Málaga, the Costa del Sol, and Spain’s New Opportunity

Broadcasting from Málaga after several days on the ground, Ronan reflects on a city that has undergone one of the most striking urban transformations on his beat. Once known primarily as a gritty port city, Málaga today has become a polished, vibrant, highly desirable destination filled with culture, food, walkability, and lifestyle appeal.

For investors who got in during the post-crisis years, the results were exceptional. Ronan revisits the original Málaga play: buying small condos in or near the historic center at fire-sale prices in the wake of Spain’s banking and real estate collapse, then using them for short-term rentals. That strategy delivered both strong rental yields and significant capital appreciation.

But the market has now entered a new phase. Much of the crisis-era excess inventory has been absorbed, demand is outpacing supply, and pricing for high-quality projects is moving sharply higher. Ronan shares what he is seeing in today’s market—from major uplifts in leading developments to a growing luxury segment in Málaga itself—and explains why he now believes the Costa del Sol is once again ready for the RETA model, this time through best-in-class pre-construction.

He also touches on lifestyle markets along the coast, including Estepona and the golf communities near Sotogrande, for those thinking not just about returns, but about where they might actually want to spend time.

For Ronan, the takeaway is clear: the easy crisis-era bargains are gone, but a new opportunity is emerging for those who can get in early on the right projects, with the right developers, in the right locations.

In This Episode

Ronan covers:

• Málaga’s transformation from industrial port city to vibrant lifestyle destination
• How earlier RETA buyers profited from the post-crisis recovery
• Why Spain’s crisis-era inventory has now largely been absorbed
• The rise of pre-construction as the next major play on the Costa del Sol
• What recent pricing jumps reveal about demand in the region
• Why Málaga is now attracting a more meaningful luxury buyer segment
• The appeal of Estepona as a livable coastal town
• Golf-community opportunities near San Roque and Sotogrande
• Why low fixed-rate financing in Spain matters in an inflationary environment

Key Takeaway

The old Spain opportunity was about buying distressed inventory in the aftermath of crisis. The new opportunity is about getting in early on high-quality pre-construction as demand rises, supply tightens, and the Costa del Sol continues its move upmarket.

