The rental market has been buzzing with activity over the past year, driven by a robust demand that has led to several significant transactions, despite low availability. In terms of rental operations on the country’s main streets, there’s been an 11% increase compared to 2023, and the total transacted area has grown by 15%, according to the Retail High Street Spain report. This surge in demand is largely concentrated in major cities like Barcelona, Madrid, Málaga, Palma, Sevilla, and Valencia, which have emerged as strategic destinations for brands looking to expand in Southern Europe.
As a result of the growing tension in the market, prime rents in the High Street market have seen a national average increase of 7% compared to the previous year’s close. Meanwhile, shopping centers have consolidated the operational improvements that began to emerge in 2023. The rise in private consumption and stabilization of inflation have boosted consumer confidence, leading to increased foot traffic and a 4.7% annual growth in sales.
Trends in Store Rentals
One notable trend in 2024 is the increased demand and presence of accessory brands, which now account for 20% of street transactions for the year. This growth has been largely driven by native digital brands, which have represented 20% of sector transactions. On the other hand, sports fashion has shown more activity than in previous years, with a 3 percentage point increase compared to 2023.
Another trend is the reactivation of investor interest in the retail sector during 2024, which has driven significant growth in investment volume, reaching €2.8 billion. This figure represents a 135% increase compared to the previous year and approaches the 10-year average of €2.9 billion. Furthermore, the retail sector has consolidated its position as the third most invested asset class nationally, attracting 20% of total investment, just behind the housing and hotel sectors.
Some key highlights of the market trends include:
- A shift in consumer behavior, with a growing focus on experiential retail and online shopping.
- An increase in demand for sustainable and eco-friendly retail spaces.
- A growing presence of international brands in the market, particularly from Asia and the US.
These trends are expected to continue shaping the retail landscape in the coming years, with a focus on adaptability, innovation, and customer experience. As the market continues to evolve, it will be interesting to see how retailers and investors respond to these changes and capitalize on emerging opportunities.