These last years were characterized by record growth in the Portuguese property market, stimulated by a favourable external context and legislative amendments that help establish new demand with strong purchasing power. This growth was concentrated in Lisbon and Porto, which witnessed the appearance of several small and medium scale urban renewal projects with high quality standards.

In 2019, the market entered a new phase of the real estate cycle. The arrival of new developers focused on the luxury segment, an increase in supply, delays in municipal council’s evaluation of licensing processes and sharp inflation of the principal development costs, made this segment less interesting. Green-field projects for the middle and upper-middle classes in the metropolitan areas of Lisbon and Porto may be a good investment alternative with greater scale, although this requires tight control of land and construction costs. On the other hand, the increased appetite of institutional investors for the Portuguese market (with larger tickets and a mid/long-term strategy), is a growth opportunity for other segments, namely offices, hotels and alternatives.

Bondstone is aware of this new phase in the real estate cycle and plans to deploy a total investment of €400 million by the end of 2021, by co-investing with prominent investors in value-add and opportunistic strategies in the commercial and residential sectors. The strategies will include development, refurbishment and repositioning projects.