And where can we find the best opportunities to invest in 2021?»
Alfonso Cuesta, Head of Spain and Portugal
First and foremost, as virtually any other sector, real estate markets have been largely disrupted by the pandemic.
Fortunately, real estate is perceived as one of the few asset classes to still generate attractive returns at a time of low or negative interest rates.
However, we understand the main industry challenge is income security which is leading to unusually high uncertain returns, and the iberian markets are not an excpetion to this global trend. Accordingly, not only the markets, but also the various asset classes, are adjusting to the new conditions at different speeds (and sometimes directions), but there is still generally a noticeable missmatch between Seller and Buyer´s expectations in most of those.
In Iberia, financing conditions remain tight and investors are already seeking alternative funding.
Responding to the latter question, as a niche investor focused on convenience retail real estate, we remain confident in our startegy and continue to actively pursue investment opportunities in the segment. In particular, Retail Parks have been the best performing and most resilient retail format prior to and throughout the COVID-19 pandemic. Retail Parks remain strong in the face of new shopping habits with parking and open-air common spaces, separate entrances to shops and operators belonging to sectors enjoying vigorous demand, such as DIY and household and sporting goods. In addition, the convenient locations, ample free parking and range of retailers offered by retail parks makes them the best answer to e-commerce and well-positioned for click and collect or returns. As a result, we continue to see strong return potential to investors in this asset class.