As project developers in Spain, we often work with investors to maximise the value of their project, ensure that budgets and timelines are hit and that all stakeholders are informed throughout. We will also work with developers from the very earliest stage to ensure their investment is viable and the plan is sound, through project feasibility studies. We will then work with them to manage the project and ensure all deadlines are met and the budget is used wisely to maximise investment returns. We believe that Spain is a great place to invest in property, or purchase land to build on, and we’re definitely not alone.

Why invest in property in Spain?

Spain is attractive for investors in general because of its open and dynamic economy, excellent infrastructure and transport networks, and strong market demand and growth available for innovative companies and projects. Last, but no means least, people flock to the area for the incredible quality of life and investors, expats and tourists just can’t stay away.

Spain leads the world when it comes to tourism, ranking 1st out of 140 countries in the World Economic Forum’s rankings for the most competitive countries in the tourism industry. 83 million tourists visit each year, making it the second most visited country after France. This makes property investments attractive as they can generate excellent rental yields during the peak summer months and the long-term rental market is also very strong, particularly in the favourite expat destinations like the Costa del Sol.

What kind of property to invest in?

There are many options depending on your investment level and interests. You could choose to build an apartment block, a complex of tourist apartments, or look at the higher end and opt for a luxury villa resort for example. Estate agents are reporting a massive demand from the high end of the market, with increased interest from HNW and UHNW individuals for stunning properties in Marbella. There’s a shortage of stock, which is pushing prices up, so building luxury villas in prime areas could be an excellent investment as long as the development process is managed by experts who protect your interest.

However, property investments in Spain are not simply for big corporations. On a smaller level, we’re increasingly seeing high-net-worth individuals and wealthy business owners approaching retirement, invest in property in Spain. They are purchasing luxury properties over €500,000, or investing in a plot of land to build their own luxury property. Investments of half a million or more allow investors to take advantage of Spain’s Golden Visa and enjoy the highly flexible and attractive residency regulations. After Brexit, this is the route that more British buyers are choosing to take and we’re seeing more and more clients approach us for our luxury villa development services to make sure their project keeps on track and within budget.

Many of these buyers look to earn rental income from these properties with a view to retiring to Spain later on. Others have seized the opportunities for remote working that have exploded due to the pandemic, and are moving their families over to Spain to enjoy the exceptional weather and lifestyle.

How Marbella compares to the rest?

Andalucía is one of the most visited areas in Spain, and Marbella has an unrivalled brand on a global scale. Made famous as a hideaway for the jet set in the 1960s, 70s and 80s, this luxury brand has stayed strong, making it highly attractive to investors who want the prestige that comes with the name.

The star of Marbella has continued to rise and it was just voted the Most Exclusive Destination at the European Best Destination awards 2022. It also came second in the overall ranking, which is leading to some fantastic promotion for the area. The prize for coming second is worth over €2 Million in international advertising. The destination gets another €2.5 Million worth of PR for snagging the top spot in the most exclusive destination category. This is going to do wonders for the Marbella brand, help the tourist industry recover from the pandemic and is a massive feather in the cap for the area.

Marbella is just one area of the Costa del Sol, but there are several others which deserve consideration. Places such as Sotogrande and Estepona are increasingly becoming very attractive and are developing their own special brand. Estepona is called “the garden of the Costa del sol” and Sotogrande is the largest privately owned residential development in Andalusia, Spain. The UK market has an added bonus with Sotogrande in particular, as Gibraltar airport is nearby and can be used as an alternative to Malaga airport.

How is the market?

Spain and particularly the Costa del Sol, where we are based, has been a magnet for property investors since the start of tourism in the 1960s and we see no sign of it slowing. In fact, the Spanish property market saw stellar growth in the first quarter of 2022, with a 25% increase and the highest number of home sales in March since the boom year of 2007.

According to Mark Stucklin at Spanish Property Insight, “If you look at sales every March going back a decade you get a clear idea of how the market is booming. Sales in March were 16% up on last year, and 37% up on 2019, the year before the pandemic. Compared to 2020, when the market was laid low by lockdown, sales are up 118%.”

