Scouting the "Next" London

Broadcasting from Madrid after two full days on the ground, Ronan opens this dispatch with his first impressions of a city that has surprised him. Long viewed through the lens of Spain’s post-2008 economic crisis, Madrid now looks very different: vibrant, walkable, architecturally grand, economically resurgent, and increasingly positioned as a major global city with strong rental potential and long-term upside.

Ronan reflects on why Spain may be especially well placed in the years ahead—from its quality of life and global appeal to its cultural and economic ties to Latin America. He also explains why Madrid today reminds him of other great European cities before they fully priced in their global status.

But the heart of this episode is forward-looking. Ronan walks listeners through his upcoming scouting calendar, explaining the logic behind each stop and the investment thesis he’ll be testing on the ground. That includes further work in northern Portugal and Galicia, a first look at Ensenada’s Baja coast, renewed scouting along Nicaragua’s South Pacific, an exploratory trip to Paraguay, and a return to Panama to review current opportunities and pipeline deals.

For Ronan, this is a reminder of what the work really looks like: forming a thesis, putting boots on the ground, challenging assumptions, and testing whether a place truly stacks up as a real opportunity.

In This Episode

Ronan covers:

• His first impressions of Madrid after two days on the ground
• Why Spain may be better positioned than much of Europe in the years ahead
• Madrid’s rental market, pricing, and world-city potential
• Why Galicia is increasingly on his radar as an extension of the northern Portugal story
• The case for scouting Ensenada and the Baja coast south of San Diego
• Why Nicaragua’s South Pacific deserves another close look
• What sparked his first scouting trip to Paraguay
• Why Panama remains such an important regional hub and opportunity set
• How Ronan approaches market scouting, bias-testing, and thesis-building

Key Takeaway

The best opportunities often begin with a shift in perspective. Whether it’s Madrid, Galicia, Ensenada, or Paraguay, the process starts the same way: challenge old assumptions, get on the ground, and see whether the macro story holds up in real life.

