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La Nación - Properties: The 20 Maxims You Should Know - La Nación
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www.lanacion.com.ar
August 07, 2023
La Nación - Properties: The 20 maxims you should know before investing in the sector
By: Carla Quiroga
How could a strong devaluation impact the property market? Did prices hit their floor? Is there a cycle change? What businesses leave the best income? These and other questions were answered at the LN Propiedades Real Estate Summit
The perception of a tail “breeze” in the real estate market was a point on which the more than 25 speakers who participated in the Real Estate Summit agreed, the annual event that LA NACION has organized for eight years and that, without a doubt, it became an unmissable appointment for those seeking answers about where the real estate market is headed and investments in the sector.
In this edition, the challenge was to answer whether a cycle change is really discounted, a complicated question in a context of exchange volatility if one takes into account that properties are sold in dollars and that the uncertainty of election years ends up delaying the processes investment. However, the more than 200 business men and women who attended agreed on 20 maxims , keys to understanding what is coming in the real estate industry.
1-There is a change of cycle
There is talk of a slow but firm recovery, with more queries, operations and prices validated between supply and demand. In other words , the owners stopped resisting the drop in prices and accepted a disclosure of the sale values , which ended up generating movement in the market . The general feeling is that prices have touched their floor.
2-There is no room for aggressive counteroffers
Negotiations have shrunk and, according to Diego Cazes, Director of LJ Ramos, bargaining of between 15% and 20% is a thing of the past. Today they do not exceed 7%. "With a bit of fresh air, the market reacts and buys," he completed. Today, with the same money that a few years ago you had access to a two-room apartment, you can buy a three-room apartment, explained Leandro Molina, Director of Zonaprop, and stressed that depending on the neighborhood, if it is a new project unit or a used one, "with US$175,000 you can access to 2 bedrooms”.
3-It is a good time to buy a property
The statement is based on a key premise: prices hit the floor. In data, Molina, which manages the platform with more than 700,000 published ads, explained that sales values have fallen by 23.9% since 2019. “Today we see a rise in sales prices, for the first time in 52 months. In the month of July there was a rise of 0.1%, ”he explained.
"We are reaffirming that the brick continues to be a valuable refuge for the Argentines", contributed Gabriela Goldszer, Director of Ocampo Propiedades. Martín Boquete, a partner of Toribio Achával agreed with the increase but clarified that this increase is "slight". At the same time, he questioned that Argentines " are used to looking at the situation to make decisions, but the truth is that the property is a product that transcends the situation: when the values are recovered, it is when people remember that the properties last 100 years and that they are for a lifetime”.
“Today there are opportunity prices, values fell and can only go up because there is an expectation of change ,” added developer Gabriel Mayo, from G&D, who recalled when in 1984 his father bought him a three-room apartment for US$17,000.
Leandro Soldati, partner of the real estate agency of the same name, acknowledged that the “owners have a hard time accepting the price drop because the nominal value is recorded without realizing that they can make larger purchases. For this reason, the processes of going up are fast, we all get on the bonanza and those of going down are slow” , he explained. Miguel Ludmer, Director of Interwin, agreed and emphasized the paradox of the market with its good and bad: "On the one hand, there is no bank pressing, which is why people try to associate the value of the purchase with what that paid or tie it, and a large percentage even prefer to postpone the sale. That is, the adjustment is by rhythm and not by price, ”he explained.
In short, the referents agreed that Argentina "is gifted." "If one looks at the historical data to project where we are standing, it gives us that the prices we have today only in 2002 and in 1989 were lower -in constant currency- than at present", Soldati compared.
4-Buying new construction is still "cheap" in dollars
While the cost of construction has held steady over the past year, it is still 10 percent below the decade average. That is to say, it is not the opportunity of October 2020 when it reached its historical floor of the last 20 years, but it is still an attractive investment . The developer Gerardo Azcuy estimated in the panel that he shared with developers that the rent that a work leaves from start to finish is around 40 percent. His colleague Gonzalo de la Serna, CEO of Consultatio agreed and explained that this number gives between 10 and 12 percent per year. “Brick is more resilient than other assets such as financials that can yield more at some point and not at another,” he analyzed.
The reality, the developers agree, is that one starts a project in one Argentina and always ends it in another. “If you start with a good cycle, you usually end it in a bad one. The current one is low, that is, it can only go up,” reflected Mayo.
5- The brick, a way to dollarize pesos
The price scenario on your floor, the reactivation of contained demand and a pivotal moment of changes in expectations encourages those who have a flow of pesos and given the impossibility of buying dollars to seek to buy future dollars through real estate investing, for example, in new construction projects. Carlos Spina, partner at Argencons, the developer that owns the Quartier brand with more than 330,000 square meters under construction, explained that in turbulent times, financiers talk to you about fly to quality , but in this sector fly to trust happens :“They say I have the weights, they burn me, and they wonder where I put them in an environment of little trust and that is where the brand weighs, its history and not having disappointed but the reality is that we do not overpromise either”.
