reflecting a significant year-on-year increase of 29%. Appetite for high street retail remained dominant, representing 71% of all new openings, followed by shopping centres (12%). The Food & Beverage (F&B) sector remained popular with 53% of the new units, followed by the Others sector with 19%. Among the most active retailers in the period under review, the German retailers Aldi and Lidl stand out in the food sector, with ten and seven new openings, respectively. Moreover, brands of the Sonae Group, ZU (pet products) and Well's (cosmetics) each accounted for close to ten new units. Additionally, the low-cost non-food retailers Normal and Action, accounted for eight and seven new stores, respectively.
590 (+29)
New Openings
71%
High Street Retail
53%
F&B
Non-random sample of retail demand aggregated by Cushman & Wakefield based on public sources and targeted fieldwork.
8
Including, amongst others, furniture, decor, DIY, communications and health
DEMAND
YTD September
BY FORMAT
2023
Others
BY SECTOR OF ACTIVITY
Food
Leisure & Culture
Fashion
During the first nine months of 2024, the city of Lisbon benefitted from 37% of all new openings in Portugal, predominantly in the high street. The areas of Avenidas Novas and Cais do Sodré/Santos stand out, each with nearly 30 and 20 new openings, respectively, mostly in F&B. This sector remained the most sought-after in Lisbon, representing 65% of the new units. Zara opened its new, 5,000 sq.m flagship store in Rossio, the second largest in the world, (which includes the Zara by Castro pastry shop), thereby strengthening the dynamism of this area of the capital.
220 (+21%)
94%
65%
LisboN
The city of Porto commanded the second-highest number of openings in the country, accounting for 19%. Like the capital, most new openings occurred in the high street, with the Baixa area still the most appealing with 31% of the new shops. F&B remained the most prominent sector, exemplified by the opening of Time Out Market Porto, in the southern wing of the São Bento station, with 16 spaces run by many of the city’s top chefs.
110 (+20%)
81%
67%
Porto
The scarcity of supply versus current demand contributed to an upward shift of rents, reaching historic highs, with rent increasing by €10/sq.m/month in Chiado and Avenida da Liberdade (Lisboa) and by €5/sq.m/month in Baixa (Porto). In the shopping centres, prime rents rose by €7.50/sq.m/month, and in retail parks by €0.75/sq.m/month.
PRIME RENTS
FORMAT
Shopping Centres
Retail Parks
Lisbon - Av. Liberdade
PORtugal
Lisbon - Chiado
Lisbon - Downtown
LOCATION
€ 115.0
€ 13.0
€ 135.0
€ 120.0
PRIME RENTS (€/SQ.M/MONTH)
Porto - Clérigos
Porto - Downtown
Porto - Av. Aliados
€ 45.0
€ 82.5
€ 55.0
Brands with purpose
Pop-up stores and shop-in-shop
Brands are increasingly investing in a circular economy, promoting eco-friendly practices and reducing waste. Consumers identify with brands that follow an ethical, environmentally, and socially conscious and sustainable business model. Major brands are increasingly integrating social responsibility into their strategy to improve customer engagement.
A more personalised and seamless shopping experience. Operational improvement and increased profitability through cost reduction and more efficient stock management. Greater alignment and integration between the digital and physical experiences.
Retailers are exploring new formats and locations and creating more immersive consumer experiences. These types of stores allow brands to test new concepts and products. Shop-in-shop is a retail concept that involves a smaller store within a larger store. Both are designed to attract new consumers and further engage with existing ones through innovation, thus providing differentiating, unique and fun experiences. The aim is to create interest, attract customers and offer exclusive deals, hence optimising brand performance.
Flagship units
TRENDS
circularity, sustainability and social responsibility
as a means to test new concepts
investing in service automation
INDUSTRIAL & LOGISTICS
In the first seven months of 2024, Portuguese trading activity contributed to a relative stability in the trade balance, with both exports and imports increasing by 1%.
IMPORTS
Lease / Sale
€55.9 billion
7,900 sq.m
513,400 sq.m
€44.5 billion
80%
(+1%)
(+36%)
(+5%)
International Trade of Goods
4.6%
€3.1 million sq.m
STOCK
Greater Lisbon Logistics Market
Source: INE; Cushman & Wakefield; IPI
After reaching a historical high in 2021, industrial & logistics take-up slowed over the last couple of years. Nevertheless, the first nine months of 2024 saw the highest take-up for this period, with 513,400 sq.m transacted, 19% above the total for 2023, representing a year-on-year increase of 36%. This growth was driven by large transactions, with the top five representing a third of the total take-up. Amongst the most prominent deals are the future occupation of the industrial unit by Coloplast in Felgueiras, the construction of which began in mid-2024 with an investment of €100 million and set to be the Danish multinational’s largest. This is followed by the leases to Torrestir and CTT, totalling 73,000 sq.m, in the newly opened Benavente Logistic Park, making this the most active development of this semester.
In terms of the geographical distribution of demand, Greater Lisbon remains the most popular with 40% of total take-up. This was followed by Greater Porto, with 25%, with the northern region, boosted by the largest deal of the semester, attracting 20% of the total take-up. Additionally, a higher concentration of speculative development (80%) as opposed to build-to-suit projects was observed.