He puts this growth down to a combination of factors, including pent-up demand following the pandemic, inflation encouraging people to invest in hard assets and rising interest rates encouraging people to borrow and buy now, while they are still so low.

How is the recovery?

As a hub for tourism, Spain took a big hit from the travel bans due to the pandemic, however the national tourism market filled in some of the gaps and 2021 was a stronger summer season than expected. Furthermore, the country will receive 10 billion Euros from the European recovery fund, and has already received its first installment.

Spain is definitely in growth phase and this is predicted to continue, with the Bank of Spain expecting the economy to grow by 4% this year. The “Spanish Business Climate Barometer survey of foreign investors” recently revealed the good news that 93% of foreign companies present in Spain plan to increase or maintain their investment in the country in 2022. This has grown from 69% in 2020 and 90% in 2021, so the trend is promising. Unemployment is decreasing and positivity is high, with the survey revealing that 71% of companies expect to increase turnover in 2022.

How to safeguard your property investment?

If you have decided to invest in Spain and build a property or development, you need to use the right people, the right plot and make a plan based on local knowledge.

A sound investment starts with the right advice from qualified and experienced experts on the ground. It requires detailed, comprehensive research and reporting to ensure that you are making an informed decision and that everything stacks up from financial, contractual and programming points of view.

Starting with a project feasibility study can make the difference between success and failure. Our clients who are due to invest in property in Spain value our highly in-depth, all-inclusive project feasibility studies. It gives them confidence to have a company on the ground, with over 30 years of experience of managing complex projects and the ability to quickly spot issues and flag up potential problems, before they cost them down the line.

These all-inclusive Project Feasibility Studies include cost projections, cash flow projections, surveys and valuations approved by the Royal Institution of Chartered Surveyors, and an investigation into licensing and permit issues. They also include thoroughly researching each aspect of the investment being considered, verifying that contractual obligations can be met and that suppliers are capable of fulfilling their commitments throughout the project’s duration. We are the experts on project feasibility on the Costa del Sol on the Costa del Sol, so please get in touch with us to find out how we can help you.

Armed with this knowledge our clients can make the best decision and have total clarity on whether this is an attractive investment or not. We have had clients walk away at this stage, thanking us for helping them to avoid a costly mistake.

How to maximise your investment returns?

Once you have decided that your property investment is a good one and the potential for returns are high, then you need to try to maximise those returns at every step. By bringing in a professional project management company on the Costa del Sol right from day one, you can save yourself a lot of money and remove a lot of headaches. It is our job to explore every aspect of the project from the planning and design to the contractor and supplier selection and negotiating contracts. We take care of the tricky process of obtaining licences and permits in a timely manner and are on hand to supervise the construction process and ensure nothing goes wrong.

A project developer in Spain is your single point of contact on the ground that you know represents your interests and is working for you to make sure everything is running smoothly. They can spot potential issues before they arise, deal with suppliers and contractors, answer questions to keep things on track and keep you informed with regular reporting and updates.

We take time to get to know our clients’ true and most pressing demands, anticipating what lies ahead, addressing the challenges before they occur. The impact we make is that we routinely bring projects in below budget and ahead of schedule. This gives them peace of mind and keeps investors and shareholders happy that the project is progressing as it should and their investment is being protected.

What to do if things go wrong?

If you are reading this because your project has hit a stumbling block and you don’t know where to go next, you probably require the support of our project rescue team. Sadly, we have had to help many clients who are over budget and late on delivering and don’t know how they are going to complete. With our experience, skills, proven track record and contact network we are perfectly placed to come in and steer a troubled project to success. Find out more about our project rescue services on our website or contact us to find out how we can help.

Conclusion

In Spain the property market is hot right now and the strong tourism market in areas such as the Costa del Sol offers excellent opportunities for property investments. If you are planning to take advantage of these opportunities, make sure you seek expert support and work with experienced professionals on the ground from start to finish. Investing in a project developer in Spain will save you money in the long run and remove the stress and worry from you and your partners. We are here to help you every step of the way, contact us to find out how and discuss your planned investment in Spain.