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Matins Esade with Pere Viñolas (LIC&MBA 86), CEO of Colonial SFL

To examine the trends and future challenges[MB1] , Pere Viñolas featured in a new session of Matins Esade entitled “The Real-Estate Sector Today: The Case of Colonial”
Viñolas

Recent years have witnessed a disruptive change in the economy which has had profound effects on the real-estate sector. These transformations have shaken up perceptions of where and how to live and work, which has also redefined the role of the sector as an investment alternative.

During the Matins Esade session, Pere Viñolas was accompanied by Patricia Valentí, director of Esade Alumni, and Dr. Jordi Fabregat, professor of Economics, Finance, and Accounting at Esade.

 

The Colonial business model

Viñolas started his talk by highlighting the equity-focused nature of Colonial, a key feature which makes it stand out in the Spanish real-estate sector. “Colonial represents a different kind of real estate: owning buildings and making a living from creating value from these assets,” he stated.

He specified that Colonial’s activity is inherently financial and focuses on the long term: it prioritizes equity over debt, revolves around the use of international capital models, and essentially serves a sub-sector of the savings market. “Colonial focuses on the prime office segment,” he said. Even though Viñolas acknowledged that diversification is positive, the current focus is still on irreplicable assets in their main geographic areas: Barcelona, Madrid, and Paris. He underscored the company’s active management, highlighting that “70% of its buildings have been built or intensively renovated from the start.”

Viñolas

Market outlook

After the real-estate sector’s restructuring cycle (2008-2013) and subsequent expansion (2014-2020), Viñolas admitted that the framework of reference had been shaken up with disruptive changes in the market. The CEO refuted the “presumption that the office market is going through a bad time” and stressed that for the past four years Colonial has had the highest occupancy ever, and three years with 100% occupancy in Paris.

However, he lamented the lower interest in investments in the office sector and the impact of higher interest rates. Viñolas described this latter factor as “conjunctural, not structural,” and claimed that “the sector is transitioning towards recovery.”

“My future outlook is very positive. The purpose of the sector has a raison d’être and meets unmet demands, so it has a bright future in the real world,” he concluded.

Viñolas explained that the rise in interest rates in the past fostered a higher demand for fixed income or private debt, with yields similar to real estate, but he stressed that real estate also comes with asset revalorization and rent.

 

Future strategy

Regarding market consolidation, Viñolas advocated the need for “a playing field with more players” in Europe, where “the stock market has failed to create a deep, broad web of real-estate companies.” He noted that the company’s larger size has significant advantages, especially in terms of debt, and he mentioned the “simple synergy” of lower financing costs after mergers.

Finally, the CEO confirmed that Colonial is planning to invest in new geographic regions beyond its longstanding markets in Paris, Madrid, and Barcelona, given that the company’s focus is not determined by the product but by its proven capacities. “What you can prove that you do particularly well, do it – that’s the focus. Right now we don’t only do offices and we’re expanding to new regions,” he reported.

Viñolas

 

 

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