Regarding the uncertainty that the inflationary context can somehow generate and the risk that the quotas in pesos adjusted by CAC will skyrocket during the work process —the traditional way of buying on site-, Spina, which among other ventures is advancing with one in Bajo Belgrano, where it sells for an average of US$3,000/m², responds that in its trust model at cost, it always complied with the amounts committed in pesos. "In dollars it is difficult to know," he analyzed and clarified that in his case he does not register arrears.
Far from the residential market, Hernán Castro, senior broker at Cushman & Wakefield, highlighted offices as a business opportunity, even at this time when empty meters abound in this type of property . In this sense, he explained that, although vacancy grew after the pandemic, the companies that buy do so to diversify their investment in pesos, when they have a surplus: they buy brick assets to preserve value. “ They place pesos, dollarize and have an income of 3 percent. It must be recognized that it is not high but that is not the end. The driver, in this case, is to dollarize the pesos that are devaluing day by day and it is a way of safeguarding value”, the executive analyzed. Regarding costs, he revealed that well-located premium offices defend a sale value of US$5,000/m², and assured that most of these transactions are new and well-located assets, because the buying companies “play it safe”. he admitted.
6-The financial market anticipates what happens in real estate
The relationship was made by de la Serna, by Consultatio. The executive analyzed that a year ago shares were 70 below their maximums and real estate was more resilient, but in the last 12 months the value of companies more than doubled in dollars: it grew 110 percent, bonds rose 40 percent and cars too. This relative price adjustment suggested that the sale values of the properties touched their floor and give the prospect that they will rise. What happens is that financial assets, being more liquid, move faster but they anticipate what can happen in the brick.
7-Good products sell
In the first half of the year, de la Serna stated that he sold all the land in the two new neighborhoods that he launched in Nordelta and in Puertos . “In total there were 200 lots, 100 of each one with tickets that oscillated between US$150,000 and US$250,000 depending on whether they face the water or not. The demand is robust and not only from end users but also from investment: we sold ten macrolots in Nordelta”, explained the CEO, emphasizing that these are investments that look at two, three and even four years.
Along the same lines, Rodrigo Nieto Silva, who manages Pilará, admitted that there was a tailwind due to the pandemic that continues today. The project has six consolidated neighborhoods and three more to be delivered. The last one, launched in September of last year, has already been sold: there were 130 lots with tickets between US$140,000 and US$220,000 . His next plan is to launch a new neighborhood in September. “It will have lots from 800 meters with tickets that will range between US$140/m² and US$220/m²,” explained the man who leads the venture where 600 families live. "We receive many inquiries from abroad because Argentina is cheap, as well as young families who want to change their lives and see Pilar as a good option that has nature and all the services," he analyzed.
Outside of the market for closed suburban developments, Azcuy stated that "the refuge of value is the product with attributes that respond to demand" , and emphasized that this is the point that guarantees a good business. The developer whose company was born with a focus on the Caballito neighborhood will disembark for the first time outside that area: he is advancing with a work in Nordelta on a piece of land on the main canal with an exit to Luján. “It is a project very connected with nature and with a nautical spirit,” he added.
In short, the developers insisted that they are offering value protection and that the brick works because they transform weights that are "little pieces of paper" into square meters that generate value.
8-There are opportunities in some Buenos Aires neighborhoods
It was relieved by the report on demand made by Zonaprop. "Caballito, Recoleta, Palermo, Villa Crespo and Saavedra are the most wanted ," Molina explained. "In Caballito there was an unexplored niche with a demand with purchasing power that built houses in gated communities in the southern zone of 1,500 square meters but lived in small, ugly, crowded apartments," Azcuy said, which sells for an average of US$3,100/m². Today it has 6 projects underway and will deliver two this year. “I am always obsessed with quality products as an antidote to bad cycles. If you have a good product, adjust the price a bit and sell the same”, he clarified.
9-The return to the city is consolidated
The absence of peak hours on the routes and the return to face-to-face reaffirms the trend. In numbers, Molina explained that the demand in closed neighborhoods dropped between 48% and 70%, depending on whether we are talking about the southern or northern corridor. In other words, life in the city is once again at the center of demand. Álvaro García Resta, Secretary of Urban Development of the City of Buenos Aires, quantified that nine out of ten Argentines live in cities .
10-Recoleta recovers its charm
There is a resurgence of this traditional neighborhood with a profile of inhabitants in full transformation and that is becoming aspirational for young demand. " It is an area that is part of the tourist circuit, the profile of the neighbors has changed, you see more people walking and it does not have so much night, " explained Boquete, from Toribio Achával, who clarified that it is also an area in the sights of people older people looking for peace of mind.