Reflects the new areas used within the scope of IPI, whose correspondence can be found on the rent map. Additionally, zones 17: Remaining North, 18: Remaining Center, and 19: Remaining South are included.
CTT
Testo Portugal
Coloplast Manufacturing Portugal
Torrestir
Atlantic-Cargo
Benavente Logistic Park
Albergaria-a-Velha Industrial Zone
Setúbal Logistics Warehouse
Felgueiras Factory
Greater Lisbon
Center
North
REGION
18
17
29,500
22,700
20,000
56,000
43,500
COVERED AREA (sq.m)
DSV
Aldi
Birkenstock
Merlin Lisboa Park
Santo Tirso Industrial Unit - Plot 1
São Domingos Industrial Zone
Panattoni Park Lisboa - Santarém
Panattoni Park Valongo
Greater Porto
Alentejo
14
16
16,000
15,900
13,000
17,000
16,100
The vacancy rate in the Greater Lisbon logistics market stood at 4.6%, underlining the scarcity of quality supply, thereby driving the development of new projects, many of which are on a speculative basis. Between January and September of 2024, 340,100 sq.m of new logistics spaces were completed, two-thirds of which were in Greater Lisbon, with an occupancy rate of 88%. Among the completed projects are the Castanheira do Ribatejo Logistics Platform developed by Montepino, whose official delivery will take place at the end of this year and the Benavente Logistics Park, developed in partnership between Invesco and Magna General Contractors. Furthermore, 277,400 sq.m of logistics space is currently under construction in Portugal, of which more than half has already secured occupation, mainly in Greater Lisbon (115,400 sq.m) and Alentejo (80,000 sq.m). Noteworthy projects include the Panattoni Park in Valongo, Lidl’s future Logistics Warehouse and the future Almeirim Logistics Platform – Phase II developed by Garcia Garcia.
Almeirim Logistics Platform
Ermida Park
Castanheira do Ribatejo Logistics Platform - Plot 1
Benavente Logistics Park
Azambuja Logistics Centre
RIBATEJO
Greater PORTO
Greater LISBON
Garcia Garcia
Logicor
Unik
Montepino
Invesco / Magna General Contractors
50,600
30,600
25,000
105,000
90,700
Almeirim Logistics Platform – Phase II
Loures Logistics Warehouse
VGP Park Montijo
Ribatejo
Panattoni
vgp
Lidl
97,600
33,000
31,400
75,000
54,000
URBAN LOGISTICS
(LAST MILE)
€7-8/sq.m/month
Increased market activity, particularly in high-quality projects, has resulted in a widespread rise in prime rents. In Greater Lisbon, rents in Castanheira - Azambuja (zone 1) rose to €5.10/sq.m/month, while in Greater Porto, in Port of Leixões – Airport (zone 10), values reached €5.50/sq.m/month. Meanwhile, the urban logistics segment in Lisbon and Porto saw an increase of €0.5-1/sq.m/month.
€6-6.5/sq.m/month
INDUSTRIAL & LOgIsticS
GRANDE PORTO
Rendas médias e Prime
Optimisation of operating costs
Modern and sustainable spaces at a premium
The growth of Data Centres and Self-Storage
Companies increasingly recognise that upgrading to new logistics spaces is more efficient from an operational viewpoint. Additionally, they consolidate their operations by planning their future space needs to ensure expansion opportunities in the medium/long term.
Globalisation and the pursuit of economies of scale led to manufacturing and stockpiling centring mainly in Asia. The recent supply chain interruptions and stock shortages worldwide, including in Portugal, set off a trend for nearshoring, that is, installing new industries in Europe to meet local and regional needs. Demand for warehousing, as well as industrial units, from companies in the renewable energy sector, has also risen.
Much of the current stock is “dated” and occupiers as well as investors are primarily interested in modern properties with sustainability credentials. Heightened focus on larger assets, which are more functional and include amenities to enhance employee retention and meet ESG criteria. For logistics operators, more sustainable warehouses can attract new accounts and retain customers.
The self-storage sector still has a lot of potential to grow throughout the country with older buildings being adapted for this purpose. Concerning data centres (currently also known as logistics and data computing), Portugal has caught the attention of the biggest data centre operators, as it is perceived as a safe country, with sufficient availability of power, and benefiting from its connectivity to intercontinental submarine cables which land in Portugal.
Nearshoring fuelling demand
Tourism activity in Portugal continued to perform well throughout the beginning of 2024, with an increase across all key indicators, despite some natural slowdown in growth rates. Until July 2024, the number of guests and overnight stays recorded year-on-year increases of 5% and 4%, respectively. This was particularly influenced by the rise in foreign tourists, representing more than 70% of overnight stays. Portugal remains a popular destination, especially with long-haul markets, which saw the largest year-on-year increase (+13%), with North America now one of the top five markets. A year-on-year rise in overnight stays was seen across the country, with less traditional regions standing out, namely the West and Tagus Valley and the Azores, with year-on-year growth of 10% and 8%, respectively. This trend reflects greater diversification, as tourists explore new areas of Portugal.
TOURISTS
Overnight Stays
REVPAR
Total Revenues
Occupancy Rate
13.9 million
36.3 million
€3,110 million
€65.4
62.3%
(+4%)
(+11%)
(+8%)
(+1 p.p.)
