MARKET STATUS
ECONOMIC SITUATION - AUGUST 2025
August brought encouraging signs for the Portuguese economy. S&P upgraded the rating from "A" to "A+," recognizing the fiscal consolidation effort and the downward trajectory of public debt. This positive revision comes at a time when Portugal has achieved some economic dynamism, after a start to the year marked by uncertainty. In the second quarter of 2025, GDP grew 0.6% quarter-on-quarter and 1.9% year-on-year, driven by private consumption, business investment, and the strong performance of tourism. The Bank of Portugal estimates that the budget balance will remain positive in 2025, albeit under pressure from increased spending in areas such as healthcare and defense.
In the Eurozone, growth remains moderate, reflecting weak domestic demand and the impact of monetary normalization. Germany's GDP stagnated, while France and Spain saw slight growth, supported by consumption and service exports. The European Commission reinforces the need to revitalize investment, especially in strategic sectors such as energy, digitalization, and defense, at a time when the shortage of skilled labor and the energy transition are emerging as key challenges. The ECB, after eight consecutive interest rate cuts, is now signaling a pause, prioritizing monitoring of underlying inflation, which remains above the 2% target in several member states. It is worth noting that France and Italy are not reducing their debt, putting pressure on the eurozone.
In the United States, financial markets have once again shown signs of tension. Yields on 30-year US Treasury bonds exceeded 5%, reflecting concerns about the deficit trajectory, which is expected to remain close to 7% of GDP in the coming years. The growing burden of public debt, projected to reach 130% of GDP by 2030, raises questions about the sustainability of its finances. This context, combined with political uncertainty and rising trade protectionism, has fueled stock market volatility and reinforced fears of a more pronounced slowdown in the world's largest economy.
China continues to face a challenging environment. Despite stimulus measures announced by Beijing, including support for the real estate sector and greater credit flexibility, economic growth remains below official targets. The prolonged crisis in the real estate sector and weak domestic demand are factors weighing on investor and household confidence. Even so, the country maintains a significant role in international trade and seeks to reposition itself as a driver of the global economy, strengthening its supply chains and focusing on high-value-added sectors such as semiconductors and green technology. The evolution of the Chinese economy will be decisive for the region's dynamics and global trade flows.
Sources: INE, BdP, BPI Research, Eurostat, Yahoo Finance; ECB, Turismo de Portugal
DEVELOPED ACTIVITIES
i. Current Management
iii. Improvements and Evolutions
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REAL ESTATE AND THE SATISFACTION OF MAN'S NEEDS
The real estate sector plays a central role in human life, not only as an economic market, but as an essential instrument in meeting the fundamental needs of man. From housing to workspaces, real estate organizes human space and directly influences the quality of life, safety, well-being and cultural identity of individuals and communities. In this context, understanding real estate only from a financial perspective is insufficient; it is necessary to address its social, ethical and cultural function.
An integrated vision of the sector is gaining more and more strength, in which the interests of investors, users and the community must be balanced. The real estate developer is not only an economic agent, but a solver of social and spatial problems, whose performance can positively transform the human experience and the urban environment.
Human beings have always sought solutions to satisfy basic needs for shelter and protection. From prehistoric dwellings to contemporary cities, real estate reflects man's adaptation to the environment, the evolution of construction technologies and social organization. In Antiquity, the built space not only protected against the elements, but also expressed power and social hierarchy, as demonstrated by palaces, temples and fortifications. During the Middle Ages and the Renaissance, urban real estate began to articulate residential, commercial and administrative functions, consolidating the concept of the city as a collective space. In the twentieth century, industrialization and (massified) urban growth introduced new challenges, including affordable housing, urban planning, and quality of life. Real estate has become both a consumer good and an instrument of social policy.
Maslow's theory of needs provides a useful framework for understanding how real estate meets the multiple dimensions of human needs. Physiological needs (shelter, protection from the weather, and space for rest), security needs (stability of tenure, legal protection, physical and structural security), social needs (integration into the community, spaces for socializing, and cultural identity), self-esteem needs (prestige associated with property and ownership, the aesthetics of the space, and comfort) and self-actualization needs (personal expression through the environment, design and functionality). Thus, real estate goes beyond the merely utilitarian function, becoming an existential good, whose absence or inadequacy can compromise individual and collective well-being.
James Graaskamp has proposed a systemic and ethical approach to real estate development. For him, the success of a project should not be measured exclusively by the financial return, but by the balance between three dimensions:
Investors: interested in the profitability and sustainability of the project.
Users: they need functional, safe spaces suitable for their activities.
Community: requires urban integration, environmental responsibility and social contribution.
The real estate developer is like the mediator between divergent interests, able to identify problems and propose solutions that simultaneously benefit all parties. This vision integrates technical, financial, social and environmental dimensions, anticipating contemporary concepts of sustainable urbanism and corporate social responsibility. Real estate is an instrument to improve the quality of life and real estate development must have human well-being as a priority as much as profit.
Henri Lefebvre states that urban space is not only physical, but socially produced. Real estate, by organizing and limiting circulation, its use and coexistence, transforms social and cultural relations. Well-designed spaces promote social cohesion; Poorly planned spaces can lead to exclusion.
David Harvey observes that housing is both a consumer good and a financial asset, generating tension between affordability and profitability. This duality shows that real estate does not always directly satisfy human needs, especially in contexts of speculation.
Manuel Castells highlights the city as the stage for social and economic interactions. Real estate influences mobility, population density and urban infrastructure, determining employment opportunities, education and access to services, reinforcing its centrality in the satisfaction of human needs.
Real estate plays a central role in social cohesion and quality of life. Housing and public policies (social housing programs, subsidies and support and directly impact accessibility). Urban infrastructures (transport, green areas, public facilities and health services) complement the housing function. Sustainability and environmental responsibility (projects that consider energy efficiency, waste management, environmental preservation, and the application of ESG criteria contribute to long-term collective needs). The integration of these dimensions demonstrates that real estate is both an individual and collective good, being an essential vehicle for social equity and the improvement of urban life.
The real estate industry faces complex challenges. The crisis of accessibility and social inequality, technological transformation with digitalization, artificial intelligence and smart buildings that change the way we live and manage spaces. Climate change that brings the need to build in a resilient and sustainable way. Social flexibility with the new ways of working and living that require the constant adaptation of real estate.
The role of the developer and the investor remains crucial: they must balance financial interests with social, environmental and ethical responsibility, aligning real estate with present and future human needs. Real estate is a mirror of human needs, reflecting aspirations, values, and challenges of each society. From basic physical protection to self-realization, built spaces structure human life and influence individual and collective quality of life.
Graaskamp's vision remains current: the real estate developer must act as a mediator between investors, users and the community, looking for solutions that reconcile profit, functionality and social well-being. In the face of contemporary challenges (inequality, sustainability and technological innovation), the real estate sector must continue to put man at the centre, ensuring that urban development is simultaneously economically viable, socially just and environmentally responsible.
Nuno Santos, Asset Manager
MONTH'S
SCHEDULE
September 2025
