Jorge Ferreira Mendes

TBY talks to Jorge Ferreira Mendes, Managing Partner of Mencovaz, about the company’s offering, client profiles, and trends in Portuguese real estate.

What makes Mencovaz a valuable partner for real estate investors?

Mencovaz is an asset valuations company founded in 2007; that differentiates itself through its technical expertise and experience. The company’s founder has been working in the field since 1972. With 51 years of market knowledge, we have seen all the stages of the market and can share our experience with investors. A great opportunity concerns the asset, the right investment time, and the price. Mencovaz is an expert at identifying outstanding opportunities. Mencovaz specifies a property’s value and determines if it is a suitable opportunity for an investor, given the prevailing market conditions.

What is the scope of Mencovaz’s consulting services?

Mencovaz’s services go beyond valuation; the company also offers consulting, development of business or investment plans, construction surveillance and monitoring, energy performance certification – and a wide range of technical reporting on properties. We work with everything to do with the investment decision and all processes related to civil engineering. Our objective is to be the technical advisor for real estate investment. We have experience analyzing and working on all real estate assets.

What client profiles does the company cater to?

Repeat business is essential to Mencovaz. Banks are one of the core targets of business development for the company. When financial institutions hire our services once, they understand our work and become recurring clients. Mencovaz began business in 2007, and in 2014 we expanded our client base to include large scale investors, developers, pension funds, and family offices, among others.

Which types of real estate assets are thriving in the Portuguese market now?

Regarding the residential market, we can identify three main segments in Portugal at the moment. In Lisbon and Porto, there is high demand for residential properties from Portuguese nationals. Another segment, also with high demand, but lower value, is the search for housing in the rest of the country, in less populated regions. The third segment is the booming market for expensive luxury properties, and those are destined both for national and foreign investors. Similarly, the commercial investment market is buoyant and dominated by international buyers. Each market has its unique supply and demand dynamics and requires stand-alone analyses. Generally speaking, the number of real estate transactions is lower than a year ago. Because prices are increasing, many are holding onto their homes and not buying new ones, resulting in fewer properties in the market. In real estate, the economy works in cycles; as the years go by, we see those cycles becoming shorter and shorter. Depending on an investor’s time horizon, it could be the right time to invest and buy a property. Even though the real estate market prices are high, they are still lower than in other European countries. Investors seeking exposure to Portugal’s benefits can access unique opportunities.

How do you evaluate the price fundamentals of real estate in Lisbon?

The real estate market in Portugal was predominantly destined to national investment until 2015. Since then, the country has opened up, and tourism has boomed. Many investors started to look at Portugal, realizing the abundance of low-cost purchasing opportunities. The government also offered powerful investment attraction incentives. As a result, today, there are fewer opportunities in offerings. Demand outpaces supply, especially in bigger cities like Lisbon and Porto. Assets in tertiary cities are less attractive because being in a prime location gives the asset greater liquidity.

What has this shift toward a market led by foreign investment meant for Mencovaz?

Catering to international investors became a company imperative for Mencovaz. In 2015, work would come to us via other Portuguese services and companies. Today we provide a direct benefit. For example, we expanded our geographical reach as part of the strengthening. In 2017, we opened a new office in Porto. We are fully equipped to provide foreign investors with local know-how that will make a difference in the efficiency of their investments. Investing must include technical advisory. It ensures investors can secure the best deals. Since 2019 we also started developing marketing activities abroad, mainly England and Spain.

What makes Mencovaz’s consulting impactful?

A trustworthy local partner helps international investors minimize risks and reduce costs. Our service implies a fee; however, in the end, we reduce our client’s expenditures by ensuring better planning, preventing unforeseen expenses and minimizing risks. For example, Portugal has many historic buildings, and one important thing that investors must be aware of is the risks and restrictions regarding renovating such structures. Partnering with a local expert like Mencovaz supports a solid development strategy. With our help, developers obtain a serious civil engineering renovation plan that can make cost forecasting more accurate. Through Mencovaz’s services, developers avoid pitfalls in civil engineering design and construction.

What value do buyers derive from consulting with a technical partner instead of a commercial one?

Mencovaz’s fees are independent of the transaction, whereas commercial partners may have a specific interest in a deal. Other advantages include better, personalized service and greater attention to detail. Remaining independent from a transaction is extremely important to us.