Real Estate Investment Funds in Portugal Exceed 2.5 Billion Euros in Residential Properties

Discover the latest data from CMVM showing a 59% increase in real estate investment funds' exposure to residential properties in Portugal.

In a recent report by the Securities Market Commission (CMVM) and as reported by ECO, data reveals that the exposure of 265 real estate investment funds to residential properties in Portugal soared to over 2.5 billion euros in December. This marks a significant 59% increase from the previous month and a staggering 63% rise from December 2022. This surge in investment represents the highest value seen since 2016, when the CMVM first began providing detailed information on fund portfolios by property purpose.

The data further highlights that investment in residential assets within the European Union, predominantly in Portugal, was the primary focus for real estate funds throughout the past year. Closed-end funds, in particular, saw a substantial 60.5% uptick in exposure to residential properties within their portfolios in December. Conversely, special real estate investment funds and open-end real estate investment funds experienced a 31.2% decrease in residential property exposure during the same period, according to CMVM figures.

The growth in the sector was further fueled by the establishment of 33 new real estate collective investment companies, including notable entities like Herdade do Pinheirinho II and Herdade do Pinheirinho Resort, managed by GEF. This development propelled GEF to the third position among the largest management companies in the country, trailing only Square Asset Managers and Lynx Asset Managers.

The heightened focus on residential assets towards the end of last year resulted in these properties accounting for 17.4% of real estate funds' portfolios, a significant increase from 13.3% in 2022 and 14% in the five years leading up to 2023.

The data from CMVM underscores the growing interest and investment in residential properties by real estate funds in Portugal, with closed-end funds leading the charge in expanding their exposure to this sector.