10
YTD July
11
Em estabelecimentos de alojamento turístico
TOURISM INDICATORS
Source: INE; Turismo de Portugal
PIPELINE BY REGION
Hotel revenues continued to boast sharp increases with total revenue 12% higher than the same period in 2023. The RevPAR (Revenue per Available Room) rose by 8% to €65.4, and the occupancy rate (per room) stood at 62.3%, reflecting a year-on-year increase of 1 p.p.
OVERNIGHT STAYS AND REVPAR BY REGION
13
By region, the highest increases in RevPAR were experienced in the areas bordering Greater Lisbon, namely Setúbal Peninsula and the West and Tagus Valley, with 14% and 13%, respectively.
12
The Short-Term Rental segment accounted for 6.8 million overnight stays and 2.9 million guests over the first months of 2024, a year-on-year increase of 6% and 5%, respectively. Total revenue grew by 13% to €337 million, with RevPAR maintaining an uptrend and rising by 16% to €42.4.
West and Tagus Valey
Setúbal Península
Algarve
Açores
Madeira
NEW SUPPLY
By September 2024, nearly 50 new hotel projects had opened with 2,950 keys. Whilst most projects were 4-star hotels (36%), 41% of the new hotel keys fall under the 3-star category, reflecting a diversification of supply to meet different demand profiles. The Lisbon and Porto municipalities benefitted from most of this new supply, with over 20 new openings, totalling 1,380 keys. Amongst the most notable openings are some 3-star units such as the Locke de Santa Joana (Lisbon, 370 keys), the B&B Hotel Porto Gaia (Vila Nova de Gaia, 210 keys), and the Icon Apartments (Porto, 170 keys). In terms of future supply, there are 110 new projects in the pipeline and/or construction phase, which are expected to open by 2027, totalling 11,100 keys, mostly 4- and 5-star hotels (39% and 42%, respectively) in the metropolitan areas of Lisbon and Porto – clearly demonstrating a commitment to upscaling the hospitality sector.
MAIN OPENINGS
+50
Hotels Opened in 2024
+2,950
New Keys
Source: Cushman & Wakefield; Turismo de Portugal (RNET)
HOTEL
Icon Apartments
B&B Hotel Leiria Fátima
Locke de Santa Joana
B&B Hotel Porto Gaia
B&B Hotel Viana do Castelo
Nôma
B&B Hotels
Locke
OPERATOR
Leiria
Viana do Castelo
Lisbon
Vila Nova de Gaia
CITY
3 STARS
3 stars
CATEGORY
170
120
370
210
Vincci Bonjardim
DoubleTree by Hilton Lagoa Azores
Holiday Inn Braga
INNSiDE Braga Centro
Holiday Inn Beja
Vincci Hoteles
Hilton Hotels & Resorts
IHG Hotels & Resorts
Meliã Hotels & Resorts
PORTO
Lagoa (Azores)
Beja
Braga
4 STARS
5 STARS
100
110
KEYS
In 2024, tourist arrivals in the city of Lisbon showed a mixed trend. Humberto Delgado Airport saw a year-on-year increase of 5% up until July. Although cruise tourism experienced a slight decline of 2%, due to considerable drops earlier in the year, the last few months have shown signs of recovery.
10.1 million
7.3 million
72.6%
€112.6
By September 2024, there were ten new hotel openings, totalling 750 keys, predominantly 3-star units. By 2027, it is expected that 30 more hotels with 3,300 keys will be added to the city’s supply. Luxury hotels will retain their appeal, with 51% of these keys in 5-star units. Prominent examples include the Meliá Lisboa (5 stars, 240 keys) and the Moxy Alfragide Lisbon (3 stars, 220 keys).
AIRPORTS
CRUISE TERMINALS
Tourist Arrivals
(-1,1 p.p.)
(+5,9%)
404 thousand
(-2%)
15
YTD July, except tourist arrivals on cruise terminals, which are YTD August. Overnight stays, occupancy rate and RevPAR refer to hotel establishments.
LISBON
During this period, Lisbon recorded 7.3 million overnight stays in tourist accommodation, which is a year-on-year increase of 5%. Nonetheless, the capital’s operational indicators reflected mixed results, with an increase in RevPAR reaching €112.6, but a slight decrease in the occupancy rate, which fell to 72.6%, compared to the previous year.
Source: INE; APL
4.6 million
2.7 million
65.8%
€81.4
Major new openings expected include the B&B Hotel Madalena with 180 keys and the Meliá São João da Madeira (4 stars, 100 keys).
TOURIST ARRIVALS
(+9%)
(+0.1 p.p.)
(+4.4%)
(+6%)
114 thousand
(+28%)
Throughout the first months of 2024, tourist arrivals in the Porto region continued to follow an upward trend. Francisco Sá Carneiro Airport recorded a 6% increase in traffic while in the cruise segment, Port of Leixões saw a 28% rise and is expected to set a new record this year. The number of overnight stays in tourist accommodation in Porto increased 9%, reaching €2.7 million, with RevPAR adjusting to €81.4 while the occupancy rate remained stable at 65.8%. By the third quarter of 2024, there were ten hotel openings, totaling 630 keys, predominantly 3-start units. The estimated pipeline, for the next three years, totals more than ten hotels with 840 keys, largely 4-star units (44%).
