Zara founder Amancio Ortega buys 500 million dollars worth of property to beat Spanish wealth taxes

Zara founder Amancio Ortega has gone on a global property shopping spree, snapping up more than $500 million (€460 million) in real estate to protect his fortune from Spain’s aggressive wealth tax laws, according to Bloomberg.

Pontegadea, Ortega’s family office, purchased a 5-star hotel in Paris as well as a residential building in Florida and a commercial property on Diagonal Avenue in Barcelona. He is reportedly also eyeing up an office tower in Miami for $275 million (€253 million).

The 89-year-old billionaire, who has a net worth of around $104 billion (€89.4 billion), remains Inditex’s largest shareholder with a 59 per cent stake and received his biggest-ever annual dividend payout – roughly €3.1 billion – in early May.

Why does Ortega spend money like it is going out of style?

Spain is currently one of the few EU countries that has a full wealth-tax on its residents. It taxes individuals’ worldwide net worth when it exceeds certain thresholds. The clock starts to run once Ortega receives the dividend. Marc Debois of FO-Next family office advisory firm said that Pontegadea’s choice was simple: either redistribute every euro from the Zara dividend, or watch as eight-figure sums of cash are drained away each year. Business Standard.

Pontegadea is one of the largest and most active family investment firms in the world.

Ortega is the owner of some of the most iconic buildings in the world. The Post Building in London and New York’s Haughwout Building are among the most iconic buildings in the world.

In addition to his commercial and residential properties in major cities, he also owns property from Toronto to Seoul. Big-name tenants include Amazon, Facebook, H&M, and Zara itself.

Pontegadea’s net assets stood at €34.3 billion at the end of 2024 – a 10.6 per cent rise year-on-year, according to official filings cited by Bloomberg.

Ortega doesn’t only buy buildings. Pontegadea’s diversification includes energy infrastructure, minority stakes in publicly traded companies and other investments. This is a tactic used to manage Spain’s Wealth Tax.

A stake in Enagas SA, a Spanish gas transport company (to be acquired in 2019), and a shareholding in a Portuguese oil company are among the notable investments.

According to media reports, the company is in discussions with KKR among others about acquiring the Sabadell Financial Center located in Miami.

Spain’s richest man

Ortega was born to a railroad employee and built Inditex, the parent company of Zara, from scratch in 1963. He never had his own office, and stepped down from the chairmanship in 2011.

Marta Ortega took over the fashion empire from her father in 2022. Meanwhile, Sandra Ortega, his 56-year-old daughter from a previous marriage, holds her late mother’s shares and has a fortune of $12.4 billion (€10.7 billion), making her Spain’s richest woman, according to the Bloomberg Billionaires Index.

At least one-fifth of the world’s richest 500 individuals now use family offices to manage a combined $4 trillion (€3.44 trillion), according to Bloomberg. Ortega’s strategy shows how Europe’s wealthiest can outmanoeuvre tax systems at the national level.

Should a man who is one of Europe’s wealthiest men be able legally to shield billions, while the rest of us face a crisis in living costs? Is Ortega playing the smart game or is he simply trying to protect his billions?

All property and investment related news.