11-The south also exists
From San Martín de los Andes, Daniela Aiello, partner of Finca Sur Gestión Inmobiliaria, focused on the fact that Patagonia is experiencing a great moment in terms of real estate development . “There is a lot of demand in investments because people seek to invest, enjoy and dollarize their savings. Today we have tickets with guaranteed income because now there are people all year round. For example, there are opportunities for apartments at US$120,000 with one bedroom, with tourist income guaranteed with a floor of 7% per year in dollars ”. She at the same time, she admitted that the demand from foreigners increased surprisingly. “The change favors them,” she emphasized. The real estate broker maintained that in the south the prices of the houses did not suffer the fall that they had in CABA.
12- In Vaca Muerta there are investment opportunities
Lucas Salvatore, the entrepreneurial creator of Idero, a company that builds single-family homes from a structure with a steel core, spoke about this topic. “They are developed under the concept of modular buildings. This means that an entire six-story building that we have, for example, in the oil area, can be relocated," said Salvatore, who assured that in Añelo, the town in Vaca Muerta in Neuquén - there are "some 50,000 beds" missing . In that area, Salvatore buys the land, develops it, builds, rents and operates different projects. He already has 96 apartments and another 120 more under construction, in addition to 50 houses and more apartments planned. “We rent to multinational companies that provide housing for their employees: we have contracts in dollars for ten years. In this investment, the rent starts at 8% in dollars, we have units of 60 m² and two bedrooms at US$120,000” , he explained.
13- The microcenter has potential.
García Resta said it in the panel that he shared with the real estate brokers. The secretary of urban development of the City of Buenos Aires gave as an example the two historic buildings in the process of conversion from offices to residences: Tornquist and Del Plata. “ There is an opportunity to residentialize the area and we generate incentives to achieve it. The first step was to generate supply, then the demand challenge will come, ideally for permanent use ”, he recounted. The urban planner is convinced of the possibility for the country to focus on the development of sub-centralities and develop 15-minute cities .
14- Neonomadism advances in real estate projects
Flexibility is a key premise for those who build a venture. A concrete example is the redefinition of the project that Eduardo Costantini had to do on the land that he planned to build on the land that he had bought in Catalinas. He abandoned the idea of an office development and will now move forward with a residential project based on the concept of the paradigm of life in motion. “ Buildings are no longer thought of as residential or office, they are spaces to be lived in that can attract extra people from their radius of influence, people looking for an expanding life with good views, amenities”, reported De la Serna . In other words, what the executive refers to is "enjoyable spaces." A concept about which the demand became aware after the pandemic.
15- By 2027, the population between 30 and 34 years old will be a record
The economist Federico González Rouco dedicated his presentation to the rental market with concrete and real numbers. In Argentina there are already 2.9 million tenant households, 34% more than in 2016, of which 77% are concentrated in CABA, province of Buenos Aires, Córdoba, Santa Fe and Mendoza . Due to the lack of mortgage loans, the low rental offer and the unfavorable conditions that the market is going through, the emancipation rate is low and there are two million young people who find it difficult to leave the family home. "By 2027, the population between 30 and 34 years of age will be the highest in history, which requires an urgent housing solution," said González Rouco. “Today rent is a luxury for the tenant and not very profitable for the owner,there is an imbalance and it is a difficult time like never before. Due to the low profitability, the offer is withdrawn and the demand is not satisfied” , he analyzed.
16- "I take charge, the law has a lot of errors and it must be changed" (Daniel Lipovetzky, creator of the rental law)
Both Enrique Abatti, president of the Chamber of Owners, and the current provincial legislator Daniel Lipovetzky, former national deputy and author of the current national rental law, reflected on how and why the current legal framework is decisive and is the cause of the market situation. Although Lipovetzky publicly expressed his responsibility for the law, he also emphatically clarified that it was a government project that was of the ruling party at that time (the presidency of Mauricio Macri) and he complied with the request made to him for being part of that political space. to present a bill that had changes in the internal and parliamentary debate, a unanimous vote by the ruling party and the opposition, which was not sanctioned as he presented it but whose role was duly fulfilled even though it is now popularly known as " Lipovetzky law . While Abatti clarified that "as a Chamber of Owners we always opposed this law ."
Abatti, for his part, measured the drama that tenants and owners are experiencing “ because historically the rental supply reached 20,000 properties, today it barely reaches 1,200 . We are going to zero rents ″, he mentioned. And among the shortcuts that owners adopt to try to improve their profitability, he listed extensions – "renewal by law implies one year without being able to update while extensions are for shorter periods, such as six months" -, or with a “voluntary increase”at the request of the owners by the tenants and, according to the specialist, it is not illegal in accordance with the contractual freedom enshrined in the Civil and Commercial Code. Also that the owners “undersell” their apartments so as not to rent and invest in countries like Uruguay or Paraguay with greater legal and financial security.
