Sector Insights: Real Estate in Portugal

REAL ESTATE IN PORTUGAL

SECTOR INSIGHTS

THE BUSINESS YEAR: SECTOR INSIGHTS: REAL ESTATE IN PORTUGAL

The snowbird movement is a global phenomenon whereby wealthy and hyper-mobile populations shift their residence to geographies with warmer climates during winter. This movement, which encompasses permanent movers, has resulted in a demand rush for Portuguese real estate. It has driven up prices and spurred a vast ecosystem of real estate-related companies. The fundamentals of Portugal as a place to live are simply too strong. And with the internationalization of the market, foreign capital is pouring in.

A decade ago, Portugal put in place attractive fiscal advantages like the Golden Visa and non-habitual residency agreements to attract foreign expenditure. This enhanced an investment proposal that was already tricky to match within Europe. A warm climate-European capital with an oceanfront offers an unbeatable lifestyle package. The jurisdictional incentives also drove the Portugal brand as a market and, in passing, as a tourist destination.

This internationalization has crowded out local buyers from downtown, as has happened in other European capitals before Lisbon. Prices soared, especially given a substantial inflow of American buyers. In 2023, the US became the number-one country investing in the Iberian country. Portugal’s cost of living and Califonianesque attributes are luring American nationals witnessing their cities being hit by inflation, high fiscal pressures, and security concerns such as homelessness.

The realtors that The Business Year spoke to for this Sector Insights report are cognizant of the unique market opportunity that Americans represent. And as a result, the real estate business in Portugal has acquired an American flavor. It has raised the exigency on agents and brought with it unique traits such as home inspections and a concierge service—the comfort-oriented approach to business that characterizes doing business in the US.

For the Portuguese, this has created opportunities for business, such as the prospect of seizable commissions or life-changing purchase offers. Although the front covers of Portuguese journals debate the existence of a bubble, the experts we spoke to outlined that prices are still below other similar European markets. Many livelihoods have benefited from the Portuguese real estate boom, with service providers and adjacent companies blooming along with it.

The real estate business is providing opportunities. In 2023, government rhetoric began to stir with programs like António Costa’s Mais Habitação raising eyebrows. Decisions like canceling the Golden Visa program do not send bullish signals to the market. Nevertheless, with the unmatchable fundamentals of Portuguese real estate, what investors want and need is stability. As long as they receive this wink essential to long-term investment, Portugal will continue to be fertile ground for real estate. ✖

Regional Director Carlos Martinez | Project Director Cristina Villegas | Country Editor Diego Brando

This publication has been produced by The Business Year International’s expert cadre of journalists, writers, editors, and designers. The content contained within is original and was compiled by our team on the ground.

24

Luciana Borges CEO, Valle Flôr Properties

• Interview

25

Carla Pinto Executive Director, Portuguese Council of Shopping Centers (APCC)

• Interview

26

Estoril Vintage Hotel the elegance of living well… in a palace

• Communique: Estoril Vintage Hotel

28

Adrian Bridge CEO, Fladgate Partnership - WOW

• Inside Perspective

29

Séverine Boutel CEO, Nhood

• Interview

30

California Dream

• Focus: Increased US investment

31

António Martins da Costa President, American Chamber of Commerce (AmCham Portugal)

• Interview

32

Real estate and US investment leading topics of discussion at The Business Year´s first event in Portugal

• Focus: Unlocking Portugal: Investment Insights & Opportunities

33

Gonçalo de Aguiar Santos Head of Capital Markets, JLL Portugal

• Interview

36

Daniel Tareco Board Member, Habitat Invest

• Interview

37

Ayres Neto Managing Partner, The Agency

• Interview

38

David Poston CEO, Portugal Homes

• Interview

39

Old Gold

• Focus: Beyond the golden visa

40

Paulo Lopes General Manager, Casaiberia

• Interview

41

Portugal 2023 Real Estate & Construction

• TBY ANALYTICS

42

José Covas General Manager, Aura Real Estate Experts (Aura REE)

• Interview

43

Why Companies Consider Coworking as the Office of the Future

• Communique: Avila Spaces

44

Jorge Ferreira Mendes Managing Partner, Mencovaz

• Interview

45

Location, Location, Location

• Infographic: Real estate transactions by region

46

José Dias Sales Director, Hydro Building Systems Portugal

• Interview

47

Filipe Nóbrega Managing Director, KONE Ibérica

• Interview

48

Montargil Monte Novo: Absolute tranquillity in a stunning natural setting

• Communique: Montargil Monte Novo

REAL ESTATE SECTOR SNAPSHOT

$11.54%

Portugal real estate activity revenue (2022)

Source: Statista

+43%

2022 YoY change in real estate imvestment

Source: portugalbusinessesnews.com

€3.6bn

Value of foreign real estate purchases in 2023

Source: Immigrant Invest

1/3>

Ratio of Lisbon properties bought by foreigners

Source: Engel & Völkers

€1,500

National average residential real estate cost per square meter

Source: Immigrant Invest

€2,082

Lisbon residential real estate cost per square meter

€1,025

Alentejo (cheapest region) residential real estate cost per square meter

140,000sqm

Amount of occupied Great Lisbon office space (November 2022)

Source: Cusman & Wakefield

11.5mn

Idealista.pt, top propery portal in Portugal, site traffic for July 2022

Source: onlinemarketplaces.com

31%

January-October 2022 YoY increase in overnight hotel stays

Source: Cusman & Wakefield

410,000sqm

January-September 2022 industrial and logistics occupied real estate space

Source: Cusman & Wakefield

380

No. of new retail units opened January-September 2022

Source: Cusman & Wakefield

JEWEL OF THE CROWN

Hugo Santos Ferreira PRESIDENT, PORTUGUESE ASSOCIATION

APPII works to promote investment, act as an ambassador for real estate investment in Portugal, facilitate entry for foreign investors, and advocate for green financing and affordable housing.

What is the mission and focus of the association?

APPII represents all real estate developers and investors in the country. We are mainly focused on institutional investors across all asset classes, from residential to commercial real estate. The latter includes offices for logistics, retail, shopping centers, retail parks, and high street retail as well as alternative sectors such as senior housing, senior living, co-working, and co-living. APPII works to advocate for the industry before public authorities, entities, and government officials, including the ministry, parliament, and municipalities and to facilitate business development among its members. Additionally, the association serves as the primary gateway for foreign investors looking to invest in the country, with 50% of our members being international.

How do you evaluate the current market conditions of the Portuguese real estate market?

Residential investment remains the jewel of the crown in Portugal, with a total investment of EUR30.7 billion in residential real estate in 2022. It represents 40% of the Portuguese GDP. In contrast, that same year EUR3.3 billion was invested in commercial real estate. Despite challenges such as the pandemic, the real estate sector has proven to be one of the most resilient sectors of the economy and played a significant role in the country’s economic recovery after the 2012 financial crisis. Along with tourism, real estate has been one of the main engines of growth for the Portuguese economy, leading to a positive spillover effects for other sectors as well.

What makes Portuguese real estate innovative?

Portuguese real estate entrepreneurs are exploring new and alternative concepts such as co-living and co-working, although the pandemic put a halt on these new developments temporarily. Nonetheless, we have been making strides in other areas such as senior living and student housing. The latest trend in innovation is green construction, which involves modular systems and industrialization. This is the commitment of the real estate markets to the new rules of sustainability, which will be the future trend. We

are also focused on reducing costs, particularly in affordable housing projects, though industrialization and modular building. We must lower costs to align with sustainability guidelines. Additionally, we are improving the levels of energy efficiency in buildings. Right now, there are discrepancies between EU directives and the Portuguese legal framework, for example, in terms of self-generated PV energy, which leave investors at a crossroads.

What are the other needs of real estate investors in Portugal?

One important issue for investors is green financing. Unfortunately, there is a huge problem with access to new affordable housing. The Portuguese middle class would not be able to afford green housing because it will be much more expensive, and the government must play a role in providing green loans for housing. The Portuguese PRR and European Green Deal are focused on fighting climate change, promoting sustainability, improving the energy efficiency of buildings, creating new affordable housing, and fostering economic growth in member states with new concepts of sustainability. Creating financing options to lower costs and allow Portuguese developers and real estate investors to produce affordable housing is the way forward. By 2030, the goal is to have all new buildings in Portugal be green.

How does APPII promote investment and help private enterprises?

We are the main gateway for investors interested in the country, and our role is to promote investment and support private enterprises. With foreign members representing 50% of our membership list, we act as a Portuguese ambassador for real estate investment in Portugal. Our primary task is to showcase Portugal’s positive attributes and convince them to invest in the country. We are still on the radar of real estate investors worldwide. Once they come here, we facilitate their entry by forming connections with local players such as real estate developers, Portuguese banks, construction companies, and asset managers. Through these connections, investors can receive the support they need to invest in the country. ✖

OF REAL ESTATE DEVELOPERS AND INVESTORS (APPII)

MORE HOUSING

Increasing the supply of available housing to lower rental prices is the main objective of the extensive Mais Habitaçao bill.

THE MAIS HABITAÇÃO PROGRAM is an initiative of the government that seeks to achieve two main objectives: support families in accessing housing; and ensure more affordable housing via various strategies that include the creation of public housing, the simplification of processes for housing construction, and the end of the golden visa program.

The main concern of realtors focused on the foreign market regarding Mais Habitação is that it eliminates the Residence Permit for Investment (ARI), the golden visa scheme, so it will no longer be possible to obtain residency in Portugal through this legal mechanism for applications submitted after February 2023. However, the initial version of the legislative package sent by the government to congress does provide for the possibility of admitting new applications for residence permits related to investments or support for artistic production, recovery, or maintenance of national cultural heritage. In order for such investments to qualify for residency in the country, a declaration of cultural property by the Bureau for Cultural Strategy, Planning and Assessment (GEPAC) is required. Considering that the entry into force of the bill is not yet known, the possibility of obtaining residency through this mechanism is a possible avenue of opportunity for those who were interested in the golden visa.

Those interested in obtaining residency through investment in cultural assets would receive a D2 residency authorization, known as the Startup Visa. This visa, which is designed for entrepreneurial investors, allows access to non-habitual resident (NHR) status and Portuguese nationality after five years. The NHR is a type of tax regime, available to golden visa recipients, which establishes the payment of a 20% income tax, a lower percentage than the usual tax regime in the country, which is up to 48%.

Regarding the end of the golden visa provided by the Mais Habitação program, it is important to point out that the bill does not include retroactive effects for permits already granted. This means that the recipients of a golden visa can continue to process their legal residence permit and tax benefits established in the ARI. Therefore, there is the possibility of renewing these permits that were issued before February 2023.

Meanwhile, the program seeks to reduce the price of homes

through various strategies, such as building 26,000 new public housing units through 2026. Another proposal to reduce the price of rent is to increase the available supply of properties, something the bill would seek to do by offering tax advantages to those who have a home and decide to rent it out. Thus, those who put their properties up for rent will have an income tax rebate of 25-28%. The program also provides for the approval of a credit line of up to EUR250 million for the construction of affordable housing. To attract private companies to the affordable rental program, the government proposes a reduced VAT rate of 6% for the construction or rehabilitation of real estate and the exemption of several annual permits that require an annual payment. Other benefits for those granting contracts under the affordable rental scheme include exemption from land tax.

Another of Mais Habitação’s proposals is the elimination of various municipal regulations and administrative procedures for housing construction. By eliminating bureaucracy, the government seeks to expedite the development of new housing in order to increase the supply of housing units. One of the ways in which it is trying to achieve this goal is with a new regulation that simplifies the change of land use, so that more land is available for residential buildings. The bill includes many other measures to try to increase the supply of available housing, such as reducing from three to one year the period for reselling a property that has been recently acquired. Meanwhile, one of the most criticized points is the possibility that the government will rent houses that are vacant, paying the owner. Preliminarily, this measure would be applicable only to apartments that have been vacant for more than two years.

The Proposta de Lei n.º 71/XV/1ª bill, which creates the Mais Habitação program, was introduced in April 2023 to congress, so at the time of writing the legislative process had not been concluded. This means that in the final version, amendments could have been made to some aspects of the bill as it was originally introduced.

Once it is approved by congress, the President will need to sign it into law. There is a possibility that the President may decide to send it to the constitutional court to issue an opinion on the new regulation, so the date of entry into force and effects of Mais Habitação are uncertain at present. ✖

A WINDOW INTO THINGS

Portugal’s real estate sector is somewhat the crown jewel in its foreign investment pull, attracting individuals and corporations alike.

TRANSACTIONS BY REGION 2021 vs. 2019

ON A MISSION

Manuel Reis Campos PRESIDENT, AICCOPN

THE EUROPEAN AND NATIONAL macroeconomic scenario for 2023 incorporates a high level of uncertainty, given the risks of escalation of the conflict in Ukraine, the evolution of inflation, and the accelerated increase in interest rates. In effect, the Portuguese economy, according to the most recent estimates, should register a growth of about 2.7% in 2023, after a strong increase of 6.7% of GDP in 2022, a year in which economic activity recovered from the effects of the pandemic and benefited from the contributions of the recovery of tourism and private consumption.

It should be noted, however, that despite the difficulties, the construction and real estate sector has stood out for its resilience and ability to maintain a trajectory of growth, despite the climate of uncertainty, the financial impacts on companies and individuals of the increase in interest rates, and the associated constraints, namely the lack of labor force and the evolution of the prices of raw materials, energy and construction materials.

In fact, in 2022, there was a positive evolution in the main sector indicators, highlighting the licensing of 30,000 new homes, 6% more than the previous year, and the appreciation of 12.6% in the house price index. Transactions of family homes, in 2022, amounted to 167,900, at a total value of EUR31,783 million, numbers that reflect an increase of 1.3% in number and 13.1% in value compared to the previous year.

For the current year, the outlook is for continued growth, estimated at 3.4%, of the gross value of production in the construction

sector. In this context, it is important to mention that the Bank of Portugal, in the economic bulletin published in June, foresees a strong boost in public investment of 25% in 2023, and of 7% in the following years, determined by financing from community funds.

