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Manuel Martin

Spain's recession shows signs of ending

​Manuel Martin (Head of Property, Spain) points out that signs from the first half of this year show that Spain, although far from healthy growth, may be in the last stages of recession.

​Manuel Martin (Head of Property, Spain) points out that signs from the first half of this year show that Spain, although far from healthy growth, may be in the last stages of recession.

Employment
The latest EPA (government employment survey) for Q2 2013 showed that almost 150,000 jobs were created between April and June; although the figure bears a seasonal component of the Spanish economy, it is worthwhile noting that in the same period of 2012, 15,000 jobs were lost. Given that over 325,000 jobs were lost in Q1 2013, it is possible that employment eradication may have finally bottomed out. The latest rise in the number of jobs is unusual, given the economy is still in negative growth. The good news might reflect the recent labour reforms, ending the axiom where employment in Spain can only be created under positive growth.

Industrial output index
April showed 7,3% growth over the same period in 2012. This brings a return to positive figures after five consecutive months of decline.

Car sales
The sales to families showed a 14% increase in May, marking two consecutive months of growth. Petrol consumption also showed positive growth in May, for the first time in five years.

Current account balance
Spain's exports beat imports for the first time in history in March this year, with a surplus of €635m. There was a commercial deficit of €13bn in May 2012 against a cumulated one of €5.7bn in 2013.

Real estate investment
Over the last three months. the investor profile has moved from private equity / opportunistic funds (more focused now on debt and on the bad bank multifamily deals) to traditional core and core plus. Indeed, we are seeing a number of institutional investors from Germany back in the market looking for quality product; the recent transactions from Deka and Union Investment may mark the beginning of a series of deals which should put life into a market that has been dead for the past six quarters. Banks are also considering lending again, although conditions are still tight.

Manuel Martin R3

Manuel Martin

Head of the South East Region, US and Latin America

Manuel's biography