Yes, even if you are resident in Spain or Portugal, you may now apply to the Identity and Passport Service (IPS) in person whilst visiting the UK.
In order to do this, you need to make an appointment with IPS in the UK and you must provide an address in the UK to which the passport may be posted.
Applicants will have to be available at this address to sign for the receipt of the passport. Please note that IPS do not accept applications by post or e-mail if you live abroad.