In effect, our country has at its disposal funds in the Recovery and Resilience Plan, which, together with the remaining European instruments, total an amount of around EUR6.8 billion per year, to be invested until 2029. In this context, it should be noted that the available European funds must also be used so that our country may return to an accelerated path of economic convergence with other countries, which requires an integrated strategy to promote the recovery and repositioning of Portugal in a more global, sustainable, and digital economy, which in turn also requires the removal of unnecessary barriers and bureaucracy.

In fact, in the public works market, in the first five months of the year, a significant growth in the main indicators was observed. The amount of public works tenders promoted totaled EUR2,655 million, which translates as a significant increase of 78% compared to EUR1,489 million in the same period in 2022. The total number of contracts signed in this period rose to EUR1,110 million, which corresponds to an increase of 47% in terms of homologous variation in a comparable period.

In the real estate market, in the first four months of 2023, there was a YoY fall of 12.2% in the total number of construction permits issued for new building and rehabilitation works. However, in terms of new building permits, which total 11,063 dwellings, an increase of 4.5% was recorded up to April, compared to the 10,589 dwellings licensed in the same period last year, which reveals a greater stake, this year, by investors in the construction of multi-family buildings, since the number of new residential building permits fell by 13.8% in this period.

With regard to the median value of the house evaluation established for the purposes of bank credit, in April the upward trend continued, with a YoY increase of 10% as a result of variations of 10.6% in flats and 5% in villas.

As for the amount of new housing credit granted by financial in-

AICCOPN is an employers’ association that represents companies in the construction and real estate industry and keeps a close eye on developments across the sector.

“With regard to the median value of the house evaluation established for the purposes of bank credit, in April the upward trend continued, with a YoY increase of 10% as a result of variations of 10.6% in flats and 5% in villas.”

stitutions, which has doubled in the last six years, in the first four months of 2023 it was a total of EUR5,802 million, which corresponds to a YoY increase of 5.8%.

In terms of market trends, it should be noted that the use of technology and its integration in companies’ activities are currently the real drivers of progress in modern societies. Companies in the construction and real estate sector are, therefore, faced with the challenge of adapting to the 4th Industrial Revolution, the so-called Construction 4.0, which is affirmed as the natural path to increased competitiveness and productivity.

In this context, it should also be noted that the growing recognition of climate change on the planet and, consequently, the need to adopt sustainable development policies, such as the effective management of construction and demolition waste, as well as its recovery and development of collaborative platforms, the development of the secondary raw materials market, the incorporation of recycled materials in public and private works contracts, the assessment of the life cycle of buildings, and the implementation of design projects that already anticipate the “future” deconstruction in new construction, require a focus on innovation by entrepreneurs. Therefore, investment in innovation, in new construction processes, such as off-site or modular construction, the training of human resources, and the search for intelligent and sustainable solutions

are unavoidable realities.

Private investment and, more specifically, companies in the construction and real estate sector, are the engine of the economy and of employment, par excellence, given their fundamental role in making cities more dynamic, promoting sustainability, reducing energy consumption, and creating jobs, so a firm commitment to innovation by companies in this sector will certainly bring about greater national economic growth and real convergence with the other European countries.

AICCOPN is an employers’ association that represents companies in the construction and real estate industry, providing specialized services, directed to their needs, operating throughout the national territory. Next August, we will celebrate our 131st anniversary, which is a reason for pride, both for our history and the many challenges that characterize it, and for the evidence of credibility in the market and the confidence of companies.

Our main mission is to defend the interests of the companies we represent and the strategic development of the sector, empowering our members for the development of our economy and our country. The association is represented in all bodies that oversee and regulate the activity of the construction and real estate sector, integrating a wide range of entities, highlighting its chairmanship of the Portuguese Confederation of Construction and Real Estate (CPCI). ✖

ADAPTING TO CHANGE

Grupo Casais emphasizes growth in knowledge and competencies and continues to remain at the forefront of technology through exposure to different markets.

Can you give us an overview of Grupo Casais and explain what makes it stand out within the real estate sector?

Grupo Casais is a family business, with a history of over 65 years. We started our international activity in 1994, in Germany when the Berlin Wall came down. There was a construction boom close-by and we wanted to take advantage of it. We also expanded to Portuguese-speaking countries. Today, we are present in 17 regions. The 1994 move was essential because it helped instill an international mindset within the company, exposing the group to other cultures and competencies. We learn a lot through exposure to the general market, technology-wise. Even in developing countries, we are doing the same; we are taking that technology and the know-how. We recognize that the construction business is subject to economic cycles. For example, political stability, and economic strengths. Now we have a new class of cycle imposed by global factors. It is therefore important for us to be present in developing countries, on different continents.

How do you evaluate the group’s performance within Portugal?

Over the past six years, the company has been identified on five occasions as the best construction company in Portugal. And for us, growth is not solely about revenue, but about growing our competencies. And we know that because our business is subject to economic cycles, in some years we might not grow in size. But at least we intend to grow in terms of knowledge.

How does Grupo Casais stay at the forefront of technology?

Innovation comes from exposure to a different market; we pick up on trends sooner than a company that is not present abroad. Construction is the biggest arm of the group, but we also have industry, and that is the one that we intend to grow more in the future. The industrial tier puts us closer to the market and with greater relevance for the labor market. We have been able to

identify the pain points sooner than firms solely operating with subcontractors. We understood early that we would face a problem in the labor market, and started to act accordingly. When understood that this was a global issue and had already captured the industry mindset, we started to bet on developing offsite construction solutions. This is one of the major areas we are investing in because we know that the growth and quality must also be tied to sustainability to be viable. We have been operating offsite since 2018 layer by layer, having started in infrastructure with unfinished walls, where we added the finishing and built capacity.

What importance do you give to sustainability?

Sustainability is not just branding or a communication pitch, but embedded in our strategy. That’s why we have been betting on off-site solutions that enable us to develop incrementally. We have a prototyping mindset. Building differently each time means there’s no incentive for you to make, say, a better door or ceiling band. We put functional constraints on engineers and architects. It’s an industry constraint. And because we develop elements in a factory it gives us the capacity to bring more scale into the solution. If we look at the sustainability part, it has provided an option to have wood as a material because of Portugal’s geography. One of the biggest challenges of climate change will be wildfires, and we need to attach commercial value to forests to better manage them. We need to tie the value of real estate in the cities with that of the environment. The best way is to use wood is renewably. Additionally, we like to say we are building urban forests with the use of wood in buildings. What is more, wood is part of the circular economy because unlike concrete it can be reused. For certain types of building, concrete is not the best solution. Hence, we understood the virtue of adopting a more sustainable approach. ✖

António Carlos Rodrigues CEO, GRUPO CASAIS

FOCUSED ON SUCCESS

João Cristina PORTUGAL DIRECTOR, MERLIN PROPERTIES

Merlin Properties is a Iberian real estate company whose diversification and service-oriented management set it apart.

How is Merlin Properties Portugal navigating the current geopolitical and macroeconomic uncertainties impacting the real estate market in Portugal?

No matter how choppy the waters may be, we have to keep our heads cool and not lose sight of our overall goal. Throughout the past years, we have managed to acquire assets in both the office, logistics, and shopping center sectors in Lisbon. These assets, which already stand in top locations, have been progressively improved, in some cases refurbished, to respond to the most demanding needs from our clients. Having said this, the real estate market in Portugal still looks attractive due to persistent supply-demand imbalances, which have been fueling persistent rental increases and require an increase in the overall supply stock. To conclude, we don’t envisage that the current geopolitical and macroeconomic uncertainties will have an ever-lasting impact on the Portuguese market or make investors turn a blind eye to it.

With property renovations and sustainability emerging as key trends, how is Merlin Properties Portugal aligning its operations to these trends?

Merlin Properties has refurbished and will keep refurbishing existing buildings as part of its strategy. Additionally, we are conscious of the environmental challenges that we all have ahead of us and have been investing in the steady reduction of overall consumptions in our buildings. As a consequence of this investment, all our properties have, or are in the process of gaining, LEED certificates. Additionally, we also want our clients to be part of our quest to reduce carbon emissions and make a more efficient use of their resources and, for this matter, have introduced green clauses granting rental discounts to those clients that have net zero operations. Along the same lines we are developing our Project Sun, which consists of equipping all those buildings in which it is structurally possible with solar panels on the rooftops, so that the energy consumed in our buildings is renewable and helps our tenants reduce their occupancy costs. Also, we take care of the social part of the equation and, as an example, have been investing

in electrical chargers, showers, and parking for bicycles, and a set of amenities is underway with a view to promote socialization, a healthy lifestyle, and wellbeing inside our properties. We are targeting the more dynamic and service-oriented use of our assets, moving away from the traditional passive stance that property owners have.

Can you discuss Merlin Properties’ strategy regarding foreign investment, considering its increasing prominence in Portugal’s real estate market?

Merlin Properties only invests in the Iberian Peninsula, focusing on commercial real estate properties in the office, shopping, and logistics sectors. As a result, being a Spanish-born company, our stance in foreign investment is very much restricted to Portugal, although we see ourselves as an Iberian company. In Portugal, over the past years Merlin has invested in all three sectors, namely offices, logistics warehouses, and also in commercial and retail assets, such as the Almada shopping center in Lisbon. We currently have circa EUR1.2 billion spread across 12 assets, and the footprint is divided between 135,000sqm of offices, 60,000sqm of retail space, and (potentially) 250,000sqm in logistics warehouse units in the north of Lisbon. Our strategy is to expand our portfolio in Portugal, either by capitalizing on our existing landbank and fully developing our logistics business unit, or through investing in data centers or, even, by acquiring some high potential properties. We want to keep diversifying our portfolio and become the dominant presence in the Iberian Peninsula in the office, logistics, and retail sectors. ✖

“Merlin Properties only invests in the Iberian Peninsula, focusing on commercial real estate properties in the office, shopping, and logistics sectors.”

BRINGING THE EXPERTISE

João Campos Forte CEO, TECNIARTE

A Portuguese construction company specializing in private-sector projects such as health, hospitality, and luxury housing, Tecniarte seeks to become the partner of choice for international developers and position itself as a creative, solutions-oriented company.

What is Tecniarte’s expertise within civil engineering and where does the company sit within the Portuguese real estate and construction sector?

Tecniarte is a Portuguese construction company with 40 years old of experience in this market, with a license (alvara) that allows us to build almost all kind of construction projects. Tecniarte is presently more focus in the private sector, going from middle to high-end housing projects, and from hospital units to hotels. Tecniarte has seen steady growth with a EUR50-million revenue, which allows it to sit between the middle to large companies of our sector.

What traits make Tecniarte stand out as a partner-of-choice for construction projects related to health, hospitality, and luxury housing? What value did you identify in these three segments?

Tecniarte through the years have been successfully a part of projects in the health, hospitality, and luxury housing, and due to the experience accumulated over those years. Tecniarte has become the partner of choice with a vast know-how bringing experience and alternatives for all kind of circumstances that occur in a construction site. The capability of thinking out of the box, and the dynamic that our technicians bring to the projects, are a step ahead for the success of a construction site. At this moment, the Portuguese market is in shortness of beds in the hospitality industry outside the big centers, which combined with Tecniarte’s strategy of decentralization of its resources, becomes a successfully match.

What is Tecniarte’s experience working with international construction developers, and how do you provide value for market entrants?

One of the guidelines of our strategic plan is to capture the international developers that nowadays are looking more to invest outside the big centers, and for that to be accomplish we open office in strategically regions of Portugal where we can

have a base office with a presence in place to allow an easier communication and knowledge to those that want to invest on those areas. These have been a success, not only for luxury villas that have been popping up in Portugal as well as hotels, with the result already consolidate in the company with several hotels and luxury housing in all regions of Portugal.

What particularities of construction in Portugal should international players be aware of?

We believe that Portugal as a country offers a wide range of opportunities to invest due to its natural advantages in term of wellbeing, safety, and beauty. Those are highly attractive points that a potential investor will look for, especially in the case of hospitality and units dedicated to senior citizens. There is also to the niche of Golden Visa investors that see Portugal as a wellness hub. Tecniarte as well as all others companies around the world had a period to adjust to the new reality that was though, but we could mitigate and overcome with the trust that our subcontracts have in us, and with an airtight planning in the procurement and acquisition of essentials materials. We need to increase in some site our stoking capability, using outside of camp facilities.

How is Tecniarte positioning itself into the future, to cater to the needs they will have in upcoming years?

Tecniarte as always tried to see the problems ahead from two perspectives, both sides of the table, and then combine both to obtain a win-win solution. For that, we have evolved from a classic construction company in the past to a creative solutions-oriented company with in-house capabilities to create alternatives to make viable a potential sustainable project. This is essential to overcome the issues created by the costs evolution that could compromise business plans already laid out or to be procured. ✖

KALAM, armed with vast international experience, has arrived in Portugal and has set about building on its brand as a restorer, rehabilitator, and preserver of historical buildings

GLORIOUS REVIVALS

FOR MORE THAN 35 YEARS, KALAM has been dedicated to the comprehensive rehabilitation, restoration, and preservation of historical buildings. We have maintained as a primary objective the creation and continuous training of the best team of professionals, who have accumulated valuable experience through the work in the magnificent buildings that we had the privilege to restore all around the world. Our portfolio includes more than 40 interventions on monuments and sites listed by UNESCO as World Heritage Sites.

Our experience and expertise has been implemented internationally, in countries as diverse as Chile, France, the US, Italy, Switzerland, and others, which adds to our extensive experience in Spain. The trust given and maintained by many of our clients, which include relevant public and private heritage organizations, for the conservation and restoration of their properties, has been a determining factor in our organizational model.

We are now present also in Portugal, where we want to be what we are around the globe, where the brand KALAM means total commitment to our clients and their

projects.

