Portuguese economy continues to perform well in 2019, although at a slower pace compared with previous years. According to Oxford Economic, GDP growth is forecast to stand at 2.0% by year end, followed by 1.7% in 2020 and 1.3% in 2021.
Exports remain resilient, and according to Oxford Economics are expected to increase 3.2% in 2019, above the Eurozone growth average of 2.1%.
Until September 2019, Greater Lisbon office market registered a take-up volume of 148,000 sq.m, in a total of 130 new lease deals. This take-up volume is in line with the same period of 2018, with the average deal size being higher, namely 1,130 sq.m against the 900 sq.m registered last year.
Investment activity has also shown a good performance over the year, with the office sector leading the way. From January to September, 16 office deals were closed in a total of €574 million.
Demand for retail space has been very dynamic in recent years. From July to September over 200 deals were identified. High street retail remained dominant with more than 120 openings, 60% of total deals. Shopping centres accounted for a significant number of new deals due to renovation and expansion of the existing schemes, namely 19% of known operations.
Retail investment activity has shown a good performance over the year, with a total of €550 million transacted in retail assets.
Demand levels on the industrial market remain below the expectations of an increasing activity sustained by e-commerce and retail sector growth. Additionally, the lack of quality space in the main axis with good accessibility is restraining the occupational market.
Until the third quarter of 2019, 7 investment deals were closed in the industrial sector totaling €104 million, in line with the same period of last year. This quarter was the most dynamic one with the sale of two portfolios, namely the Imofundos portfolio purchased by M7 Real Estate for €30 million and the Imocomercial portfolio sold by Selecta to Invesco for €25 million.
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