Portugal: Commercial Property Market

Lisbon Elena Saharova 1392332 Unsplash

Our Portugal Director and commercial property expert David Moura-George joins us to talk about the commercial property market, the many reasons to invest in commercial property in Lisbon and the different types of property investment opportunities available.

Why is commercial property in Portugal a good investment?


One of the reasons that so many choose to invest in commercial real estate as opposed to other types of investment, such as stocks and shares, is reliability. At Athena Advisers, the properties we source typically have long leases of between five and 20 years, making it easy for you to plan for the future.

Steady returns

Portuguese commercial property investment yields range from 4.5% to 6.5%. The average yield will vary according to the type of commercial asset.

Hedge against inflation

At the end of the year, the Portuguese government releases the latest inflation figures and it is then possible to amend the commercial property lease in order to account for any increases. 

Hassle-free investment

Commercial real estate is usually a very hands-off investment as it is the responsibility of the tenant to maintain the property. This means that you can generate rental yields without any headaches. Nevertheless, Athena Advisers are here to help you every step of the way.


As well as generating reliable rental yields which are in line with inflation, the value of a commercial property will usually increase over time and you can also benefit from leverage. 

Key market factors influencing the commercial property market in Portugal

One of the major attractions of investing in commercial property is that you can work with AAA tenants such as big multinational companies. At Athena Advisers, many of our commercial properties for sale in Portugal come with tenants already in place and locked in for up to 20 years. Take a look at our commercial property listings to see some of our current opportunities and do get in touch with David Moura-George to find out about our numerous off-market investment opportunities. 

There is currently an excellent bank guarantee in place. So if your tenant leaves or is removed due to not paying their rent, the bank will support you whilst you source a new tenant for a period of up to 12 months. 

As you probably know, the Portuguese Golden Visa programme is changing and after December 2021, it will no longer be possible to apply for a Portugal Golden Visa by buying a residential property in Lisbon or Porto. However, the commercial property market will not be affected by these changes which means that investors can still be eligible for a Golden Visa if they buy a commercial property in Lisbon in 2022.

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Types of commercial property in Lisbon

Different sectors appeal to different people. Below, are the most common types of asset available.


Most commonly used for assembly, storage or distribution. This sector has seen increased demand in response to the pandemic with more Portuguese citizens now buying online.


Planned developments which transform raw land  into big investment opportunities


Highly dynamic sector providing opportunities for all types of investor. This sector includes shopping centres, convenience stores and supermarkets. 


This includes a whole range of industries from bars and pubs through to sports centres. Vaccination will be a hallmark in the recovery of this sector 


Offices are one of the most common types of asset to have within a commercial property portfolio and come in a variety of sizes.

The commercial property market in Portugal 2020

Key takeaways
  • The office occupation dropped last year due to the fact that many people were working from home in response to the pandemic. Nevertheless, 190,000 sqm of office space was occupied in Lisbon and Porto.
  • €2.7bn was invested in commercial property last year, the third-largest sum of all time. This is especially impressive given the impact of the coronavirus.
  • More than €5bn was invested in residential real estate last year
  • Logistic yields dropped from 6.56% to 5.75% due to the surge in demand for these types of spaces.
Investment evolution

The graph below shows both how transactions have grown over the past two decades and the growing number of international investors who have confidence in Portugal’s commercial property market.

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Investment volume by sector

Last year, 55% of transactions occurred during the first quarter whilst the remaining three quarters accounted for the final 45%. It is important to remember that these final three quarters coincided with the peak of the pandemic. In terms of investment volume, retail and office space led the way. Logistics and mixed-use also saw a boost too. Though there are limited mixed-use commercial investment opportunities in other countries this sector is quite new in Portugal and has a bright future ahead of it.

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Sector focus: offices for sale in Portugal

One of the key trends seen last year was that clients were looking for larger office spaces. Not only does this offer superior comfort but larger spaces are important for social distancing. The average office space has grown by 19% which equates to 1,300 sqm. Last year, 104 transactions took place and 192,000 sqm of office space was occupied between Lisbon (138,000 sqm) and Porto (54,000 sqm)

With many people now working from home, what is the future of the office market in Lisbon? 95% of people want to work from home one or two days per week once things get back to normal. However, a return to the office is especially important. Companies increasingly recognise the gains in productivity, collaborating and innovation motivated by a shared physical space. As a result, we believe that a hybrid occupation will emerge over the next three to four years, having an impact on space organisation and optimisation.

As you can see, office rental prices have remained unchanged throughout Lisbon. One of the reasons for this is that prior to 2019, the office market in Portugal was somewhat depressed as there was a lack of quality spaces. With 150,000 sqm of new office space in the pipeline (30% of which is pre-leased) and the growing demand for larger office space, we expect the overall demand for offices in Lisbon to rise.

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Sector focus: retail property investment in Portugal

Retail was hit especially hard during the height of the pandemic as there were tighter lockdown restrictions imposed on shops and the lack of tourists visiting Portugal would have had an impact too. Tourism is key to the Portuguese economy. The country has a total population of around 10 million yet, before the pandemic, Portugal would welcome around 5 million tourists per year.

Nonetheless, some types of retail really proved their resilience during the pandemic such as pharmacies, petrol stations and supermarkets. Another trend that we have noticed is that shops selling sporting goods or home improvement wares did very well during the pandemic. This is due to the fact that we spent much more time inside last year and our homes became more than our family spaces; they became our gyms, offices and home schools too.

Convenience shops also saw improvements last year, too. This is due to the fact that many people are working from home and people prefer to go to shops close by within their residential neighbourhood.

Unlike offices, the value of rents suffered at the end of the first half of the year, a reduction between 5 and 10% in street commerce or in shopping centres that remained until the end of the year.

Shopping centres are the asset which has suffered the most during within the retail sector. This is not only a result of the fact that shopping centres were obliged to close their doors but also a change in consumer behaviour as the pandemic has meant that many consumers have a distrust of enclosed spaces. Previously, shopping centres performed very well as the Portuguese have only just got into online shopping and Portuguese families enjoy visiting the mall and the whole experience of it. 

In the future, we do think that shopping centres will bounce back but as many Portuguese citizens have now become accustomed to purchasing online, supermarkets will need to adapt.

Lisbon Kaboompics Modern White Building, EDP Headquarters Of Architect Aires Mateus, Lisbon, Portugal

Sector focus: Industrial and logistic properties for sale in Portugal

Online sales have tripled since the beginning of the pandemic and, throughout the course of last year, new market players and businesses have become interested in this type of space. “Last-mile” storage units have risen 20% in value since last year, with the average now at €6 per sqm.

Commercial real estate: how much does it cost to buy a property in Portugal?

Acquisition costs
  • When buying a commercial property in Portugal, you can expect the buying costs to be around 8-8.5% of the value of the property. 
  • When buying an asset deal, you will need to pay IMT which is up to 6.5% of the sale price as well as stamp duty which is 0.8% of the property price. Lawyer fees vary, but typically they cost around 0.5-1% of the property cost.
Company running costs
  • Tax is 21.5% of a company’s earnings
  • Accounting typically costs €200 per month
Ongoing costs
  • IMI is a yearly property tax in Portugal and is 0.3-0.45% of the property value
  • You will also need to take out insurance. The cost of this varies according to the type of commercial you buy and the size of it.

As mentioned before, financing is available for commercial properties. You can expect to borrow up to 50% of the property’s value and the loan will need to be paid back over a period of up to 10 years.