Cat 2 / Hepps relocating to the Rock fuel the property growth

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By Louis Montegriffo, CEO, BMI Group


High value clients (Cat 2 / Hepps) continue to represent a significant part to the Gibraltar property market. Over the past few years, the jurisdiction has seen continued growth in Gaming, Insurance, Banking, and Funds. The Distributed Ledger Technology (DLT) sector and the Gibraltar Finance Centres’ foresight in regulating the industry at technology level is already proving to be hugely successful and has the makings of developing similarly to the online gaming sector, which has, over two decades been responsible for substantial growth.

Further consistent growth

Despite the uncertainty surrounding the jurisdictions place in the Brexit agreement, there are numerous fundamentals surrounding the Gibraltar economy which will underpin further consistent growth. Prices will hold at current levels and there may be further growth particularly within the upper tiers and owner occupier driven sectors.

The market has performed incredibly well since November 2020, with increase in prices to April 2022, of up to 60 percent in certain segments and high value locations. Due to huge demand and a lack of supply, there have been some phenomenal increases in prices in the larger high value properties.

Average price

In general terms there has been an average increase in prices of an 18 month period of approximately 35-40 percent. This makes the average price or property in Gibraltar approximately £900,000. Over the past five years we have also alluded to the fact that this may well play out as it has and that other segments, such as the studio market may not necessarily enjoy the same growth, due to an over-supply and a lack of suitable end users, in what is a largely speculatively driven market.

The market in the second half of 2022 slowed down in the pace of sales volumes and price hikes, which considering the pandemic aftermath, Brexit uncertainty and the war in the Ukraine is not surprising. With rising prices in most western economies and interest rate increases not seen since the 1990s, it is only normal for there to have been a degree of uncertainty and nervousness affecting the property market, in the same way other markets were affected.

A sensible 4 tier market

The developing 4 tier market (Low, Mid, High, Ultra-High) that we have reported on for the last eight years are now firmly accepted in the jurisdiction. The very fact that Gibraltar is attracting a new ultra-high segment is the clearest sign of confidence from a new emerging market. Few Finance Centres and Finance Services locations can boast such a cross section of the market.

Commercial property

With respect to current availability and stock, it is safe to say that there are options in various locations, but particularly so in older commercial properties. The offering is generally lower quality and in certain areas, compromised in terms of layout flexibility and sizes.

There is no question that an element of decanting from the older commercial properties into the newer and better designed office schemes has been the order of the day over the past 48 months. Worthy of note is the fact that letting rates/sqm have not been compromised at the higher end due to the decanting, in fact quite the opposite; applicants are prepared to pay high-end prices for high end specs. This creates an opportunity for landlords with older buildings, to upgrade and provide the market with improved offerings to market.

New modern office options will serve to improve the commercial offerings in the market and will generate new business steered by new expectation, which once again serve to underpin the positive future for Gibraltar PLC.

New off-plan developments

Currently at the time of writing, Eurocity, Marina Club, North Gorge and The Reserve are the only major off-plan developments which are under construction, with the latter two being the only ones primarily steered exclusively to the owner occupier segment. There are a great many re-sales at Eurocity, particularly studios and one bed apartments, that continue to be of the view that prices within these types of properties may suffer, with available volumes on smaller units increasing by the day.

The E1 and Forbes developments, completed at the end of 2022, has seen good movement in Forbes, which comprises of a wider range of mixed units, but E1, which is primarily studios and smaller one bedroom apartments, has seen a great many of the properties come back onto the market for re-sales and rentals.


Property values as indicated have grown enormously since November 2020, but we have seen this rally slow down and adjust since May 2022.

Our take on the future very much depends on the impact that higher interest rates have on the local economy and the pending Brexit agreement with Spain.

New business in Gibraltar is present and the private client space will continue to feature highly, as we see high value clients looking for a jurisdiction that is safe, proactive, low tax and well-regulated.