The experience acquired carrying out complex works in which we have demonstrated the expected and timely quality has been valued by clients who rely on the services we provide to successfully develop the projects they are promoting. We know that many of these parameters are fundamental to the real estate sector and developers and that is why we are sure that they will also be appreciated in a market such as the Portuguese one, where there are very demanding national and international operators. We are ready to help them with our experience and become successful partners.

In Portugal, our technical autonomy in the construction’s management, our department of technical studies and budgets, lead by José Costa Trindade, and post-construction management and sales are already consolidated and growing. We are now in phase two of KALAM Portugal’s development, training local talents to join our team, lead by our technical manager, Carlos Escudero.

KALAM is making great efforts and investment into the Portuguese market.

Ramón Mayo, KALAM’s President, always trusted in this Iberian endeavor, and his efforts are already getting significant results. It is with great pleasure and great sense of responsibility that I am leading Kalam’s growth and increasing its autonomy in this country. We are already present in the market and being invited to major projects by major international players in the real estate investment industry in Portugal.

Over the past two years we have completed several projects in Portugal: the adaptive reuse of the Automovel Club de Portugal’s (ACP) headquarters in Lisbon, the Spanish Consulate in Porto, the adaptive reuse of an amazing building in Lisbon’s Rossio Square for an international investment fund, another adaptive reuse of a building in Bairro da Graça, also for an independent international investor, and we are going now to rehabilitate two new historical buildings in Lisbon’s downtown for a British investment fund, and by the end of the year we expect to start three more projects. We thank these clients for the confidence placed in our team of specialists. These are the kind of reference institutions and private investors that we use

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to work for and that we appreciate to work with.

This solid growth in Portugal is the result of our organizational structure, recognized by our brand values and unequivocal dedication to quality, and supported by a proven and unique experience in the sector. This is proved by all the distinctions achieved throughout our trajectory, which have so much honored us as a team.

This recognition of our work includes being awarded in two occasions with the European Union/Europa Nostra Award for Cultural Heritage, one of the most relevant awards worldwide in the field of heritage conservation. The first one was awarded in 2016, with a Special Mention in the category of Dedication to Heritage Service, and the second one in 2018, in the category of Conservation, for the Restoration of the Façade of the College of San Ildefonso of the University of Alcalá de Henares, in Spain. An international jury acknowledged the excellent restoration that was carried out by our team, highlighting the respectful maintenance of the historical patina of such a unique monument. ✖

MAKING A DIFFERENCE

Pedro Lancastre CEO, JLL

JLL’s broad expertise across different real estate types and its 360-degree approach to providing value to clients make it a valuable partner for real estate developers in Portugal.

What characteristics differentiate JLL as a partner for real estate developers?

JLL is a top real estate advisor in Portugal. One of our main differentiating factors is our broad expertise across real estate types. Many of the projects we are involved in are mixed-use. The current trend for developers is to design projects that incorporate aspects of commercial, residential, and offices. Working in all sectors allows us to understand each project holistically. We can provide value from the initial ideas to the final commercialization. JLL’s 360-degree expertise is, therefore, a precious asset for our clients.

At a market level, what areas are attracting investor interest?

Residential real estate in Portugal represents 10 times more volume than other segments. There are EUR30 billion in transactions in that segment, versus EUR3 billion in commercial real estate. Hotels and hospitality account for 33% of the total investment, followed by offices on 27% and logistics on 18%. Approximately 80% of investment spending is international. Commercial real estate is driven by offices and should remain the case. Within residential real estate, a trend that everybody is talking about is the lack of supply. Demand outpaces supply, and domestic demand accounts for 94% of transactions. There is a huge scarcity of new products in the residential market, which explains why prices are rising. This reality has created a niche market of premium high-quality developments. There is still much to be done to create new products from scratch and realize land development.

Given these market conditions, how does JLL provide value?

We help clients create the best products to meet the needs of the population, not only to live in but as social spaces. Our position is that of an advisor to identify the right opportunities. Many players are not local, whereby we are the locals that can show them the best opportunity. We have the data and the technology and are able to present them the best of it. In Portugal, the company

has a long trajectory of local know-how, which, combined with JLL’s network of offices in over 80 countries, is powerful. One of the best aspects of real estate in Portugal is the quality of the industry in which we are involved. Construction companies and developers are highly qualified and specialized. JLL collects a lot of information from the markets and uses it to give confidence to investors entering the Portuguese market. Actionable information is transparent and consistent, which is essential for the investor. Furthermore, being an international firm means we are aware of the major advances in trends because we are involved in them abroad. Our colleagues occasionally work to create products at a much larger scale or ones that still do not exist here. Thus, when we talk about such topics, it is from an informed position. Being international is a vital driver of innovation.

What is JLL’s approach to innovation, data handling, and optimizing strategy through information?

Our main focus is on organized data because this gives us a competitive advantage in decision-making. Three items are tightly interconnected: technology, information, and transparency. We invest in emerging product companies via our tech venture JLL Spark. And since 2018, we have invested over EUR300 million in 40 pro-tech companies that offer innovative solutions to transform the way that commercial real estate operates. Global tech start-ups have the capacity to support investors with innovative solutions in construction and sustainability.

What is the company doing in terms of sustainability?

We ensure that real estate projects comply with the energy requirements of tomorrow. With the growth of the population, cities will see greater building needs, and we are ready to continue to build extensively to meet the need for new houses, schools, and hospitals. We have products that are much more adapted to the quality of life that people are looking for. Real estate accounts for over 40% of carbon emissions in the atmosphere. And we are addressing this. ✖

A STRONG VOICE

Filipa Arantes Pedroso PRESIDENT, WIRE PORTUGAL PARTNER J+LEGAL

Can you describe the role WIRE Portugal plays in the real estate sector and how its work has evolved since its inception?

WIRE Portugal was incorporated on February 23, 2022, with the purpose of increasing the visibility of women in the real estate and construction sectors, boosting their representativeness, and defending their interests. WIRE was incorporated by 19 professionals in real estate and construction, and we are now at 45 associates and growing. An associate of WIRE needs to be a director or a C-level professional in any area of the real estate or construction. Our first public meeting took place on June 27, 2022, at Palácio Sottomayor, sponsored by PwC. The panel included the representative for Planning of the Lisbon Municipality Joana Almeida, a partner of PwC, Hugo Santos Ferreira (APPII) and António Gil Machado (Vida Imobiliária/ Iberian Property), as speaker and moderator, respectively, a member of WIRES (Wire Spain), and myself (WIRE Portugal). It was a big success. Since then, we have implemented our site, increased the number of directors from five to seven, created a training program, obtained several benefits for associates, and we are preparing a mentoring program for young professionals. Other than APPII, Vida Imobiliária, and Iberian Property we also have as partners GRI Club, SIL, and Confidencial Imobiliário. WIRE Portugal is growing fast and leaving its footprint in the real estate market and events.

How has the trend of property renovations and the continuation of foreign investment influenced the real estate market in Portugal in 2023, and how is WIRE Portugal responding to these trends?

Property renovations have been a success since they were implemented in 2009, due to the tax benefits namely the VAT in construction of 6% instead of 23%, and exemption from property tax (IMT) and municipal tax (IMI). In Portugal, rents are exempted from VAT; therefore, the VAT is not reimbursed, ending up as cost. Foreign investment has been important

since 2015 and has changed the Portuguese real estate market. The real estate market was stagnant during the bail out period (2010/2015) but started to grow in 2015 due to the changes implemented to the Real Estate Lease Law, the property renovation tax benefits, changes to short rentals legislation (Alojamento Local), the implementation of the so called Golden Visa for non-European residents, and legislation applicable to non-habitual residents, and has been increasing every year since then. Although foreign investment continues to grow, Portuguese residents are the main investors in residential real estate. In the first trimester of 2023 investment had a slowdown but has been slowly and steadily increasing. WIRE has been a following the trends and its associates are providing its opinion in various articles published in Vida Imobiliária, Iberian Property, and the Publico newspaper. As President of WIRE, I have participated in two podcasts, one for Expresso weekly newspaper and the other for Observador. WIRE and its associates have an active voice in all matters related to real estate and construction.

What challenges does the Portuguese real estate sector face in light of the geopolitical context, particularly the war in Ukraine, and its potential economic consequences? How is WIRE Portugal working to mitigate these challenges?

WIRE Portugal is a strong voice for women in the real estate and construction sectors, and is involved in discussions surrounding regulations effecting every area of the industry.

“As with all other European countries, Portugal has been affected by inflation and the Ukraine war, which has had an impact notably on energy costs and construction costs.”

As with all other European countries, Portugal has been affected by inflation and the Ukraine war, which has had an impact notably on energy costs and construction costs. Although these matters are out of the control of WIRE, all our associates have provided solutions to the clients they work with and discussed alternatives with public entities. The Portuguese real estate market has been resilient, and professionals and investors are confident that real estate investment will continue to grow steadily. WIRE’s associates have an important role in advising and informing the players in this market.

The Portuguese government has initiated significant legislative changes and technological adaptations, such as the SIMPLEX program and the adoption of proptech. How are these changes impacting the real estate market, and what is WIRE Portugal’s role in facilitating these transitions?

The legislative changes and technological adaptation are important notably for the celerity of the licensing of development projects. The delays in licensing have been criticized by investors and have an enormous cost that is naturally transferred to the final consumers, buyers or tenants. The 308 municipalities (278 on the continent, 11 in Madeira, and 19 in the Azores) have different regulations and interpretation of the law and an effort to change this is one of the most important objectives of the so-called Simplex program. It could have gone further in the changes to the actual legislation, but it is no doubt a good start. WIRE and its associates have been discussing in various articles of opinion the changes proposed and have supported the interaction between municipalities and the government. In WIRE’s opinion, it is not possible to implement these changes successfully without support and approval by the municipalities.

Could you elaborate on the impact of the Mais Habitação program and the cancellation of the Golden Visa program on the real estate market, and how is WIRE Portugal adapting to these changes?

The Mais Habitação program has been criticized by all players in the real estate market. Its objective to decrease prices and rents in the residential market will not be achieved, as WIRE has been thoroughly defending in various articles and meetings. The way to decrease the prices and rents in the residential market is to increase the offer of new houses and decrease the applicable taxes, as was done for the renovation of properties. Accessible Lease has some tax benefits that are not enough to make build-to-rent attractive. The cap in the rents will have a negative effect on the renting market. The Golden Visa only represented 0.6% of real estate transactions, so it seems that it will not have a major effect on the real estate market—we need to wait and see. The law was approved in general by parliament, but it still has a long way to go in the discussion of the specificities and WIRE has defended several changes to turn around some of these provisions.

With the new Asset Management Regime (AMF) in place since May 2023, what opportunities and challenges have come to the restate sector, and how is WIRE Portugal leveraging this new regulation?

The collective investment undertakings (OIC) including risk capital and specialized investment are now all ruled in one document, the AMF. The only companies that can manage assets are the collective investment undertakings management companies (SGOIC) and capital risk companies (SCR). The authorization process by the securities commission (CMVM) is faster and simplified for the alternative investment undertakings (OIA), which are divided according to a size criterium. The new regime applies to four types of OIA: real estate, risk capital, credit, and others. The real estate OIA can now invest in rural and mixed properties, develop properties for renovation, rent, operation, or resale, and in certain cases it can buy participations in other real estate companies. This will certainly bring new opportunities to the real estate market; however, the real estate management funds now have one year to adapt the AMF. ✖

ADAPTIVE & SUSTAINABLE

Patrícia Barão HEAD OF RESIDENTIAL JLL PORTUGAL

JLL’s residential wing has adapted to changing market dynamics and today prides itself on the sustainable nature of its projects.

As the head of residential at JLL Portugal, can you give us an insight into the current sectoral dynamics of the Portuguese real estate market?

For the Portuguese real estate market sector, in the context of residential, the first quarter will have brought a further reduction in sales, following the marked trend throughout 2022. Although the annual total has surpassed the result for 2021, the trajectory throughout last year was of loss of steam, with the fourth quarter placing sales 12% below the first quarter (38,500 vs 43,500, data from INE). The expectation is that 1Q2023 will show a drop of around 5% compared to the previous quarter. The residential market maintains robust performance levels due to the strong imbalance between supply and demand. However, impacted by the economic situation, it is registering a slower pace of sales and is already showing some price adjustments in the more heated markets of Lisbon and Porto. There is no demand shock, as evidenced by the good dynamics in the commercialization of new projects coming to the market, and by the dynamics of the national public (61% of JLL’s sales were made to Portuguese buyers). The measures of the Mais Habitação program in Portugal may have the opposite effect to the one intended, namely at the level of creation of new supply, and especially of rental. The coercive rental of vacant houses or the rent caps may limit market activity and create uncertainty, leading developers to postpone or cancel projects.

How does JLL differentiate its residential property offerings in the ever-evolving Portuguese real estate sector, and could you highlight some unique aspects or projects?

There is a tendency to restructure demand, which now tends to widen its geographical search and consider markets that are

“Looking ahead to the next half year, the residential market maintains a robust performance due to the imbalance between supply and demand but shows a slower pace of sales and price adjustments in Lisbon and Porto.”

more distant from urban centers, but where there are houses that are more adequate to their income level and, often, with the added value of being larger, better equipped, and in areas with a good quality of life and relatively close to urban centers. In the Lisbon Metropolitan Area, municipalities such as Barreiro, Seixal, and Setúbal are great examples of emerging markets. The replenishment of supply, which is slow, is not going to accelerate. Construction costs have increased almost 12% in the last year (INE), a fact that we cannot and do not control and that comes with inflation. The tax burden is heavy and licensing processes take a long time, which, along with the already lengthy real estate production cycle, has been dramatic. Because of the continued shortage of supply, and despite adverse macroeconomic conditions, prices have shown themselves to be quite resilient, although with a deceleration already felt at the beginning of this year.

What emerging trends do you notice in Portugal’s real estate market and how do they influence your strategic direction at JLL?

