Portugal Real Estate Market 360º 1 ST Half 2017 Bi-annual Publication Portugal Market 360º H1 2017 1
Introduction It s that time of year to measure the pulse of the real estate market and news couldn t be better! The growth curve observed in the last few years is confirmed, being more pronounced and again transversal throughout all sectors in the first half of the year. In offices and retail, demand is remarkable and rents are rising. In residential, sales exceed expectations, the Portuguese are more dynamic when buying and foreigners are increasingly interested in Portugal: in JLL alone we have 37 different nationalities in the first six months of the year! More tourists from more countries continue to arrive, encouraging the hotel industry only in Lisbon 20 new hotels is forseen for 2017, the street shopping and the urban rehabilitation. In investment, transactions volume reached 1 billion euros breaking a new semester record. The scenario is encouraging, the economy is helping and the second quarter GDP registered the highest growth in 10 years. The Lisbon internationalization is also a main driver to market vitality. Nowadays, the Portuguese capital competes with the main European cities as a destination for investment, companies and people. The quality of life and the country attributes in terms of culture, safety, gastronomy and climate equally contribute to this success. Adding the return generated by Portuguese real estate to this mix (among the best in Europe), allows the mix of ingredients to further sharpen investors appetite. The huge demand for assets acquisition is certain to become more fierce, with everything aligned for success and a new record of 2,000 million euros invested in 2017, which would reflect the best year ever! Pedro Lancastre Portugal Managing Director 2 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 3
Portugal was able to stand out as a stable economy and investment destination in several sectors. 78,000sqm The real estate market continues to experience a great moment. In recent years, all sectors have shown a continued growth. 130 /sq m Monthly prime retail rent of Rua Garrett, in Chiado In 2017, investment in commercial real estate may exceed the 2 billion euros mark, demonstrating a high demand increasingly competitive. Tourism and, consequently, the number of touristic accommodation units do not stop increasing. Just in 2017, there should be 20 new hotel openings in Lisbon with a total of 1,500 rooms. 4 Portugal Market 360º H1 2017 1,000M Invested in commercial real estate during the first six months oh the year, a historical high in semi-annual terms. 37 Different nationalities that have bought houses at JLL between January and July. Lisbon had become definitely an international city. Portugal Market 360º H1 2017 Highlights Office take-up during the 1st half of 2017. 5
Contents Economy Indicators...08 Offices...10 Retail...14 Investment...18 Residential...20 Hotels...24 6 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 7
conomy Economic Stability It took 10 years for most of Portugal s economic indicators to return to pre-crisis levels. GDP annual growth rate in the second quarter remained at 2.8%, the highest figure since 2007. This growth, a result of the work carried out by the last two governments, is sustained by a strong growth in exports, enormous dynamism in the Tourism sector and the investment growth from abroad. The growing domestic demand led to an increase in private consumption and therefore imports also grew, resulting in a deterioration of the trade balance and an unchanged inflation rate of 1%, at the end of the second quarter. GDP +2.5% Private Consumption +2.3% According to the increase in the number of created jobs and in line with the trend observed in previous months, the unemployment rate has decreased again, reaching the lowest level since 2009. This year has been marked by growing geopolitical instability, however it has been a prosperous year for Portugal. Consumer and investor confidence regarding the positive evolution of key economic indicators has grown and sectors such as Tourism or Real Estate are living their best years ever. Despite the low estimates for Portugal s economic growth published at the beginning of the year, the country managed to affirm itself as a stable Unemployment Rate 9.4% economy and a destination for Foreign Direct Investment from different origins. The different sectors are expected to remain very dynamic and to keep growing with the increasing international confidence levels, which should be corroborated by the credit rating agencies, in the next review. Inflation Rate 1.6% Exports +9.6% Source: Banco de Portugal: 2017 Forecast 8 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 9