Transcript

SPEAKER_00 0:05

Hi there, greetings from Madrid and welcome to your notes from the field. Your notes from the field, and we should make a jingle of this, is where I bring you my latest boots on the ground research. Research you can profit from. And I'm talking to you today from Madrid, as I mentioned. I'm going to touch a bit on that. My report will be preliminary, very much incomplete. I've only had boots on the ground here for two days, and but I want to tell you what I've seen and what my impressions are so far. But the lion's share of this dispatch will be to talk you through my scouting plans for the next two to three months, where I'm going, why I'm going there, what I'm hoping to find. But starting off in Madrid, I flew here from I flew here from Ireland on Saturday night. As I'm talking to you now, it's now Monday night. So I've essentially had two full days of pounding the pavements in Brazil. I've clocked up 50,000 steps in in those two days. And you know, it's been two days that have been just wonderful. You know, I've just found Madrid to be an absolutely wonderful place to spend time. I'm not sure what I expected. I want to lay out up front some biases I've I've I've held about Madrid and also historically other parts of Spain. Um I guess Madrid first came on my radar in the aftermath of the 08-09 crisis when Spanish real estate and the economy was just absolutely on the brink, the the country's real estate industry was was broken and bankrupt, the country's banking system was broken and bankrupt, and and fiscally the place was just an absolute mess. I mean, we're talking about you know unemployment rates, well into double digits, just everything was bleak, bleak, bleak. Um and deals in Spain came on my radar because we could buy at fire sale either auction or directly from fire sale banks at prices that were as much as 80% off. So we were in the Costa del Sol, we made an absolute killing on Rita deals down there. You couldn't even get me on a plane or a train to come to Madrid because I was of the view, and I would argue that that view was correct as of as of that time, that Spain was an absolute economic catastrophe. It was a mess, there was pretty much no light at the end of the tunnel, and to the extent that I was interested in deals in Spain, it was only deals that were in the most internationalized um locations within Spain. So primarily the Costa del Sol, the places that you know continued to attract folks from right across the globe. And at that moment, when it came to investing in any of Europe's capital cities, 2008 and post-2008 and 2009, um I went and looked and recommended deals in Berlin, and certainly Berlin was a appeared to be a far better bet at that moment, and that's certainly how it played out. I mean, Berlin was seeing the the double whammy of a surging, you know, or a German economy poised to surge post the the interruption of the 08-09 crisis. Berlin was seeing the huge benefits from German reunification, the huge benefits that were accruing specifically to Berlin as well as as well as more broadly. Um so roll on nearly 17 years. I'm here in Madrid. I'm eight minutes walk from the train station, which is just wonderful, and I'm told is the most connected high-speed train station on earth. You can take a high-speed train to more destinations from here than any other high-speed train station. My Airbnb is a ground floor unit without a single window, without a single window uh giving giving clear light. I'm talking to you from a bit of a cubbyhole of a back terrace. And um, you know, the the the the the the reason I'm in an Airbnb without, well, you know, which the the Airbnb is perfectly located, you know, it it it all works. I'm not claiming um poor circumstances or anything here, but it's very interesting that I'm paying not an insignificant amount of money for an Airbnb that doesn't have a single window, and that's how strong the rental market here is today. You know, I figure a ground floor unit like this, which was a very simple apartment that they without a window that they opened up onto a street, generates 60,000 euros plus a year in short-term rental income. And I base that from studying their calendar and knowing their rates, and I've I've studied what they're doing here quite closely in the four or five months since I booked it. So um so to start there, this is a place where there is potential to generate very, very significant rental income. It is also a place where the real estate is not inexpensive. It's certainly not cheap for nice stuff, you know, in part as a result of the B ⁇ B I'm staying in, I've discovered an anomaly that, you know, ground floor units can be bought for a lot less, like very, very significantly less than higher units. So that kind of creates an opportunity to generate really, really strong yields because those ground floor units will still rent extremely well, even though they're not much um of appeal to the to the local market. But real estate here isn't cheap. I mean, and when I say it's not cheap, you know, you're looking at while while I could find some ground floor units, ground floor two-bed, two-bath units in in need of attention for the low 300,000 euros, for example, in the main, you're looking up in the region of six, seven, eight, ten thousand euro per meter. Um, so what that translates to in terms of dollars per foot is maybe 700 to up to a thousand dollars per square foot. So again, these are my these are my preliminary senses of what prices are like in places that are extremely uh accessible and walkable to all the main attractions, but not necessarily the fanciest and the most expensive streets or areas and the most luxurious um places. So what does this mean? Where is Madrid in a macro sense and where is Spain in a in a macro sense? So for you know by by all measures Spain is doing phenomenally well right now. I mean, Spain is outperforming pretty much all the rest of the the Eurozone in terms of growth rates. Now, that's not saying a huge amount. Um Spain has a couple of particular advantages that really being here has just, I guess, forced me to think about and really the the I guess the the penny has dropped in terms of both where Spain is at and also the opportunity. One very interesting thing, you know, today I was driving in our well being driven um in the main business district, and I'm seeing these shiny corporate buildings for Spanish companies that I'm a customer of in Mexico. So for example, Banco Santander is all over the place. That's who I bank with in Mexico. I was looking at a big, shiny high rise from an insurance company called Mafra. That's a company that I buy insurance policies from in Mexico. So there's a lot of big Spanish corporations and brands that have a very, very foot, very big foothold in Latin America, and clearly in terms of language and culture, have some very, very big advantages in terms of operating in Latin America, and Latin America is growing. The economy is growing, there's more people, there's more money, there's