In Portugal, it is natural that demand slows down, because families have lost purchasing power and because access to credit is more expensive and difficult. This was already visible

throughout last year, after the unprecedented peak of almost 46,000 homes sold in one quarter (4Q2021). The trend was to lose steam throughout the year. Each quarter had fewer sales than the previous one, although the average quarterly sales remained high at around 41,000 units. But there will always be a need to buy or move house because we get married, because we get divorced, because we have another child, because we change jobs, because our life changes. The pandemic is the best example of this strength of demand—in the first year, completely caught by surprise with a health crisis and in confinement, house sales fell by only 11% and it was mostly in reaction to the initial shock. During the first quarter the housing market maintains robust due to the strong imbalance between supply and demand. However, impacted by the economic environment, it registers a slower pace of sales and already signals some price adjustments in the more heated markets of Lisbon and Porto. There is no demand shock, as evidenced by the strong dynamics in the marketing of new projects coming to the market, and by the dynamics of the national public (61% of JLL’s sales were made to Portuguese buyers).

JLL has a global reputation for sustainable and innovative property solutions. How are these values being realized in your residential projects in Portugal?

Our residential team in Portugal has huge concern for sustainability and innovation in the property sector. We work closely to developers, and we incentivize them to adopt sustainable practices and incorporate environment friendly features into their residential developments, such as energy efficient appliances, solar panels, green building materials, and water saving fixtures, and ensure that properties that JLL markets are designed and built to minimize their ecological footprint. We strongly believe that a genuine commitment to sustainability is key to continue building future residential buildings

for the next generations.

Given the impact of the COVID-19 pandemic, how has JLL Portugal adapted its residential strategies to accommodate shifts in consumer behavior?

The COVID-19 pandemic has indeed brought significant shifts in consumer behavior and JLL residential had to adapt its strategy accordingly. We embraced technology and started to utilize virtual technologies to conduct virtual property tours, virtual open houses, and video conferences with clients enabling potential buyers to explore properties remotely. We also enhance our online presence by optimizing our website and utilizing social media platforms and leveraging online advertising. We also started to create informative and engaging content that educates potential buyers about the Portuguese market, neighborhood amenities to reach a wider audience, and generate leads.

What do you predict for the future of Portugal’s residential real estate sector, and how is JLL preparing for these potential changes?

Looking ahead to the next half year, the residential market maintains a robust performance due to the imbalance between supply and demand but shows a slower pace of sales and price adjustments in Lisbon and Porto. Demand has not suffered a shock, as evidenced by the dynamics in the marketing of new projects and the significant participation of Portuguese buyers (61% of JLL’s sales). Lisbon continues to have good market dynamics, with Portuguese buyers representing most sales, while Brazilians and Americans are the most active among foreigners. However, there are adjustments in the average sale prices. In Porto market is also dynamic, with good demand for new commercial developments, mainly by national buyers. The market shows adjustments in average sale prices and a slowdown in sales. ✖

THE GOLDEN TOUCH

Luciana Borges CEO, VALLE FLÔR PROPERTIES

Valle Flôr Properties seeks to set itself apart via the quality of its work, from locations to building materials and more.

How has Valle Flôr Properties adapted to the increasing trend of property renovations in Portugal, and what role does sustainability play in your renovation projects?

Valle Flôr Properties takes on the challenge of adding value and contributing to the development of the real estate sector through new construction and rehabilitation projects, promoting the preservation of the historical and heritage richness of buildings, and, simultaneously, integrating solutions that adapt to the current requirements of modernity, comfort, functionality, attractiveness, and high quality of all elements. Since the beginning, sustainability has been at the forefront of our projects, with the selection of materials, including giving preference to eco-efficient ones, and also in the construction process, ensuring thermal, acoustic, and energy efficiency in a clear commitment to the future.

With growing interest from foreign investors, particularly Americans, how is Valle Flôr Properties working to attract and cater to this demographic?

The main focus of Valle Flôr Properties is to provide projects with a different quality and not, exactly, attract a specific target audience. Our projects are designed in all dimensions, combining a modern design with character and unique details, providing privacy in large cities. Those who are looking for these characteristics, including American investors, will feel naturally attracted by the compositions of Valle Flôr Properties

Given the ongoing geopolitical uncertainties, what strategies is Valle Flôr Properties implementing to mitigate potential risks and ensure stable growth?

Despite the effects of recent geopolitical events, in the real estate segment we sell, i.e. high range and high value, customers are less susceptible to economic cycles. However, we always seek to frame solutions that guarantee an attractive quality/price ratio. Portugal is one of the safest countries in the world, offering a good quality of life, whether due to its geographic location, climate and cuisine, or the friendliness of the Portuguese people, making our country one

of the most attractive. As demand exceeds supply, it is justified that, at this moment, the premium segment has a high growth potential. I am also part of a Portuguese family group with more than 55 years of experience, with the know-how and financial strength necessary to respond to growing challenges. Based on projections, we ensure the sustainable growth of Valle Flôr Properties.

Can you elaborate on Valle Flôr Properties’ new projects and how they align with the current trends and demands in the Portuguese real estate market?

Valle Flôr Properties is focused on creating a trusted brand, so the commercial strategy involves fulfilling the essential characteristics that sustain its collections, through my meticulous and direct monitoring. We currently have three residential buildings in Alcântara, Lisbon, and two hotels in the Braga historic center in an advanced state of construction. Also in Alcântara, we have three more residential projects, under approval, that will advance when we met all the necessary conditions, which we expect to happen by the end of 2023. In addition to these projects in progress, we recently completed the acquisition of some properties in Porto, which will soon see developments. With regard to the type of projects we take on, we do not seek to follow any type of trend; we strive to implement the necessary requirements to be classified as premium segment. All projects have my stamp; I treat them as though they were my own home, which is the main success factor for Valle Flôr Properties. ✖

“Valle Flôr Properties is focused on creating a trusted brand, so the commercial strategy involves fulfilling the essential characteristics that sustain its collections.”

THE PLACES TO BE

Carla Pinto EXECUTIVE DIRECTOR, PORTUGUESE COUNCIL OF SHOPPING CENTERS (APCC)

The APCC represents the organized retail sector in Portugal, defends its interests, and promotes various initiatives to ensure organized spaces provide positive experiences to the people who visit them.

As the Executive Director of APCC, how do you view the role and the importance of shopping centers in Portugal’s economic landscape? Our industry is known for its high capacity for resilience and regeneration. Shopping centers are the main driver of commerce and retail, capable of setting standards of quality and competitiveness for the market. Increasingly, they are also the incubator for launching and testing new concepts, not just retail, but also all types of services, leisure, culture, and multiple forms of involvement with local communities and people who live and work nearby. Shopping centers have changed profoundly with the offer of new services ranging from health to car mechanics, as well as well-being and leisure.

Can you share some examples of initiatives that APCC has taken to support the growth and sustainability of shopping centers in Portugal? Sustainability, in all its dimensions, is one of the central axes of our work. In this sense, we promote a series of initiatives ranging from energy saving to reducing water consumption, reducing waste, and promoting recycling. This is an example of how we are currently dealing with this topic; however, shopping centers have long since adopted the best practices in their daily operations in the various dimensions of sustainability.

How has the APCC adapted to the digital shift and e-commerce trends?

What strategies are in place to encourage physical shopping and maintain the relevance of shopping centers?

The biggest challenge is to look at digital not as a competitor but as a complementary channel. And omnichannel strategies are already part of our daily life. Retailers, in one form or another, have long had a sense of what the future of retail will look like: consumers shopping anywhere and anytime via computers or mobile devices, stores transforming into showrooms or distribution centers, and products with home delivery and in ever-shorter timeframes. Therefore, APCC promotes

training for tenants who want to boost their digital channels and the possibility of shops that are exclusively online becoming physically present in shopping centers.

Can you discuss the APCC’s role in promoting social responsibility and sustainability among its member shopping centers?

APCC has promoted the signing of a Pact for Sustainability that incorporates the commitment to develop a positive influence with all stakeholders to integrate sustainable practices in all aspects of its operations, from energy and water consumption through to waste management, social responsibility, and long-term economic viability, as well as the management and awareness of the entire value chain, allowing an acceleration of the sustainability journey of the sector. This pact seeks to establish a set of measures and goals that reflect the commitments to social responsibility, inclusion, environmental protection, and long-term value creation. It is based on three pillars.

What are the association’s goals for the coming years?

The APCC aims to continue representing the organized retail sector in Portugal, defend its interests, and promote various initiatives to ensure organized spaces provide positive experiences to the people who visit them. We thus aim to promote an environment of close cooperation between all economic actors and ensure the protection of what is one of our economy’s most dynamic and successful sectors. ✖

“Shopping centers are the main driver of commerce and retail, capable of setting standards of quality and competitiveness for the market.”

ESTORIL VINTAGE HOTEL THE ELEGANCE OF LIVING WELL… IN A PALACE

THE GOOD AND BEAUTIFUL LIFE

A secular family home. A building full of history, tradition, and memory. A cultural and artistic legacy. A view facing the sea, 18 rooms with a unique signature and identity, and the undeniable and irrefutable compliment to the art of living well, with refinement and elegance. Welcome to Estoril Vintage Hotel, the new passion of charming hotels’ universe.

ONCE UPON A HOTEL FULL OF CHARM FACING THE ATLANTIC

This is the story of a building with memory. A hotel that tells stories and that will surely be part of each guest’s personal history. Entering the brand-new Estoril Vintage boutique hotel is opening the doors of a romantic palace, exploring memories that echo in every detail of its century-old architecture, recognized as a cultural heritage, and venturing into a sophisticated time capsule, playing with the calendar and with the clock hands and understanding where and how the days of the Great Gatsbys and the European elites of the beginning of the last century were spent. Elegant places, exclusive environments, sumptuous settings, where one can easily imagine gatherings, ravishing romances, international intrigue, and some espionage, whose fascination persists to this day. A hotel that embodies all of this is not just a place to stay, but a magical site to create memories where one wants to come back again and again. Checking in at the Estoril Vintage Hotel is like opening the pages of a book that we can't stop reading. The invitation is for you to be part of this plot.

WALKING DOWN MEMORY LANE

After the synopsis, the protagonists. Com-

pleting 100 years, the mansion began its days with the name of Casa de S. Cristóvão. A good omen, as it honored the patron of travelers, whom, relatives or strangers, it always knew how to welcome with impeccable refinement throughout its life. Most notably during the summer season, in times when Estoril and Cascais were the seaside resorts of the Lisbon and European aristocracy, where many noble and bourgeois families had their summer home.

It was built in 1917 by Alfredo da Silva, a visionary businessman, forever linked to Portugal’s industrial development, and who gives his name to the hotel’s street. The project was given to the award-winning architect and painter Tertuliano Marques—a great name in Portuguese architecture and one of those distinguished with the Valmor Prize, who designed the building in Baroque style, with strokes of classical and erudite inspiration and a certain inclination toward the style of the King D. João V period.

A heritage with architectural, social, and cultural weight, erected in front of the Atlantic and which the Líbano Monteiro family, at the right time, decided to transform into a charming hotel, leading the mansion back to its vocation as a host. A tribute to the past with a contemporary signature, in a place of traditions and affective memories that are intended to perpetuate in the life of each visitor.

SIMPLY SUPERB

In a refined atmosphere and with an interior design that respects the architectural design, the past and the history of the mansion, the

charming Estoril Vintage Hotel offers 18 elegant and majestic rooms, with princely areas, stylized and updated period decoration, different in each one of the rooms. The environment is sophisticated, inviting, modern, and comfortable, because if time travel stimulates the imagination and beauty pampers the spirit, body and mind demand all the comforts of our days, including technological ones, because even on vacation, nobody wants to log out. Also, because the view, over the ocean or the garden, requires photos at any time of the day, so the Wi-Fi is non-stop and free.

To this exquisite setting, Amazing Evolution, the hotel management company, adds its expertise: an excellent service, personalized and available 24/7, for a customized experience that meets the wishes of each guest.

• Exclusive beach area on Praia das Moitas for all guests, with bar service, which works as a hotel extension

• Private driver on request

• Fluent interpreters in any language

• Cultural tours through Lisbon,

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

“If you are looking for an experience, you will be able to live the best in the world. If you are just looking for a nice room, you will be overwhelmingly surprised!”

harmonized with traditional Fado

• Tours through the magical and enchanting landscapes of Sintra, the same ones that led the poet Lord Byron to refer to it as a “glorious Eden” and to describe the village as being “perhaps the most beautiful in the world.”

• National wine tastings

• Tastings of the hotel’s own olive oils

• Historical and artistic itineraries

• The exclusive possibility to organize tailor-made private programs

100% cotton and satin bedding by the renowned Portuguese brand Bordalima, amenities by London-based Molton Brown, and a kettle in each room are the most comforting signs that one is at home. A good home!

At Estoril Vintage Hotel, each stay is a unique experience, and each guest is special in a hotel whose experience replicates that of a sumptuous family home that honors the art of hospitality.

The good, the beautiful, the elegance of details, and the afternoon tea

Rehabilitated, restored, and embellished with craftsmanship and ancestral skills, with original frescoes, stone details, carved wood, and century-old tiles, the building honors the role of a charming hotel, where good and beautiful achieve a feat so often coveted and rarely achieved, that of offering the pleasant sensation of a private and exclusive home, the perception of being special and that everything revolves around the satisfaction and well-being of each of its “inhabitants.”

The renowned interior designer Graça Viterbo ensured the maintenance of the building’s architectural and cultural identity and knew how to transfer this heritage of refinement and good taste, where there is no lack

of a certain British accent, to the amenities required today.

Worthy of period settings, where Agatha Christie characters would not hesitate to spend a season, the common areas are charmingly glamorous. If the dining room stands out for its privileged view, covering the entire line of the maritime horizon, and for the gustatory experiences born of a cuisine that praises the national gastronomic culture, the bar, with original frescoes, signed by the famous painter João Reis, seems designed to take to another level afternoon tea, a daily ritual offered to all guests.