Transcript

SPEAKER_00 0:15

Welcome to your notes from the field. This is where I bring you my latest boots on the ground research. Research we can profit from. It is 111 a.m. on Saturday morning. It's an absolutely beautiful, crisp, warm sunshine morning in Malaga. I've just checked out of my hotel. I'm sitting in a cafe. I'm looking up the pristine and beautifully polished Calle Larios. That's the main tourism and shopping drag. That's the main artery that runs up through Malaga's historic old town. To my right I see palm trees. Modern spaces in the port and the marina area. I hear it said, and um I hear it said quite frequently that um Malaga is the new Barcelona, and I hear these comparisons and I I just don't get it. Um because for me Malaga is just a much, much richer, vibrant, just better experience than certainly Barcelona of the the the last decade or so. It's an absolutely fabulous city to to visit for a city break, to come and hang out, to eat great food. Um you know shopping isn't my thing, but the the shops look look amazing. Even I found myself wandering around and window shopping, the history, the culture, the food, the weather. Um it's just absolutely wonderful place to spend time. And um it wasn't always like that. You know, you go back 20 years, Malaga was just a grimy, grimy, corrupt industrial port city. You know, so much of the the historic old town that's lined with Gucci and Prada and Michelin Star restaurants now was given way to squatters and was was pretty much derelict. So this is just an example of the great transformations that can happen when the right set of circumstances come together. And um Rita members who got in in 2012 when I recommended buying here at that time we had the the convergence of the convergence of the Malaga regentrification story, the transformation from grimy, industrial, crime ridden to chic and trendy. Um we had that trend happening at the same time when this catastrophic banking and real estate crisis rolled um rolled through Spain. So because of the crisis moment, we could buy super cheap while still getting ahead of that wave of transformation. And um, you know, it's interesting that the recommendation back then that I made was to buy um buy small condos in or on the edge of the historic centre and make them available for short-term rental. Um great idea. Those who got in have just seen like stell uh like amazing yields, you know, yeah gross yields north of north of 20%, plus you know, really, really strong cap capital appreciation, close on a double. Interestingly, what I didn't spot at the time, and what's emerged, I'd say, as part of this growing global trend, is that there's a major luxury market here now, that the the top end of the market now here in in the downtown area, you know. I'm speaking specifically here about Malagan, not the broader Costa del Sol. Um, there's a market now of you know beautifully restored apartments in the historic district for as much as 1.5 and and 2 million euros. So it's interesting to see the the the luxury market here as well. Um you know uh 2 million euros is a lot of money to spend in uh you know in a in a city that you know for for most people it's just gonna be a weekend break place. But anyway, maybe it's maybe it's a function of all this ultra high net worth people's money that's just sloshing around the world now looking looking for a home. You know, we've seen it play out in Lisbon, um, there's so much more so supply and demand of it there in Lisbon, but interesting to see that it's that it that that it's arrived here. Um so to to jump in, and I guess the the point of this, what why we're all here primarily is um how do we make money from the this beat of of of international real estate and um so what is the the Rita play here? Um so to jump in I have seen I have seen numerous great uh pre-construction projects here and just to back up uh a little you know just to back up a little in terms of our our Rita backstory with with this part of of the world. So the the crisis, the great recession, um led to the complete the the absolute implosion of Spain's real estate and banking system. Um that was 2008 and 2009. By 2012 and 2013, the Spanish banks and their bad bank, which absorbed a lot of these failed projects and these toxic assets, um, started fire sale started fire selling these condos. So these were condos that were built and completed around 2008-2009. The developers failed, the inventory went bank back to the bank, then the bank failed, and the inventory was moved on to the toxic banks Arab. And around 2013 we started getting great deals. Um these were finished, finished projects. We were buying at as much as 70% less than the than the kind of the pre-crisis pricing, and we had a run of those types of deals that you know was really, really strong 2013 to 2015-16, and then became more intermittent right up to just last week where Acosta Casares deal is still um still an output of of that Sarab bad bank toxic assets um process. But at this point, you know, through through those times I was very hesitant about recommending pre-construction in Spain because there was so much of this excess supply from from the crisis. Um so you know, so at this point, um I haven't made any pre-construction recommendations in in the Costa del Salem. Those Rita members who got in made out like bandits on on those um those ground floor crisis opportunities. So the point has arrived now where you know almost all that excess inventory has been has been absorbed. Um demand here is exceeding supply and also price point sensitivities have moved way way up. Just anything good is just selling for much much more than it did six months ago, nine months ago. Um so I looked at two two um two two really really nice projects. One was called Paolo Alto, the other was called Royal Palms. Um they're both have great sea views. Paulo Alto is just basically in the hills above Marbella, um Royal Palms is closer to closer to Malaga, also with Great Sea views. Um Paulo Alto started pre-construction um launched on the market about about four years ago with an entry price of of 340,000 euros. Today their get-in for a similar condo is in the region of 500 to 600,000 euros, so really really dramatic uplift on you know on the best projects. Likewise with Royal Palms. I was coming to to see Royal Palms um with a launch price list from their from their last um from their last launch in my hand, and then just before the the meeting, um I got a new price list for for their next launch, which showed pricing of a hundred and a hundred and nine thousand euro and more and and more more than what the pricing was on the previous phase a week earlier. So this is this is really dramatic because we were talking about you know prices spiking from you know 290 to 400 and the the low 400s. So the the the the takeaway, I guess, that the bottom line for us here is um I'm now willing, comfortable, and excited about recommending the best pre-construction projects on the Costa