ffices 78,000 sq m of office area was occupied during the first half of 2017, in line with the same period of last year. The first half of 2017 was very dynamic for the office market. During the first six months of the year, approximately 78,000 sq m were occupied, in line with the same period of the previous year. As seen in 2016, the net take-up remained dominant, with 54% of the total occupied area, which shows the strength of the business fabric. The Net Take-up accounts for the area expansion of established companies and new entrants in Lisbon. In the first half of the year, while the average transaction area (606 sq m) was lower than the same period of the last year (822 sq m), the number of transactions was considerably higher. From 129 transactions registered, 21 were for an area above 1,000 sq m, occupied mainly by companies from the Technological, Consultants and Lawyers and Financial sectors. BNP Paribas continues to relocate its back office and call centre services to Portugal. During the second quarter it leased another 5,200 sq m in Torres do Colombo, accounting for more than 50,000 sq m of office space in Lisbon. This is one of the examples of many international companies that provide this type of service and look for Portugal to set up offices, contributing to a strong dynamism on the demand side. The Western Corridor was the most dynamic zone, representing 28% of office take-up in the first half of the year. The lack of vacant offices with quality in the Lisbon city centre and, mainly, in Parque das Nações has led several companies to the Western Corridor, where vacancy has been high, namely offices with large areas. The vacancy rate continues to decline, remaining below 10% for the first time in 7 years. At the end of the first half of the year the vacancy rate reached 9.7%, decreasing in all zones. In Parque das Nações there is almost no vacancy and Prime CBD and the Historic and Riverside Zone follow the same path. Rents have been gradually increasing, with quality and recent finishes being the requirements that most value the assets. Parque das Nações registered an increase in prime rents for the fourth consecutive quarter, reaching 16.5 / sq m /month, due to the low vacancy rate Top 3 Transactions Abreu Advogados Infante D. Henrique, 26 Zone 4 - Historic & Riverside Zone 5,800 sq m Uría & Menéndez Maquês de Pombal 12 Zone 1 - Prime CBD 5,260 sq m BNP Paribas Torre Oriente, Colombo Zone 3 - New Offices Zone 5,214 sq m and high demand for offices in its modern buildings. In the first quarter of the year, the Historical and Riverside zone and the Western Corridor also recorded an increase in rents: the former due to the establishment of important companies in the Cais do Sodré / Avenida 24 de Julho axis, which are setting a new trend; the latter due to a rental adjustment in Lagoas Park, an area where rents have been low for a long time. Despite remarkable demand, the development of new supply remains low. The increase in rents has not yet been sufficient for the developers business plans approval, since they still face difficulties in getting credit for asset developments. On the other hand, in central zones, residential developments are more profitable than office ones. In the first half of the year, the new Abreu Advogados headquarters in the Historic and Riverside Zone was completed, resulting from the refurbishment of an old warehouse with 6,000 sq m, and by the end of the year 2 more buildings are expected to be completed in the same zone, representing 22,200 sq m. By 2018, 6 new buildings with more than 70,000 sq m are expected to enter the market, of which 82% are speculative development. In the pipeline we highlight the FPM41 tower in Prime CBD, where KPMG and PLMJ will occupy almost all of the area, and the Hub Criativo do Beato, which already has a guaranteed occupancy of around 50% of the office area with 30,000 sq m. In Porto, the market is also very dynamic. Porto Downtown, which is now very fashionable in all market sectors, is increasingly sought after. The Trindade Domus Building is a clear example of this 10 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 11
demand, where 8 deals were closed in the first 6 months of the year. T he construction of new buildings is moving again. Given that the second largest Portuguese city is also an option for setting up shared services companies in Portugal, the pipeline is expected to increase soon. In the short / medium term, we are able to anticipate the main trends in the sector: (1) The upward trend in demand for large office spaces by international companies specialized in back office and call centre services is likely to continue in Lisbon and Porto; (2) Although the pipeline of new offices is still low, developers are aware of the market and we believe that in the meantime new projects will appear to cope with existing demand and the current lack of supply; (3) For the same reasons Portugal has become first choice in the options of the mentioned international companies and if we consider the talent and entrepreneurship that the Portuguese have recently revealed, we are sure that Portugal has the opportunity to centralize large incubators of start-ups, a