Diversification of products and destinations
Exposure to new markets
Capital allocation / Investment in hospitality
Diversification and upscaling of hotel supply targeted at demand with a high purchasing power. Growth of new accommodation concepts, combining short, medium, and long-term stays. Increased competitiveness of new tourist destinations, supported by nature, gastronomy, and cultural packages.
Consistent growth in the North American market, gaining strategic relevance in terms of market share, and with signs of continuity. Opening up to new markets of origin, particularly in Asia, whose growth and contribution potential is higher than nearby markets. Return of direct air connections to Portuguese airports based on the diversification of medium to long-haul markets of origin.
More capital is available to be allocated to the tourism and hospitality sector from an investment perspective. Consolidation of operational platforms and portfolio transactions. Purchase of independent projects requiring investment and modernisation. Investors appear willing to pay premiums for projects aligned with ESG policies.
NR. OF UNITS SOLD
Average Absorption Time
AVERAGE PRICE
Average Discount and Adjustment Rate
NEW
1,030
TOTAL
4,210
(=)
6,810/sq.m
4,780 sq.m
(-3%)
-4%
-8%
15 month
7 month
720
(-20%)
2,510
(+3%)
4,240/sq.m
(-1%)
3,210 sq.m
-3%
-7%
8 month
6 month
New and used
SALE OF APARTMENTS
Source: SIR Ci
RESIDENTIAL PROJECTS LICENSING
According to information from the Residential Information System / Confidencial Imobiliário (SIR Ci), the first semester of 2024 recorded a drop of 3% in the number of apartments sold in Portugal, to 41,700 units. However, the average price saw a year-on-year increase of 5%, reaching €2,750/sq.m. In the Lisbon and Porto municipalities, there was a slowdown in the average sales price of apartments and the total number of properties sold stabilised. Between January and July 2024, a total of €12.9 billion in mortgage lending was granted to individuals, according to the Bank of Portugal, representing a 9% growth compared to 2023. A survey of the banks carried out by the Portuguese central bank showed a slight increase in the demand for credit by individuals over the past year.
19
Percentages correspond to the year-on-year variation of the indicators
Bank of Portugal Credit Market Survey (publications from July in relation to the previous quarter).
sale of apartments
Source: Pipeline Imobiliário Ci
SALES PRICE OF APARTAMENTS
In Lisbon, the average sales price of apartments (both new and used) recorded a year-on-year decline of 3% to €4,780/sq.m, falling slightly lower for new properties (-2%). For both new and used properties, the Historical Centre remained the most sought-after, reaching sales prices of €5,770/sq.m, followed by a 5% rise in the Traditional area (€5,740/sq.m). The most significant downward adjustment occurred in the Parque das Nações (-17%), dropping to €5,340/sq.m. The average discount and adjustment rate increased to 8%, with the average take-up time falling to seven months. In terms of future supply, between January and July 2024, Lisbon experienced a decline in the volume of licensed residential projects (-60%), and an 18% increase in projects submitted for licensing.
PRICE OF APARTMENTS
20
Diferença entre o preço final de venda e o valor inicial de oferta do imóvel
21
Source: Cushman & Wakefield; SIR Ci
Source: SIR Ci * Half-yearly accumulated values until June
In Porto, the sales price of apartments recorded a fall of 3% standing at €3.210/sq.m, although less pronounced (-1%) among new properties. Foz continued to command the highest prices, reaching €4,760/sq.m, a 14% increase compared to 2023, while the Historic Centre saw the largest year-on-year decrease (-11%), dropping to €3,430/sq.m. The average discount and adjustment rate stabilised to 7%, with the average take-up time decreasing, falling to six months. In terms of future supply, over the first seven months of the year, the city recorded a significant increase in the volume of licensed projects (+26%) as well as in projects submitted for licensing (+34%).
NR. LEASED UNITS
Average Monthly Contracted Rent
(-32%)
1,350
NOVO
€24.6/sq.m
€19.1/sq.m
(+2%)
-6%
2 month
60
(-7%)
240
(-9%)
€17.5/sq.m
€15.3/sq.m
3 months
RENTAL MARKET
During the first half of 2024, the imbalance between supply and demand remained in the private rental sector (PRS), according to SIR Ci. In parallel with the built-to-sell market, this contributed to a 4% decrease in the number of apartments leased nationwide, totalling 4,330 apartments. This decline was associated with a significant 9% increase in the average prices, to €15/sq.m/month. Although the shortage of supply continues to generate interest among some developers to develop built-to-rent projects, their limited financial viability and lack of confidence in the sector's legal framework led to the majority of future projects in this segment being public initiatives.
In Lisbon, rents increased to €19.1/sq.m (+2%), while new properties saw a slight decrease of 1% falling to €24.6/sq.m /month. The Historic Centre maintained its lead, remaining stable, followed by the Riverfront zone, which recorded the highest year-on-year growth (+10%) in the city. In Porto, the average rental price increased slightly by 2% to €15.3/sq.m/month, with new apartments recording a decrease to €17.5/sq.m /month (-9%). Like the built-to-sell market, the area of Foz remains the most popular, and recorded the highest year-on-year rental growth (+35%), despite the reduction of leased properties. The discount and adjustment rates increased in both cities, with the average take-up time decreasing by one month for new properties.