17- The long-term logistics real estate business
The expectation in this market, both in the logistics and industrial sectors, has never been as great as at this moment. “We are optimistic about everything to come and the market is proving us right ,” agreed Santiago Isern, from Cushman & Wakefield, and Alejandro Winokur, from Newmark. "With the low vacancy we have and the moment the market is experiencing, new areas were validated . Places standardized as successful increase their values too much and the owners of those lands still do not accept that there is a limit to being profitable. This pushed us to move to other places, such as Escobar, Pilar and Rotonda De Alpargatas., among other examples", expressed Isern and emphasized that, although this was a proposal "a bit out of character" a few years ago, today it is part of what the market demands. “They are all going to be successful projects,” she added.
Regarding the validation of new areas for expansion, Winokur added that all these projects are around five years old and that is why today their value is undoubtedly much higher. “Any of these ventures started trusting that the market would flow and expand, which it did. During this period, these lands, which were completely rural before and are now lands suitable for development, were revalued and their value quintupled ”, he added.
18-The offices became spaces that contain
Valeria Cavallero, Business Manager of We Work, expressed that today flexible offices are being developed where the use of spaces and the user experience are prioritized over square meters. The new paradigms propose " that the employee feels that going to the office has added value ", he mentioned and pointed out that this year there has been a trend known as fly to quality that seeks to put aside the meters, in pursuit of adding services . “For us, the post-pandemic was a clear opportunity for the development of flexible offices. Today it is preferred to have just enough space and share meeting rooms, common areas”, commented the executive. Along the same lines, Fernando Novoa Uriarte, a partner at Newmark added that it is important that the new offices look at what young people and new talents are needing. " The user experience is sought in the building , in the environment and this is vital for companies to attract talent", the professional deepened. Today, “the new works in the city are incorporating open and collaborative spaces that are not inside the office but in the building”, he reflected.
For his part, Gonzalo Meira, JLL's director of transactions, specified that in order to seduce employees to attend the office at least a few days a week , it is necessary to be clear about "what is the experience that is going to be given to them" . Novoa Uriarte agreed with what was just stated, who also stated: "The collaborators are imposing their conditions and if you don't give them what they want, they won't go."
In accordance with the uncertainty generated by an election year, Meira maintained that "it would be necessary to separate between the companies that are thinking of moving and those that have capital as a reinforcement." In terms of the executive, the first point has to do with understanding what will be the need and the use that will be given to the office: “Will there be a flex modality? Will it be in person? Which in some cases is still not fully resolved. Regarding the second axis, "we have had a record year of sales because firms understand and see that investing in real estate is safe."
19- Artificial intelligence could solve the traffic problems of cities
"The cities of the future with the adoption of artificial intelligence are going to be smart cities where we have many algorithms that will allow the efficient solution of various problems that we have, such as logistics ," said Rebeca Hwang , general partner of Kalei Ventures. The specialist points out that these smart cities were designed many years ago and the visions of how they can be today are diverse. “With the dizzying adoption of technology today we are going to start micro-ecosystems where these near-future pilots can be created,” she summarizes.
20- Buenos Aires, Bariloche and other inland cities can be "15-minute cities"
Carlos Moreno, the creator of the "15-minute city" concept, spoke at the Real Estate Summit from Paris, where he lives and works with Mayor Anne Hidalgo on urban planning issues, and assured that both megacities and small cities can be "15 minute cities" . What is it about? Being able to implement six basic attributes in 15 minutes in very compact areas and in 30 minutes in areas with less population density: decent housing, a local business, physical and mental health, education and culture, recreation in public spaces, workplaces, all this in short distances and as far as possible without the need to use a car.
In our country there is a project that has this formula as a base and it is in the heart of the city of Buenos Aires. “On my last trip to Buenos Aires I was in Flores and Villa Crespo , because we have a very intense collaboration with the Government of the Autonomous City of Buenos Aires with a project called 48 Calles that represents the 48 neighborhoods of the city . The transformations that are underway, such as the regeneration of the microcenter, seem very important to us; see the urban wound created by the highway in the Flores neighborhood, socially segregating the population to one side and to the other; the creation of green streets with public spaces; and linear parks that are a very strong trend in modern urbanism to create new centers.The microcenter exists but we must create new and more centers that we call polarities, a multicentric city”, he deepened.
For Moreno, not only large capital cities have the potential to be 15-minute cities: “I had access to a project in San Carlos de Bariloche that will be called Bariloche Este and it has all the potential to become a 15-minute city. It is very important that we show that we can go in this direction being small cities because this concept is not a monopoly of big cities and its six attributes can be implemented in small ones ”.
