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The Portuguese Real Estate Market in February


The beginning of the second month of 2021 was marked by some good news in the real estate investment sector as it continues to demonstrate dynamism, and investments pour in.  At the same time, policies enacted by the Portuguese government have leveraged some parts of the sector. February started with good prospects with the publication of a study that named Portugal as one of the best countries for acquiring properties via a golden visa programme. According to the UK’s Astons, based on similar programmes in 20 countries worldwide, Portugal is the only country in the European Union that is among the three best places to buy a new house in Europe using a golden visa programme. Simultaneously, the government announced that it would postpone planned restrictions on the visas’ regulatory framework to January 1st, 2022. The decree also established new limits in terms of investment for residence permits that are not directly related to real estate, the sector that attracts the lion’s share of investment through the programme. With the new legislation, investment in commercial real estate, the office segment, retail and tourist flats are not covered by the restrictions. Commercial investment in Lisbon and Porto will also remain eligible for golden visas.

The Portuguese government simultaneously announced significant investments in housing, which will provide support to 26,000 families in the years to 2026. The government will invest funds through the EU’s Recovery and Resilience Plan (PRR), tapping community funding created to mitigate the effects pf the Covid-19 crisis. The policies include the First Right – Support Program for Access to Housing, which will receive 1.2 billion euros, and the National Stock of Urgent and Temporary Accommodation (€186 million).


February had barely begun when news came of an approximately €60 million investment in an urban rehabilitation project in Funchal. A subsidiary of the AFA Group, Savoy Investimentos Turísticos S.A, will build the Savoy Residence Insular project in Madeira, totally refurbishing and redeveloping the existing site. Construction of the four different interconnected blocks is scheduled to last a year and a half.

Meanwhile, Caledonian expressed interest in entering the Portuguese market. The company owned by Enrique López Granados is negotiating with a fund to build residential projects in Portugal. Caledonian operates in the build-to-rent sector, and it currently has three residential projects underway.

The Catalonian real estate developer ARC Homes acquired enough land to build 156 homes in Porto in a €30-million investment. The project is the first of three acquisitions the company intends to complete this year. ARC’s future investment plan, totalling 100 million euros, includes the purchase of land for the construction of 500 homes in Porto.

North Americans are also continuing to eye opportunities in Portugal. HIG Capital began moving ahead with the acquisition of three apartment buildings in Lisbon, aiming to expand its real estate portfolio in Portugal. The locations of the properties were not disclosed, nor was the amount HIG Capital paid.

The month also ended for the sector with a bang, as news came out of Round Hill Capital and TPG Real Estate’s €150 million investment in the Lumino residential project. The new building is going up in  Lisbon’s Campo Pequeno, with approximately 40,000 m2 that will house a residential area with 300 flats and a 380-bed university residence.

Student Residences and Co-living

Covilhã will host a development with a capacity for 267 student residences as well as apartment buildings. Royal Prime plans to invest 29 million euros to build the project, including other complementary and support structures. Construction is expected to begin during the second half of the year and last for three years.

Co-living projects are becoming a more significant factor in the real estate sector, proof of which is Smart Studios plans to invest more than 130 million euros in the next three years in Portugal. The Portuguese company, which specialises in the alternative real estate segment, particularly in residences for students and young professionals, currently has ten developments.

Offices and retail

The Ageas Portugal Group, which acts in the office space and operational real estate segments, announced a significant sale. The transaction was completed after Israeli-based real estate investment group Taga Urbanic acquired the Fernandes Tomás 352 building from Ageas Portugal Group for €11 million.

In February, Signal Capital Partners completed the acquisition of a building in Saldanha for €30 million from Sonangol. Construction on the development, which includes plans for offices and housing, with around 14,500m2 of gross above-ground construction area, was suspended in mid-2015 and has yet to resume.


Despite the constraints imposed by the pandemic crisis, the publication of an analysis by DBRS Morningstar provided a boost for the tourism sector at the very beginning of the month. The financial rating agency is forecasting that while the Portuguese tourism industry will not fully recover this year, the country nevertheless remains highly attractive to international investors. Despite the pandemic and the associated restrictions on travel, the company stated that the characteristics that made Portugal attractive travellers before the crisis have not changed.

In other good news, the City of Braga was named the best European destination in 2021 by the website European Best Destination. Braga collected 109,902 votes from internet users, consolidating itself as a renowned destination of excellence and a benchmark in the international tourism scene.

Investments in the hotel sector continued to resist the pandemic. Solar Investment announced that it would build a new hotel in the north of Portugal. The new four-star Hotel Santa Rita Wellness & Spa is scheduled to open in Chaves in the summer of 2022.  Solar Investment, which will take over the hotel’s management in the former Solar dos Montalvões, plans to invest a total of 6.9 million euros.


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