more economic activity, their demographics are more robust than the West. So that poses a particular advantage um for Spain. And you know, another big thing as we as we try and understand, understand macro views on places, you know, I mean there's there's just no getting away from demographics, you know, our beat of real estate is physical housing for people and for real estate demand, you need to have people, you need to have a certain number of households and where they're at in terms of in terms of affluence is is very important. So we can't separate real estate from demographics and specifically demographics as they relate to a to to a small area, and you can't separate demographics from emigration, and you know, pretty much wherever you are in the world today, or whatever your view about this is, but emigration is now one of, if not the biggest hot button issue facing facing the the developed world. The developed world we we need more people, you know, certainly places in Europe where populations are set to just create or not not just fall but just come off a crit. You know, emigration is needed for to create consumers, and also emigration is needed to do the actual work. And wherever you look in the world, Spain is just uniquely positioned to attract consumers and workers. So it's uniquely positioned to attract consumers for all the reasons we know about here at Rita, because there's year-round sunshine, there's great golf, there's great food, there's great culture, there's great beaches, there's all these reasons why people with high sta high capacity to spend money want to move here and have moved here in huge numbers for for decades now. And then on the the worker side, you know, there is just no other country in Europe that can tap into a pool of potential emigrants who are as close culturally and in terms of language as Latin Americans are to Spain. So it's it's it's it's interesting in that Spain could be poised to navigate this situation in the smoothest and most beneficial way or least harmful way of pretty much any country in Europe. And it's also interesting that you know Spain is the place that a lot of Latin Americans are drawn to, you know, wealthy Latin Americans looking looking for a foothold in Europe. Um so again, that bodes well because that's a that's a growing market. So the future is bright for Spain, and Madrid today reminds me of what I found in London 25 to 30 years ago, and what I found in Paris maybe around are about 25 years ago, and these were stunningly beautiful, historic, major world cities, but pre-gentrification. So they were still full of young creative people, they were still vibrant. I mean, you go to most of London today, and it's just full of rich old people, Paris the same, rich old people and tourists, because it just doesn't work for people, for people in between. But Madrid is still at that cusp where it's got grandeur, it's got a shiny business district, it's got beautifully polished historic buildings, but it's still got that energy and bit of grit, and it's also got neighborhoods that that that haven't been gentrified. So, you know, um you can argue that maybe it should be left alone, and maybe that's the case, but the reality is I expect that that's not what's going to happen on a world-scale, nice real estate in Madrid still can be bought at a significant discount to comparable world cities, and it's a city that I believe is in those relatively early stages of jumping up a league, but becoming a true, true world city, a true place that can be spoken of in the same terms as a London or Paris. So those are my initial thoughts. As I say, I'm two days in, I have another three days here. Um after the trip, I'll give a give a full debrief. But two days in, I mean the most pressing thought I want to impart, then this is my self-reflection, which is how the hell have I not scouted Madrid before? It is absolutely wonderful. The weather is perfect, a very interesting quirk of Madrid, too, as well, is that the weather we have right now, which is sunny, low 70s, bit of a breeze, is being described to me as what a typical winter's day in Madrid is. So, I mean, it's incredible to be able to get a world-class city with weather like this. I mean, I certainly wouldn't want to be here in July and August when the city empties out and it gets super hot. Um, but this is a place where you know clearly very strong rental incomes can be can be generated. I'm going to crunch the numbers and see how they look in terms of yields, but I think pretty solid and could also be a wonderful place to have a base and to to spend time. Um, so that's this week. That's first stop in my fall scouting lineup. Thursday I leave here and head to Orense, which is in Galicia. It's going to be a very fleeting one-day stop in Orenzi. Um, first of all, to get my first impressions, a bit like what I'm doing here in in Madrid. I like to go to a place, get first impressions, pound the pavements, step away, do research from my desk, and then come back to run the rule on specific deals. But Orense came onto my radar because the entire team who've been working on my home in Caminha in northern Portugal are from Orense, and all they've done is you know just convince me about how beautiful it is and how wildly inexpensive real estate is there. Um, so I'll be checking that out, and seeing how it's a place that's coming very much into vogue. It's only two hours and 10 minutes in the fast train from the train station that's eight minutes from where I'm talking to, so it's easily accessible to Madrid, it's in the heart of Galicia. It's only an hour and 20 minutes then from Caminha. So our logistics of getting from Madrid to Caminha will be that we will, my wife and I will get the train to Orense and then we will get a car transfer from Orense to Camina. So Camina will be Caminha and Galicia will be my base for for pretty much all of all of October. Um I'm going to make multiple scouting trips into Galicia, back to Orense, gonna head to Vigo, um to Santiago de Compostela, and really just dig on my thesis that the next Caminha or the next place in northern Portugal is actually across the border in Galicia. So that's gonna be a be be a lot of lot of fun. Um maybe I'll be getting into questionable weather territory, you know, I'm gonna be there at the pushing tail end of October, probably not the the best weather, but again, I'll be operating from the basis that you know that that I do know that there is really good weather up there for at least seven, maybe seven, eight months of the year. And um, you know. This is the big thing, and you know, a question I've got a lot about about chemenia is but what about the winter weather? And A, you know, well, first of all, you know, perfectly valid and good question. In terms of my strategy, it's not relevant because I won't be there in winter. And I'd also follow up with the point or the observation that almost nowhere has good year-round weather. So even maybe if I were to say a place on earth that has the best weather