As electricity and now even water supply issues do not appear to abate in the country, the chat around the dinner table often turns to emigration. Fortunately, vat jou goed en trek is now not the only option. There are many opportunities besides semigration to the Western Cape and leaving for good. The pandemic has opened our eyes to alternatives to being in the office day in and day out. Andrew Rissik from Sable International told BizNews about prospects in Portugal for South Africans considering options to internationalise themselves. According to Rissik, Portugal can be regarded as the Western Cape of Europe and, if you are looking for a city with vibes, Lisbon is Cape Town on steroids. There are also interesting possibilities just down the coast for digital nomads who want to combine coffee culture with surfing and an opportunity to invest in a development in Porto that opens the door to a Golden Visa. – Linda van Tilburg
Excerpts from the interview with Sable International’s Andrew Rissik
Between 500 and 600 South African families have taken advantage of Portugal’s golden visa
The Portugal of 2012 and Portugal of 2022 are very different countries. To give a little bit of perspective. After the global financial crisis, Portugal was quite a bad place. In 2012, they had to have a bailout and post the bailout, the Portuguese government was quite proactive in trying to attract foreign direct investment and they had a whole raft of measures they put in place. One of them was the so-called Golden Visa, which is quite well known in South Africa now. I think you will probably find around 500 or 600 South African families have taken advantage of this visa. Very simply, it is a residency by investment programme where for a minimum capital investment you obtain residency. That was the seed that was sown and prompted South Africans to go and explore Portugal. As time goes by, those relationships with Portugal have developed and it has become a very well-known destination.
In certain respects, living in the Western Cape is more expensive than living in parts of Portugal
Portugal is bucking a lot of global trends at the moment and it’s driven by many factors. In terms of geographic location, it is almost the forgotten southwestern tip of Europe. Therein lies such a great opportunity because nobody ever asked: have you been to Portugal? The response is usually: no, but I’ve been to Spain. Countries like Spain and France are very well known. But there’s been a discovery and as we move into a world where people embrace simpler lifestyles and a better quality of life – which means many different things to different people – Portugal really does tick a lot of boxes. In the European and the EU context, Portugal’s quite an affordable place from a cost of living perspective. Just to give you an idea, when we started doing business there, properties per square metre in prime locations in Portugal were probably a third of what you would be paying in a prime location in London or Paris and that translates into the general costs of living. Also , if you go out and eat or to the grocery shop, Portugal is much more affordable. The main reason is that the Portuguese are not very wealthy as a nation. They have to be able to live and survive in their own country. This makes it really attractive, particularly to people from South Africa where it is really comparable. Living in the Western Cape is probably more expensive than living in parts of Portugal. But, not when it comes to property. In fact, in certain parts of Portugal, the property prices have gone through the roof. The Estoril-Cascais area, which is prime, the Portugal Riviera, forms part of Greater Lisbon and you are probably looking at pretty close to more developed EU countries in terms of your price per square metre but only in a small part of the market.
Portugal is bucking the trend with 7% growth
Portugal is showing this year, I reckon about 7% economic growth, which is really good if you measure it against the EU and look at what is happening throughout the world with the post Covid-19 logistics and all the other issues. But it’s not immune from the geopolitical issues that are affecting the whole world. I also think Portugal comes off a base where the expectations are much lower than, for instance, a German or a Brit. If you tell somebody in the UK or Germany they must switch off their heating and they’re going to be cold this winter, they will probably react quite badly. Whereas in Portugal, they will wear jerseys or jumpers as many cannot afford to keep their houses properly heated. It’s a little bit like South Africa.
Interestingly, we’ve started to see more and more American clients looking to buy properties through us in Portugal. And what is intriguing is that the Northern Europeans and the Americans all complain about how cold and badly insulated the Portuguese houses are. I imagine it is easier for South Africans to adapt to that than a Brit or a Swedes.
