Real Estate for a changing world

REVIEW - INVESTMENT MARKETS IN EUROPE - Q4 2024

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€154.4bn were invested in commercial real estate over the year, establishing 2024 as the start of market recovery with a  +18% annual increase. 
The ECB has made significant progress in returning eurozone inflation to the 2% target. This should allow the central bank to continue cutting interest rates until monetary policy reaches a neutral setting. 

 

Office investment volume at €40.4 billion has eventually bottomed out. Logistics at €39.3 billion is the traditional asset recovering the fastest, with its market share comparable to offices at around 25%. It is yet to be seen whether this will be a pivotal moment for market allocations. Retail at €33.7 billion is bouncing back rapidly at +23% and may grow further over 2025. Hotels (€20.5bn) became the leading asset class by volume growth, expanding 70% y.o.y. 


Foreign capital accelerated by 24% to €70 billion supported by resurgent American investment (+73% vs. 2023). European cross-border investment maintained the lead position at €30.3bn and grew by 19% compared to 2023.


Real estate is entering a new phase for pricing. Since Q4 2023 prime yields across all asset classes have remained constant. Sporadic compression signals from some markets are evident such as London and Paris at 4.00% (vs. 4.25% in Q3 2024).


 

REVIEW - INVESTMENT MARKETS IN EUROPE - Q4 24
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