trend that is starting to take place. Take-Up 2% 20% 28% 78,000sq m 11% Zone 1 Zone 2 Zone 3 Zone 4 15,398 sq m 8,766 sq m 12,834 sq m 14,855 sq m Offices Prime Zones - Lisbon 3% 19% 17% Zone 5 Zone 6 Zone 7 2,309 sq m 22,185 sq m 1,734 sq m Source: JLL/LPI PONTE VASCO DA GAMA A2/SUL ALGARVE CRIL/IC17 Av. de Berlim ORIENTE Av. D. João II Vacancy Rate 2ª Circular AMADORA CRIL/IC17 BENFICA PONTINHA A5 Eixo Norte-Sul Av. Lusíada 2ª Circular Av. dos Combatentes AMOREIRAS PRAÇA DE ESPANHA Av. Joaquim de Aguiar RATO CAMPO GRANDE Av. António A. Aguiar Av. 5 de Outubro MARQUÊS DE POMBAL 2ª Circular Av. da República Av. da Liberdade Av. de Roma ALVALADE CAMPO PEQUENO SALDANHA AREEIRO Av. Almirante Gago Coutinho Av. Duque d Ávila Av. Almirante Reis Av. Marechal Gomes da Costa ALFAMA Av. Santo Contestável OLIVAIS Almirante D. Henrique Zone 1 Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 Total 3.1% 6.3% 8.0% 8.6% 7.1% 9.7% The vacancy rate continues to decline, remaining below 10% for the first time in 7 years. 21.9% GÉS CRIL/IC17 Av. das Descobertas BELÉM Av. da Índia Zone 1 Prime CBD Zone 2 CBD PARQUE FLORESTAL DE MONSANTO Av. da Ponte Av. de Ceuta Rua Infante Santo Av. 24 Julho PONTE 25 DE ABRIL A2/SUL ALGARVE Av. D. Carlos I Rio Tejo Zone 4 Historic & Riverside Zone CHIADO CAIS DO SODRÉ BAIXA TERREIRO DO PAÇO Zone 5 Parque das Nações SANTA APOLÓNIA Zona 6 Western Corridor Prime Rents /sq m/month 20 18 16 14 12 10 8 6 4 2 0 18.5 15.0 15.0 15.0 Zone 1 Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 H1 2016 H2 2016 H1 2017 16.5 Source: JLL/LPI 12.5 Source: JLL 12 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 13
etail +5.2% Year-on-Year growth in Retail Sales Index during the first semester of 2017. The Retail market had a positive performance in the first half of the year. Throughout 2017, retail has achieved strong growth. Several indicators reflected a good performance, namely the consumer confidence index, which moved into positive territory in the second quarter of 2017, and the retail trade indicator that maintained the growth trend. The end of the Income Tax surcharge by the end of the year is expected to have a positive effect on these indicators. In fact, Portuguese consumers and the high number of tourists have been an important driver for the retail market performance, with the most relevance in prime Shopping Centres and High Street Shopping, respectively. Prime assets continue to show good performance, both in retail developments and high street, and are often retailers first choice for expansion. Given the maturity of the market, supply has remained stable while the pipeline for new developments continues low. The first quarter of the year registered the Ikea store opening, located in the Mar Shopping Algarve complex, while the opening of the Shopping Centre and Outlet is scheduled for the second half of this year. Évora Shopping is expected to open by the end of 2017 and it will be the first shopping centre in the Alentejo Region; presently, the only development planned to open in 2018 is the expansion of NorteShopping, with an increase of 21,000 sq m in Gross Lettable Area. Shopping centres continue to be the Portuguese consumer s preference. Their performance have increased due to significant improvements of the mains market indicators. In the main zones of Lisbon and Porto, High Street Retail continues to benefit from tourism growth, but also from the increase of Portuguese consumers confidence levels. In Lisbon, demand largely surpasses supply in the main axis of Chiado and Baixa, causing pressure on rents and generating increasingly higher key money amounts. Nevertheless, new openings may arise in these areas, as a result of the exit of some retailers and the redevelopment of several buildings mainly in Baixa, where rents have been consistently increasing. Demand in Avenida da Liberdade is mainly focused on small to medium sized areas, which does not match with the existing supply, Stock of Shopping Centres 3.7 Million sq m therefore there is still availability of medium to large size commercial spaces. Cais do Sodré and Príncipe Real are highly sought after to welcome new concepts of food & beverage. Consolidated residential eighbourhoods, such as Alvalade and Campo de Ourique, are becoming progressively appealing to new concepts addressed to the daily life of residents. High Street Retail is also very dynamic in the city of Porto. Baixa is defined as the zone of highest interest where Rua de Santa Catarina, with heavy footfall, shows great demand from mass-market brands. The Flores / Mouzinho da Silveira axis on the other hand, is arising as a destination for independent and quirky concepts, with a focus on food & beverage. It is important to highlight the Urban Leasing Law alteration, the amendments of which are expected to have little negative impact on the established growing trend in High Street Retail. These amendments increase the tenants rights regarding the update of old rents, eviction in case of works and creates a regime of protection for historical stores and entities. Pipeline 95,500 sq m 14 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 15
