Why do all the international companies want to be in Malaga?

Google finalizes the opening of its new cybersecurity center, which will be installed in a former Military building in the Andalusian city.

"Everyone wants to be in Malaga because everyone knows it's going to be the city of the future." This is the response from the business sector when asked about their landing in Malaga.

In recent months, numerous multinationals have opened a headquarters in the Andalusian city: the consultancies CBRE or EY, 'telcos' such as Vodafone or technology companies such as Oracle and IBM. The last to land has been Google, which will install its new center of excellence and cybersecurity in the city.

Google: "We are trying to position Malaga as a global cyber-security hub"

The North American company is immersed in the comprehensive rehabilitation of the old building of the Military Government of Malaga, on Paseo de la Farola, in the heart of the Malagueta area. Google has invested 3 million euros in renovating the building, in a project that has been designed by the Domingo Corpas Arqutect and Engineer studio and executed by the constructor Construcciones Bonifacio Solís. The American company will have 2,500 square meters prepared from where they will provide their service.

Another big company that has landed in the city is Banco Santander, which is preparing a new technology center. The new hub complements the technological offer of the financial entity for all countries and businesses, in one of the areas "with the most potential in Spain", as described. Several heads of transformation and operations participated in the presentation of the project, together with representatives of the bank in the region and the Mayor of the city.

A combination of good weather and easy flight connections

The Andalusian city has several components that make it one of the favorite cities to live in within Europe. First, the weather. Malaga has moderate temperatures most of the year. Also its air connections help, with an airport that connects with Stockholm, Dublin, Copenhagen, Lisbon, Brussels, Doha, London, Zurich, Nice, Paris, Casablanca or Rome. Some managers and businessmen often joke that if the city's taxation were more lax it would become the Silicon Valley of Europe. During 2020 and 2021, Malaga was the Spanish province with the highest population increase, reaching 1.7 million inhabitants.

The Andalusian city grows more than Alicante, Valencia or Murcia.

The housing situation?

The housing market has experienced the consequences of international interest in Malaga. The price of a flat is at historic highs, reached during the real estate bubble. Buying a one-bedroom home costs an average of €188,000, two €242,000, three €273,500 and one four-bedroom €482,000, according to the real estate data platform Brainsre.

The arrival of new inhabitants has also triggered the rent. A tenant looking for a home now pays 31% more than at the beginning of 2021. This represents an unprecedented increase in just a year and a half. Some more central areas of the city even show average prices similar to those recorded in Paseo de la Castellana in Madrid, the area of Playa de la Concha in San Sebastián or the center of Barcelona.

The rapid increase in house prices has attracted the interest of numerous investors. The large funds have allocated 17.8 million to rent, that is, homes built directly for this purpose. Other models of living such as coliving, student residences or residences for the elderly are also in the focus of large investment vehicles, with an accumulated investment of 86.2 million.

The tourist accommodation “Socimi All Iron” has already bought three buildings to rehabilitate, the Swedish firm Iberian Yield and the construction company Grupo Otero intend to develop 1,000 homes,

and the Spanish management company Azora and the sovereign fund of Singapore GIC acquired 3 plots of land. Firms like Casavo, specialists in buying, reforming and selling already have an office there.

No offices available

According to a study carried out by CBRE at the end of last year, Malaga has 600,000 square meters of offices. Availability in the downtown area of the city is 2%, so it could be said that this market is fully occupied. The outskirts do have a higher unemployment rate, which is around 4.5%. The rents are much lower than those of Madrid and Barcelona, so the route of the offices in the city is enormous.

The same thing happens with logistics warehouses, which hang the full sign, with an occupancy rate of over 97.5%. The total area of this type of assets in the city is infinitely lower than that of towns such as Valencia, Zaragoza, Seville, Bilbao and Alicante. However, a significant increase in logistics stock is expected in 2023 due to the imminent completion of projects, both in the capital and in Cártama and Antequera. Parcel and e-commerce operators are the ones that most demand warehouses.

"All images in this article are taken from properties currently for sale by Christensen Estates as of 15 August 2022"

Source: https://www-laopiniondemalaga-es.cdn.ampproject.org/c/s/www.laopiniondemalaga.es/economia/2022/08/08/google-grandes-consultoras-mundo-quiere-estar-malaga-dv-73168624.amp.html