Introduction

In recent years, the hospitality, co-living, and co-working sectors have undergone significant transformations across Europe. This article aims to delve into the market trends and opportunities within these sectors, specifically focusing on Portugal, France, and Spain. These three countries have been at the forefront of attracting investments and experiencing noteworthy developments in these areas.

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Portugal's favorable advantages

Portugal stands out with its quality of life, security, and emergence as a technological hub. This has attracted companies operating in the technology industry and research & development, with cities like Lisbon and Porto becoming key destinations. The country's high rental prices and investor-friendly legislation make it an appealing investment destination. Portugal experienced a 0.5% average increase in prime yields across all asset classes, with a staggering €3,250 million investment turnover in income properties. Its economic growth ranks second in Europe.

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Key asset categories

Traditional real estate assets continue to drive high investment income. However, hotels have seen a resurgence, surpassing 2019 levels in 2022. Additionally, alternative assets like student accommodation, senior housing, healthcare, and agribusiness are gaining traction. Build-to-rent, data centers, and life sciences are expected to grow from 2023. In the office sector, dynamism remained strong in 2022 and is projected to continue in 2023.

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New working paradigms

Post-pandemic, companies sought better work environments and flexibility. Some relocated their operations, with Portugal as a prime choice. Smaller enterprises embraced co-working spaces for their flexibility, contributing to the 24,000 sqm of flexible spaces in Lisbon alone in 2022. The rise of co-working spaces is aligned with the evolving needs of businesses and employees.

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Stability of the hospitality sector

Portugal's hospitality sector rebounded from the pandemic, matching 2019's overnight stays in 2022. However, rising operating costs prompted hotels to increase prices, linking the increase to improved quality. Notably, Lisbon, Madeira, and Algarve earned prestigious titles as leading destinations, with tourism recovering and thriving across different regions.

Also, Portugal's Golden Visa program underwent changes, now requiring investments to support artistic production and cultural heritage preservation. This alteration further enhances the attractiveness of investing in Portuguese hospitality.

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Student residences & Co-Living

Portugal's educational landscape draws in foreign students, with a remarkable 94% year-on-year increase in credit program students. Demand for student residences and co-living is strong due to the shortage of 76,000 beds in Lisbon and 32,000 beds in Porto. Geographically, Lisbon, Porto, and Coimbra are prominent student hubs.

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Key market trends

• Flexibility in job structures drives demand for office spaces and co-working in Lisbon and Porto.
• The rise of digital nomads fuels the demand for short-term rental accommodations.

• Student mobility increases demand for both short-term accommodations and dedicated student residences or co-living arrangements.
• Hospitality experiences growth, accompanied by rising prices and improved quality.
• Lisbon, Porto, Algarve, and possibly Madeira stand as focal points for hospitality, with a potential glance toward Coimbra for student accommodation.

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Conclusion

The hospitality, co-living, and co-working sectors in Portugal, France, and Spain are undergoing exciting changes. With Portugal's technological advancements, favorable investment climate, and vibrant hospitality scene, it emerges as a key player. The focus on quality and adaptability to evolving work and living patterns ensures these sectors will remain dynamic and full of opportunities.

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