Investors looking to satisfy an appetite for retail parks have turned to Spain, where international real estate advisor Savills predicts that transaction volumes could reach between EUR 70 and EUR 100 mln in 2010, up considerably from a total of EUR 19 mln in 2009.

Investors looking to satisfy an appetite for retail parks have turned to Spain, where international real estate advisor Savills predicts that transaction volumes could reach between EUR 70 and EUR 100 mln in 2010, up considerably from a total of EUR 19 mln in 2009.

Research by Savills suggests that demand is driven by current yields of between 7% and 7.25%, compared to 6% in UK. However, a shortage of available supply combined with a predicted upturn in demand will, Savills warns, cause a downward trend in yields. The current retail warehouse stock represents a density of 73 m2 per 1,000 people compared to 257 m2 in the UK.

Luis Espadas, Savills retail investment director in Madrid, said: 'Retail parks stir up strong interest amongst international investors. They seek well-anchored parks in principal Spanish cities at market rental levels with good lease lengths and minimal vacancy. What many investors are not aware of is how scarce this product is and the lack of projects under construction.'

Savills reports that between 2010 and 2011, 355,000 m2 of retail parks will be added to Spain’s existing retail park stock of 1.29 million m2.