Source:
Propiedades: las 20 máximas que hay que saber antes de invertir en el sector
¿Cómo podría impactar una devaluación fuerte en el mercado de las propiedades?¿Los precios tocaron su piso? ¿Hay un cambio de ciclo? ¿Qué negocios dejan la mejor renta? Éstas y otras preguntas se respondieron en el Summit de Real Estate de LN Propiedades
www.lanacion.com.ar
August 07, 2023
La Nación - Properties: The 20 maxims you should know before investing in the sector
By: Carla Quiroga
How could a strong devaluation impact the property market? Did prices hit their floor? Is there a cycle change? What businesses leave the best income? These and other questions were answered at the LN Propiedades Real Estate Summit
The perception of a tail “breeze” in the real estate market was a point on which the more than 25 speakers who participated in the Real Estate Summit agreed, the annual event that LA NACION has organized for eight years and that, without a doubt, it became an unmissable appointment for those seeking answers about where the real estate market is headed and investments in the sector.
In this edition, the challenge was to answer whether a cycle change is really discounted, a complicated question in a context of exchange volatility if one takes into account that properties are sold in dollars and that the uncertainty of election years ends up delaying the processes investment. However, the more than 200 business men and women who attended agreed on 20 maxims , keys to understanding what is coming in the real estate industry.
1-There is a change of cycle
There is talk of a slow but firm recovery, with more queries, operations and prices validated between supply and demand. In other words , the owners stopped resisting the drop in prices and accepted a disclosure of the sale values , which ended up generating movement in the market . The general feeling is that prices have touched their floor.
2-There is no room for aggressive counteroffers
Negotiations have shrunk and, according to Diego Cazes, Director of LJ Ramos, bargaining of between 15% and 20% is a thing of the past. Today they do not exceed 7%. "With a bit of fresh air, the market reacts and buys," he completed. Today, with the same money that a few years ago you had access to a two-room apartment, you can buy a three-room apartment, explained Leandro Molina, Director of Zonaprop, and stressed that depending on the neighborhood, if it is a new project unit or a used one, "with US$175,000 you can access to 2 bedrooms”.
3-It is a good time to buy a property
The statement is based on a key premise: prices hit the floor. In data, Molina, which manages the platform with more than 700,000 published ads, explained that sales values have fallen by 23.9% since 2019. “Today we see a rise in sales prices, for the first time in 52 months. In the month of July there was a rise of 0.1%, ”he explained.
"We are reaffirming that the brick continues to be a valuable refuge for the Argentines", contributed Gabriela Goldszer, Director of Ocampo Propiedades. Martín Boquete, a partner of Toribio Achával agreed with the increase but clarified that this increase is "slight". At the same time, he questioned that Argentines " are used to looking at the situation to make decisions, but the truth is that the property is a product that transcends the situation: when the values are recovered, it is when people remember that the properties last 100 years and that they are for a lifetime”.
“Today there are opportunity prices, values fell and can only go up because there is an expectation of change ,” added developer Gabriel Mayo, from G&D, who recalled when in 1984 his father bought him a three-room apartment for US$17,000.
Leandro Soldati, partner of the real estate agency of the same name, acknowledged that the “owners have a hard time accepting the price drop because the nominal value is recorded without realizing that they can make larger purchases. For this reason, the processes of going up are fast, we all get on the bonanza and those of going down are slow” , he explained. Miguel Ludmer, Director of Interwin, agreed and emphasized the paradox of the market with its good and bad: "On the one hand, there is no bank pressing, which is why people try to associate the value of the purchase with what that paid or tie it, and a large percentage even prefer to postpone the sale. That is, the adjustment is by rhythm and not by price, ”he explained.
In short, the referents agreed that Argentina "is gifted." "If one looks at the historical data to project where we are standing, it gives us that the prices we have today only in 2002 and in 1989 were lower -in constant currency- than at present", Soldati compared.
4-Buying new construction is still "cheap" in dollars
While the cost of construction has held steady over the past year, it is still 10 percent below the decade average. That is to say, it is not the opportunity of October 2020 when it reached its historical floor of the last 20 years, but it is still an attractive investment . The developer Gerardo Azcuy estimated in the panel that he shared with developers that the rent that a work leaves from start to finish is around 40 percent. His colleague Gonzalo de la Serna, CEO of Consultatio agreed and explained that this number gives between 10 and 12 percent per year. “Brick is more resilient than other assets such as financials that can yield more at some point and not at another,” he analyzed.
The reality, the developers agree, is that one starts a project in one Argentina and always ends it in another. “If you start with a good cycle, you usually end it in a bad one. The current one is low, that is, it can only go up,” reflected Mayo.