High Street Retail Lisbon Rua Joaquim António de Aguiar marquês de pombal Rua Castilho Rua Rodrigo da Fonseca Av. Fontes Pereira De Melo Avª da Liberdade Avenida Almirante Reis mart im moniz sant a apo l ónia High street retail is undoubtedly an increasingly consolidated sales channel. Both high street zones, home to large retailers, and residential zones, where different concepts related to residents daily life are emerging, are increasingly busy, attracting a growing number of retailers. ROSSIO al fa ma ra to R. Escola Politécnica Rua da Prata Rua Augusta es tre la la pa/ es tre la Rua de São Bento Rua D. Luís I príncipe real Calçada do Combro Rua de S. Paulo chiado Largo de Camões Rua do Alecrim Rua da Mesericórdia cais do sodré Rua Garret Rua do Ouro Rua do Carmo Rua Ivens Rua Serpa Pinto Avenida das Naus baixa terreiro do paço Prime Rents rio tejo 40 130 20 120 00 90 100 Chiado Av. da Liberdade Baixa Príncipe Real Cais do Sodré Castilho 80 60 60 Prime Secundary Source: JLL Demand Behavior Shopping Centres Low Retail Parks High Street High High Street Retail Main Openings, Q1 2017 JncQuoi (Avenida da Liberdade); Mango (Chiado); Sunglass Hut (Downtown); Casa Pau Brasil (Príncipe Real); Pizzaria Otto (Cais do Sodré); e a Perfumes & Companhia (Santa Catarina in Porto) 40 20 0 Shopping Centres Source: JLL 40 40 35 35 30 30 11 Retail Parks Chiado Av. Liberdade Rua Castilho Baixa Principe Real Cais do Sodré Sta. Catarina Clérigos Aliados Flores/ Lisboa Porto Mouzinho High Street H1 2016 H2 2016 H1 2017 16 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 17
nvestment 1,000M of investment in commercial real estate during the first half of 2017. The first half of the year confirms the expectations for 2017 as the best year ever in terms of investment. After a dynamic start, 2017 has proved to be in line with the expectations of a record year for investment in commercial real estate in Portugal. Some transactions that began in 2016 were finally executed, resulting in a volume invested in the first half of 2017 of over 1,000 million euros, a historical high in semi-annual terms. Foreign investors from all over the world remain the most active, accounting for 90% of the amount invested. The return on Portuguese assets, which according to the IPD Index is one of the highest in Europe, has been one of the main drivers of the international investors interest in the Portuguese market. Investment in Retail accounted for 40% of the amount invested, with 2 of the largest Prime Yields Source: JLL % 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 5.00 Offices Zone 1 Offices Zone 2 transactions of the year in Shopping Centres. The Industrial & Logistics sector, whose market share is usually low, represented 30% of the volume traded due to the transaction of a large logistics portfolio. In third place comes the office sector with 24% of the investment, where the Entreposto Building located next to the Park of Nations stands out. Prime yields have declined again, and are already below historical lows in almost all market sectors which reveals a strong investor appetite. Investors are increasingly adopting aggressive strategies in their ability to do business. Yields remain however superior to most European markets, making Portugal a very sought-after market, with real estate assets attractiveness being maintained by the low levels of reference interest rates. The abundant liquidity in the market comes from investors with different profiles. Large investment funds are driven by large volumes and once the Core product is scarce, Value Added assets become an option after a detailed scrutiny during the Due Diligence phase. In the coming years we will see greater diversification in the investment product, which will include more transactions of hotels, residential buildings, student housing and micro living projects. 5.75 5.75 Offices Zone 3 6.00 Offices Zone 4 5.75 Offices Zone 5 7.50 Offices Zone 6 H1 2016 H2 2016 H1 2017 Large transactions are underway, raising the potential record investment of 2017 to 2 billion euros. In line with this trend and assuming market fundamentals remain, more diversification is expected in the coming years: Hotels, which have been transacted on a piecemeal approach basis, Residential Buildings focused on short and long term rentals and alternative assets such as Student Housing and Micro Living that are emerging, despite not being of interest in the past, will certainly be on the investors agenda Top 3 Transactions Logicor Porfolio Industrial & Logistic 260 M 530,000 sq m Buyer: CIC Fóruns Portfolio Shopping Centres 220 M 72,200 sq m Buyer: Greenbay Vila do Conde Fashion Outlet Outlet 130 M 28,750 sq m Buyer: Via Outlets 5.00 Shopping Centres 6.50 Retail Parks 4.75 High Street Retail Lisboa 6.50 Industrial & Logistics 18 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 19
