After seemingly weathering the property market crisis for longer than other affected sectors, Spain's construction giants were badly hit in the last quarter of 2007 with combined losses totalling more than 200 million euros.

With annual sales falling 21%, Sacyr-Vallehermoso's profits slumped 25% over the last quarter alone, according to a report in El País. For their part, Afirma - which resulted from the merger of Astroc, Landscape and Rayet Promoción - lost €261 million while Martins-Fadesa lost €103 million and Ibesós, nearly €12 million.

The latest two-year forecast by the Caja de Ahorros Economic Foundation (Funcas) indicates that while the economic situation is likely to be even less favourable than at first believed, demand is expected to pick up again in the medium term, although a report in ABC warns the sector that when it does, customers will be "more mature and more demanding."