Krest is a Brussels based developer and investor in prime real estate. Its portfolio spreads across all segments of the industry, from offices to residential, retail, logistics and hospitality.
What was the context in which Krest came to life and what is your footprint in Portugal at the moment?
Krest is a family endeavour, derived from our textile raw materials business - at some point we decided to build our own warehouses, which stimulated our appetite and opened this new path in real estate. We started off in Belgium by creating the largest office park at a time when nobody trusted this sector.
Going against the tide and being one step ahead of the market trends is part of our DNA, we like to take risks even when everybody else is scared to do so and rely a lot on our instinct. A similar moment happened at the beginning of 2013, when I first arrived in Portugal with the idea to buy some of the assets that the government had decided to sell. I chose 11 properties - which we're still renting out to them at the moment. We were the first investors to put their money into such trademark buildings.
We now have a portfolio of 600.000 square meters under development and management and this year we are investing over 100 millions, spread across various projects that are meant to address present needs of the community. This aspect of making a positive contribution matters a lot to us.
Portugal has come a long way since 2013, becoming an incresingly sophisticated market. What makes a successful project nowadays?
Right now, keeping a balance between the traditional way of building and new environmental requirements is vital in order to be able to develop new projects. The truth is that Portugal still lags behind in terms of sustainability, and we see this as a great opportunity.
It is an element we always include in our projects - through green areas, waste and water management systems, measures for near zero carbon emissions and so on. Our residential project of 200 units in Paço de Arcos is a good example of that, we've designed it to include vegetable gardens, geothermal systems and modular buildings.
The licensing process is seen as very cumbersome in Portugal - how does it compare with other juridictions in which you are present, for instance Belgium?
Not unlike Portugal, Belgium has a licensing process that is extremely difficult and frustrating, with many steps that need to be completed. As an example, we have an 400 apartments project in Brussels that has been in limbo for six years now because the relevant authorities are not in full agreement with the plan. On the upside, once a project successfully passes this approval stage, the rest of the licensing process goes extremely smooth.
In Portugal we've seen a lot of goodwill from politicians but the local municipalities tend to overcomplicate the licensing process, both out of lack of resources and of interest towards new developments. However, while there is a long waiting time in Portugal, what is certain is that at some point you're going to be able to finish the project - Belgium doesn't always guarantees this outcome.
Your Portuguese portfolio is well diversified - where do you see most opportunity coming from presently?
We have spread our portfolio across all real estate sectors in Portugal because we wanted to take advantage of a market that was stuck for a decade and suddenly turned into the El Dorado. We were lucky to start ahead of time - back in 2014, the office market had 4,5 million square meters of unoccupied units in Lisbon, so everybody considered us crazy when we decided to invest in it. But we ended up on the winning side - with the arrival of giants like Google and Microsoft the stakes, as well as the returns, became much higher.
Jardim de Miraflores is yet another project that came about in an opportunistic manner, a beautiful residential development set in a location that was being overlooked by everybody at the time, but that is drawing ample interest now.
Our most exciting and recent project is located on the other side of river bank, in Alcochete - a full neighborhood spread acros 450,000 square meters. I'm very happy with what Portugal still has to offer, especially since we are in a privileged position of having a generous landbank left in our portfolio.
Where do you envision Krest in the coming years? Are there any objectives that you are particularily excited about?
Segment wise we want to pay particular attention to residential developments - our clientele is made of 70% Portuguese people and there is a clear lack of affordable housing options than can cater to their needs. But our big objective is to instill the idea of sustainability into the market and turn it into the standard approach while also finding a way to mitigate the added construction costs that come with it.