esidencial At JLL, 60% of total sales in the first six months of the year were made by international investors. Lisbon s internationalization in the global prespective is a matter of fact. The momentum observed in the residential market during the first half of 2017 exceeded expectations, revealing a higher number of transactions than last year s average. According to Statistics Portugal, there were 35,200 transactions in the first quarter (the data of the semester is not complete), representing a 19% growth over the same period of the previous year. Housing purchases thus continue to gain strength in a market dominated by this type of transaction and where the rental market offers very low supply at very high prices. The banking sector is also helping; Housing loans are becoming more accessible, registering 42% growth over Top 3 Developments Alexandre Herculano 41 Zone: Avenida da Liberdade Developer: Louvre Capital 21 Apartments 100% Sold in 10 months the first six months of 2016. Although domestic buyers dominate the market in general, foreign investors are the most important in the highend segment in the Lisbon region. International purchases from 37 different nationalities represented 60% in JLL sales, with Brazilian buyers taking the lead. Investors origins are increasingly diverse and new nationalities are coming, such as Philippines, Colombia or Morocco. The take-up time remains very low, with almost all projects being sold off plan and the single units being quickly withdrawn from the market, mainly in the most sought after zones such as Avenida da Liberdade, Chiado and Príncipe Real. The development of new projects in these privileged zones does not fulfill the high demand, provoking an upward pressure on prices thus creating opportunities in new zones. The Riverside Zone is increasingly consolidated in its western part and starts to extend towards the eastern part, with the developments in the Avenidas Novas zone beingsold very quickly. 800 apartments in new developments that entered the market in the first half of 2017.. At the end of the period more than 50% of these Calçada do Galvão 15 Zone: Restelo / Belém Developer: LX Capital Partners, Lda 8 Apartments 88% Sold in 7 months units were already sold, which proves a dynamic market that is expected to remain. Although the high-end market was one of the first to come up, new projects are also starting to emerge in a lower market segment. In Alta de Lisboa, new residential buildings are being built again, and in Carnaxide, on the western outskirts of the capital, the Sky City development is being highly sought after. According to Statistics Portugal data, the Housing Price Index has maintained an uptrend since 2015. The central zones are the most expensive, in which the range of prime values is increasingly narrow, due to the rise of the minimum limit. The offer differs depending on each project s target. Developers are very focused on the areas optimization and are increasingly creative in the offer, both in architecture and amenities / services, still unusual in Portugal. In the long-term rental market, demand is also higher than supply, especially in the city centres of Lisbon and Porto where owners prefer short-term rentals (Touristic option). The city of Porto follows the same path as Lisbon, with a remarkable recovery of domestic investment and an exponential increase of international investors Avenida Residence Zone: Lapa / Estrela Developer: Brave Return 30 Apartments 60% Sold in 8 months Source: JLL 20 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 21
demand. In the Invicta city, where the high-end segment also focuses on the city centre and the prime zone of Foz, some projects may emerge focused on the middle segment in less central areas. Prime Residential Zones Lisbon Although the sales figures in the centre rose considerably ( 4,000-5,000 / sq m), they remain below similar European cities, which, combined with a good quality of life, makes the second largest Portuguese city very competitive. PONTE VASCO DA GAMA A2/SUL ALGARVE TOP 3 International Buyers 1 st Brazil 2 nd Turkey 3 rd Philipines 25% 18% 8% ORIENTE Av. D. João II 2ª Circular Av. Marechal Gomes da Costa IC 19 A5 Eixo Norte Sul AMOREIRAS 2ª Circular PRAÇA DE ESPANHA Av. Joaquim Ant o de Aguiar RATO CAMPO GRANDE Av. António A. Aguiar Av. de Berna PARQUE EDUARDO VII MARQUÊS DE POMBAL Av. da República Av. Fontes Pereira de Melo Av. da Liberdade ALVALADE AREEIRO CAMPO PEQUENO Av. Almirante Gago Coutinho Av. Duque d Ávila Av. Almirante Reis ALFAMA OLIVAIS Al. Infante D. Henrique 37 Nationalities PARQUE FLORESTAL DE MONSANTO BAIXA ALGÉS Av. das Descobertas BELÉM Av. da Índia ESTORIL/CASCAIS AJUDA ALCÂNTARA Av. de Ceuta Av. 24 Julho R. de São Bento SANTA APOLÓNIA Av. Infante Santo PONTE 25 DE ABRIL A2/SUL ALGARVE Av. D. Carlos I R. do Alecrim CHIADO Rio Tejo CAIS DO SODRÉ R. Augusta TERREIRO DO PAÇO The demand pressure on the prime zones creates opportunities in other zones of the city, where the projects for sale also present good performance. Prime Values ( /sq m) Chiado 6,500-9,000 Lapa / Estrela 4,000-5,500 Colina de Santana 3,000-4,500 Avenida da Liberdade 5,000-9,000 Riverside Zone 4,000-6,000 Restelo / Belém 4,500-6,000 Príncipe Real 4,750-7,500 Campo de Ourique / Amoreiras 3,000-5,500 Parque das Nações 3,500-5,000 Historic Zone 4,000-6,500 Avenidas Novas 3,000-5,750 Estoril / Cascais 5,000-12,000 Source: JLL 22 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 23