RENTAL PRICE OF APARTAMENTS
22
The student accommodation and CoLiving segments continue to suffer from a lack of supply, especially of purpose-built accommodation. In terms of private sector supply, between January and September, five new units were completed, with a total of 890 new beds, with Ebora Residentes (Évora) standing out with 330 beds and two units from the Odalys Group, the Odalys Asprela (Porto) and the Odalys Belém (Lisboa) with a total of 390 beds. The ratio of beds per student picked up slightly to 14%, with activity by private operators, who now represent around 40% of the supply, remaining stable.
29,080
14%
40%
Total Supply (nr. of beds)
Private Operators
Provision Rate
(67%)
23
Ratio between number of beds and displaced national and international students
Student Accommodation / CoLiving
24
Next 3 years
Heightened demand continues to attract the private sector, as well as encouraging the allocation of public investment to these segments, particularly through the National Plan for Housing in Higher Education (PNAES), funded by the Recovery and Resilience Plan (RRP). In this context, the new supply forecast by 2026 currently stands at 10,530 beds. Amongst future private supply, prominent examples include the Nido Alta de Lisboa – Plot 12 with 640 beds, in addition to the entry into the market of The Social Hub with two projects, in Carcavelos (Lisbon) and Porto (the Bonjardim project), with a total of 840 beds.
MAIN PRIVATE OPENINGS
MAIN PRIVATE PIPELINE
AMRO Porto
Odalys Belém
Ebora Residences
Odalys Asprela
StudentVille Palma
AMRO Estudiantes
Grupo Odalys
StudentVille
Royal Prime
150
330
270
The Social Hub - Lisbon Carcavelos
The Social Hub – Porto Bonjardim
Nido Alta de Lisboa – Plot 12
Xior Boavista
Milestone Olaias
The Social Hub
Milestone
Smart Studios
University Hub
Cascais
440
400
640
500
In the senior housing sector, the number of available beds continues to increase, to now 105,700. However, the rate of new openings has not kept pace with the ageing of the population, and hence the equipment ratio has remained stable at 14%. The private sector continues to be driven by high occupancy rates and a lack of quality supply. In the first half of 2024, the DomusVi group stands out with the opening of a 130-bed unit in Leiria. Looking ahead, over the next three years, another 300 new beds are expected from amongst the main private operators, with two of these in Cascais.
105,700
92%
25
Ratio between the number of beds and population aged 80 and over; 2023 estimated population (Source: INE).
25%
Equipment Rate
Senior Housing
Source: GEP; INE; ACSS
SUPPLY
MAIN PRIVATE OPERATORS’ PIPELINE
MAIN PRIVATE OPERATORS’ OPENINGS
26
Source: Office for Strategy and Planning – Social Charter (excludes Madeira and Azores)
Lisbon Metropolitan Area
Residência Bom Sucesso
DomusVi Santo Agostinho
Momentus Sénior - Cascais
Emeis
DomusVi Group
MomentusSenior Living Residences
130
Amera Estoril
Residência Estuário do Douro
Residência Cascais Guia
Amera
90
Pressure on the residential market for the middle-class housing segment is set to worsen
Demand for student accommodation or co-living projects will continue to rise
The shortage of senior housing is expected to exacerbate
Uncertainty regarding the reduction of VAT has led to the postponement of the development of some projects. Continued supply-demand imbalances will fuel rising prices.
Excessive taxation and the inadequate legal framework continue to hinder the development of specific built-to-rent products for the mid-end segment, inevitably leading to further contraction and pushing rental prices upwards.
Demand for student accommodation and more exclusive co-living concepts from occupiers and investors is expected to maintain its upward trend, with developers looking for ever larger and more appealing solutions that serve as suitable alternatives to the traditional residential segment.
In the context of an ageing population, increased supply still falls a long way short of what is needed, fostering the development of private assisted living homes and offering quality services for the elderly. Nonetheless, the development of this segment could be impacted, on the one hand, by the high monthly rates for the average Portuguese family, and the difficulty to hire specialised staff, especially in locations outside large urban centres.
Development of the residential rental market will continue to stagnate
Development
Aquisições de edifícios para reabilitação ou terrenos para promoção
MAIN URBAN DEVELOPMENT AND REGENERATION DEALS
27
According to Cushman and Wakefield’s proprietary transaction database, activity in the urban development and regeneration sector presented a total transaction volume of €163 million in the first nine months of the year spread over 17 deals. Noteworthy transactions include Millenium BCP’s sale of the Villafundo plot of land in Amadora, for an estimated price of €30-35 million; Panattoni’s purchase of Futuro Panattoni Park Lisbon City’s plot of land located in Loures for an approximate value of €24-27 million and the purchase of land in Carnaxide located near the World Trade Centre for an undisclosed amount.
28
Baseada em fontes internas e públicas
Photo Panattoni
TYPE
Land
Land & Building
Building
Santa Luzia Plot
Loulé Plot
Rossio 74
Villafundo Plot
Future Panattoni Park Lisbon-City
ASSET
Lisboa
Loulé
Amadora
Loures
15,200
38,500
2,300
242,000
85,000
€1,380
€450
€4,810
€130
€300
VALUE (€/sq.m)
€20-22 M
€17-18 M
€10-12 M
€30-35 M
€24-27 M
Carnaxide Plot
Oeiras
8,300
N.A.
