The office sector has undoubtedly been one of the hardest hit in the real estate market by the crisis resulting from the Covid-19 pandemic. In fact, at the end of 2020, the leasing of office space in Madrid had decreased by 35% compared to a year earlier, to reach around 350,000m2. However, we consider that figure to be very acceptable if we take into account the significant decrease in demand since March.
Regarding investment, the total figure amounted to 2.0 billion euros for Spain as a whole during 2020, well below the historical high recorded in 2019, but not far off of the amounts recorded in previous years. In any case, at Knight Frank, we are convinced that the drop is something temporary given that the market fundamentals are in much better shape than in previous crises. And, although there is no denying the serious economic consequences of the health crisis, we predict that the stimuli applied and the latent demand will allow the market to recover to levels seen in previous years from 2022 onwards.
Translated by Carmel Drake. Read the full article in Spanish.