Coral Homes has launched a portfolio of more than 70 residential projects on the market with an approximate value of 40 million euros. This portfolio is made up of promotions started, each of them in different phases of development, which are known in the market as WIP (promotion in progress) and which, as the entity has identified, are suitable to be allocated, once they are finished, to the market. of the rent.
According to the manager’s estimates, these projects, which total 1,409 homes, will offer a return of between 7% and 8% to investors who invest in their development, complete the work and rent them. These are promotions Build to Rent that are located in secondary locations with demand and limited rental supply.
Specifically, 31% of the projects are located in Castilla-La Mancha, Another 15% is in Andalusia and 14% of the developments are located in Barcelona. These are the three regions with the greatest presence, followed by Galicia, with 10%, Murcia with 7% and the Canary Islands with 6%. 3% of the portfolio is located in Madrid, with two projects.
“The selection of assets has been carried out from a real estate point of view, in which the viability of the projects to develop has been taken into account. rental product focused on local and regional investorsexplains Alberto Prieto, general director of Coral Homes.
To date and after receiving 80 unique offers, just over 50% of the portfolio has already been sold or with commitment agreements, which demonstrates the high appetite there is for the rental market in secondary markets, where it has never existed. a professionalized offer and in which In many cases the problem is not high prices, but rather a lack of available supply.
The majority of investors who bet on these projects are local developers or large family assets in the area who know and have experience in those markets. In this sense, the manager points out that “the selection of these secondary locations allows these local investors to opt for higher profitability compared to main citiesin markets that they know perfectly well and where in recent years no rental product has been made available to the market.
On the other hand, Prieto points out that another advantage of this type of project is that “The percentage of work completed allows us to mitigate the latest increases in construction costs At the same time, the average number of homes per project, which is about 20, means that the risk for the investor is truly controlled.”
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