The year 2025 has marked a turning point for Spain’s luxury real estate market, with an unprecedented surge in Branded Residences projects. From Tenerife to the Costa del Sol to Madrid, leading hotel operators and developers from both Spain and abroad have invested in this residential model, which combines the exclusivity of luxury homes with the services of high-end hotels. At Arum Group, experts in the development and management of luxury residential resorts, this is entirely consistent with market trends.
According to Spanish business and financial newspaper Cinco Días, Branded Residences are now recognised as a secure and profitable investment, with over 2,400 units under development in Spain and Portugal, and prices of 24 million Euros. However, challenges exist. Developers must address regulatory matters, including the absence of clear legislation permitting a combination of tourism and residential use, particularly in cities such as Barcelona, which has announced a ban on tourism rentals beginning in 2029. They must also contend with heightened competition and ensure their properties distinguish themselves within the market.
Which locations stand at the heart of the luxury market?
While residential options are popping up across various regions, the Costa del Sol in Málaga, as well as Madrid, account for a significant share of Spain’s supply. In Andalusia, high-profile projects include developments backed by tennis player Rafael Nadal and entrepreneur Abel Matutes, who announced a joint investment of 200 million Euros in Marbella and Estepona, as well as the first Branded Residences by Pachá on Marbella’s Golden Mile.
In the Spanish capital, the Hyatt Regency Madrid Residences, located in the exclusive Salamanca district, has opened with luxury apartments offering five-star hotel services. Also joining this landscape is the SLS Madrid Infantas Residences project, managed by the SLS brand, which has begun construction in central Madrid of high-end residential units.
Alongside these two epicenters, Tenerife also plays its part in the European market for exclusive homes, with the impressive residential options at Abama Resort Tenerife preparing for their next major step forward. Looking ahead to 2026, what many call “the best kept secret in Europe” plans to expand its residential portfolio with developments designed to meet the interests of the new international buyer. Although details are yet to be revealed, Abama Resort, widely regarded as the best residential resort in Spain, is already working with one of today’s leading architecture studios to introduce new products next year.
In summary, 2025 has been the year that Branded Residences firmly established themselves in Spain, reshaping the luxury property market and positioning the country as a European leader in this segment. With numerous projects now underway, 2026 will be a year of consolidation, continuing the trajectory with upcoming luxury developments in Tenerife making a substantial impact.