otels 3 million overnights were registered, representing an increase of 17% over the same period of last year. Lisbon, a cool city, a solid destination with strong growth. After a year full of successes in terms of international awards (more than 500) and articles published in the international media (more than 16,000), the digital marketing strategy carried out by the competent bodies is finally recognized as being one of the main drivers of this growth. Tourism was responsible for the creation of more than 52,500 jobs in the first half of the year and was key to the High Street Shopping boost. It was also one of the main drivers of the cities rehabilitation and the growth observed in the regional and national economy. In the first half of the year Lisbon reinforced its position in the international scene as a reference destination for Tourism. In the period between January and April, 3 million overnights were registered, representing an increase of 17% over the same period of last year; The average occupancy rate of 77.93% and the average price per room (ADR) of 96.30, also reflected a positive evolution representing a year-on-year growth of 8% and 10.6%, respectively. As a result of these two aspects, the available revenue per room (RevPar) stood at 75.05, representing a year-on-year increase of 19.5%. The evolution of passenger arrivals at Lisbon airport is increasingly consolidated, with total arrivals reaching 6,108,400 by June, an increase of 22.4% over the same period of the previous year. Main Openings Hotel Verride Palácio Santa Catarina Alto de Santa Catarina 5 - Star 19 Bedrooms Altis Prata Baixa 4 Star 22 Bedrooms 1908 Lisboa Hotel Intendente 4 Star 36 Bedrooms In the Cruise Terminal, the number of passengers has increased consecutively to 192,685, registering a growth of 2.5% compared to the same period last year. Regarding supply, there were 5 hotel openings during the first half of the year, adding to the 26 units opened in the last 2 years. There are 15 new hotels projected to open until year end, representing more than 1,200 new rooms. Despite the high number of openings, especially when compared with the historical past, demand growth is still higher than supply, which is very diverse in terms of size, position, concept and target markets. The first semester has performed well and this is expected to continue throughout the year. More tourists and a greater diversity of nationalities are expected as a result of the strategy to open new routes, such as the Lisbon-China direct route and the 300 new flight connections created in the last 6 years; On the other hand, supply reinforcement and qualification are also evident, aiming to provide the city with accommodation units focused on different market segments. Passengers (H1 2017 vs H1 2016) +22.4% Source: Observatório do Turismo 24 Portugal Market 360º H1 2017 Portugal Market 360º H1 2017 25
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Contacts JLL Offices Lisbon Edifício Heron Castilho Rua Braamcamp, nº 40-8º 1250-050 Lisbon +351 213 583 222 Porto Edifício do Lago, Bloco B Rua Prof. Mota Pinto 42S, Escritório 1.11 4100-353 Porto +351 225 431 099 www.jll.pt Pedro Lancastre Maria Empis Mariana Rosa Patrícia Araújo Managing Director pedro.lancastre@eu.jll.com Head of Strategic Consultancy & Research maria.empis@eu.jll.com Head of Office Agency & Corporate Solutions mariana.rosa@eu.jll.com Head of Retail patricia.araujo@eu.jll.com Fernando Ferreira Patrícia Barão Karina Simões Fernando Vasco Costa Head of Capital Markets fernando.ferreira@eu.jll.com Head of Residential patricia.barao@eu.jll.com Vice-President, Portugal Hotels & Hospitality karina.simoes@eu.jll.com Head of Develoment Solutions fernando.vascocosta@eu.jll.com JLL - AMI 8654 2017 Jones Lang LaSalle IP, Inc. All rights reserved. The information contained in this document is proprietary to JLL and shall be used solely for the purposes of evaluating this proposal. All such documentation and information remains the property of JLL and shall be kept confidential. Reproduction of any part of this document is authorized only to the extent necessary for its evaluation. It is not to be shown to any third party without the prior written authorization of JLL. All information contained herein is from sources deemed reliable; however, no representation or warranty is made as to the accuracy thereof. 28 Portugal Market 360º H1 2017