VALUE (M€)
REAL ESTATE PROJECTS UNDER LICENSING
Concerning future supply, between January and July 2024, 5.8 million sq.m were submitted for licensing in mainland Portugal, distributed across around 13,900 projects, reflecting a year-on-year growth of 25% and 7%, respectively. Most of the area submitted for licensing is for residential use (67%) and new construction (72%). In terms of the type of construction, the dominance of new development ranged from 40% in hospitality to 75% in the office sector.
Source: Pipeline Imobiliário Ci * YTD July
REAL ESTATE PROJECTS LICENSING
Between January and July 2024, the licensing of real estate projects by construction area in Lisbon followed an asymmetric trend when compared to the same period last year, with a 15% increase in the area of projects submitted for licensing and a significant decline in the total area of licensed projects (-64%). Concerning the projects submitted for licensing, despite the prevalence of the residential sector, representing 139,000 sq.m, the retail sector boasted the highest year-on-year increase (+143%), reaching 11,000 sq.m. Amongst the licensed projects, the residential sector represented almost 60% of the total area with 82,000 sq.m, and the tourism sector benefitted from the most growth (+22%) reaching 27,000 sq.m. Most of the licensed area (67%) was for refurbishment as opposed to new construction.
260,100 sq.m
(+15%)
141,600 sq.m
(-64%)
LICENSED
Submitted for Licensing
LICENSED REAL ESTATE PROJECTS*
Construction costs increased slightly, with average costs (excluding VAT) in Lisbon, ranging from €1,500/sq.m to more than €2,000/sq.m, for new construction, and between €1,800/sq.m and above €2,200/sq.m for refurbishment projects.
CONSTRUCTION COSTS BY SEGMENT
High
Average
Luxury
€1 800/sq.m
> €2 000/sq.m
€1 500/sq.m
New Construction
€2 000/sq.m
> €2 200/sq.m
A total of 230,000 sq.m were licenced in Porto up until July 2024, a year-on-year increase of 19%. Among the projects submitted for licensing, the first seven months of the year saw an increase of 29% when compared to the previous year, totalling 265,000 sq.m. In terms of the projects submitted for licensing, the residential sector remained the most popular covering 160,000 sq.m with the area allocated to retail commanding an increase of more than 60%, standing at 7,000 sq.m. Regarding the newly licensed projects, the residential sector remained dominant, corresponding to more than 80% of the total area, striking a balance between the area for new development and refurbishment.
264,700 sq.m
(+29%)
230,300 sq.m
(+19%)
Source: Pipeline Imobiliário Ci * YTD July.
Construction costs in Porto rose slightly, with prices (excluding VAT) ranging from €1,450/sq.m to more than €1,850 sq.m for new construction and between €1,550/sq.m and above €2,000/sq.m for refurbishment projects.
€1 650/sq.m
> €1 850/sq.m
€1 450/sq.m
€1 700/sq.m
€1 550/sq.m
The need to promote housing for the mid-end segment will remain a priority. The lack of supply will continue to be affected by high taxation, lack of incentives for new construction and high construction costs. The government’s announcement of a possible reduction of VAT on newly built residential projects during its parliamentary term may lead to the development of some projects being postponed, especially in the medium segment.
Shortage of Housing Development
The increasing return to offices and demand for more modern and environmentally and energy efficient offices will fuel development in the office sector and the potential creation of new business centres. Simultaneously, older buildings in more traditional and touristic areas will become available to be converted into housing or other types of accommodation and leisure.
Development of a new cycle of more sustainable, efficient and certified buildings
Activity in the commercial real estate investment sector remained low in the first half of 2024, at €690 million, reflecting a slight year-on-year decline of 6%. Nonetheless, the outlook improved in the third quarter of the year, with a total volume up to September of €1,050 million, indicating a 3% rise when compared to the same period in 2023. With several recent deals, most notably Castellana Properties’ purchase of a portfolio of three shopping centres, the total value up to October stands at €1,410 million, reflecting a year-on-year increase of 20%. In contrast to last year’s trend, 2024 benefitted from an increase in the number of large-scale deals. The four most sizable deals represented a third of the total volume invested, with the average deal size rising to €26 million, in more than 50 transactions to date. Additionally, foreign investors became active again, currently representing 83% of the total volume invested, the highest market share of the last five years.
TOTAL VOLUME
Foreign Investment
RetaIl
€1,410 million
(+20%)
83%
46%
30
YTD October
COMMERCIAL REAL ESTATE INVESTMENT
29
When comparing with total values as of October 2023
INVESTMENT BY QUARTER
Capital allocation by sector in 2024 strengthened the recovery of the retail sector and sparked renewed enthusiasm in the hospitality sector, which accounted for 46% and 23% of the total volume invested, respectively. In retail, of the €660 million invested, the two largest deals to date were both in shopping centres: Lighthouse Properties’ purchase of Ceetrus do Alegro Montijo for €178 million and Castellana Properties’ purchase from Harbert of LoureShopping, 8.ª Avenida and RioSul Shopping for €177 million. In hospitality, the €320 million invested was particularly influenced by two major deals in the 5-star hotel category: the purchase of the Sofitel Lisboa Liberdade from Accor Invest by a private investor for €75 million, and the purchase of The Oitavos from the Champalimaud Group by BTG Pactual for around €70-80 million.