del Sol. We Rita members need to be where we always need to be, which is at the ground floor getting in with our group buying power before that launch. So in Paolo Alto, you know, we would have been buying at a discount on the 340. So now what we don't have is a time machine to to go back for those projects, but what we now have is a game plan for our place in the market in Spain, and we have a target list of the various developers that we we need to talk to, and we've started speaking to. Malaga Airport, kind of starting in the Lacala area and going the whole way. Well the when I say the whole way, I'm only talking about a drive of about an hour and 20 minutes um out to the out to Manilva and and Soto Grande areas. So the the the the takeaway, I'm extremely bullish on the Costa del Sol. Um the way for us to play it, the the the primary play here for us is to buy is now to buy best in class construction from best in class developers, just our same formula as in the as in the as in the Riviera Maya and and and Panama. And my team and I have started those conversations all already. So, you know, before this trip, we we had a few early stage balls in the air, those are progressing. Um we're now giving this market um very, very significant, significant, um significant focus. So I expect in the you know in the coming in the coming months, you know, those conversations are going to progress and in the not too distant future we'll have um significant significant launches coming. Um so then I guess the the the next question so the for for for the Rita member who is just interested in it purely to to to to make money um just have a sip of my coffee there. Um for the Rita member who's in it purely to to make money, I'd I'd hold tight. Um there's gonna be some some pre-construction deals coming down the track that that will fit into our into our Rita formula. In terms of to somewhat kind of to flip the conversation and think about what would I do if um if I wanted to if I wanted to move here or if I wanted to spend time here right now. And um this is a place I would be very close to the top of my list, or might even be the the top of my list if I hadn't made my commitment to Portugal. And remember, I've made my commitment to Portugal for a variety of reasons, um including including organizing myself out of Portugal for for tax reasons. But one one big discovery from this trip is the the the town of Estepona. So the town of Estepona, you have you have the Malaga and Malaga Airport, then you've got Marbella. After Marbella, you've got Porto Benus, which is that very, very luxurious and supercar enclave. Then you have San Pedro d'Alcantara, which was a big Rita recommendation back in 2014 and 2015. That's where the path of progress saw the highway going underground and being replaced with uh an urban garden, and Rita members who got in there made out like bandits because again they were able to buy super low because of the the crisis moment, and then they were also benefiting from the Path of Progress event, which was where there was highway that was just bisecting the town and was noisy and dirty, that all went underground and was replaced by this kind of beautiful open air, open air urban park. And again, you know, it's just worth stressing that again, you know, that here at Rita, you know, we're not just following a single trend. You know, there's there's there's so many factors playing in our favour. When we if you're willing to pan out, you know, go right across the globe, you will find places where where there's a convergence of events where you can buy cheap because of one situation, but you're getting the the benefit of that cheap buying moment plus something else that's that's having a transformational impact, like Malaga, buy cheap because of the price crisis, but the place is also being regentrified. San Pedro d'Alcantara buy cheap because of the crisis, but the place is also being transformed because of this big big infrastructure project. And San Pedro was a town that was primarily a you know a town that served the the resort communities and the the kind of the tourism industry all around it. So San Pedro as kind of development moved from Porto Banus towards San Pedro, that became very, very chic and and gentrified. Um maybe gentrified is the wrong word, just kind of trendy somewhat trendified, just lots more, you know, where it was a traditional Spanish town. It retained the charms of being a span a traditional Spanish town, but lots of more vibrant restaurants and bars and cafes were were were added. And then the next town is is Estepona, and again Estepona as a as a town was was primarily overlooked and now is coming coming into Vogue. That you know it's it's a got this fabulous, compact, small, small old town. Um it's beautiful to to stroll in. You've just got a long um a long beachfront boulevard. Um again, just the the huge thing, the huge appeal for me about the the cost of that salar, a well probably the biggest appeal for me is to be able to be in a to be in a small city or a big town where everything is walkable, where it's where it's where there's life and there's vibrancy and there's you know great cafes, there's great restaurants, um you feel you know you you feel that kind of energy and vibrancy, and it's a pretty traditional Spanish too, and in the sense it's not overrun with Irish people or English people or German people. And um Estepona is really finding its charms. It's got these amazing murals, there's about 80 murals all all around town. You know, I I posted some photos of those on on my Instagram account as I as I as I went. Um great restaurants, just a lovely place to to walk. It's a place where you feel like you know, walking and healthy living would just be integrated into your lifestyle. And um, you know, if if I was buying along here, I'd be very, very tempted to buy right in the middle of right in the middle of town there. From a from a rental perspective, you'll find very, very strong rental market. Um I saw one project called Living Estipona, which is just a block off the beach, which looks um very, very appealing. Um but broadly speaking, you know, screaming deals are are are hard to find. You know, this isn't uh this isn't a market where we can where there's kind of low-hanging low-hanging fruit to be low-hanging fruit to to to be picked. So if I was buying today for a place that I'd use for some of the year, um and maybe rent out when um when I wasn't here, I certainly wouldn't want to be here in high summer. It's too hot, it would be too hot for me and much too busy. Um, it just gets really, really busy here in high summer. And if you don't like traffic and if you don't like lines, and if you don't like being around lots and lots of tourists, you know, this this may not be the place for you, but the flip of that again is that that is an amazing time to to rent. So the other thing I would the other places that I would consider, and both of these are a very, very similar deal, is