Spanish Commercial Property Continues to Draw Investors

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Investment in real estate in Spain this year will have doubled from 2005 to €9.5 billion ($11.97 billion), according to estimates released yesterday by consultancy CB Richard Ellis.

Investment in offices, commercial centers and industrial property in the first six months alone amounted to a total of €3.9 billion -- 86% more than the whole of last year, said the consultancy.

Overall, CB Richard Ellis surveyed 15 European countries, estimating investment in the region by the end of the year would hit €170 billion, up 12% from last year.

Spain has enjoyed a massive property boom over the past 10 years, largely paid for with private debt. Some economists have described it as a bubble, although others say there is no reason for an abrupt correction.

Spain was rated the second-most-attractive European country to investors, scoring 65.4 points out of 100, beaten only by Denmark, which scored 65.6 points, and closely followed by France and Germany, each with 64.6 points.

CB Richard Ellis ranked countries according to criteria such as the rate of unemployment and growth in private consumption.

In particular, Spain is expected to attract more investment than any other European country for the development of shopping centers during the next two years, followed by Italy, France and Britain.

By the end of 2008, commercial space per thousand Spanish residents will be the fourth-highest in Europe, with more than 300 square meters per thousand residents, CB Richard Ellis estimated. Just last year, Spain was in ninth place.

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