The attention paid to every detail, from the decoration to the service, the ability to anticipate needs and satisfy desires, reinforce the general feeling of well-being and belonging. This is how unique experiences and indelible memories are built.

GO ON DISCOVERY—WHAT TO DO

With Estoril beaches just a few steps away, and an inviting ocean front promenade as far as the eye can see, sea lovers need nothing more than a short walk between the hotel’s pool and the ocean waves, where sailing, surfing, or boat trips are irrefusable invitations provided by the hotel, through a reliable network of long-standing operators with proven experience. The same applies to golf, tennis, or horseback riding, for those who, even during break times, do not dispense with physical activity. Maintaining a healthy routine will not be a problem for those who prefer relaxation practices either. A complete menu is offered by the hotel’s SPA and Wellness center, with the Comfort Zone Skin Care & SPA Treatments quality seal.

WITHIN EASY REACH—WHERE TO GO

With a privileged location, facing the sea, the hotel is surrounded by numerous touristic

points of cultural and artistic interest. Lisbon is just 27km away—around 20 minutes by car—the charming Sintra is just 17km away and the elegant Cascais is just 1km away. Palaces, castles, mountains, museums, award-winning restaurants, and an attractive nightlife and social scene are part of an unforgettable stay. We leave you with a short list of the most seductive and unmissable places to visit:

• Casa das Histórias Paula Rego

• Portuguese Music Museum

• Forte da Cruz

• Cabo da Roca – Westernmost point of mainland Europe

• Pena Palace

• Moorish Castle

• Quinta da Regaleira

• Seteais

• Casino Estoril – With a dynamic artistic program

ABOUT AMAZING EVOLUTION

Amazing Evolution is a private hotel and resort management company, passionately and engagingly dedicated to hospitality, to which it always adds the “amazing” factor. From a positive and inspiring reading of each project, and framing it in its geographical, environmental, historical, and cultural reality, it creates differentiating hotel units with an identity of their own. Amazing Evolution focuses all its action on people’s well-being and happiness and on the ability to amaze them while promoting a better world to live in—A purpose that aims to deliver unique and tailor-made experiences to guests, capable of being included in the most demanding memories album. Amazing Evolution is also a five-times-in-a-row winner of the World’s Leading Boutique Hotel Operator award, and twice named World’s Leading Hotel Management Company, awarded by the World Travel Awards. ✖

NEW HORIZONS

Adrian Bridge CEO, FLADGATE PARTNERSHIP - WOW

When the Fladgate Partnership moved its bottling facilities away from the River Douro near Porto, WOW was born as a touristic real estate development initiative that has birthed museums, shops, restaurants, and more.

THE VISION of WOW is to bring a totally new set of cultural concepts to Porto for people who live in the city and for returning visitors to the area. The consistent theme throughout the project is excellence, sustainability, and entertainment. We currently have seven museum experiences, shops, restaurants, a wine school that is WSET certified, and multiple cafés and bars.

The project came about in 2008, when The Fladgate Partnership (The umbrella company that includes Taylor’s Port and several other companies, including WOW) decided to relocate its bottling away from its traditional riverside home. This decision freed up a number of warehouses on the south bank of the River Douro and left us with a large area in Vila Nova de Gaia and the opportunity to do something with a lasting effect for Porto. The first phase was to build The Yeatman Hotel, a luxury wine hotel that opened in 2010, with the second phase being the opening of WOW.

The Fladgate Partnership determined that WOW would open in July 2020, and we first broke ground in January 2018, leaving just two and a half years to bring the whole complex together. There were various changes to the project as it was underway, for example The Chocolate Story was added whilst crews had started digging as we had been looking to add chocolate to WOW. There was a belief that the market was changing and the market for high-quality cocoa-rich chocolate was increasing. The Chocolate Story was then moved to the old Croft bottling building to give it the space that it needed.

Central to the process was the need to dig down 17m to create a new ground level that was considerably deeper than the existing one. Perhaps the most interesting stage of this part of the construction process was the underpinning of the largest warehouse which was propped up while the ground around and under it was dug out to create the new floors required for the project. This presented the engineers with a series of challenges, not least of which was the poor weather and high winds that tested construction to the very limit. The warehouse also held during the small earthquake that struck Porto in September 2018. Once complete, the old warehouse was left supported on stilts that suspended it in the air. There were also practical reasons to dig down—we would block the spectacular Porto views if we solely built upward. These views have been perfectly preserved and can be seen throughout WOW and especially from our main terrace.

WOW opened on time in July 2020 and dark, dingy warehouses that had been crying out for a new use had either disappeared or been transformed into airy, well-lit expanses of space that are welcoming to visitors.

We are constantly innovating the space and adding new museums, exhibitions, and restaurants. In 2023, we have opened a new museum, The Atkinson Museum, which will house an exhibition in collaboration with The Tate Collection called ‘’The Dynamic Eye: Beyond Optical and Kinetic Art.” We have also changed the concept of one of our restaurants to be focussed on luxury laidback dining from Chef Ricardo Costa, who has two Michelin stars at his restaurant at The Yeatman just a few steps away. Mira Mira by Ricardo celebrates small producers and has two tasting menus, one of which is completely vegetarian. ✖

“We are constantly innovating the space and adding new museums, exhibitions and restaurants.”

TRANSFORMING SPACE

Séverine Boutel CEO, NHOOD

Nhood’s overarching goal is to create, revitalize, and transform cities, neighborhoods, and mixed-use assets into living places for people to live, work, and thrive.

What is Nhood’s expertise?

Nhood specializes in revitalizing and transforming spaces where people can live, enjoy, play, and work. With a presence in 11 countries, our main strength is covering the entire construction process, from strategy and project execution to delivery. We have an operation management of over 700 partners in Portugal. Focused on providing services for tenants, we design and market real estate services that extract the value of real estate assets. For us, finding the right partners is crucial when embarking on a real estate project. Investors need to understand the market and local culture, so hiring partners with an international mindset and experience in different countries is crucial. We believe in business with partners that can provide expertise and knowledge.

Can you elaborate on Nhood’s unique concept of the triple positive impact? Our positive impact approach centers around the three Ps: planet, people, and profit. The goal is to positively impact the environment and the communities we serve by re-imagining spaces. For this, we keep sustainability at the core of everything we do, and we strive to integrate the best practices available to achieve our targets. 100% of the assets under our management rely solely on renewable energy, and we apply global best practices in Portugal. Developers need a partner who understands the challenge and can implement the right strategies. At the same time, the main priority for stakeholders is sustainability and ensuring long-term viability. At Nhood, we are determined to execute all our CSR commitments. Another of our considerable strengths is our ability to integrate processes and test solutions, achieved by continuously testing and improving our processes and solutions in line with the evolution of technology.

What are the specific market segments you want to explore?

We aim to create, revitalize, and transform urban spaces for a lively neighborhood life, contributing to the 15-minute city and create a well-balanced ecosystem for people to live, work, and thrive in. We want to remain aligned with clients who share the same vision

of sustainability and the same values. Our expertise lies in the design of mixed-use projects, integrating various focuses such as offices, restaurants, and hotels in the same space. This allows us to cater to multiple needs and encourage better lifestyles within a community. Nhood also offers management, development, and promotion services.

Can you provide an overview of your current portfolio of assets?

We manage over 200,000 sqm in Portugal and we have a pipeline of projects already identified in more than 15 municipalities, which touches different uses from commercial, residential, office and other real estate, which represents project management with an associated investment of EUR700 million.

How do you envision the future of urban space?

Collaborating to achieve sustainability objectives is a must when the subject is the future of our cities. Sustainability is only possible when done with others in a collective mindset. We envision a future where cities prioritize proximity and well-being, involving citizens in the design of public spaces and betting on the diversification of uses. Through closer alignment between stakeholders, public powers, and inhabitants, we can create a more sustainable and inclusive environment.

What is the importance of being an international company?

Being present across Europe and Africa, we benefit from many synergies carried out by more than 1000 employees. Thanks to our geographical dispersion and combined experience managing over 4.3 million sqm, we can learn from our experiences in one country and apply best practices across all markets. Being international also helps us stay at the forefront of trends and technology. For instance, we were the first company in Portugal to use Google’s AI for customer care, which has since become a successful case study for the country. Additionally, we can implement successful proof of concepts in one market and replicate it in others, which helps us optimize our operations and expand our reach. ✖

CALIFORNIA DREAM

US investors invested EUR 1.15 billion in Portuguese real estate, representing 33.7% of all commercial real estate investments.

PORTUGAL IS FIRMLY in the sights of American investors. With a pleasant climate as well as beautiful beaches and surf, the country is becoming a European hotspot where Americans can find a second California that is also full of Hollywood stars like Madonna, Scarlet Johansson, John Malkovich, and Michael Fassbender, who are just some of the celebrities who in recent years have bought property in the country.

Of all the sectors of the economy, the one that interests Americans the most is real estate. At the institutional level, US real estate investment was EUR1.15 billion in 2022, representing 33.7% of the total invested in Portugal in the commercial real estate sector, said Patrícia Barão, Director of JLL’s residential division in Portugal, during a conference held in mid-2023 organized by the American Chamber of Commerce in Portugal (Amcham). Among the largest transactions was the Crow portfolio, which includes 23 properties and was closed at the end of 2022 for a total of EUR850 million.

This is one of the most important transactions in recent years in the Portuguese real estate sector. Known as the Crow project, it involves the purchase of ECS Capital’s portfolio of projects by Davidson Kempner Partners. This is a transaction that also interested potential buyers such as Bain Capital. The properties included are NAU branded hotels, such as the Palácio do Governador in Lisbon, as well as others in the Algarve and Alentejo. Also included in this operation are La Vie shopping centers, located in the cities of Funchal, Guarda, Porto, or Caldas da Rainha.

The other major institutional investments in the real estate sector were made by Blackstone, which closed the purchase of two portfolios for EUR330 million, including a pipeline of 35 logistics assets. These facilities, totaling 530,000sqm and located in the metropolitan areas of Lisbon and Porto, are leased to distribution and retail companies. In total, Blackstone has a portfolio of 1,080,000sqm in the country.

As for the residential real estate sector, Barão indicated there were 170,000 transactions in 2022, of which 6% corresponded to foreign investors and Americans accounted for 15% of this international share.

According to the JLL expert’s calculations, there were 10,200 real estate transactions by foreigners in 2022, 15% of which corresponded to some 1,530 US investors.

Portugal’s residential real estate market has been at the forefront of the US market in recent years due to its low prices, security, and climate; however, another important factor has been the Golden Visa program, also known as residence permit for investment, which has been used by citizens from non-EU countries to obtain residence in Portugal in exchange for making an investment. This program, which started in 2012 and was suspended for new applications in February 2023, allowed residence in Portugal in exchange for an investment of

EUR500,000 in a real estate asset, or EUR350,000 in a property located in a qualified urban regeneration area.

With this program suspended, Portugal faces a new scenario for attracting foreign real estate investment, since this legal mechanism was very appealing for individuals who were not citizens of an EU member country. However, the country has a new program called Mais Habitação that provides residence permits through investments that support the conservation of buildings of historical and cultural importance. This is a new possibility to access a residential permit.

In addition, despite the end of the Golden Visa, the country has important attractions such as its climate and a high standard of living as incentives to attract residential real estate investments from the US. Another factor to take into account is remote working, a way of being employed that allows Americans to look for places in the world where it is convenient to work and that do not have a significant time difference with an office in New York, for example.

Cheap prices, climate, high speed internet connections, and a desirable tax system, such as the non-habitual resident (RNH, in Portuguese), for which the worker pays a maximum income tax rate of 20%, are attractive factors for Portugal to attract workers from all over the world through the digital nomad visa.

Meanwhile, other real estate sectors such as leisure, commercial or industrial show a good moment to invest. As for commercial leisure real estate, the timing could not be more optimal. In 2022, Portugal received approximately 28 million visitors and there were about EUR20 billion in tourist revenue, or 15% more than in 2019, the year before the restrictions to try to curb the spread of the COVID-19 pandemic.

As for the industrial real estate sector, Portugal is positioned as one of the most attractive countries for FDI in Europe. According to the Europe Attractiveness Survey 2023, prepared by the consulting firm EY, Portugal was the sixth European country by number of FDI projects attracted in 2022, with 248. These 248 FDI projects represented 24% more than in 2021, representing the highest YoY growth in number of projects in the entire continent, second only to Romania.

“The strong performance of countries such as Italy (17% vs 2021), Poland (+23%), Portugal (24%), Romania (+86%) and Turkey (+22%) illustrates their comparative advantage as low-cost countries, which makes them compelling destinations in the race for large manufacturing and back-office investments,” the EY report says. The attractiveness of the country for manufacturing investments guarantees a good performance in the coming years for industrial assets, such as the logistics assets identified by Davidson Kempner Partners in 2022. Everything is on track for the real estate sector to remain an attractive part of the Portuguese economy for US investors. ✖

PROMOTING TIGHTER LINKS

António Martins da Costa PRESIDENT, AMERICAN

AmCham Portugal serves as a two-way street for promoting transAtlantic business links, with objectives that include networking, advocacy, and providing services to members.

What is the history and structure of AmCham?

AmCham was founded in 1951 by a group of American expatriates in Portugal, and its initial focus was to attract American investment and trade to Portugal. Over the years, it has become a twoway street, which also promotes Portuguese investment to the US. AmCham is a road for businesspeople and partners that want to do business on both sides of the Atlantic. We are also members of AmCham Europe, which consolidates the views of all the European American chambers of commerce. In terms of membership, our community includes both corporations as well as individual associates. AmCham’s board is composed of 25 members. Big boards and small structures allow the chamber to remain lean while attracting the key business figures in the country that can form and execute strategy. Of those 25 names on the board, according to our bylaws, the majority are American companies. In addition, AmCham is home to Portuguese companies from all sectors that are investing in the US. Finally, we also have institutional board members such as universities and the Luso-American Development Foundation (FLAD), a foundation created jointly by the Portuguese and US governments. One key partner of AmCham is the US Embassy, and AmCham liaises with the embassy’s departments for economy, trade, and commerce.

