Nomad Capital is a real estate investment, promotion and development company headquartered in Portugal. First, it is important to know better the company’s history, as well as the most important milestones in its path so far.
I arrived in Portugal six years ago from New York City. Back then, the Portuguese real estate market was starting to attract foreign investors, mostly thanks to the Golden Visa program. At the time, I partnered with two other French entrepreneurs, and we created Optylon Capital. Our aim was to acquire buildings in the touristic downtown area of Lisbon, known as “Baixa”, and give them a new life. Optylon also owns LovelyStay, one of Portugal’s leading vacation rental management company. The strategy was to propose to golden visa investors a new apartment in a prime location, with a rental management solution and a yield guarantee. As tourism kept growing in Portugal, Baixa became the main touristic hub of Lisbon, and our business boomed along with the increase in demand.
After doing several successful investments in Lisbon, we also implanted in the Porto and the Algarve markets. Some notable investments include the Corpus Christi building in Lisbon, and Palacio do Comercio in Porto.
As the market matured, Portugal also started to attract full time foreign residents, specifically retirees from Northern Europe, and young entrepreneurs in the real estate, tourism, food & beverage, and hospitality sectors. This created a new demand for higher-end projects, services, and amenities.
Nomad Capital was then created, with the objective to acquire, design and develop luxury serviced residential projects and resorts. Our main brand Nomad Residences targets specifically the international markets of North America and North Europe, while promoting Portugal as a full-time residential destination.
Nomad Residences services and amenities provide owners with the comforts of a home, while enjoying the luxury of world class hotels. Our current flagship project, Nomad Bay, is a high-end resort located in Carvoeiro, Algarve. The project has 74 apartments and will open in the summer of 2023 (nomad-bay.com).
Today Nomad Capital is present in Portugal and The Netherlands and looks to expand to other markets such as France. Our presence is very strong among American clients, who see many similarities in our projects many similarities with the type of products and services they are accustomed to back at home.
How did Nomad Residences Brand start? What was missing in the Portuguese real estate sector that you thought should be addressed? What about the future outlook?
Branded residences and serviced apartments concepts have been present in the luxury real estate markets across America, Asia and the Middle East for at least 20 years now. However, Europe has been lagging in such developments, despite a growing local and international demand.
Having spent seven years in America, specifically in New York City, I noticed many buildings had great amenities, such as having security and door man 24/7, as well as a fitness room, cleaning and maintenance, and a wide range of other services at the owners’ doorsteps, as part of the building’s services. After returning to Europe, I noticed very few if any projects were proposing such a product, and the idea of developing a Europe based Brand for serviced residential projects came to mind. This is when Nomad Residences was born.
In 2020, Graham Associates produced a very detailed report on the global branded residences markets and found that the fastest growing segment in luxury real estate in Europe was Branded Residences, with Portugal leading the trend. It appears that hospitality brands have chosen Portugal and the Algarve specifically as their test markets for their European deployment. Besides our Nomad Bay project, which sold over two thirds of its 74 apartments in less than nine months, W Residences in Albufeira and Viceroy’s Ombria Resort are other notable examples of commercial success in the sector. Other brands are currently implementing in the Algarve, as well as the rest of the country. We are also looking at future developments, so we can expect the market to strongly develop in the coming years.
The demand from Americans for this trend has highly increased, as they have discovered in Portugal the same types of investments, products and services they are used to back at home. They also see Portugal as a great alternative to Florida or California to retire in. In fact, Portugal offers a very similar quality of life, but at a fraction of the prices proposed in America, with the added benefits of living in Europe, with access to many countries, cultures, and experiences. Since COVID started in March 2020, North Americans represent about 50% of our property buyers.
You mentioned that Nomad Capital had a vast experience in sourcing, acquisition, contracting and property management, and is the perfect local partner to international investors looking to establish a presence in Portugal. How can you describe the essence of these products and services to us? Can we say that they are unique in the Portuguese market?
Portugal is a very specific market, with its own set of rules and regulations, and ways of doing business. In that regard, most foreign investors looking to allocate funds in Portugal should be looking at a local partner to serve their interests and grow their local investments.
Most of our operations are done in-house, and we have multi-cultural, dedicated and experienced teams in all the value chain items essential to any real estate development. As an example, a good real estate investment is often made at the time of initial purchase. Our team sourcing properties has a wide range of options allowing them to find assets off-market and using unique and innovative strategies. We also provide all the architecture and interior design, which helps keep timelines according to expectations. In addition, we also integrate all the financial modeling and structuration, marketing and sales, project, and construction management, and finally after sales and the property management too. The only task we currently outsource is the construction itself.