5- The brick, a way to dollarize pesos
The price scenario on your floor, the reactivation of contained demand and a pivotal moment of changes in expectations encourages those who have a flow of pesos and given the impossibility of buying dollars to seek to buy future dollars through real estate investing, for example, in new construction projects. Carlos Spina, partner at Argencons, the developer that owns the Quartier brand with more than 330,000 square meters under construction, explained that in turbulent times, financiers talk to you about fly to quality , but in this sector fly to trust happens :“They say I have the weights, they burn me, and they wonder where I put them in an environment of little trust and that is where the brand weighs, its history and not having disappointed but the reality is that we do not overpromise either”.
Regarding the uncertainty that the inflationary context can somehow generate and the risk that the quotas in pesos adjusted by CAC will skyrocket during the work process —the traditional way of buying on site-, Spina, which among other ventures is advancing with one in Bajo Belgrano, where it sells for an average of US$3,000/m², responds that in its trust model at cost, it always complied with the amounts committed in pesos. "In dollars it is difficult to know," he analyzed and clarified that in his case he does not register arrears.
Far from the residential market, Hernán Castro, senior broker at Cushman & Wakefield, highlighted offices as a business opportunity, even at this time when empty meters abound in this type of property . In this sense, he explained that, although vacancy grew after the pandemic, the companies that buy do so to diversify their investment in pesos, when they have a surplus: they buy brick assets to preserve value. “ They place pesos, dollarize and have an income of 3 percent. It must be recognized that it is not high but that is not the end. The driver, in this case, is to dollarize the pesos that are devaluing day by day and it is a way of safeguarding value”, the executive analyzed. Regarding costs, he revealed that well-located premium offices defend a sale value of US$5,000/m², and assured that most of these transactions are new and well-located assets, because the buying companies “play it safe”. he admitted.
6-The financial market anticipates what happens in real estate
The relationship was made by de la Serna, by Consultatio. The executive analyzed that a year ago shares were 70 below their maximums and real estate was more resilient, but in the last 12 months the value of companies more than doubled in dollars: it grew 110 percent, bonds rose 40 percent and cars too. This relative price adjustment suggested that the sale values of the properties touched their floor and give the prospect that they will rise. What happens is that financial assets, being more liquid, move faster but they anticipate what can happen in the brick.
7-Good products sell
In the first half of the year, de la Serna stated that he sold all the land in the two new neighborhoods that he launched in Nordelta and in Puertos . “In total there were 200 lots, 100 of each one with tickets that oscillated between US$150,000 and US$250,000 depending on whether they face the water or not. The demand is robust and not only from end users but also from investment: we sold ten macrolots in Nordelta”, explained the CEO, emphasizing that these are investments that look at two, three and even four years.
Along the same lines, Rodrigo Nieto Silva, who manages Pilará, admitted that there was a tailwind due to the pandemic that continues today. The project has six consolidated neighborhoods and three more to be delivered. The last one, launched in September of last year, has already been sold: there were 130 lots with tickets between US$140,000 and US$220,000 . His next plan is to launch a new neighborhood in September. “It will have lots from 800 meters with tickets that will range between US$140/m² and US$220/m²,” explained the man who leads the venture where 600 families live. "We receive many inquiries from abroad because Argentina is cheap, as well as young families who want to change their lives and see Pilar as a good option that has nature and all the services," he analyzed.
Outside of the market for closed suburban developments, Azcuy stated that "the refuge of value is the product with attributes that respond to demand" , and emphasized that this is the point that guarantees a good business. The developer whose company was born with a focus on the Caballito neighborhood will disembark for the first time outside that area: he is advancing with a work in Nordelta on a piece of land on the main canal with an exit to Luján. “It is a project very connected with nature and with a nautical spirit,” he added.
In short, the developers insisted that they are offering value protection and that the brick works because they transform weights that are "little pieces of paper" into square meters that generate value.
8-There are opportunities in some Buenos Aires neighborhoods
It was relieved by the report on demand made by Zonaprop. "Caballito, Recoleta, Palermo, Villa Crespo and Saavedra are the most wanted ," Molina explained. "In Caballito there was an unexplored niche with a demand with purchasing power that built houses in gated communities in the southern zone of 1,500 square meters but lived in small, ugly, crowded apartments," Azcuy said, which sells for an average of US$3,100/m². Today it has 6 projects underway and will deliver two this year. “I am always obsessed with quality products as an antidote to bad cycles. If you have a good product, adjust the price a bit and sell the same”, he clarified.
9-The return to the city is consolidated
The absence of peak hours on the routes and the return to face-to-face reaffirms the trend. In numbers, Molina explained that the demand in closed neighborhoods dropped between 48% and 70%, depending on whether we are talking about the southern or northern corridor. In other words, life in the city is once again at the center of demand. Álvaro García Resta, Secretary of Urban Development of the City of Buenos Aires, quantified that nine out of ten Argentines live in cities .
10-Recoleta recovers its charm
There is a resurgence of this traditional neighborhood with a profile of inhabitants in full transformation and that is becoming aspirational for young demand. " It is an area that is part of the tourist circuit, the profile of the neighbors has changed, you see more people walking and it does not have so much night, " explained Boquete, from Toribio Achával, who clarified that it is also an area in the sights of people older people looking for peace of mind.