What are AmCham’s objectives, and what mechanisms are in place to promote trans-Atlantic business links?

The main objectives of AmCham are to promote networking, strengthen advocacy, and provide services to its members. To facilitate partnerships, we host two key annual events. One of them is AmCham Tributes, where companies that have made a difference in the relationship between Portugal and the US are recognized. The second is the Trans-Atlantic Business Summit, a space that brings together Portuguese and American thinkers to discuss the bilateral relationship. Advocacy is focused on defending, through dialogue, the policies supported by our businesses research. Finally, the third component is a service to members. To our associates, we disseminate information around macro-

economic prospects concerning Portugal, the US, and the EU. AmCham’s business missions are that extra step that serves to execute the findings of research. We have agents and special committees focused on research key areas of relevance such as technology, innovation, data science, cybersecurity, healthcare, R&D, education, tourism, sustainability, and the energy transition. By coordinating business tours for members, AmCham acts as the bridge between theory and execution.

Which areas of the economy pose opportunities for Portuguese and American companies going forward?

Having a shared understanding of needs helps Portuguese and American businesses collaborate and form partnerships. Two areas that offer attractive business opportunities are energy transition and digital transformation. There are also opportunities for businesses that address logistical challenges such as supply chain disruptions, inflation, and the scarcity of raw materials. These wider macroeconomic trends can benefit rapprochement between the US and Europe. One example is nearshoring. American companies are looking to locate important strategic assets in friendly markets such as Europe, which can be interesting for Portugal. The war on Ukraine is putting pressure on the reshuffling of logistics chains, and Portugal is a good candidate because of its geographical location, competitive costs, and maritime experience. For example, Portugal and Spain are the two countries that can best receive the liquid natural gas (LNG) that is so needed in the center of Europe.

Why is Portugal an excellent place for American companies to locate investment?

The US is currently the fourth-largest market for Portuguese exports. In 3Q2022, Portugal exported USD6.5 billion worth of goods to the US and imported USD3.5 billion. This makes the US Portugal’s fourth-largest partner and is the reason why this relationship is crucial, especially given that our trade balance is positive. American investment in Portugal performs steadily between EUR1.5-2 billion.

CHAMBER OF COMMERCE (AMCHAM PORTUGAL)

REAL ESTATE AND US INVESTMENT LEADING TOPICS OF DISCUSSION AT THE BUSINESS YEAR´S FIRST EVENT IN PORTUGAL

The Business Year gathered figures from across the local business community at its latest event, Unlocking Portugal: Investment Insights & Opportunities.

❱UNLOCKING PORTUGAL: Investment Insights & Opportunities, gathered senior executives from across the Portuguese business community last April presenting Six-high level speakers from business associations and leading companies who spoke to a C-level audience about their perspectives on the short- and long-term opportunities and challenges facing Portugal.

The event, which was opened by TBY Portugal Director Cristina Villegas, came shortly before the release of The Business Year: Portugal 2023, TBY’s latest publication dedicated to the country, the most significant chapter of which was that dedicated to the country’s booming real estate sector.

To produce the publication, the team spent four months researching and conducting more than 130 interviews with senior executives from various sectors of the Portuguese economy.

Attractive tax incentives, highly skilled workforce, and social and political stability are some of the advantages highlighted by American Chamber of Commerce President António Martins da Costa, who opened the event with an overview of the Portuguese economy. Martins da Costa also referred to the resilience shown by the national economy to respond to some of the recent macro challenges, such as COVID-19 and the subsequent inflationary and interest rate pressure.

Worth EUR30.7 billion in 2022, residential real estate remained the leader in wider real estate investment last year, according to Hugo Santos Ferreira, President at the Portuguese Association of Real Estate Developers and Investors (APPII). In a speech that followed Martins da Costa’s, Santos Ferreira spoke of the importance of the real estate sector as one of the main sources of FDI, describing it as a segment that is attracting particular attention from US investors despite the end of the Golden Visa program.

The end of the Golden Visa was the first topic addressed in a roundtable discussion featuring four speakers: Gonçalo Santos, Head of Capital Markets at JLL; Daniel Tareco, Board Member at Habitat Invest; Miguel Pernes, Managing Director Portugal at Hitachi Energy; and Bernardo Maciel, Partner at Yunit Consulting. During the discussion, panelists commented that the existence of other investment tax regimes will help mitigate the end of the Golden Visa program.

The event was produced in collaboration with the American Chamber of Commerce in Portugal (AmCham Portugal) , The Portuguese Chamber of Commerce and Industry (CCIP), the Portuguese Association of Real Estate Developers and Investors (APPII), and the Spanish Chamber of Commerce in Portugal (CCILE). ✖

HERE FOR YOU

Gonçalo de Aguiar Santos HEAD OF CAPITAL MARKETS, JLL PORTUGAL

JLL is an international real estate consulting company, specialized in the provision of real estate services in Portugal.

As the Head of Capital Markets at JLL Portugal, could you shed some light on the current state of Portugal’s real estate markets?

In 1Q2023, the real estate market in Portugal performed at two paces. On the one hand, in investment, housing, and offices, transaction levels have slowed. On the other hand, in logistics, food retail, and hotels, activity exceeded the standards of the last two years. Portugal’s commercial real estate investment volume, in the first quarter of the current year, was EUR240 million, in line with the same period of 2022, but 63% below the average of the first quarters of the last five years. Activity was highlighted by a EUR150 million purchase of a portfolio of 40 supermarkets across the country by LCN Partners. Therefore, retail generated 63% of the amount invested, offices 16%, and logistics another 16%. Foreign capital accounts for 85% of the invested volume.

JLL has a significant role in facilitating and influencing investment flows in the property market. What are the key strategies employed by JLL Portugal in attracting and managing capital investments in the real estate sector?

The main strategy we have adopted is to showcase and/or reinforce the key attractiveness factors of Portugal as an investment destination, even in such a volatile macro environment. Portugal has a shortage of supply in investment products across all sectors, which, given the still very strong demand, creates an added resilience to asset liquidity and value. Of course, each sector has its own dynamics regarding demand and we, as a company, are always connected to our client’s strategies and to market trends to identify new business areas and continue to deliver excellence.

Could you elaborate on the trends emerging in the real estate capital markets in Portugal, and how is JLL leveraging these trends to provide value to its clients?

Capital market trends point to new business areas and JLL in Portugal is prepared to support its clients in new ventures. A new business area, natural capital, is focused on assets that support agricultural and forestry activities. This area of the real estate con-

sultancy provides investment advisory services, valuations, and strategic consulting, also benefiting from the 360o approach. Elsewhere data centers provide a vital role in the real estate industry by providing reliable, secure, and efficient technological infrastructure. Our data center services drives results with a comprehensive suite of solutions for data center operators and users. We help our clients create and execute data center market strategy, complete projects on time and on budget, operate data centers with 100% uptime, and institute sustainability programs that drive efficiency and profitability, optimizing spend and total cost of ownership. And finally, our capital solutions/debt advisory and equity area aggregates capital sources to real estate transactions by leveraging relationships with funds, owners, operators, and others. Debt and equity placement teams use their relationships with capital markets to obtain financing for or after a purchase. We provide clients with the most competitive terms and the most reliable debt executions.

In what ways does JLL’s approach to capital markets in Portugal differ from other markets, and how are these differences tailored to suit the unique characteristics of the Portuguese market?

We are a relatively small market on the global investment landscape, but we have intrinsic and unique characteristics that position our country as an appealing investment case that delivers quality assets, adequate returns, and growth potential. We, as a capital markets advisor, need to be very connected to local dynamics, identifying opportunities to generate value for our clients, even on periods of activity slowdown such as the one we are facing.

Looking forward, what are your predictions for the future of Portugal’s real estate capital markets, and how is JLL positioning itself to ride these potential market shifts?

We look into the future with optimism as we believe that real estate will continue to play a major role in shaping the cities and communities toward a brighter tomorrow. ✖

Image: DaLiu

INNOVATIVE PRODUCTS

Where does Habitat Invest fit within the Portuguese real estate ecosystem?

Habitat Invest is a real estate invest firm founded in 2001 present across the full spectrum of the residential sector. We invest in the full scope of the residential segment from mid-market to premium/luxury, developing also touristic apartments. Currently, we have 17 projects ongoing, corresponding almost to 2,000 residential units and more than EUR600 million of investment. Our aim is to offer the best housing solution for each segment where we try to be present.

What do you consider to be the current trends emerging within the RC sector?

One of the major trends for 2023, and an inevitable one, is the implementation of environmental, social, and governance (ESG) compliant investments. The sustainability and decarbonization of the real estate sector are a priority, as the sector overall represents about 40% of carbon emissions, more than the transport sector. Another major topic for the residential sector is the built to rent sector, thus far extremely scarce in the Portuguese market, either private or public-private. This occurs as there is a major housing problem in Portugal, with a small rental market supply, leading to unaffordable prices for Portuguese families. Finally, industrialization and/or modular construction will also be a hot topic. Construction companies face extreme labor shortages, deeply impacting projects delivery times and costs. One way to minimize this impact is by reducing the onsite required workers and construction and assembly time.

How was the year 2022 for Habitat?

Despite the challenging year we faced, due mainly by the war

in Ukraine accelerating inflation growth to levels not seen in the last 30 years and consequent rising interest rates, our economic activity was extremely positive. In 2022, we managed to deliver almost 200 residential units in concluded projects, we launched four new projects for sales and achieved extremely positive outcomes for all of them, with over 30% pre-sales, and we acquired four new projects representing almost EUR200 million in investment. All of this in a year of great uncertainty and exponentially growing construction costs was a mark for us.

What will be Habitat’s focus in the coming years?

We aim to further expand our recognition in the market as a major player providing housing solutions for our clients in all segments and in all major locations including greater Lisbon, greater Oporto, and Algarve.

What is Habitat’s competitive advantage in a market characterized by increasing competitions?

Along the years, we have been building long-standing relationships with all our stakeholders, including municipalities, architects, contractors, agents, and more, based on trust, integrity, communication, and delivery capabilities. This helped us to get where we are, and we will continue to work every day to continue to inspire the trust and confidence of our clients.

What are Habitat’s consolidation and expansion plans in the market?

We want to continue to provide the best and most innovative products to our clients at the most competitive price. As such, we will keep investing in the development of our internal capabilities and further work with our partners to continue to grow and be better. ✖

Daniel Tareco BOARD MEMBER, HABITAT INVEST

A real estate investment firm that focuses on the full spectrum of the residential sector, Habitat Invest aims to provide the best housing solutions for each segment.

WHITE-GLOVE SERVICE

The

What is The Agency’s specialty, how do you assist buyers interested in Portuguese real estate?

The Agency is a real estate company run by experienced agents who prioritize the client’s needs. We offer white-glove services throughout the entire real estate investment process. Our personalized advice on real estate investment includes educating clients on Portugal’s legal and financial processes as well as sharing our knowledge on available properties. We take the time to interview our buyers to fully understand their needs and expectations, whether they are investing, buying for personal use, or for a family member. From the initial interview to the final purchase and beyond, we guide our clients through the entire process. If additional services are required, we can refer our clients to qualified professionals such as interior decorators or contractors. We provide all the advice and assistance that buyers will need in Portugal.

What are the needs and priorities of The Agency’s target market?

We focus on properties that are excellent options for expats and provide a holistic approach to the sales process. Our primary focus is on the luxury real estate segment, which typically attracts international buyers from various countries. To meet the needs of our diverse clientele, we have a multicultural team that can provide tailor-made assistance in their native language and understand their cultural backgrounds. Clients want to relocate homes with an adviser that understands their lifestyle and business practices.

What makes Portugal an interesting jurisdiction for real estate investment?

Portugal offers a wide array of factors that make it an attractive destination. Its amazing weather and geography make it a desirable location. Furthermore, Portugal ranks seventh in the world for English proficiency, making it the ideal destination for expats.

The country also boasts excellent infrastructure, schools, and healthcare systems. Foreign buyers are also drawn to Portugal for its security and safety. Finally, Portugal competes with other popular destinations such as Spain, Italy, France, and Greece in the global market for “snowbirds,” namely people who migrate from north to south for the winter season.

What aspects of the regulatory framework support the investment rationale?

One advantage of investing in Portugal is the five-year warranty offered on purchases, which is appealing to foreign investors purchasing refurbished assets. This warranty provides assurance and peace of mind to foreign buyers. In parallel, Portugal has high construction standards, especially for new developments that comply with European regulations, making it safe to invest in large assets. The financial process is also safe and transparent, and The Agency’s local connections allow us to identify the best assets for our clients.

What has been the market response to The Agency?

We had high expectations, though we surpassed them by a significant margin. We have more agents, listings, and sales than we initially projected. In a highly competitive real estate market, The Agency stands out because we are proactive and do not wait for client to approach us. We expand and network to reach clients no matter where they are. Our clients expect exceptional service, and we deliver by establishing a triangular relationship between the client, consultants, and marketing teams. As experts, we provide clients with valuable advice on real estate, healthcare, education, safety, and legal aspects, which are all essential when considering a move to a foreign country. The Agency prioritizes building relationships with its clients, which is the foundation of our business. ✖

Ayres Neto MANAGING PARTNER, THE AGENCY

Agency is dedicated to helping home buyers and sellers navigate the complex Portuguese market expertly and efficiently while prioritizing client satisfaction and relationships above all else.

INVESTING IN CUSTOMERS

David Poston CEO, PORTUGAL

Portugal Homes stands out in the local real estate market by offering a complete service, including aftersales and leisure concierge services.

What makes Portugal Homes’ services stand out among real estate players in Portugal?

