Investment Funds, the engine that is making the real estate accelerate to bottom

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After years of turmoil, the Real Estate Investment Fund (FII) market is on the rise, attracting more and more investors - mainly foreigners, but also Portuguese, who are arriving little by little. Many of the businesses carried out in Portugal this year, which animated the real estate market, had FII protagonists. Now that the REITs are about to arrive, what is their future?

The Securities and Exchange Commission (CMVM) says that in just one year, "more than 26 thousand investors participated in FII, which proves the attractiveness of the sector."

According to data provided by this entity, in August the amount under management of the IFI reached 10,890.5 million euros. The amount invested was 7,826.3 million euros, and the European Union countries were the destination of the total investment made in real estate assets: 43.7% in real estate services.

Most of these operations have been carried out by foreign investors, which the president of the Portuguese Association of Investment Funds, Pensions and Patrimony (APFIPP), José Veiga Sarmento, explains to the idealist/news has to do with being " that they have the financial capacity, a great availability of capital to invest, often to comply with legal ratios imposed on them and that they see in our market a way of applying these liquidity surpluses safely and with a very interesting profitability perspective " .

In the National Real Estate Funds, the effects of this new reality of "gold" are not yet fully understood. Still, the president of APFIPP believes that "national investors are gradually returning to the IFIs, which are starting to present results that far exceed the returns that traditional bank deposits have been offering."

The Government announced that by the end of 2018 it should submit a proposal on the creation of real estate investment companies (REITs) (Real Estate Investment Trust). The announcement was made by the deputy minister Pedro Siza Vieira during the Portugal Real Estate Summit, as reported by the idealist / news.

In this regard José Veiga Sarmento recalls that the "investment that has raised the market for" lethargy "has come through foreign vehicles, Luxembourg funds, Family Offices and Spanish socimi. In fact, it is the socimi of Spain that will be, by all indications, the model followed by the Portuguese Government.

By the end of 2018, and taking into account the current portfolio in pipeline, everything suggests that the optimism in the national real estate sector, especially in the commercial segment, is to last as the total volume forecast could reach 3,000 million euros.

"2018 will be a new record for the commercial real estate investment market, far exceeding the two billion euro mark and motivated by the sale of portfolios in the retail and office segments," anticipates Alexandra.