Our typical investors include high net worth individuals, family offices, and other institutional entities, who contact us as they see Portugal’s potential for growth but lack the know-how and network specific to Portugal. We effectively become the Portuguese team for those investors, staying on the ground 24/7 to guarantee the proper deployment, development and exit of their investments.
This integrated model to real estate development is a key attribute, as it provides both efficiency and transparency, while providing a one-stop-shop and single point of contact to our investors, regardless of the project. Another key attribute is providing full flexibility and adapting each of our projects to our investor’s needs and objectives.
Besides Nomad Residences, we have been contacted by other hospitality and hotel brands, as many of them are interested in developing projects in Portugal and the rest of Europe. In the near future, we are looking to potentially white brand our know-how and experience and help luxury brands adapt to the service residential space. This includes of course hotel brands, but we would also be interested in exploring partnerships with fashion and high-end consumer brands, as we know some of them have been doing well in other continents.
What are the main differences between a Branded Residence and a conventional unit? Do you believe it has the potential to be the future of the sector?
Branded residences have two specific components that sets them apart from traditional residential projects. First, they provide services that are similar to a hotel, while still remaining a standard apartment. Second, because it is a brand, investors and guests can expect a certain level of service, design and amenities which is similar to other projects of the same brand. In other words, Branded Residences provide the apartment itself, but also a wide range of services and on top of it, and a guarantee of quality.
With the emergence of the Millennials generation, experiences became an essential component of consumption. Buyers are looking at more than just a prime location and a nice apartment, they are also (mostly) looking at the services provided, having everything ready and maintained on their behalf, and most importantly enjoy an experience.
Then came COVID in early 2020, which made Branded Residences even more attractive to buyers. In fact, as travel was no longer permitted, investors looking to buy a new property had to rely on virtual meetings and visits to make decisions. The brand greatly helps buyers, as it gives them comfort on the final result.
With COVID also came a new demand for bi-primary residences. As offices closed down, people discovered working from home, and a lot decided to move away from large cities and spend longer periods of times in other locations. Portugal is a big winner in this trend, especially the Algarve.
About 60% of our buyers in the last two years expect to spend at least four to six months in Portugal and enjoy their home. The rest of the time, they appreciate that their property will be taken care of, maintained, or repaired when needed, and fully ready when they come back. Owners can also benefit from rental income, as we provide optional. property and rental management for all of our projects.
In our opinion, those trends are likely to stay in the future, and Branded Residences provide the best option for those Nomadic property owners.
The project which deserves all the attention is Nomad Bay – A Resort located in the Algarve. What distinguishes Nomad Bay?
Nomad Bay is our current flagship project, and will be ready in summer of 2023. We acquired the land in early 2018 and spent almost two years in the design concept of the project.
As is a new construction on a previously vacant piece of land, it allowed us to design everything from scratch, and create what we believe to be the perfect branded and serviced project. We are happy to see the market reacted very positively to our project. In fact, since we launched sales in late 2020, we already sold about 70% of the apartments.
Overlooking the ocean and located in Carvoeiro, a charming seaside village, Nomad Bay enjoys unique views and countless activities. 74 high-end apartments with outstanding views, ranging from one to three bedrooms, all with private terraces or roof tops, marketed within the Nomad Bay brand, and made available for rent through an in-house reservation centre.
Only a few minutes away from the beach, fine dining, beautiful golf courses and conveniently close to Faro International airport, Nomad Bay’s location ensures excellent connectivity to what makes the Algarve fabulous, as well as the exclusivity and intimacy of a private resort to enjoy with friends or family. All apartments feature floor-to-ceiling windows, fully blending the bright and spacious indoor spaces with the outdoor terraces. Globally inspired furniture and materials, attention to details at every step, delivering elegance, comfort, and functionality.
The interiors are curated with tailored finishes, while using natural and sustainable materials. In our opinion, long-term value-add lies in the extensive creative design and craftsmanship of simple materials.
As a primary residence, a vacation home, or as an investment, there is a Nomad Bay property for every investor.
Inevitably, we have to address the issue of the day, which is the pandemic that is being experienced worldwide. What was its impact on the real estate sector, both nationally and in Europe?
COVID as certainly created a lot of challenges and issues, and hurt many industries worldwide. Portugal has been very impacted as well. However, I believe crisis brings its own set of opportunities, and COVID is no different.
With the announcement of the first lock down, the world had to adapt to a new way of life, and businesses came to a full stop.