Our distinguishing feature in the market is that we offer a complete service. This is crucial for foreign investors who are driving the real estate market within Lisbon and make up 90% of all our clients. The needs and requirements of these buyers are different, and we noticed a market gap. We are focused on offering complementary services, and one of our strengths lies in our aftersales department, an important sector that provides fiscal representation, property management, property inspection, along with leisure concierge services that go above and beyond for the client’s assurance and comfort, while we take care of their properties overseas. It is about making sure everything is taken care of throughout the purchasing process and successfully doing so while they are away. For example, many Asian clients like to have their trips arranged for them, and our leisure concierge services are the perfect solution. Another example has to do with American clients, who are used to having property inspections before the property is handed over, which does not exist in Portugal for 98% of transactions. Our aftersales department covers all these areas, which is why we call it aftersales. We are not interested in doing rentals or making money from that aspect. We are trying to look after the clients and their entire experience when investing in Portugal. Cultural sensitivity is a huge differentiating factor for Portugal Homes. Understanding the difference between clients, how they invest, and what they expect from their investment is important for us. We have been in the market for 17 years, so the property side is easy for us.

What has been Portugal Homes’ experience in real estate construction?

We recently started investing in the project development and

construction industry, this way we can please two investors in the same transaction if we can find a building at less than market value, renovate it, and still offer it at less than market value. The main role of this company and our experience and knowledge is an investment. We show clients how to make returns. We decided to start our own construction company to better facilitate our investors and ensure our clients were getting the right deal and in the right areas. In just three years, we have developed seven projects in the historical center of Lisbon and three across the Algarve, two of which were hotel resorts of more than 200 rooms. We are currently working on two more large projects in central Lisbon and Porto to release in early 2023. Offering a complete service to our clients, from construction to aftersales, allows us to benefit from a lot of repeat business as well as referrals, which currently make up 30% of all our deals. This gives us confidence to keep improving our clients’ experience and evolving as much as possible within the market.

What currently are the main business development objectives for Portugal Homes?

The goal is to move Portugal Homes further into the real estate realm, as at this time 80-85% of our clients are purely investment related; they are here to make money. We want the Portugal Homes brand to become a pure real estate company over the next three to seven years whilst allowing our investors to still make returns through our projects and investments with HP Invest. The idea is to appeal to everyone looking for a second home that they can enjoy and also live in. There are also people looking for retirement and many non-habitual resident (NHR) clients here, and being sensitive to cultural differences will allow us to match the right real estate property with the right cultural profile and the right buyer. ✖

HOMES

OLD GOLD

The golden visa program has ended, but the dream is not over. Portugal’s climate, its EU membership, and its legal certainty are fundamental reasons to keep investing in the country.

PORTUGAL’S GOLDEN VISA scheme has come to an end. February 16, 2023 was the last day to submit applications to be processed for the golden visa investment program. In March, the council of ministers approved an initial version of the Mais Habitação program that put an end to an initiative that, since its inception in 2012, has served to attract foreign investors to Portugal. However, while the entry into force of Mais Habitação puts an end to new Golden Visa applications, it does not affect the renewal of visas already granted.

The golden visa scheme, also known as Residence Permit for Investment (ARI), has been used to allow foreign nationals of high net worth to obtain residency in Portugal in exchange for making an investment. This has been a very attractive scheme for non-European Union (EU) citizens to obtain a type of visa entitling them to reside and move freely throughout the Schengen area. Some of the most interested in this type of visa have been Russian, Chinese, and Brazilian citizens.

The Golden Visa provided a series of highly attractive benefits in exchange for making investments in real estate, business, or supporting the arts in the country, among other possibilities. For example, in the case of real estate it was necessary to invest up to EUR500,000 in a property or EUR350,000 in a property located in an area qualified as urban regeneration.

Another possibility included transferring EUR1 million to a Portuguese bank or investing EUR1 million in a company. It was also possible to obtain this visa by investing EUR500,000 in a fund focused on venture capital, or simply creating a company that would create 10 jobs for Portuguese nationals.

Between October 2012 and February 2023, some 11,758 Golden Visas were issued to foreigners. The majority of these visas, 45%, were obtained by Chinese citizens and 10% by Africans. An estimated 300 Russians also received these visas. Other participants include people from the US and Turkey.

Another attractive aspect of the visa was that, after five years under the program and spending only 14 days in Portugal, the beneficiary could apply for Portuguese nationality. This was of concern to the EU, however, since several Russian millionaires were able to obtain citizenship of a member country through these legal mechanisms. This became increasingly problematic when some of these

individuals appeared on sanctions lists in the wake of Russia’s war of aggression in Ukraine. The result was the freezing of assets worth EUR25 million in Portugal, as announced by European Commissioner for Justice Didier Reynders.

In an interview with local newspaper Diario de Noticias, Reynders said Europe was discussing with the Portuguese government the possibility of ending these nationality and Golden Visa programs in 2023. The problem lies precisely in the difficulty of proving the legality of these funds that have been entering the country.

In any case, it is estimated that the Golden Visa, together with other residency programs in Portugal, has attracted EUR6.85 billion worth of investment to the country. The big uncertainty facing the sectors that have benefited most from this visa is how to maintain the attractiveness of investing abroad in Portugal without the juicy tax and residency benefits of the visa.

The reality is that there are still a number of fundamentals in the Portuguese economy that sustain investment. In 2022, even though the purchase of real estate in Lisbon no longer granted access to the Golden Visa, foreigners invested EUR894 million, according to data from consulting firm Confidencial Inmobiliário, only EUR63 million lower than the 2021 figure. In total, 1,655 homes were sold to foreigners of 78 nationalities in the capital in 2022.

As we have seen, the Golden Visa was of great importance for the real estate sector, but this industry has other key factors that allow the country to remain a magnet for a high level of foreign investment. Portugal is a politically stable and legally secure country and is a growing tourist destination focused on well-off tourists. Portugal’s sun, sea, and sand offering is a favorite for Europeans, who flock to the country every year to experience its cultural richness, play on its golf courses, or receive healthcare in its hospitals.

Additionally, Portugal is an EU country, giving investors access to a market of some 500 million people across the continent. And although the Golden Visa has ended, there are other programs such as the non-habitual residency program (NHR) to help to fill the void. Among other advantages, the NHR program offers a flat 20% income tax rate, while local citizens pay a maximum of 48%. The Golden Visa was undoubtedly a great opportunity for investors in the real estate market, but there are reasons for non-EU citizens to continue investing in Portugal. The dream is not over. ✖

ABOVE THE REST

Paulo Lopes GENERAL MANAGER, CASAIBERIA

What attributes set Casaiberia apart as a real estate company?

Casaiberia was founded in 2007, and from the beginning we made it a priority to invest in technology to consistently improve the level of service we offer our clients and better plan for future ventures. We carry out a regular analysis of the market, maintain strong community connections, and continually look to strengthen the strategies we use in both our traditional and digital marketing. As a company, we operate with integrity and adhere strictly to ethical principles and prioritize client satisfaction. This combination of factors has helped to distinguish us from other real estate firms operating within the same market. Casaiberia started off with just a small, one-story office and channeled all our resources into growing as a company. This has translated in more recent years to an increased focus on strengthening our online presence. Thanks to these decisions, 35% of our leads come from our website, with much of the traffic we receive being organic traffic. We also have a strong, multilingual in-house and freelance team, which is incredibly important in this increasingly international industry. These factors, alongside our ability to adapt to an ever-changing industry, have helped us maintain a strong position in the real estate market in Portugal.

What allows Casaiberia to provide high-quality services to foreign investors interested in Portugal?

As a company, we have a wide range of skills and experience. We have individuals in our team with backgrounds in project management, investment consulting, engineering and architecture. We have also placed time and effort into assembling a strong administrative and commercial team, with a huge amount of combined experience in real estate. Whilst Casaiberia is a small company, we have agents and staff from a variety of different

countries. When working with international clients, we understand the importance of exercising extra due diligence, and taking the time to understand their unique needs and requirements. This extra care enables us to achieve the best outcome for our customers in terms of both the properties we show them, and the service we provide. My family and I moved from Germany to Portugal in 2004, giving me firsthand experience of relocating to Portugal with a family. This has also given me a certain level of understanding of the situations those who move here from abroad go through. I can also rest in the knowledge that the effort is worth it for those who wish to embark on the worthwhile adventure of moving to Portugal.

Does Casaiberia focus mostly on B2C or are you also exploring B2B opportunities?

Whilst our primary focus as a company is the residential property market, we have begun to explore a range of business opportunities in the B2B sector both in the Algarve and in Lisbon. We have a dedicated section of Casaiberia that covers investments, and my background as a project manager has helped me a significant amount in the work I do today with investors and developers. Our aim in the investment sector of the company is to help to ease the entire investment process for clients: we source opportunities, oversee the project development and deliver the finished product in the final step. This work can take different forms. Our approach is personal and direct, which is something that is so important in this trade. We focus on establishing trust and offering a quality service. I am also an active lecturer at the European Academy of Real Estate and have a solid relationship with chambers abroad such as the German Association of Real Estate, as well as participating in forums within the international business community. ✖

Casaiberia distinguishes itself as a premier real estate company through its investment in technology, regular market analysis, community connections, client satisfaction, and its multilingual team.

TBY ANALYTICS: PORTUGAL 2023 REAL ESTATE & CONSTRUCTION

We posed a number of questions to our interviewees in the real estate and construction sector. These are their top responses.

What area of real estate and construction shows the biggest promise for growth?

What is the main thrust of your plans over 2022?

BEST OPPORTUNITIES

José Covas GENERAL MANAGER, AURA REAL ESTATE EXPERTS (AURA REE)

Aura REE provides advisory for international funds acquiring NPL portfolios mainly in three major groups of assets: hospitality, logistics, and healthcare homes.

Can you provide an overview of Aura REE’s expertise and international reach?

Aura REE is an advisory company focused on evaluation, advisory strategy, and consultancy established in Spain 12 years ago. It focused on the distressed market and provided advisory for international funds acquiring NPL portfolios. We later replicated this model in Portugal, Greece, and Italy, traditionally countries with more debt and stressed assets, though there are slight variations in the business depending on the country. For example, we created a capital market boutique focused on real estate transactions in Portugal. Here, we mainly focus on three major groups of assets: hospitality, logistics, and healthcare homes. The latter focuses on hospitals, clinics, and all buildings related to health. The hospitality sector is booming right now, including hotels, student housing, and restaurants.

Given the changing market conditions, what has been the focus?

The approach to these stressed assets is different from before. Portugal is doing a fantastic job on these stressed assets; I expect 2023 to be similar to 2022. We expect a small number of stressed assets or portfolios to enter the market. We are now working on advisory and adjusting our strategy and business model accordingly. The second change is the opening of capital markets for the transaction part. We are leveraging our knowledge and experts to help our clients find opportunities to acquire assets for defaults. This is an entirely new mission and vision for us. Our clients come to us to help them invest without dealing with brokers, third parties, or agents. We study the market, determine the best opportunities for our clients’ needs, and bring the best value.

Who are key potential clients for the future?

Portugal has attracted many international investors in the last five to six years. Some 15-20 years ago, the market was highly lo-

cal; however, this is not the case now. Portugal is a safe country, with an attractive tax and legislation system compared to other countries. As a result, many pension funds, institutional investors, major developers, and large companies that want to spread out their investments are looking at Portugal. Pension funds are now investing EUR5-10 million in assets, even in new sectors such as healthcare, education, and hospitality.

What is the priority when dealing with clients?

There are several important points for clients. Investors always want more information about the future and what might happen. We provide forecast modeling, with two or three scenarios outlining the possibilities of a particular investment. The second is ethics, transparency, and a strong track record. The third point—which is why some investors come to us and not our competitors—is that clients want to feel special. I have worked in large international firms where it is sometimes difficult for some clients to feel their needs are being prioritized. A large company can feel like a machine with hundreds of employees. This is why we significantly focus on offering tailor-made services for our clients. If a company can comply with all these requirements, clients will continue to come back to them.

How do you evaluate the market conditions for real estate investment in Portugal?

There is an imbalance between demand and supply, which creates an opportunity for those who want to develop that part of the market to create new projects. Environmental, social, and corporate governance (ESG) has significantly impacted the office market, and many buildings will require upgrading or refurbishment to fulfill ESG requirements. I see an excellent opportunity for advisory, transaction, construction, renovations, and project management. ✖

WHY COMPANIES CONSIDER COWORKING AS THE OFFICE OF THE FUTURE

THE CONCEPT OF COWORKING has gained significant popularity as a viable workspace solution for both freelancers and businesses. Traditionally associated with digital nomads and start-ups, coworking spaces have now become a preferred choice for companies seeking flexible and collaborative environments. This trend is evident at Avila Spaces, that at the beginning was often wanted by nomadic workers, and has now witnessed a significant increase in the number of companies opting for our flexible and supportive work environment. In this article, we explore the reasons behind this transformation and why coworking is a compelling option for companies.

FLEXIBILITY AND TAILORED PLANS

One of the primary reasons companies are drawn to work with us is flexibility. Unlike traditional office leases, we provide customizable plans that can be tailored to meet the unique needs of each business. Avila Spaces offers flexible monthly plans, allowing companies to scale their workspace according to their evolving requirements. This flexibility eliminates the burden of long-term commitments and offers a cost-effective solution for businesses.

PROMOTING NETWORKING AND COLLABORATION

Another key advantage of working with us is the opportunity for networking and collaboration. Avila Spaces has cultivated a vibrant and dynamic community that fosters interac-

tion among its members. By bringing together professionals from diverse industries, we have created an environment that encourages the exchange of ideas, collaborations, and business partnerships. This networking potential can be particularly beneficial for companies looking to expand their contacts, explore new opportunities, or find potential clients.

POSITIVE WORK ENVIRONMENT

The work environment plays a crucial role in employee productivity and satisfaction. Avila Spaces prioritize creating a positive and inspiring atmosphere. With modern and well-designed interiors, comfortable workstations, and various amenities, we offer a conducive environment for focused work. Additionally, the presence of like-minded individuals and a sense of community can enhance motivation and overall job satisfaction, ultimately contributing to increased productivity among employees.

