The new development segment of Mallorca’s real estate market is booming with steady high consumer demand. This is underlined in published statistics by the Ministerio del Fomento on newly constructed property in The Balearics.
The latest figures indicate that the total sales transaction volume in the region has more than doubled in the first and second quarters to 390 million euros in 2021 from 190 million euros in 2019 for the same period. Even last year during the pandemic, the total sales transaction increased slightly to 212 million euros in the first and second quarters.
This is a dynamic sector of the real estate market with strong interest from overseas buyers, and The Balearics has emerged as one of the top property destinations for overseas investors in Spain and the Mediterranean with principal interest from Germany, the UK, France, the Netherlands, Sweden. Switzerland and Austria.
Says Hans Lenz, Managing Director Engel & Völkers Mallorca Southwest: “Due to the sheer lack of land for construction, developers have focused on building high-quality luxury real estate with top Mallorquin architects that add tremendous style and prestige to each project.
Since the peak of new development construction in 2007 when some 11,830 licences were granted in the Balearics, building costs have tripled mainly due to the use of high-quality materials. Subsequently, new construction has an added market value of at least 10% on the final listed price plus other factors such as the substantial use of sustainable, environmentally-friendly technology with innovative architecture and design that further impacts the value”.
Engel & Völkers Mallorca Southwest with over 30 years of expertise on the island is leading two “stand-out” new developments with award-winning local architects, Tomeu Esteva of Esteva i Esteva and Jaime Oliver of OHLAB who are focusing their international expertise on two highly individual projects: Amber Village located on a hillside position overlooking Port Andratx, and Parallel in Bonanova on the outskirts of the city overlooking Palma.
The focus on contemporary modern architecture with Mediterranean details (such as dry-stone walls with local stone, wood detailing, and window shutters) has become popular with standard features such as underfloor heating, designer bathrooms, and kitchens plus the latest technology to meet the demands of the international investor.
In contrast, more developers are now looking at central locations in the rural heart of the island near traditional villages with views to the Sierra Tramuntana Mountains to build “one-off” modern country houses with stunning contemporary designs. Says, Christina Deutsch, Managing Partner, Engel & Völkers Mallorca Central & South; “In the past few years, the attraction of village locations for new off-plan projects has been a growing trend for developers.
As plots become increasingly difficult to find, developers have been investing inland for new opportunities. In the traditional wine-growing areas of Binissalem, Binali, and Sencelles, all located within 30 minutes drive of Palma, with good road connections and wonderful views across the mountains, a handful of new projects are now being planned over the next two years. In the south locations such as the traditional town of Llucmajor is an area with strong potential that offers a variety of restaurants, facilities and a local market and has easy access to the coast, Palma International Airport, and the capital”, says Deutsch.
In Palma’s old town Can Santacila is the redevelopment of a 16th-century manor house that is nearing completion, comments Terence Panton, Managing Partner, Engel & Völkers Palma Centre, and East; “This is a rare opportunity for buyers to invest in superb contemporary design within a unique historic building with all the modern-day comforts and facilities which are difficult to find in the centre of the old town.
As an established year-round destination, Palma has a superb cultural offering and lively social agenda with restaurants, shopping and a range of sports facilities which underlines the attraction for investors from all over Europe”.
Virtual Viewings
In the current climate, prop-tech tools have become increasingly useful to provide potential buyers with the first impression of off-plan projects. High-quality renders combined with drone shots of the location and the latest high-performance animation technology have become increasingly sophisticated.
In the case of the Amber Village development, the client can book a LIVE virtual tour and immerse him/herself in a virtual tour to get a true impression of the residential complex and the houses and get a feel of the size, layout, and special features. They can also question the virtual tour presenter and agent from the comfort of their sofa in a compelling bi-directional tour that is totally flexible and customised to the clients’ needs.