Madrid Shopping Streets Exceed 90% Occupancy with Tourism Boost
10 July, 2024
Madrid has strengthened its post as Spain’s city-break destination par excellence, with 2023 seeing a 20% rise in tourism compared to 2019 figures. Gesvalt and aRetail have published their 2023 High Street Report, which looks at retail market data for 13 cities across Spain and Portugal.
Gesvalt and aRetail have published their 2023 High Street Report, which looks at retail market data for 13 cities across Spain and Portugal. The study highlights elements including a rise in tourism in Madrid, up 20% in 2023 compared to 2019. The city attracted more than seven million international travellers, generating 1.85 billion euros and this has led to occupancy rates for commercial spaces in the capital’s primary shopping streets topping 90%.
Aside from the increase in tourism, the INE’s Retail Trade Index statistics also indicate that the Community of Madrid sits top for retail sales, with an increase of 13.3% in the period from January to July 2023, three and a half points above the national average. Retail trade in the region accounts for 6% of Gross Value Added.
Calle Fuencarral boasts a 100% occupation of its 130 premises. Most notable among the businesses present are fashion and jewellery brands, representing almost two thirds of the total at 66.15%. These are followed by the restaurant sector, which occupies a total of 13.85%. In third place are cosmetics businesses, at 6.15%, followed by services and home at 1.54% and 0.77% respectively, leaving some 12.73% for other areas of activity.
Calle Serrano, meanwhile, has just one premises available of a total of 156 on the street, boasting an occupancy rate of 99.36%. Among the different businesses features, the fashion and jewellery sector is dominant once again, with 61.54% of the total. It is followed on this occasion by service businesses (13.46%) and restaurants (10.26%). Behind them are cosmetics companies, with 1.92%, and home brands at 0.64%, leaving 11.54% for other businesses.
On the famed Calle Preciados, occupancy stood at 95.65%, with only three of the 69 existing premises vacant. The fashion and jewellery sector is once again the predominant force, with 34.78% of premises, here closely followed by restaurants, which account for 27.54% of the total. On the other hand, businesses dedicated to services account for 5.80% and cosmetics take 2.90%, leaving 24.64% for other sectors.
Meanwhile, Gran Vía had an occupancy rate of 94.76%, with only 10 of 191 premises currently available. The restaurant sector was the most predominant here, with 29.84% of the total, followed by fashion and jewellery shops, which accounted for 20.94%. Service businesses account for 14.14%, while cosmetics make up 3.14%, leaving 23.56% for premises used for other purposes.
Finally, on Calle Ortega y Gasset, 36 of the 40 existing premises are in use, meaning an occupancy rate of 90%. The split between different sectors is far less varied here, with some 83.33% of units housing fashion and jewellery stores and 8.33% being used for service-based businesses. This leaves the remaining 8.33% engaged in other sectors.
Rents between €35/m2 and €400/m2
Rents in Madrid show significant variation between the main shopping streets and also depend heavily on the size of the premises. In Calle Fuencarral, premises of over 1,000 square metres are priced at between €60/m2 and €75/m2, while those between 501 and 1,000 square metres sit at between €70/m2 and €90/m2. Smaller surface-area premises, between 301 and 500 square metres, have rents between €90/m2 and €115/m2, while for between 101 and 300 square metres, the rent is between €150/m2 and €180/m2. Fewer than 100 square metres tend to be priced between €290/m2 and €320/m2.
On Calle Serrano, premises of fewer than 100 square metres are the most expensive in the capital, at between €350/m2 and €400/m2. Following the usual trend, rent per m2 falls as the size of the unit increases. Prices range between €250/m2 and €300/m2 for premises between 101 and 300 square metres and between €180/m2 and €250/m2 for premises between 301 and 500 square metres. For larger premises, greater than 501 square metres but fewer than 1,000, prices sit between €150/m2 and €200/m2, while premises of over 1,000 square metres are priced between €50/m2 and €100/m2.
Rental prices in Calle Preciados, meanwhile, sit between €50/m2 and €80/m2 for premises over 1,000 square metres and between €115/m2 and €150/m2 for those over 501 square metres. The price range for premises between 301 and 500 square metres varies from €190/m2 to €220/m2. Units below 300 square metres are on offer for €240/m2 to €275/m2, while the smallest (less than 100 square metres) sees the price jump significantly to between €340/m2 and €370/m2.
When it comes to Gran Vía, the price analysis must differentiate between three sections of the street given the significant variation between them. Along the first stretch, running from Calle Alcalá to Calle Montera, prices are the lowest of all the streets analysed. They range from €35/m2 to €65/m2 for premises of over 1,000 square metres, from €55/m2 to €70/m2 for premises of fewer than 1,000 square metres and between €80/m2 and €100/m2 for those under 500 square metres. Premises of fewer than 300 square metres are priced between €100/m2 and €140/m2, while below 100 square metres cost from €140/m2 to €180/m2.
The second section, which runs from Calle Montera to Callao, sees the highest prices. Here, smallest premises, of fewer than 100 metres, range from €340/m2 to €380/m2. For premises up to a maximum of 300 square metres, the price ranges between €240/m2 and €280/m2, while up to 500 square metres can reach figures of between €190/m2 and €230/m2. For premises with a surface area over 500 square metres but fewer than 1,000, prices sit between €120/m2 and €160/m2. Any bigger than that, and prices are between €50/m2 and €80/m2.
The third section, which runs from Callao to Plaza de España, has rents of between €45/m2 and €70/m2 for premises over 1,000 square metres, between €60/m2 and €75/m2 for those under 1,000 square metres, between €80/m2 and €100/m2 for those under 500 square metres, between €120/m2 and €160/m2 for those under 300 square metres and between €150/m2 and €190/m2 for the smallest, fewer than 100 square metres.
Finally, Calle Ortega y Gasset, shows rental prices of between €330/m2 and €350/m2 for smaller premises of fewer than 100 square metres. This drops to between €250/m2 and €270/m2 for those larger than 100 square metres. The price for units over 300 square metres is between €200/m2 and €220/m2, while those that top 500 are prices between €160/m2 and €180/m2. Premises measuring over 1,000 square meters are on offer for €50/m2 to €100/m2.
Retail and real estate face the challenge of population growth
Retail, like the rest of the real estate sector, will have to address the challenges presented by Madrid’s high population growth. The INE estimates that the region’s population will increase by more than one million inhabitants over the next 15 years, meaning occupancy and sales methods will have to adapt to changing population needs.