The country recorded a 67% increase in real estate investment, the highest growth in Southern Europe, according to a report by consultancy Savils.
Real estate investment in Southern Europe (Spain, Italy and Portugal) reached a record value of €31.7 billion in 2022, with the Portuguese market recording the largest increase, according to data from consulting firm Savills.
The total value of investments in the three countries grew by 36% in 2022 compared to the previous year, reaching the aforementioned 31.7 billion euros, according to a report released today by Savills, a real estate advisory firm operating in the Americas, Europe, Asia-Pacific, Africa and the Middle East.
Portugal was the country with the largest increase, around 67%, in the volume of real estate investment registered in 2022 compared to the previous year, reaching 3.3 billion euros.
Spain accounted for 52% of the total (16 billion euros) and had an increase of 39%, according to Savills, which forecasts a lower volume of investment in this region this year, but still better than expected for the rest of the continent. Italy, on the other hand, recorded investments of 11.6 billion euros, an increase of 26% over the previous year.
The Southern European region also absorbed a larger share of the continent’s total real estate investment in 2022, with 11 percent, compared to 6 percent in 2021 and up from the 7 percent it had averaged over the past five years.
The recovery of domestic consumption after the pandemic and greater protection against rising energy prices than in the rest of Europe contributed to these results, according to the real estate consultancy.
Cross-border investment reached €18.7 billion, 59% of the total amount invested in Southern Europe and the highest volume ever recorded. Most of the foreign capital invested in the region came from other parts of Europe (23%) and the Americas (15%).
According to Savills, market fundamentals remain strong and continue to attract investors, particularly in non-prime residential assets.
The consultancy also points out that across Southern Europe, the structural imbalance between supply and demand for residential and logistics assets will support rental market growth, or at least stabilization. It also believes that tenant demand will continue to support real estate investment in the region.