While Spain's traditional property market attracts steady attention, a parallel network of off-market transactions is drawing investors willing to navigate legal complexities in exchange for properties priced as much as 60% below estimated market value.
Lior Levy, CEO of Israeli-founded Nadlan B'Jeans, has built a business model around identifying and acquiring distressed or undervalued assets in Madrid and Málaga. The firm has been involved in more than 1,800 property acquisitions across Spain, focusing on properties that rarely appear in public listings.
Lior Levy, CEO of Israeli-founded Nadlan B'Jeans, talks about his company's focus Ynet Global studio
"Many of us have real estate outside," Levy said. "But what we offer is real estate with high yield. These are properties that are not necessarily in the market — properties outside of the market with different types, and we are offering our clients something unique."
The significant discounts Levy describes often come from properties entangled in legal complications — bank repossessions, inheritance disputes or occupancy issues that traditional buyers and institutions prefer to avoid.
"Those deals are coming from the banks, from big companies, big corporations," Levy explained. "Those companies cannot and will not deal with these properties. They will not file the data and try to navigate to solve the problem in these deals."
One acquisition model the firm employs is the "inverse" arrangement, known in Spanish markets as "viager" or usufruct sales. Under this legally regulated structure, investors purchase full ownership of a property while the seller, typically an elderly resident, retains the right to live there for life.
"You are buying a property — it is your property with your name, it is a normal property — but you are not allowed to enter inside," Levy said. "You give the option for the person, the old owner of the apartment, normally elderly, to live until the rest of his life in the property. In return, you get a big discount on the property."
The arrangement offers financial relief to sellers who purchased properties decades ago and may struggle to meet monthly expenses, while investors acquire assets at roughly 50% below market value without paying utilities, maintenance or other carrying costs during the occupancy period.
Perhaps more controversial are the firm's investments in properties affected by "Okupas" — situations where tenants have stopped paying rent or remain in properties through legal protections that heavily favor occupants in Spain.
"The banks will not and cannot deal with these properties," Levy said. "So they're coming to investors just like us and saying, 'You want to buy it? It is 40%, 50%, 60% below market price.'"
Levy's strategy involves purchasing these properties at steep discounts, then negotiating directly with occupants. "If you own a property worth 100K, we are going to talk with the tenants who in most cases are getting €500 a month, and we're going to offer them 5K, 6K, 10K, 15K — whatever it takes for them to leave and find another apartment," he said. "In most cases, we're getting the property below one year at 50% below market price."
The company has developed proprietary AI systems to identify opportunities across Spain's fragmented property landscape.
"We developed a system that's tracking every property across Spain from any platform existing — and there are hundreds of platforms," Levy said. The system analyzes data spanning 30 years of official government records to evaluate whether deals meet the firm's criteria.
Madrid specifically attracts the firm's focus due to demographic and economic factors. "It's got 150,000 persons every year coming to live in the city," Levy said. "There is a big real estate crisis — more than 600,000 units are missing by 2025."
He contrasts Madrid's market with other European cities like Lisbon, where foreign buyers dominate. "In Madrid, 82% are locals purchasing properties," Levy said. "In Lisbon, 82% are foreigners buying the properties. If a crisis will come, many people will leave and you will have a bigger real estate crisis. In Madrid it will not happen because most of the people are actually living there."
The firm operates on a co-investment model, placing its own capital alongside client funds in each acquisition. Investors can participate with as little as €50,000, typically spread across multiple properties purchased in groups of 10.
"We believe that if you're not putting your own capital on the deal, you cannot really give them security," Levy said. "We put our own capital in every deal."
Not every opportunity passes the firm's due diligence process. "Many times, even during the deal, if it's not passing our protocol, our lawyers, or things inside — even at 40% below market price in the Okupas case — we are not moving forward," Levy said.
The approach reflects a broader shift in how some investors view European property markets — less as traditional real estate holdings and more as specialized asset plays requiring legal expertise and patience.
Whether Madrid's off-market segment represents sustainable opportunity or concentrated risk remains debated. For Levy, the city's fundamentals justify the focus.
"If you're looking for security and high yield, this is absolutely Madrid," he said. "The economy is strong in Spain in general. You have different types of property to invest in which other markets cannot give to you."
The firm continues to expand its operations while maintaining what Levy describes as strict investment criteria, betting that Spain's housing shortage and legal frameworks will continue generating the distressed assets that form the foundation of its business model.