Martínez-Avial (BNP Paribas Real Estate): "El principal riesgo en vivienda es su politización"

The main risk in real estate, according to Ignacio Martínez-Avial, the CEO of BNP Paribas Real Estate Spain, is its politicization. In a market with a shortage of supply and massive structural demand, the key challenges to addressing the problem are regulatory risk and the politicization of the debate. Constant changes in the rules of the game and reputational risk can erode confidence among institutional investors, causing caution or capital diversion to assets or markets with more certainty.

The freehold segment, which is most susceptible to legal uncertainty and reputational risk, will suffer the most. On the other hand, much of the investor appetite is expected to focus on affordable residential and student residences, which have lower regulatory risk. Despite current sector challenges, such as constant regulatory changes and obstacles for new industries like data centers, Martínez-Avial expects the Spanish real estate market to remain solid next year.

This will come after a record-breaking 2026 with investments totaling between 18.000 and 20.000 million euros, depending on whether significant operations close in the year. However, the director anticipates a slight slowdown in growth due to rising interest rates. While financing costs require more selective use, the director believes the rise in rates will be mitigated by strong fundamentals, inflation, and revenue growth.

Value creation for Martínez-Avial no longer depends on mere revenue growth, but on active property management, operational efficiency improvements, and the development of large-scale platforms. In terms of sectors, offices are expected to show positive growth in 2027, driven by high rents and the gradual shift of demand to well-managed assets in peripheral areas.

The hotel industry is also expected to maintain its strength, supported by strong international tourism and operators' ability to adjust prices and improve EBITDA. The logistics sector is also expected to have a good year, benefiting from e-commerce and nearshoring demand, as well as scarcity of speculative supply, which offsets the adjustment in yields.

Regarding asset valuation, Martínez-Avial expects a slight price correction in 2027, but no dramatic drops or transactions with large discounts. The degree of correction will depend directly on the type of asset and its real ability to generate operational income. For Martínez-Avial, Spain has consolidated as one of the strongest and most attractive destinations in Europe.

The Spanish market has moved away from being strictly linked to speculative cycles and is now a structurally healthy, mature, and institutionalized market. This is complemented by a very strong economy, growing faster than the majority of European countries, backed by world-class infrastructure and a perception of safety that is key to attracting large patrimonies, professionals, and international students.

BNP Paribas Real Estate aims to double its revenue by 2030, and its close collaboration with the corporate and institutional banking division allows it to offer a global coverage throughout the investment cycle, facilitating the capture and support of both international institutional funds and large private patrimonies. With a presence in France, Spain is positioned as a top priority market within its top 4 in Europe, alongside France, Germany, the UK, and Italy, with specific resources to boost its growth in the country.

BNP Paribas Real Estate's new strategic plan aims to evolve towards a pan-European model to accompany institutional clients globally throughout the investment cycle. The company intends to reinforce its team by focusing on commercial areas and the Capital Markets business, leveraging the efficiency of its current back office structure and mutualizing services with the group.

The goal is to increase its workforce by 40% and reach 160 professionals by 2030. In terms of AI, the company is betting on its potential, giving it a clear competitive advantage in terms of efficiency. BNP has already signed an agreement with Google Cloud to develop AI models using Gemini.