INVESTMENT DISTRIBUTION BY SECTOR
MAIN INVESTIMENT DEALS
Or €/key in hospitality. In case of a range in the “Value (M€)” column, the calculation of this indicator is based on the range’s average value.
31
Offices followed suit, corresponding to 16% of the total amount invested, at €220 million. The most noteworthy deal was the purchase of K Tower by Real I.S. from Krestlis for approximately €75-80 million. Other assets attracted 10% of the total investment, with increased activity in the PBSA (Purpose-Built Student Accommodation) sector. In this segment, Xior’s purchase of Home & Co Campo Pequeno for €58 million and the purchase of two PBSA units in Lisbon by Stoneshield Capital for between €55-60 million stand out. Finally, the industrial and logistics market continued to be less active and secured a mere 5% of the total amount invested, standing at €60 million (reflecting the lack of supply). Following upwards adjustments, across all sectors during the last two years, the evolution of prime yields has remained stable throughout the year, with expectations that interest rates will be lowered, which only recently began to show signs of change.
Retail
LoureShopping, 8ª Avenida & RioSul Shopping
LCN Portfolio 1
Alegro Montijo
Loures, São João da Madeira & Seixal
Several
Montijo
74,080
56,800
Harbert
LCN Capital Partners
Ceetrus
VENDOR
Castellana Properties
Slate Asset Management
Lighthouse Properties
PURCHASER
€177 M
€150 M
€178 M
€2,382
€2,000
€3,130
9.0%
6.25-6.75%
7.2%
YIELD
SECTOR
Office
K Tower
14,990
Krestlis
Real I.S.
€75-80 M
€5,170
Hospitality
Sofitel Lisboa Liberdade
160 keys
Accor Invest
French Private Investor
€75 M
€460,120
The Oitavos
140 keys
Grupo Champalimaud
BTG Pactual
€70-80 M
€520,830
Home & Co Campo Pequeno
380 beds
TPG / Round Hill Capital
Xior
€58 M
€152,630
5.0%
2 PBSA units in Lisbon - Ajuda & Areeiro
500 beds
Ricardo Kendall / LX Partners
Stoneshield Capital
€55-60 M
€115,690
Praia D'El Rey Marriott Golf & Beach Resort
Óbidos
240 keys
Oxy Capital
Azora Capital
€50-55 M
€216,050
Sintra Retail Park
Sintra
20,100
Nhood (Ceetrus)
AM Alpha / European Familly Offices
€45-50 M
€2,360
7.0-7.5%
Current estimates indicate that investment in commercial real estate will pick up significantly throughout the last quarter of 2024 with around €680 million in different deals (currently in various stages of negotiation) expected to be concluded by the end of this year. In 2024, the total volume could reach more than €2,000 million, reflecting a year-on-year growth of 23%. These circumstances could lead to minor adjustments in prime yields at the end of the year, particularly in the most sought-after asset classes.
OUTLOOK
PRIME YIELDS
Low activity marks the first half of the year
A gradual resurgence of large international investors is expected, but...
EASIER AND CHEAPER ACCESS TO BANK DEBT AND REFINANCING
The differential between yields on income producing real estate and the so-called "risk-free assets" stabilises through subsequent reductions in interest rates; Disparity in price expectations between sellers and buyers narrows.
Prime yields will mostly reach year-on-year stability by the end of 2024. In the most sought-after categories, there may even be a reduction in yields and a consequent increase in value (also supported by specific increases in prime rents for the best-performing assets). New or refurbished assets, with excellent ESG credentials, are more resilient.
...local open-ended funds, pension funds, and family offices (involving smaller deals, without recourse to debt) still have a role to play.
More moderate financing rates. Owners are reasonably capitalised and banks have been managing their risk portfolios effectively.
Capital values may increase in the most resilient asset types
with a gradual recovery in sight for the second half of the year and especially in 2025, as...
COMMERCIAL REAL ESTATE CERTIFIED BUILDINGS
Given the more demanding criteria and increasingly stringent legislation, the market's predominant focus on sustainable buildings prevailed in 2024, as well as the inclusion of Environmental, Social and Governance (ESG) criteria in the decision-making processes of the domestic real estate market. In light of the current landscape, there is mounting evidence that tenants and investors are more inclined to pay a green premium for sustainable assets. Furthermore, market evidence suggests that companies, in particular, larger international ones, have internal requirements not to occupy or acquire spaces that do not comply with ESG criteria. Consequently, due to increased regulation at the European level, obtaining certificates such as the BREEAM (Building Research Establishment Environmental Assessment Method), LEED (Leadership in Energy and Environmental Design) and WELL certification is rapidly taking precedence in Portugal, in addition to the assessment of a property’s alignment with taxonomy.
32
New certification or renewal; only includes the projects listed by the respective entities (some projects are anonymous and therefore not published).