EXPANSION AND GEOGRAPHIC DECENTRALIZATION

Avila Spaces, with its successful track record of 20 years and two coworking locations, is now expanding its reach with the upcoming launch of a third space. This expansion demonstrates the growing demand for coworking options beyond the city center. By strategically establishing coworking spaces in different areas, we want to be an option for geographically decentralized companies. This approach provides more options for

businesses to choose a location that best suits their operational needs and enables them to tap into new talent pools in different regions.

The changing dynamics of the modern workforce have propelled coworking spaces into the mainstream as an attractive option for companies. Our business, through its flexible plans, networking opportunities, and commitment to providing a positive work environment, has witnessed a shift from primarily nomad workers to an increasing number of companies choosing our spaces to work. The ability to adapt to changing workspace requirements, foster collaboration, and offer geographically decentralized options has made us a valuable choice for businesses of all sizes. As the trend continues to grow, Avila Spaces are set to play a vital role in shaping the future of work, providing a flexible, collaborative, and supportive environment for companies to thrive.

Welcome to the office of the future!

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

“Unlike traditional office leases, we provide customizable plans that can be tailored to meet the unique needs of each business.”

An ability to adapt to changing workspace requirements, foster collaboration, and offer geographically decentralized options has made Avila a valuable choice for businesses of all sizes.

TRUSTWORTHY PARTNER

Jorge Ferreira Mendes MANAGING PARTNER, MENCOVAZ

Mencovaz is a valuable partner for real estate investors due to its technical expertise and experience in identifying outstanding investment opportunities, providing impactful consulting services.

What makes Mencovaz a valuable partner for real estate investors?

Mencovaz is an asset valuations company founded in 2007 that differentiates itself through its technical expertise and experience. The company’s founder has been working in the field since 1972. With 51 years of market knowledge, we have seen all the stages of the market and can share our experience with investors. A great opportunity concerns the asset, the right investment time, and the price. Mencovaz is an expert at identifying outstanding opportunities. Mencovaz specifies a property’s value and determines if it is a suitable opportunity for an investor, given the prevailing market conditions.

What is the scope of Mencovaz’s consulting services?

Mencovaz’s services go beyond valuation; the company also offers consulting, development of business or investment plans, construction surveillance and monitoring, energy performance certification—and a wide range of technical reporting on properties. We work with everything to do with the investment decision and all processes related to civil engineering. Our objective is to be the technical advisor for real estate investment. We have experience analyzing and working on all real estate assets.

What client profiles does the company cater to?

Repeat business is essential to Mencovaz. Banks are one of the core targets of business development for the company. When financial institutions hire our services once, they understand our work and become recurring clients. Mencovaz began business in 2007, and in 2014 we expanded our client base to include large scale investors, developers, pension funds, and family offices, among others.

Which types of real estate assets are thriving in the Portuguese market now?

Regarding the residential market, we can identify three main segments in Portugal at the moment. In Lisbon and Porto, there is high demand for residential properties from Portuguese nationals. Another segment, also with high demand, but lower value, is the search for housing in the rest of the country, in less populated regions. The third segment is the booming market for expensive luxury properties, and those are destined both for national and foreign investors. Similarly, the commercial investment market is buoyant and dominated by international buyers. Each market has its unique supply and demand dynamics and requires stand-alone analyses. Generally speaking, the number of real estate transactions is lower than a year ago. Because prices are increasing, many are holding onto their homes and not buying new ones, resulting in fewer properties in the market. In real estate, the economy works in cycles; as the years go by, we see those cycles becoming shorter and shorter. Depending on an investor’s time horizon, it could be the right time to invest and buy a property. Even though the real estate market prices are high, they are still lower than in other European countries. Investors seeking exposure to Portugal’s benefits can access unique opportunities.

How do you evaluate the price fundamentals of real estate in Lisbon?

The real estate market in Portugal was predominantly destined to national investment until 2015. Since then, the country has opened up, and tourism has boomed. Many investors started to look at Portugal, realizing the abundance of low-cost purchasing opportunities. The government also offered powerful investment attraction incentives. As a result, today, there are fewer opportunities in offerings. Demand outpaces supply, especially in bigger cities such as Lisbon and Porto. Assets in tertiary cities are less attractive because being in a prime location gives the asset greater liquidity. ✖

LOCATION, LOCATION, LOCATION

From the Algarve to Lisbon, from the North region to the Azores, here we detail the evolution of real estate transactions across the country.

BEST SOLUTIONS

José Dias SALES DIRECTOR, HYDRO BUILDING SYSTEMS PORTUGAL

Hydro Building Systems develops custom aluminum building systems for various projects globally and is a market leader in several countries.

Can you provide an overview of Hydro Building Systems?

Hydro Building Systems specializes in developing custom aluminum building systems for a wide range of projects, from special products to regular construction. The group is present in many countries with different brands highly recognized in each market, allowing to combine a global knowledge with a local specification. Our offer includes portfolio products as well as tailored developments to the specific needs of architects and real estate owners, with a focus on finding the best solutions. Our team includes experts in technical areas such as thermal and acoustic performances. By controlling the entire value chain, we also play an important role in reducing CO2 emissions in the industry and promoting the circular economy.

Hydro is present in over 40 countries and has over 31,000 employees. What makes Hydro a market leader, and how is this an asset for its clients?

One of the major advantages of having a presence in many countries is that it enables us to incorporate the various cultures and cater to diverse market needs. Our focus on sustainability and safety is consistent across all countries. We control all processes and have a presence in all stages of the supply chain, allowing us to better understand the needs of each market and deliver tailored solutions. We are able to create greater value in markets for any process or service with our knowledge of the needs and the ability to adapt to the best solution.

What are the unique needs of Portuguese builders, and how does Hydro cater to them?

We have grown significantly over the last decade, mainly because of our exposure to different customers from different markets. All this has been an opportunity for Hydro to innovate and improve. We have the expertise and solutions to address the specific needs of the Portuguese construction market, due to almost 50 years’ experience in the market. Working with two brands in Portugal, Technal and Sapa, we can meet the needs of different market

segments. We can work with different approaches and different products.

How do Hydro’s products contribute to a client’s sustainability agenda?

Hydro’s products play a crucial role in ensuring building efficiency and supporting a client’s sustainability agenda. Our solutions for windows can achieve the best performance values, which are essential to building efficiency. By partnering with Hydro brands, companies can help obtain sustainability certifications, as our products have been tested and certified to meet the most demanding environmental, thermal and acoustics standards.

What has been the reception to innovation in Portugal?

In Portugal, there is a growing trend of developers coming from all over the world with a greater capacity for investments. We are seeing investors who understand the need for different and innovative solutions, and they are helping to improve the quality of the market. In addition to new buildings, there is also a surge in building renovation projects. We have ambitious renovation roadmaps and mainly work with products that can be used for renovation. Commercially, we cover the entire country, from north to south, as well as the islands. From Portugal, we also sell in Mozambique, Angola, and Cabo Verde.

What are Hydro’s main business development objectives?

We want to lead the sustainability strategy and develop more sustainable products that are more efficient and resistant, ensuring the same quality in houses with fewer resources. Aluminum plays a major role in terms of the carbon footprint of buildings, and we aim to minimize this impact. Unfortunately, there is no clear governmental recommendations on sustainability, and we need a better understanding of these important issues. We are anticipating regulations and want to remain ahead of the curve. While we do not expect immediate profits from sustainability, we see it as a long-term investment whose importance can be conveyed to the market. ✖

LIVABLE ENVIRONMENTS

KONE is evolving to meet market requirements by focusing on sustainability and accessibility in its installation, modernization, and maintenance services for elevators and escalators and working with city planners to improve urban environments.

What trends are driving the urban mobility industry?

What was traditionally a product-related industry, has shifted toward a service and solutions industry. An elevator or an escalator was just a piece of the whole building system but today thanks to connectivity they can provide added value to customers. By integrating the equipment with other elements—driven by IoT and AI—the building becomes a complete ecosystem to provide customers’ enhanced efficiency, reliability, and comfort. Nowadays, 50% of the global population lives in urban areas, and by 2050 that number is expected to increase to two thirds. To make these urban environments manageable and livable, buildings must be smarter and environmentally friendly. They need to be connected and efficient. For example, a portion of the EU funds is related to the efficiency and sustainability of buildings. So, there is a significant investment there, both in new buildings and in refurbishment. To make city dwellers’ daily life better and more pleasant, KONE works directly with city planners to improve the flow of urban environments.

How is KONE’s business evolving in the face of market requirements?

KONE´s business consists of three segments: installation in new buildings, which are elevators, escalators, and automatic doors; modernizations, which involve installation in existing buildings and upgrading the elevator or escalator; and maintenance. The market trends of efficiency and sustainability are transversal in these three business lines. Buildings are designed to be more sustainable, while maintenance and refurbishment are intended for matters of efficiency. There is also still a significant portion of market need related to accessibility. Many of the buildings that exist in Portugal were built during a significant construction boom in the 1970s and 1980s and were not conceived at the time anticipating accessibility or future mobility needs of the tenants. Considering the longevity and aging of the population—and buildings—it is a great opportunity to ensure

a safe and comfortable movement for all. Sustainable and accessible buildings are the central element of urban regeneration, and they need to respond and adapt to our future needs, not only in terms of safe mobility but also eco-efficiency.

How does KONE work to make elevators and escalators more energy-efficient and better for the long-term energy consumption of buildings? Traditionally, and in terms of technology, KONE has been known for being the most innovative company in the industry. The groundbreaking developments in the industry for the last 30 years have been pioneered by KONE, and the same goes for sustainability. We were the first company to really pledge science-based targets in terms of greenhouse gas reduction. We pledged to reduce 50% of energy consumption and committed to being carbon neutral by 2030. This 50% also applies to energy consumption during the full lifecycle of equipment. We were the first to do this and have the highest ambition in terms of reducing the emissions of greenhouse gases. As an example, nowadays more than 70% of our offices in Portugal and Spain are supplied with green electricity. We are transitioning our fleet of 700 cars to hybrid or electric. A lot has also been done on the equipment itself: we have class A energy efficiency elevators. Just as an example of the significant environmental impact than an elevator can have, our current KONE elevators are up to 90% more energy-efficient than the ones installed in the 1990s, so only the elevator has the potential to significantly reduce our customers energy consumption and carbon footprint. As a result, when we refurbish a building, one of the main topics— aside from obviously improving the ride comfort and aesthetics—is eco-efficiency. Our objective is to be a leader in sustainability, not only in our own industry, but also beyond. We want to help our customers make cities better places to live, and we want to be their most trusted partner throughout their building life cycle. ✖

Filipe Nóbrega MANAGING DIRECTOR, KONE IBÉRICA

MONTARGIL MONTE NOVO: ABSOLUTE TRANQUILITY IN A STUNNING NATURAL SETTING

LOCATED IN THE MUNICIPALITY of Ponte de Sor in the village of Montargil in Alto Alentejo, Montargil Monte Novo is a true refuge and an oasis of tranquility and natural beauty.

Situated on the banks of the Montargil dam, Monte Novo offers a privileged location about 95km from Lisbon, about an hour and a half’s car drive. This proximity to the capital allows many of its visitors to easily escape the urban hustle and to submerge themselves in a serene and relaxing environment.

THE MYTHICAL ESTRADA NACIONAL 2

Monte Novo is even more special because it is located on the famous Estrada Nacional 2 (EN2). This legendary road, also known as the Portuguese Route 66, crosses the country from Trás-os-Montes to the Algarve.

The 738.5-km EN2 runs through 11 districts and 35 municipalities and crosses 11 mountains and 13 rivers, providing an incredible journey through Portugal’s interior. This iconic route stretches across rich and stunning landscapes, ranging from the vineyards of the Douro to the vast plains of Alentejo, culminating in the

beautiful beaches of southern Portugal.

EN2 is the longest road in Portugal and Europe and the third longest in the world, surpassed only by Route 66 in the US and Ruta 40 in Argentina. Traveling along this iconic road, travelers have the opportunity to explore a diverse landscape, meet captivating people, and immerse themselves in the richest cultures of Portugal.

The stop at Montargil Monte Novo, at Kilometer 460 of EN2, is almost mandatory—either to stay overnight, enjoy a few days rest, or simply have lunch.

THE PERFECT REFUGE TO DISCOVER THE ESSENCE OF ALENTEJO

At Montargil Monte Novo, guests are welcomed with an unforgettable experience. The restaurant, located in the main building, offers stunning panoramic views over the dam. Here, it is possible to taste the best of Alentejo gastronomy, with a distinctive touch from the talented resident executive chef Miguel Varela, who is also in charge of Montargil Monte Novo and reinvents traditional dishes, preserving the essence and authentic flavors of the region. The lunch and dinner menu is carefully crafted using fresh and seasonal

ingredients sourced from local producers. The surrounding nature of Monte Novo is present in every detail. Many of the vegetables, aromatic herbs, and fruit used in the kitchen are grown in the garden and orchard on the property, ensuring the highest quality and authenticity of

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

“The surrounding nature of the Monte Novo is present in every detail. Many of the vegetables, aromatic herbs, and fruits used in the kitchen are grown in the garden and orchard of the property, ensuring the quality and authenticity of the dishes served to the guests and customers.”

the dishes served to the guests and customers.

At this retreat in Alentejo, visitors have the opportunity to enjoy unforgettable moments, from relaxing while being lulled by the sound of birds, to enjoying the irresistible Alentejo gastronomy, or even participating in various sports and recreational activities, both on land and in the blue calm waters of the dam.

At night, the starry sky and the reflection of the moon on the reservoir create a truly magical atmosphere. Montargil Monte Novo is the perfect place for a stay with family or friends, a romantic retreat for two, a private event, or a memorable gastronomic experience.

Life in the countryside is revealed in each plant, each tree, the soft singing of the birds, and the serenity of the Alentejo horizon. At the Monte Novo estate, nature unveils itself before our eyes, making each visit a unique and extraordinary experience.

Come and enjoy the calm, harmony, beauty, and nature at its purest state in the Montargil Monte Novo, in Alentejo, Portugal. ✖