CBRE Portugal Breaks Another Record – Results Grow 25% in 2016

CBRE today presented the 2016 business activity results, which increased 25% when compared to 2015, exceeding the company’s best year to date.

Francisco Horta e Costa, CBRE Portugal Managing Director
These results are fruit of the hard work of a highly qualified team that clearly understood our clients’ needs at a time when the market was very dynamic.
We are very pleased to have witnessed growth of over 100% in non-transactional areas, such as Asset Management and Building Consultancy, while remaining the market leader in valuations, as well as recording strong growth in transactions.
Francisco Horta e Costa, CBRE Portugal Managing Director

In 2016 Capital Markets and Development advised on the transaction of 34 assets with a total area of 260,000 sq m, worth over 550 million Euros, with included 8 office buildings, 3 hotels, 5 logistics properties, 17 buildings to be refurbished and 1 plot of land.

Highlights include the sale of Edifício Monumental in Saldanha (Lisbon) to Merlin Properties, and the placing of 25% of the Sierra Portugal Fund, on behalf of Sonae Sierra, with an American investor, and the sale of a logistics platform of one of the largest international sports retailer in Portugal via a Sale & Leaseback deal. The latter was the largest investment transaction in the logistics sector in Portugal in 2016.

CBRE advised a national investor on the Viking hotel and a hotel in Madeira. The company was also involved in the sale of Hotel Lawrence (Sintra) to a foreign private investor.

On the refurbishment front, CBRE sold a property investment fund comprising ten properties in Lisbon to a European pension fund, and one of the most emblematic buildings in Rua Garrett (Lisbon) to a Dutch family office. The company also completed deals for five buildings in the Baixa-Chiado area of Lisbon with a number of international investors.

Special reference must be made to the sale of the Lisbon headquarters of Diário de Notícias newspaper to an international property developer, towards the end of 2016.

At the beginning of 2017 the company is already working on a number of deals with a market value of almost 450 million Euros that should be completed within the next three months. CBRE has already been instructed to sell properties with a potential value of around 300 million Euros.

As regards Services to Occupiers, CBRE saw its business grow by 20%, and handled over 135,000 sq m. Office Agency was involved in deals totalling 20,000 sq m, the most important of which were Global Media (5,200 sq m) in Torres de Lisboa and Nowo (2,000 sq m) in Edifício Lisboa, in the Parque das Nações area of Lisbon. CBRE was also responsible for the lease of 2,000 sq m to Sanofi in Lagoas Park (Oeiras) and the lease of,500 sq m to Axa Assistance in Edifício Libersil in Avenida da Liberdade (Lisbon).

In 2016 the Retail business totalled around 40,0000 sq m distributed across Retail Parks (17,500 sq m), High Street Retail (16,000 sq m) and Shopping Centres (6,500 sq m). We point out the deals involving New Balance and Havaianas Flagship Stores in Porto and A Vida Portuguesa and Anselmo 1910 in Chiado (Lisbon).

In the Food & Beverage sector CBRE was responsible for the opening of McDonald’s and Pizzeria Zero Zero at Parque das Nações and Delidelux close to Avenida da Liberdade.

The Retail Department ensured that Parque Mondego was 100% occupied by through the marketing of 4 new stores, and initiated the letting of the second phase of Matosinhos Retail Park, where it placed Media Markt and Deborla.

Industrial and Logistics recorded strong growth with deals totalling 75,000 sq m from north to south. Special mention should be made to the leasing of a 11,500 sq m logistics platform, in Parque Autoeuropa, and the leasing of two warehouses with a total area of 12,000 sq m in Aveiro.

Residential Agency strengthened its team in 2016 and is now responsible developments in Lisbon, in particular Boavista 62, Áurea 72, Edifício Leonel, Ouro Grand, Park Avenue and Terraços da Guia.

In terms of Valuations CBRE valued some 200 million sq m, made up of 30,000 properties worth over 10,000 million Euros. The highlight was the valuation of the assets of Novo Banco for an international buyer.

Consultancy undertook over 20 strategic analysis and repositioning studies for shopping centres and offices, as well as best-use analysis for land development Commercial Due Dilligences to support property transactions. Clients include Millennium BCP, Rockspring and Finsolutia.

In 2016, Asset Management saw its business double and is now responsible for managing around a million square metres valued at over 800 million Euros. This growth was the outcome of new contracts in the logistics sector, for clients such as Logicor, Aberdeen and CBRE Global Investors, and in the retail sector, where it took over the management of 3 shopping centres: Alameda Shop & Spot, Nosso Shopping and Alma Shopping.

Last year was one of strong growth in Building Consultancy with an increase in turnover in excess of 100%.In the office sector special mention must be made to fit-out projects where CBRE was responsible for design and project management for Merck (1,300 sq m), SAS (800 sq m) and Sealed Air (800 sq m). CBRE was also the project manager for the renovation of the lobby at Colombo’s Torre Oriente (Lisbon), while work is underway at the Axa Assistance new 1,500 sq m office in Avenida da Liberdade.

In the retail segment CBRE took on the project management of the food court renewal at Forum Aveiro. CBRE is also handling both the design and the project management for the full refurbishment of Nosso Shopping in Vila Real.

In terms of Enterprise Facility Management, in 2016 CBRE managed the premises of companies such as IBM, BP, Cisco, BBVA, Microsoft and Motorola, employing a specialist team of 46 professionals that provides services to around 4,000 occupiers in 13 Buildings, 3 IT Centres and 15 Branches.

Neoturis, a CBRE Group company, witnessed a growth of 15%, working on a range of projects for clients and investors from Portugal, Belgium, Brazil, the USA, Kuwait and Qatar.

Mention should be made to the selection of hotel chains in Portugal for leasing, management or franchising purposes, market, best-use and economic feasibility studies for hotels and integrated tourist developments, as well as development and marketing strategies for visitor attractions and tourism regions.

Francisco Horta e Costa, CBRE Portugal Managing Director
In 2017 now that the banks have been recapitalised, have new shareholders and a significant level of recorded impairment losses, this will speed up the sale of assets and will have a positive impact on the market.This year we will continue to see strong demand for properties to rent and to refurbish, as interest rates are expected to remain at record low levels.
Investors are aware that they have to take greater risks in order to achieve higher returns. This, combined with the scarcity of quality office space, will lead to a recovery in property development and the sale of land for the construction of offices, as well as residential accommodation and logistic facilities.
In 2017 the demand for offices from nearshore companies will cause the office market to spread to other cities such as Porto and Braga. In terms of shoppings, two new centres are to open in the south of the country: Mar Shopping Algarve and Évora Shopping.
We can expect demand from hotel chains to continue and a recovery in the sale of medium to large scale tourist property ventures, mainly in Lisbon, Porto and the Algarve. The Douro and Alentejo regions are already under scrutiny by a number of international investors.
Francisco Horta e Costa, CBRE Portugal Managing Director

In 2016, in response to the upturn in business, CBRE hired a further 26 staff, with a current team of 130 professionals.