Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Secrets to billionaire Zara founder’s US$11 billion property empire … steer clear of housing real estate

Amancio Ortega currently owns property in nine countries: Britain, Canada, France, Italy, Mexico, Portugal, South Korea, Spain and the United States. His portfolio is mostly made up of offices and shops, as well as some hotels

Spanish billionaire Amancio Ortega, the founder of clothing giant Zara, has built up a global real estate empire that includes offices used by Facebook and Amazon in Seattle and large swathes of London’s Oxford Street.

Diversifying his fashion fortune to preserve his sizeable wealth, the value of the real estate portfolio owned by Ortega’s investment holding Pontegadea Inversiones stood at around €10 billion euros ($11 billion) at the end of last year.

Pontegadea collects almost all of the dividends which Ortega earns – €1.6 billion in 2019 – and then reinvests the money in real estate, a spokesman for the holding firm said.

The 83-year-old stepped down as chairman of Inditex, the owner of Zara, in 2011 but he still owns 59 per cent of the world’s biggest fashion retailer, which also owns other popular fashion brands like Massimo Dutti and Bershka.

He is currently the world’s sixth richest person, according to Forbes.

His latest major real estate purchases came earlier this month when Pontegadea bought an office building used by Facebook in Seattle for US$415 million as well as the “Troy Block” complex in the same city which houses part of Amazon’s headquarters for US$740 million.

It is “normal” for entrepreneurs with a lot of capital to set up an investment fund to manage the cash to “diversify and preserve” the fortune by building a “refuge” from stock market fluctuations, Juan Carlos Amaro, a professor of finance at the Esade business school in Barcelona, said.

Ortega, who founded fast-fashion giant Zara with his ex-wife Rosalia in 1975 in Spain’s northwestern region of Galicia, fiercely guards his privacy and is known for being a prudent investor.

Analysts said he was targeting real estate as a long term investment, not to speculate.

“It is a very conservative activity which was chosen, not for its great profitability but because it is sufficiently stable,” a Pontegadea spokesman said.

Ortega steers clear of housing real estate, which is potentially more profitable but has a bad reputation after a property bubble burst in the late 2000s, triggering a prolonged recession.

His portfolio is mostly made up of offices and shops, as well as some hotels.

In addition to owning several buildings in Madrid and Barcelona, Ortega has become the main real estate proprietor of London’s Oxford Street, Europe’s busiest shopping street.

In Paris he owns the building that houses Apple’s flagship store as well as a commercial building on the Champs-Elysee avenue.

Ortega only buys property “in the capitals of major countries that are stable”, preferably in prestigious neighbourhoods, the Pontagadea spokesman said.

He also favours “top category tenants with good solvability”, with a preference for major multinationals, said Rafael Sambola, a professor Barcelona’s Eada business school who has authored several books on finance and accounting.

Ortega has found it easy to meet his criteria in the United States: in recent years he has snapped up properties in Miami, San Francisco, New York and Washington in addition to Seattle.

“I think he wants to have a diversification of exchange rates” to protect himself for possible setbacks with the euro or the pound, said Manuel Romera, the director of the finance department at Madrid’s IE business school.

Ortega currently owns property in nine countries: Britain, Canada, France, Italy, Mexico, Portugal, South Korea, Spain and the United States.

The rent he collects from these buildings – €405 million (US$447,577) in 2018 – are immediately reinvested in Pontegadea, according to the holding.

The Zara owner is not afraid to rent buildings to rival clothing such as Primark, which occupies one of his properties on Madrid’s high street.

Last year Pontegedea made a rare venture outside real estate, snapping up 10 per cent of Telxius, Spanish telecoms giant Telefonica’s subsidiary which provides telephone towers and fibre networks in Europe and Latin America.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
The Personality Rights Challenge in India’s AI Era
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Study Finds No Safe Level of Alcohol for Dementia Risk
Trump Says Ukraine Can Fully Restore Borders with NATO Backing
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
France’s Looming Budget Crisis and Political Fracture Raise Fears of Becoming Europe’s “Sick Man”
Three Russian MiG-31 Jets Breach Estonian Airspace in ‘Unprecedentedly Brazen’ NATO Incident
European manufacturers against ban on polluting cars: "The industry may collapse"
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
France, at an Impasse, Heads Toward Another Government Collapse
×