Description

Situated on Rua da Conceição, in the vibrant heart of Porto’s UNESCO World Heritage Zone, this fully renovated mixed-use building presents a compelling opportunity for investors seeking both stabilized cash flow and value-add upside in one of Europe’s most dynamic real estate markets.

The property comprises three short-term rental units with active STR licenses, one protected long-term residential lease, and a ground-floor commercial space secured by a 10-year rental contract—offering a well-balanced income stream with diversified tenancy. The structure has been fully restored to modern standards while preserving the charm of its original architecture.

With Porto continuing its rapid urban renaissance and Portugal ranking high on the radar of international investors, this asset offers a strategic blend of secure yield today and strong potential for appreciation in the medium term. Opportunities like this—offering location, licensing, and flexibility—rarely come to market in such a prime and historic setting.

FINANCIAL SUMMARY
24 (Transition Year):
Effective Income: €181,527
Management: Owner-operated Jan–Jul, outsourced Aug–Dec

2025 (Stabilized Forecast):
Projected Gross Income: €190,603 (+5% YoY, reflecting full-year
professional management and peak-season optimization)
Projected Net Operating Income: €164,313
Implied Cap Rate (at €2.4M valuation): 6.85%

INVESTMENT POTENTIAL
Value-Add Opportunity: The residential units, while fully operational and revenue-generating, offer clear potential for value creation. Targeted interior upgrades — including modernizing bathrooms and refreshing furniture and finishes — can elevate guest experience and support ADR (Average Daily Rate) increases of 10–20%. With minimal CAPEX, investors can capture a strong uplift in both income and asset valuation, aligning the units with the expectations of today’s high-paying short-term rental clientele.

Future Upside – Additional AL Unit Potential: The long-term residential unit is current leased under a protected contract at €100/month to an elderly couple. While stable, this unit presents significant upside: upon natural lease turnover, the space can be repositioned as an AL-licensed short-term rental, in line with the other three units. This would allow for
substantial income uplift and optimization of the building’s full rental potential.

STR License Advantage: With short-term rental (AL) licenses becoming increasingly restricted in central Porto, this asset stands out as a rare compliant opportunity. Portugal — and especially Porto — continues to experience surging demand from tourists and digital nomads, driving high occupancy and premium nightly rates. The scarcity of legal AL properties in such prime locations significantly enhances both the operational and capital value of the asset.

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