Source: BREEAM, LEED and WELL
In terms of the certification of sustainable projects, the number of buildings BREEAM and LEED certified between January and September 2024 was almost double the total certified during 2023; mostly in the office and retail sectors. Almost all BREEAM certification was obtained for buildings in use, in contrast to LEED certification, in which new construction/refurbishment dominated. In terms of future certification , data for which is only available for LEED, currently around 50 buildings are registered. In terms of the WELL certification, which focuses on the use of the building and the well-being of its occupants, in 2024, five WELL certifications were issued in Portugal, both in office buildings, namely Exeo Office Campus’ Lumnia and the ALLO buildings, both located in Lisbon. This sector continues to lead future certification, with approximately 60 projects registered.
34
33
Certification requests submitted
Mitigation and adjustment to climate change
Integration of the value chain into corporate activities and reporting
Growing focus on biodiversity and natural capital
The new Energy Performance of Buildings Directive (EPBD) was approved in April 2024. It aims, amongst other goals, to double the annual energy renovation rate of buildings and includes targets to boost the energy efficiency of buildings, promoting the reduction of primary and final energy consumption by 11.7% compared to 2020. This represents an enormous challenge for our building stock. Thus, we will continue to see a trend towards the renovation and repositioning of existing buildings through significant refurbishment works, allowing them not only to be placed back on the market, but also obtain higher prices, particularly when they have obtained category A energy certificate or have been certified. Given that investment is risk-averse, and buildings are a critical element in resilience to the impacts of climate change and in protecting the population, there is growing concern about assessing these climate risks and in the definition and implementation of mitigation measures to better protect our heritage, the activity carried out there and its users. Research concerned with Climate Risk has taken on greater importance thanks to European Taxonomy.
The Sustainable Finance Disclosures Regulation (SFDR) continues to change the way investments are made in the real estate market. Major investors and financiers, such as banks, are now required to report on the sustainability of their assets and investments and have begun to integrate ESG performance indicators into their assessments, refusing or providing less favourable finance terms to those unable to demonstrate their commitment. These ESG-focused regulatory and legislative changes have been a game changer boosting requirements concerning building certification and the need to collect, manage, and analyse information that reflects building performance. In addition, it also includes the assessment of property alignment with European Taxonomy, which recently added a new circular economy goal.
The Corporate Sustainability Due Diligence Directive (CSDDD) was approved in May this year. This directive establishes obligations for large companies (those with more than 1,000 employees and a turnover of more than 450 million euros), ensuring that they identify, prevent and address adverse human rights and environmental impacts throughout their value chain, including those carried out by their branches and business partners. The commercial complexity of the market will require a substantial effort to assess, align, and constantly monitor suppliers, with increasing scrutiny from stakeholders
Following the publication, in January of this year, of Portuguese legislation with respect to the voluntary carbon market (VCM), which provides benefits for the protection of natural capital, on the 2nd of October the framework applicable to Decree Law 4/2024 was published. This establishes the functioning and operationalisation of the VCM, which will fall under the remit of the Agency for Energy (ADENE). These measures are crucial to mitigate and increase resilience to climate change. The call is clear for the private sector to contribute to a positive impact on biodiversity and natural capital, aiming for carbon neutrality, by acquiring carbon credits generated by the reduction of emissions or carbon sequestration projects. For the real estate market, this means that more and more property owners, in particular portfolio investors, are increasingly adopting not only strategies to measure and report on their building emissions, but they are also beginning to invest in strategies to offset emissions on a broader scale, namely through land acquisition and carbon offsetting initiatives, after implementing all of the other possible measures for the reduction of emissions.
Non-financial reporting and redirecting investment to sustainable activities
MARKETBEAT PORTUGAL,
AUTUMN 2024
For further information or additional copies of this or other reports, please contact: MARKETING & COMMUNICATION Miguel Sena miguel.sena@cushwake.com Tel.: +351 213 224 757 Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also receives numerous industry and business accolades for its award-winning culture and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. To learn more, visit www.cushmanwakefield.com © 2024 Cushman & Wakefield. All rights reserved. Cushman & Wakefield Av. da Liberdade, 131- 5º 1250-140 Lisboa Av. Da Boavista, 1837- 8º 4100-133 Porto www.cushmanwakefield.com
HEAD OF PORTUGAL Eric van Leuven eric.vanleuven@cushwake.com TRANSACTIONS Paulo Sarmento paulo.sarmento@ cushwake.com RESEARCH & INSIGHT Andreia Almeida andreia.almeida@cushwake.com OFFICES Pedro Salema Garção pedro.salemagarcao@cushwake.com RETAIL João Esteves joao.esteves@cushwake.com INDUSTRIAL, LOGISTICS & LAND Sérgio Nunes sergio.nunes@cushwake.com HOSPITALITY Gonçalo Garcia goncalo.garcia@cushwake.com DEVELOPMENT & LIVING Ana Gomes ana.gomes@cushwake.com
INVESTMENT David Lopes david.lopes@cushwake.com ESG Ana Luísa Cabrita analuisa.cabrita@cushwake.com ASSET SERVICES Bruno Silva bruno.silva@cushwake.com RETAIL ASSET SERVICES André Navarro andre.navarro@cushwake.com PROJECT MANAGEMENT Carlos Pueyo carlos.pueyo@cushwake.com VALUATION & ADVISORY Ricardo Reis ricardo.reis@cushwake.com BUSINESS DEVELOPMENT Isabel Correia isabel.correia@cushwake.com