for me, I'd probably say cabo, but cabo weather is only habitable for me for nine months of the year. There are three months that are too hot and too humid. So wherever you're looking, you know, it's highly unlikely that you'll get 12 months a year of the perfect weather for you. Um so again, stay tuned for the reports from Caminia and Galicia. On the 2nd of November, I fly to Guadalajara, and Guadalajara will be my base for extensive scouting trips in November and December. So November and December are going to be pretty much full-on scouting, so I won't be in Cabo as my base on till the new year. But first scouting trip coming up from Guadalajara will be to Ensenada. So Ensenada is the area essentially just south of San Diego. So I'll fly from Guadalajara to Tijuana and scout the the coast south. And the the pieces here is very, very simple. You know, there's condos you can buy right on the beach that are 80 minutes drive from the heart of San Diego. So the accessibility and the proximity to a place with some of the the highest real estate values on earth and to be able to buy right on those beaches for $400,000, $450,000 on paper is is worth worth investigating. So, you know, a couple of team members of mine have have been up there. Um we've had multiple team scouting trips, I've watched hours of internal team video dispatches, live feeds, you know, it's certainly a place that's worthy of significant in investigation. So I'll be up there in mid-November. So, you know, my movements, I'll get to Guadalajara, you know, get caught up with let's call it the desk job, etc. And then, you know, about a week later head to head to Ensenada. Then my next trip back to Guadalajara, and then tail end of November, I'm going to Nicaragua. So I'm going to focus on the South Pacific coast. I'm going to I'm going there to investigate a number of very, very significant path of progress developments. There's new infrastructure happening in the capital Managua, which is set to improve accessibility, huge new airports later. There are new improved accessibility in terms of getting from the capital and the airport south to those Pacific beaches. And then there is also a very, very exciting coast road project. So I'll be spending time in San Juan del Sur and in the beach community of Rajasantana. And um, you know, I I just can't wait to get back to that part of the world. You know, it sadly it hasn't appeared much in Rita in recent years. Um, and you know, that's primarily because of political uncertainties, you know, gave me gave me pause about making specific recommendations there. But what I will say absolutely, unequivocally, is that this is just one of the most stunningly beautiful coasts on earth. You know, it is just a place you should you should you you should visit and see for yourself. Um as to whether I'll find opportunity. I certainly know that your dollars just stretch phenomenally far on this Pacific coast, you know, when you compare it to you know what you'd pay just across the border in Guanacaste, when I compare it to what you pay for Pacific real estate in in Cabo, you're buying for an absolute song. Um but, you know, Nicaragua doesn't have the things that Guanacaste and Cabo go have going for it, you know, things like incredible accessibility, you know, really, really strong juggernaut, tourism, industry, stability, positive perception in terms of that stability. So um so I can't wait to go and um at a minimum I know I'm going to find some really really cool real estate I'll be I'll be excited to to tell you all about. Um so that'll bring us into early December and um then second week in December I'm planning a trip, my first trip to Paraguay. And um, you know, essentially this stemmed from I I got on a zoom with our fellow member Kurt. Um Kurt is a longstanding Rita member and friend of Rita's, and he's down there investing in in real estate. And you know, he's someone whose judgment I I respect. I've seen him do really, really well from Rita deals, and I've seen him do really, really well from deals he has found and locations he's he's found himself. And um I got off that hour long plus Zoom, which you know we'll we'll link to it below here, and I just said I gotta go, you know, I got to check out this place. And it's not just Kurt, you know, Paraguay has been, it's one of these things, it's been coming at me from multiple angles now for for some time. It kind of one of these things that start as a whisper and then it spreads, and you know, and now it's time. So I don't know what to expect. I mean, I've again I've had I've had a perception, and then I look at videos on YouTube and talk to Kurt, and that perception is blown away. But you know, I think for me, and I'm not sure if you feel the same, but I feel like you should. It's very, very important to articulate our perceptions and biases so we can so we can chat challenge them. You know, I mean, right at the start of this, I articulated a perception and a negative bias against Madrid. And you know, sometimes these are right, sometimes they're wrong, and they they hold us back, but it's certainly a an opening position we can we can measure, measure a place against. But uh very excited about about getting to Paraguay. And then just because of the way the logistics work and I'm due a trip, um, I'm going to route through Panama. So again, this is interesting because it speaks to Panama's role as a hub, but my flight route will be Guadalajara, Panama, Panama, um, Paraguay. But so what I'm going to do now is I'm going to fit in a two-day layover um in Panama, you know, to haven't been there for a few months, haven't been there for um, haven't been there since early this year, um, put boots on the ground, check in on our most recent opportunities, and also run the rule over what's a really, really strong pipeline of of of Panama opportunity. So there you have it. That's my that's the game plan. Madrid, Galicia, Camina, Guadalajara, Ensenada, Nicaragua, focus on on South Pacific, Paraguay, and Panama City. So that's a pretty full scouting lineup planned between now and the year round. And um yeah, and I'm I'm excited, you know, I'm I'm excited about every single one of those places. Some are new and there's always more excitement associated with the the new places, but everywhere is you know is is stunningly beautiful, although I haven't seen Paraguay, so I'll you know I can't definitively say say that yet, but everywhere is beautiful and has a set of circumstances happening that might mean opportunity for us. And that's what we do here. We get out there, we put boots on the ground, we generate an investment thesis, and we see how that place stacks up to it. And then we we invest or we don't, but we keep moving, keep learning, and keep developing the research and knowledge base that will will help us make make the best possible decisions. So there you have it, it's Tapas time for me, and um thanks. Thanks for being a Rita member, and thanks for sticking with these musings this evening. Take care, I'll get it.