11-The south also exists
From San Martín de los Andes, Daniela Aiello, partner of Finca Sur Gestión Inmobiliaria, focused on the fact that Patagonia is experiencing a great moment in terms of real estate development . “There is a lot of demand in investments because people seek to invest, enjoy and dollarize their savings. Today we have tickets with guaranteed income because now there are people all year round. For example, there are opportunities for apartments at US$120,000 with one bedroom, with tourist income guaranteed with a floor of 7% per year in dollars ”. She at the same time, she admitted that the demand from foreigners increased surprisingly. “The change favors them,” she emphasized. The real estate broker maintained that in the south the prices of the houses did not suffer the fall that they had in CABA.
12- In Vaca Muerta there are investment opportunities
Lucas Salvatore, the entrepreneurial creator of Idero, a company that builds single-family homes from a structure with a steel core, spoke about this topic. “They are developed under the concept of modular buildings. This means that an entire six-story building that we have, for example, in the oil area, can be relocated," said Salvatore, who assured that in Añelo, the town in Vaca Muerta in Neuquén - there are "some 50,000 beds" missing . In that area, Salvatore buys the land, develops it, builds, rents and operates different projects. He already has 96 apartments and another 120 more under construction, in addition to 50 houses and more apartments planned. “We rent to multinational companies that provide housing for their employees: we have contracts in dollars for ten years. In this investment, the rent starts at 8% in dollars, we have units of 60 m² and two bedrooms at US$120,000” , he explained.
13- The microcenter has potential.
García Resta said it in the panel that he shared with the real estate brokers. The secretary of urban development of the City of Buenos Aires gave as an example the two historic buildings in the process of conversion from offices to residences: Tornquist and Del Plata. “ There is an opportunity to residentialize the area and we generate incentives to achieve it. The first step was to generate supply, then the demand challenge will come, ideally for permanent use ”, he recounted. The urban planner is convinced of the possibility for the country to focus on the development of sub-centralities and develop 15-minute cities .
14- Neonomadism advances in real estate projects
Flexibility is a key premise for those who build a venture. A concrete example is the redefinition of the project that Eduardo Costantini had to do on the land that he planned to build on the land that he had bought in Catalinas. He abandoned the idea of an office development and will now move forward with a residential project based on the concept of the paradigm of life in motion. “ Buildings are no longer thought of as residential or office, they are spaces to be lived in that can attract extra people from their radius of influence, people looking for an expanding life with good views, amenities”, reported De la Serna . In other words, what the executive refers to is "enjoyable spaces." A concept about which the demand became aware after the pandemic.
15- By 2027, the population between 30 and 34 years old will be a record
The economist Federico González Rouco dedicated his presentation to the rental market with concrete and real numbers. In Argentina there are already 2.9 million tenant households, 34% more than in 2016, of which 77% are concentrated in CABA, province of Buenos Aires, Córdoba, Santa Fe and Mendoza . Due to the lack of mortgage loans, the low rental offer and the unfavorable conditions that the market is going through, the emancipation rate is low and there are two million young people who find it difficult to leave the family home. "By 2027, the population between 30 and 34 years of age will be the highest in history, which requires an urgent housing solution," said González Rouco. “Today rent is a luxury for the tenant and not very profitable for the owner,there is an imbalance and it is a difficult time like never before. Due to the low profitability, the offer is withdrawn and the demand is not satisfied” , he analyzed.
16- "I take charge, the law has a lot of errors and it must be changed" (Daniel Lipovetzky, creator of the rental law)
Both Enrique Abatti, president of the Chamber of Owners, and the current provincial legislator Daniel Lipovetzky, former national deputy and author of the current national rental law, reflected on how and why the current legal framework is decisive and is the cause of the market situation. Although Lipovetzky publicly expressed his responsibility for the law, he also emphatically clarified that it was a government project that was of the ruling party at that time (the presidency of Mauricio Macri) and he complied with the request made to him for being part of that political space. to present a bill that had changes in the internal and parliamentary debate, a unanimous vote by the ruling party and the opposition, which was not sanctioned as he presented it but whose role was duly fulfilled even though it is now popularly known as " Lipovetzky law . While Abatti clarified that "as a Chamber of Owners we always opposed this law ."
Abatti, for his part, measured the drama that tenants and owners are experiencing “ because historically the rental supply reached 20,000 properties, today it barely reaches 1,200 . We are going to zero rents ″, he mentioned. And among the shortcuts that owners adopt to try to improve their profitability, he listed extensions – "renewal by law implies one year without being able to update while extensions are for shorter periods, such as six months" -, or with a “voluntary increase”at the request of the owners by the tenants and, according to the specialist, it is not illegal in accordance with the contractual freedom enshrined in the Civil and Commercial Code. Also that the owners “undersell” their apartments so as not to rent and invest in countries like Uruguay or Paraguay with greater legal and financial security.