Portugal is the Western Cape of Europe… Lisbon is Cape Town on steroids
I always compare Portugal in the EU context if you understand South Africa. Portugal is kind of the Western Cape of Europe; it offers a great lifestyle, all the security relative to the rest of Europe, but it’s not the economic powerhouse. From Lisbon or any of the three major airports in Portugal, you can pretty much be in most capital cities of the EU within two, two and a half hours. A flight from Lisbon to London is just over two hours. So, it’s much like living in the Western Cape if you do business in Joburg and that’s quite a good comparison. I think that Lisbon is like Cape Town on steroids. It offers a great lifestyle; it is a good economic centre and is an ideal place to be based if you’re springboarding into the rest of the EU.
If you enjoy living in Cape Town and are prepared to take a sacrifice in terms of your income., versus living in Johannesburg, for instance, I think Lisbon and the area where I’m going to be living certainly offers the same thing. It’s a lifestyle decision.
A lot of our clients are starting to see Portugal offers quite a cool base to set up businesses if they’re looking to internationalise their businesses. We see this more and more as people have realised you can work remotely post-Covid-19. You don’t have to be in an office all the time, particularly if you own or run a business. Your staff and keep the office running. As a business owner, one can go and explore what Portugal has to offer. We are seeing a lot of clients, sort of my age, whose kids have just finished university. Suddenly, you’re out of that whole education framework and your life is no longer ruled by rugby matches on a Saturday and school holidays. Many people choose Portugal as a swallow base. This is what we are trying to do as well but with that comes a bit of stress. I suppose it sounds and looks quite nice and it is, but it involves planning and there are a lot of things that one needs to consider.
The Rebello: Ten apartments qualifying for Golden Visa in central Porto
It is a really big project based in Porto, which is the second largest city in Portugal. Porto is actually a more industrialised part of that. The area further north is the more industrialised part of Portugal. So, economically, a very interesting area and famous for its Port wine and the Douro River, which runs right through from the eastern side of Portugal into the sea. That river was the arterial along which all the Port wine was moved from the Douro valley down to the warehouses in Porto to be exported globally. The boat that carries those barrels of port is known as a rabella. So, the Rebello gets its name from that. These are a cluster of old port warehouses in a historic side of Porto that have been converted. The development is about 98% complete now. It’s a luxury five-star hotel that will be opening in Q1 2023. So, it is imminent. It was going to open in November/December this year but owing to all the pandemic delays over the years, it was pushed back by three or four months. For all all intents and purposes, it’s almost complete. So, from a development risk point of view, that is taken care of and it’ll be operated by Bon Porto Hotels, which is the same operator that ran all the hotels in Lisbon. Track record-wise, our investors are all very happy. So, it is an interesting project.
What’s interesting about the Rebello is that this is in prime central Porto, and you may remember at the end of last year, there were changes in the Golden Visa where primary residential property in the markets of Lisbon or Porto no longer qualify for Golden Visas. So, this is quite unique in that we have 10 apartments that will qualify for the visa where the investor actually gets a title deed and owns the apartment. We are very excited about that.
Portugal has just launched digital nomad visas
They have just launched the Digital Nomad Visa, which we are busy working on at the moment. Portugal has got a population that is decreasing. So, unlike many European countries, they are looking to attract people into the economy, which obviously further stimulates economic growth. But they are very particular and the digital nomad concept has been driven hard and reinforced by the whole Covid-19 great realisation that people can work remotely and digitally. Before the pandemic, the Portuguese were very much on a drive to attract IT sector skills and IT investment into its economy. The Web Expo, is an annual gathering of all the big tech companies, and the guys from Facebook, Google, Amazon, and very high-level speakers come to these expos. Lisbon wrestled that away from the Irish about four or five years ago and has been hosting it ever since every October.
It just plays really well into a lot of guys who work remotely. These so-called digital nomads enjoy surfing. They enjoy that sort of coffee culture. Portugal offers that. There is a place called Ericeira, which is about an hour and a half from Lisbon, up what they call the Silver Coast; is this awesome little surfing town, with a lot of very clever guys working on laptops. Some of them practically own a table in the coffee shop. This is where they work and that’s the world we live in. And Portugal is pretty good at it.
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