(Bloomberg) -- Claude Berda, who sold French broadcaster AB Groupe earlier this year, has joined a growing number of French nationals investing in Portugal’s real estate market as that country’s economy accelerates and property prices rise.
Berda says he began looking into Portuguese real estate after his son Rolland asked him to visit the country two years ago. Since then, he’s bought ten buildings in Lisbon, a resort in the southern Algarve region and 350 hectares of land in Comporta, a beach retreat an hour’s drive from Lisbon. He plans to invest 450 million euros ($490 million) in the purchase and development of these properties before selling them, and he’s seeking bank financing for some projects.
“Portugal is definitely my next big project,” Berda said in an interview in Lisbon. “I’ve spent some time with real estate brokers and they’re looking for properties to sell. They don’t have enough product. The market is very good and strong.”
Portugal’s property market is generating growing interest from the French, which last year overtook British nationals as the biggest foreign property buyers in the country, according to the Portuguese Real Estate Professionals and Brokers Association.
Under Portugal’s so-called non-habitual residence program, foreign pensioners who come to live in the country may have their pension income exempt from taxes as long as it’s paid from a foreign source. The country is also offering residence permits to non-Europeans who invest more than 500,000 euros in real estate. Both programs have been a magnet for foreign buyers, including French citizens seeking lower taxes and Chinese seeking a home in Europe.
Real estate investment in Portugal may rise to a record 2 billion euros this year from 1.3 billion euros in 2016, Eric van Leuven, the managing partner at Cushman & Wakefield in Portugal, said on Jan. 4. Home prices in Lisbon rose 23 percent last year, according to Confidencial Imobiliario, a company that collects property-market data.
While foreign investment has been welcomed by Lisbon authorities, it has pushed real estate prices to levels that are making it hard for locals to live in the city center, Manuel Salgado, the councilman responsible for urban planning and renewal, said in December.
Berda says Lisbon is still relatively cheap when compared to other European cities.
“You would have to give me money to live in London,” said Berda, adding that his bet on Portuguese real estate marks a new stage in his career after selling AB Groupe, the broadcaster he founded in 1977, to Mediawan SA for about 270 million euros. “It’s the end of a story and the beginning of another one.”
The 70-year-old travels to Portugal about twice a month from his home in Switzerland to visit the offices of his Lisbon-based real estate company Vanguard Properties, which is managed by his son Rolland and a local partner.
“I know the Portuguese quite well,” said Berda, who sold t-shirts in Portugal when he ran a clothing business more than two decades ago. Moving to Portugal for good “is a possibility.”