Last year, real estate agency Barnes named the Spanish capital the most sought-after city in the world for such buyers. Earlier this month, brokerage Knight Frank referred to Madrid in its annual “Wealth Report” as a “challenger city” to traditional wealth havens like London.
And within the Spanish capital, the district Justicia has become “the most interesting neighborhood in central Madrid for international buyers seeking a high-standard life and culture,” according to Marco Gramaglia, an agent with Lucas Fox in Madrid, who lives in the area.
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Historically “one of the bourgeois neighborhoods of Madrid, and a big area for families, Justicia has changed completely in terms of how trendy and international it is,” Gramaglia said. “[Nearby district] Salamanca had been that way, but it’s now saturated.”
Agents at the Agency’s Madrid office have clocked a notable uptick in American and Middle Eastern buyers house hunting in the city so far this year.
“Justicia is one of the neighborhoods that transitioned from ‘emerging’ to a place with global prime assets,” said Patricio Guzman, managing broker of the Agency in Madrid. “It’s become like the Soho [in London] or Le Marais [in Paris] of Madrid, with a cosmopolitan ambience, beautiful architecture, a huge diversity of international cuisine, and great little galleries and shops. The neighborhood has always had a strong LGBTQ presence, with an open and arty community. But not with these prices.”
Along with its lifestyle, the architecture of Justicia’s classical, early-20th-century buildings is a draw, said Arcadio Diaz, an agent with Engel & Völkers Madrid. “It’s also superbly located, between the prestigious neighborhoods of Recoletos and Almagro, which have always formed the most elegant ring of the city. And there are excellent transport links.”
Prices and Housing Stock
Apartments make up nearly all of Justicia’s real estate, and there’s no more room to build in the tightly packed neighborhood.
With voracious demand for the limited inventory, “prices are increasing every day,” Diaz said. “We have a lot of buyers from Mexico and Latin American countries who see a good opportunity to invest. Recoletos has become too expensive, and even though Justicia is soaring, it’s still priced lower per square foot.”
Apartments in Justicia were priced between €9,500 and €17,000 per square meter (about US$1,037 to US$1,580 per square foot) over the last two years, a 35% increase over prices six years ago, Diaz said.
“It’s a prime area now, but Salamanca is even higher, at €13,000 or €14,000 per square meter. So Justicia should go even higher,” said Gramaglia of Lucas Fox.
Subtle architectural differences can affect prices of apartments just steps from each other, Gramaglia said.
“Some buildings have beautiful ceiling moldings and facades, spacious entrances, and cage elevators over 70 years old, located on more exclusive streets like Bárbara de Braganza, Orellana and General Castaños. Other buildings are somewhat simpler, and on slightly less exclusive streets, including San Lucas, Belén and Mejía Lequerica.”
In a sign of its ascent, Justicia will get its first branded residence this year, with the conversion of a graceful 1920s building into the SLS Madrid Infantas Residences, with 33 condominiums, a concierge, pool, fitness amenities, and a screening room. Prices will average about €15,000 per square meter, according to its developer, Persepolis Investments.
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“Investment funds are starting to buy these buildings to transform them into projects like this,” said Guzman of the Agency.
Demand has also risen from Americans, Guzman said. “They’re realizing that compared to prices per square meter in Paris or London, they can buy an apartment two or three times the size here, even with price increases.”
Amenities
The neighborhood boasts top shopping and cultural experiences, according to Diaz of Engel & Völkers. “It simultaneously boasts exceptional cultural, gastronomic and fashion offerings. That includes boutiques with an enviable selection of design and quality, distinguished art galleries and antique shops, charming bookstores, renowned restaurants, as well as trendy bars, small cafes and carefully curated gourmet food shops.”
Justicia also has many parks and green spaces, said Guzman of the Agency. “Madrid is also a very clean city, and compared to big cities in Europe, crime rates here are much lower.”
While there are no schools in Justicia itself, “Madrid is smaller than other cities, so you can get anywhere, including school campuses, in 20 or 25 minutes,” said Gramaglia of Lucas Fox.
Who Lives There
“Some of the most prominent families in Spain live here,” Gramaglia said, including the family of former Inditex/Zara CEO Paolo Isla and members of the billionaire Cortina family, which is in construction and development.
Outlook
“There’s nowhere left to build in this neighborhood, so as long as demand remains strong, prices will continue appreciating by at least 7% or 8% in Justicia,” Guzman said. “Many investors are coming to Madrid from unstable countries, and we see no reason for demand to drop in the near future.”
Justicia “is a great opportunity to invest in Madrid right now,” Diaz said. “It’s a great neighborhood, and prices are increasing time after time.”
Prices “will continue to go up,” Gramaglia said. “Prices have stabilized a bit since the pandemic, when it was crazy. But demand will push prices up by 5%-7% per year. The market here is not a bubble. Madrid is taking its place among world capitals, and Justicia will be a hot spot for years.”