Madrid and Barcelona add 2.5 million m² of offices that could be homes

2023-07-17 17:27:54

Madrid and Barcelona have 2.5 million m² of offices that could be transformed into households in the next 20 years, according to a study produced by EYwhich amounts to 28,000 units that could be added jointly to the housing stock and that, for the most part, would be for rent.

The firm estimates that the Madrid office market has 1.8 million m² of built-up surface area that, if repositioned as alternative residential, would imply a strong valuation for the owners of said properties and the incorporation of 20,000 residential units.

Barcelona could follow the same trend as Madrid, but to a lesser extent. In Barcelona they could join 8,000 residential unitsor assimilable, if 763,000 m² of built-up office space were repositioned, which is currently not achieving the profitability expected by its developers or owners.

potential prices

In the case of Madrid, this phenomenon would mean a recovery of the average rental prices of “prime” office buildings located in the center of the business districts of at least 30%, up to 44 euros/m2/month . Similarly, in the best office areas of Barcelona, ​​prices could reach 37 or 39 euros/m2/month.

This reconversion would, however, require public-private collaboration, since the Administration should contribute to this process by speeding up the necessary urban planning procedures.

Impact of teleworking

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As indicated by the partner responsible for the Real Estate sector of the EY Strategy and Transactions area, Javier García-Mateo, this phenomenon could mitigate the current housing shortage and value an office market that is currently oversupplied by eliminating a part of its inventory to favor the increase in the rental prices of the buildings that remain.

“The real estate market cannot continue to ignore the teleworking consolidation and the need to offer housing for rent with services to citizens”, he points out. The office market in Spain registered 743 million euros of capital transacted up to July, 40% less than a year earlier. 64% of the registered activity took place in Madrid, 33% in Barcelona and the rest in other province capitals in Spain.