Real Estate is quite an established industry, which usually is not prone to change and innovation. COVID forced developers to adapt and invent new ways to continue their operations and developments, as well as to attract new buyers.
On Nomad’s side, we had to train our teams to work remotely and stay up to date, especially on the technical divisions. But the real transition came from the digitalization of all of our marketing and sales divisions. Like most developers, we used to rely on brokers and international roadshows to sell our projects and find new buyers. Overnight, borders closed, travel was no longer possible. We could no longer meet with our clients abroad, and they could no longer come visit their investments. We decided to strengthen our social media strategies and explore ways we could take advantage to further promote our projects. It is a trend we had noticed with the luxury and fashion industries and thought to apply it to our projects.
This was quite the revolution for our company, and today at least four out of ten of our new clients found us on either Instagram or Facebook. Today, we are much closer to our audience, we can communicate with them directly, receive feedback, all without the added layer of third parties. It benefited each stakeholder involved in our projects, from our investors all the way to our internal teams and final property buyers.
Of course, developing a brand proved to be a key selling element, and our following base on Instagram grows each day (@nomadresidences).
More precisely in the Algarve, many claim that it is the region of the country where the pandemic is having a more demanding impact. For Nomad Capital, what challenges have arisen in this area?
It did hurt tourism significantly, and it was a difficult and scary period, but I think in the long term, the Algarve and Portugal will benefit. Also, I found over the years that Portugal is very resilient to crisis and knows how to adapt and recover from difficult times. I expect it to be the same this time, and Summer 2021 has proven that it is the case.
As soon as Portugal opened it’s borders, tourists came back right away. We noticed tourists coming from countries not typical to tourism in Portugal in previous years, and again COVID played a part in this, as Portugal is now the country in the world with the highest percentage of vaccinated people. Also, the country proved to be an example internationally with the way it dealt with the first lock down.
More importantly, all of the reasons Portugal is so attractive to foreigners and tourists still exist today, despite the pandemic. In other words, I am not worried for the future, and I have full trust in Portugal to recover quickly, but also to find ways to re-invent itself and become even more attractive.
One thing we can already notice following the pandemic is that it also attracted a lot of new interest on the region. We are seeing a new wave of property buyers, not looking at Portugal only as a vacation destination, but as a long-term residence. Not only for retirement, as these new individuals are much younger, and hoping to establish news businesses and ventures in Portugal.
The most notable examples are Americans, looking at Portugal as an alternative to Florida and California to retire. Canadians are looking to benefit from the new advantageous tax regime in the crypto-currency industry, which is also a new trend. And finally North European looking to relocate and work remotely during the winter month from Portugal, while the weather is still pleasant in the Southern parts of Europe.
In my opinion, COVID was the main driver for these new types of clients, which will bring a lot of long-term value to the country. And I am sure we will be seeing new trends in the coming months as the situation evolves further.
Nomad Capital’s mission is, from day one, to imagine and develop the best experiences in life, creating projects inspired by the world and consistently responding to the needs of its clients. What news and projects are being planned? So, how will it keep up with the expected changes in the future of the sector?
We have many ideas in development.
Our main objective currently is to further expand our operations in the Algarve, as we think the next Portuguese real estate boom is in this region. We are currently working on a potential €100M project in the Algarve.
We also want to create the first Urban Resort in the Lisbon area, which would be managed under the Nomad Residences umbrella.
In the longer term, as we expect the branded residences trend and demand to grow in the next 20 years, we trust there will be potential for our products and services in various places around Europe. Our aim, thanks to our knowhow and expertise, is to become the prime development partner for Europe-based serviced and branded residential concepts. This can be either via our own brand, or in partnership with international hotel, luxury and fashion brands.
And of course, keep innovating and being at the top of the trends !
Finally, what does Nomad mean?
Historically, a Nomad is a member of a community whose lifestyle adapted to infertile regions, and where mobility is the most efficient strategy for exploiting scare resources.
In the modern world, we talk about digital nomads, people that are constantly traveling, seeing the world, discovering new cultures, and meeting people from all walks of life. I think a lot of our property buyers relate to this way of life, and have different places to call home around the world. The Nomad brand fits into this environment.
Prior to settling down in Portugal, I lived for many years in Japan, China, India, the Middle East, America, and many other countries. During those times, I discovered many ways of life, and got very interested in the hotel and hospitality sectors. Especially how luxury and services is applied differently in various parts of the world. Nomad projects are inspired by the world, we take the specificities we prefer in each markets, and apply them to target locations in which we invest, such as Portugal.