in San Rock. So driving um driving west um driving west towards Gibraltar, probably um probably about an hour and twenty minutes from from Malagay Airport, you've got the San Rock golf and resort community, um two excellent, really, really, really top top class, like so it in that area you have truly world-class golf courses. You've got Valderama, which is the hosted the Ryder Culp, it's the the it's the Augusta of Europe that's right next door. You have Real Sotogrande, which is just about seven minutes from from there, and that's top top tier. So you've got this kind of top top 0.1% of world golf courses are on your doorstep, and then you've Got San Rock, which is a top class golf resort, albeit at a slightly differ lower level than the Valderamas and the Real Soto Grande. But it's it's gorgeous there, you know, lovely, quiet setting. Um you know, you're you're within about seven or eight minutes from a kind of a traditional Spanish town. Um and there I found big spacious kind of homes. They're they're they're detached, so they're they're attached on both sides, but they're big homes of you know, three and four bedroom homes, very, very spacious, probably, I'm waiting on the measurements, but probably about uh about 2500 square feet that overlook um that that overlook the the golf course, and those come from approximately 500,000 um euros. You know, some of the entry price ones are a bit lower, some of the premium aspect, and some are a bit bigger, go up closer to 600. But that is a a very, very attractive deal in my mind. These are mostly built, they look the the kind of the design and the aesthetics of the houses that you enter from the front and the front looks a bit odd. Um I'm not sure how to describe it. Um it's not overly aesthetically appealing, but inside then opens up and then all your views are are are are out the back. So, you know, you might or mightn't care. You you might or mightn't agree with my personal view on the the front of them, and you might or mightn't care. You know, I'm not sure I I don't think I particularly care because for me all my living would be inside and and oriented to to the golf course. And these are built and and ready to go. If that idea grabs your attention, I'll put um contact details but below this. And um then the other was Real Real Sotogran not not Real Soter La Reserva de Sotogrande, which is another um golf resort, um same area and same kind of idea, homes in that homes in the similar ballpark, but the the the the the homes are again three and four bed homes, spacious, spacious homes well built there. The the price range is kind of 500,000 to 800,000 euros. Um 500,000 euros doesn't get you great views. It it those give you views onto a road and to houses in front. Um for views out to the golf course you're paying 800,000 euros. Now the those again, you know, it's kind of important to put these kind of sticker prices in in context. The Costa del Sol, those prices, those sticker prices are extremely low by Costa del Sol standards, they're extremely low by Algarve standards, they're extremely low by the standards of kind of a a luxury golf community in the Mediterranean are are other parts of other parts of of Europe, you know, are Airbnb. I was there with my team, we stayed in an Airbnb, which was like a pretty shiny and luxurious new built home. It was over three levels plus a roof terrace up top, it had a lift, and uh but that homes like that list for 1.4 million, but they're kind of in the suburbs, you know, there's no sea view from there, it's developed all around, you know, it's it's not a it's not a ocean view, it's not a it's not in the heart of a city or a town, it's not in a manicured um it's not in a manicured um r resort environment. And you know price points for um price points for town homes, say in the Palo Alto community start at 1.5 million, 1.5 to 2 million. Um you know the the these are very low price points is is what I'm getting at for a market for the Costa del Sol or for any kind of similar similar market. Now big big kicker, big, big thing to just really shine a light on um about Spain right now is that you can borrow and you can fix those rates for up to up to 10 years plus at rates of you know 2.3% to 2.8%, depending on depending on various things. But if you're conscious of inflation, if you think we're in for an extended inflationary environment, and if you think the central bank's response to that is going to be to raise rates, um then this is an incredible opportunity to buy best in class real estate and to lock in those super, super low rates. I know no other there is just no inflation hedge out there like buying best in class real estate and borrowing up to the hilt with fixed rate and long-term fixed rate mortgages because what happens there, like I mean, what what inflation is is just paper money losing value. So if you have a hundred thousand dollars or euros outstanding in debt and there's ten percent inflation, that hundred thousand dollar debt goes down in real terms by by by by ten percent. So if you're borrowing for if you're borrowing for two to three percent and the value of that debt is going down in real terms by by ten percent every year, then it's it's literally a wealth creation machine. It's a wealth creation machine, it's the best, it's a wealth preservation machine, um it really is what you should consider doing if you if inflation um is a significant concern of yours. And um you know it's um you know and I do think you know r recent events, you know, that the this war have just made these inflationary concerns that we've all had just much much much much more um much much more acute. You know, there is just no sign of the the supply chain issues unraveling. Now we have a war. Um there's a war that's going to you know involve more there's sub supply chain bottlenecks, plus there's going to be more government spending. Um so you know it's it's it's hard to see it's hard to see a benign inflationary environment in the in in in the in the coming time being. So um so there you there you have it. Um greetings from Malaga um takeaways, um visit Malaga, visit Estepona. If you're looking for golf resort living, check out um San Rock, our um our La Reserva de Soto Grande, and those homes there. And if you're in this beat to make money, stay tuned, watch your alerts for um we're gonna be here, um, we're gonna be here in the Costa del Sol, and we're gonna be on the ground floor, just like we've been on the ground floor in in the Algarve in recent years, and just like we're we're here on the ground floor in um in the Riviera Maya, in Cabo, and Panama, and all these other markets where we've where we've been able to just ride these convergence of trends buying super low in a place that's on the up. Okay, there you have it. Um I'm heading to the airport now, from there to Amsterdam, from Amsterdam to Mexico City, and from Mexico City to Portovarta. So my iPad is is loaded up, and um I'm looking forward to to a big, big Netflix binge.