17- The long-term logistics real estate business
The expectation in this market, both in the logistics and industrial sectors, has never been as great as at this moment. “We are optimistic about everything to come and the market is proving us right ,” agreed Santiago Isern, from Cushman & Wakefield, and Alejandro Winokur, from Newmark. "With the low vacancy we have and the moment the market is experiencing, new areas were validated . Places standardized as successful increase their values too much and the owners of those lands still do not accept that there is a limit to being profitable. This pushed us to move to other places, such as Escobar, Pilar and Rotonda De Alpargatas., among other examples", expressed Isern and emphasized that, although this was a proposal "a bit out of character" a few years ago, today it is part of what the market demands. “They are all going to be successful projects,” she added.
Regarding the validation of new areas for expansion, Winokur added that all these projects are around five years old and that is why today their value is undoubtedly much higher. “Any of these ventures started trusting that the market would flow and expand, which it did. During this period, these lands, which were completely rural before and are now lands suitable for development, were revalued and their value quintupled ”, he added.
18-The offices became spaces that contain
Valeria Cavallero, Business Manager of We Work, expressed that today flexible offices are being developed where the use of spaces and the user experience are prioritized over square meters. The new paradigms propose " that the employee feels that going to the office has added value ", he mentioned and pointed out that this year there has been a trend known as fly to quality that seeks to put aside the meters, in pursuit of adding services . “For us, the post-pandemic was a clear opportunity for the development of flexible offices. Today it is preferred to have just enough space and share meeting rooms, common areas”, commented the executive. Along the same lines, Fernando Novoa Uriarte, a partner at Newmark added that it is important that the new offices look at what young people and new talents are needing. " The user experience is sought in the building , in the environment and this is vital for companies to attract talent", the professional deepened. Today, “the new works in the city are incorporating open and collaborative spaces that are not inside the office but in the building”, he reflected.
For his part, Gonzalo Meira, JLL's director of transactions, specified that in order to seduce employees to attend the office at least a few days a week , it is necessary to be clear about "what is the experience that is going to be given to them" . Novoa Uriarte agreed with what was just stated, who also stated: "The collaborators are imposing their conditions and if you don't give them what they want, they won't go."
In accordance with the uncertainty generated by an election year, Meira maintained that "it would be necessary to separate between the companies that are thinking of moving and those that have capital as a reinforcement." In terms of the executive, the first point has to do with understanding what will be the need and the use that will be given to the office: “Will there be a flex modality? Will it be in person? Which in some cases is still not fully resolved. Regarding the second axis, "we have had a record year of sales because firms understand and see that investing in real estate is safe."
19- Artificial intelligence could solve the traffic problems of cities
"The cities of the future with the adoption of artificial intelligence are going to be smart cities where we have many algorithms that will allow the efficient solution of various problems that we have, such as logistics ," said Rebeca Hwang , general partner of Kalei Ventures. The specialist points out that these smart cities were designed many years ago and the visions of how they can be today are diverse. “With the dizzying adoption of technology today we are going to start micro-ecosystems where these near-future pilots can be created,” she summarizes.
20- Buenos Aires, Bariloche and other inland cities can be "15-minute cities"
Carlos Moreno, the creator of the "15-minute city" concept, spoke at the Real Estate Summit from Paris, where he lives and works with Mayor Anne Hidalgo on urban planning issues, and assured that both megacities and small cities can be "15 minute cities" . What is it about? Being able to implement six basic attributes in 15 minutes in very compact areas and in 30 minutes in areas with less population density: decent housing, a local business, physical and mental health, education and culture, recreation in public spaces, workplaces, all this in short distances and as far as possible without the need to use a car.
In our country there is a project that has this formula as a base and it is in the heart of the city of Buenos Aires. “On my last trip to Buenos Aires I was in Flores and Villa Crespo , because we have a very intense collaboration with the Government of the Autonomous City of Buenos Aires with a project called 48 Calles that represents the 48 neighborhoods of the city . The transformations that are underway, such as the regeneration of the microcenter, seem very important to us; see the urban wound created by the highway in the Flores neighborhood, socially segregating the population to one side and to the other; the creation of green streets with public spaces; and linear parks that are a very strong trend in modern urbanism to create new centers.The microcenter exists but we must create new and more centers that we call polarities, a multicentric city”, he deepened.
For Moreno, not only large capital cities have the potential to be 15-minute cities: “I had access to a project in San Carlos de Bariloche that will be called Bariloche Este and it has all the potential to become a 15-minute city. It is very important that we show that we can go in this direction being small cities because this concept is not a monopoly of big cities and its six attributes can be implemented in small ones ”.
